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6/5/22 – Sunday Stock Talk Write Up

What does the market have in store for us this upcoming week? What are the important support & resistance levels to be aware of? Read the Sunday Stock Talk Write Up to find out.

$AMZN Split

As I started looking over charts for the week ahead my eyes are just drawn to the $122 quote for $AMZN. It will be a very interesting week there with one of the most anticipated stock splits of the past 2 years finally is taking place, and I had this conversation over the weekend with a friend of mine where he wants to buy it after the split, and my thinking immediately said “it will be a short”. Is it a buy the rumor, sell the news type of move? After it has moved about 20% over the past 2 weeks it makes me not want to get long it I know that for sure. A crack under 120.93 at some point this week, and we have some room to go lower, and even better if the market is falling with it.

Which I don’t think it will take much for the market to break this week after the daily buy setup that was in place, and almost erased it the very next day. A rally early on in the week would have be cautious on continued strength to end the week, but early weakness that can get us under 4064.25 has plenty of room to the downside. There is a little bit of strength being shown in the RTY compared to the other markets, but it isn’t compelling enough for me to completely discount the potential for a move lower.

With a very limited earnings list we will have to be extra selective on our strong and weak watches. On the long side I’m watching $CAT & $RH at the moment with good strength being shown on Friday after the market gave back much of the move from Thursday. $AMZN & $TSLA are probably my favorite short side trades at the moment given the catalyst on the split, and good relative weakness in $TSLA that essentially caused/lead part of the move from Friday.

It isn’t a week to come out swinging for the fences after a short week so review your trading rules, and keep your ego on a short leash.