Trading Plan for Monday, April 29th, 2024
Trading Plan for Monday, April 29th, 2024
Market Sentiment: Bullish, following a multi-day rally. However, proceed with caution as a period of price discovery and more complex action is likely after the strong movement.
Key Supports
Immediate Supports: 5127 (major), 5117, 5102 (major), 5089 (major), 5082
Major Supports: 5068-72 (major), 5043 (major), 5034 (major)
Key Resistances
Near-term Resistance: 5150 (major), 5168-5171 (major), 5185 (major)
Major Resistances: 5206-5208 (major), 5230, 5245 (major)
Trading Strategy
Consolidation Anticipated: Expect a period of consolidation and complex price action after the recent surge. Overtrading can lead to losses.
Long Opportunities: Look for failed breakdowns at 5127 or 5102 as potential long entry points. Prioritize bids within the current range for a cautious approach.
Short Opportunities: Target the 5185 level (resistance of the downtrend channel) for possible short positions. Consider level-to-level profit-taking within the range.
Risk Management: Maintain disciplined risk management in this potentially volatile environment.
Bull Case
Holding Support: Defending the 5127 or 5102 major supports is crucial for bulls to maintain control.
Reclaiming Resistances: Bulls need to push above the 5150/5168-71 zones for a potential run to the next major target, 5185.
Adding on Strength: In an ultra-bull case, look for bull flagging above 5127 to add exposure in anticipation of an upward move.
Bear Case
Breakdown Signals: A convincing break below 5102 could trigger a deeper retracement. True bear case resumes with a break below 5033. As always, be wary of traps – look for a bounce/failed breakdown first, then consider shorting with level-to-level profit-taking.
News: Top Stories for April 29th, 2024
Equity Market Overview
Global Performance: S&P 500 and Dow Jones rose over 10% in Q1 2024; European and Asian indices also hit highs.
Sector Trends: AI boom fuels tech sector gains; value stocks participate more in market rallies.
Bond Market Dynamics
Interest Rates: Delayed rate cuts by the Federal Reserve impacting bond yields.
Performance: High yield bonds outperforming investment-grade due to favorable risk-return amidst volatile rates.
Key Economic Indicators
Inflation and Sentiment: Persistent inflation concerns; consumer sentiment improves slightly.
GDP and Employment: Strong GDP growth and employment figures support bullish equity market sentiment.
Market Outlook and Investor Sentiment
Short-Term: Continued growth expected, but potential for increased volatility.
Long-Term: Earnings growth modest in sectors like IT, significant in "Magnificent 7" companies.
Federal Reserve Policy and Market Outlook
Fed Stance: Maintains rates; cautious on inflation.
Market Impact: S&P 500's performance influenced by rate cut expectations; market may face limited growth post-rate cuts.
Market Sentiment: Bullish, following a multi-day rally. However, proceed with caution as a period of price discovery and more complex action is likely after the strong movement.
Key Supports
Immediate Supports: 5127 (major), 5117, 5102 (major), 5089 (major), 5082
Major Supports: 5068-72 (major), 5043 (major), 5034 (major)
Key Resistances
Near-term Resistance: 5150 (major), 5168-5171 (major), 5185 (major)
Major Resistances: 5206-5208 (major), 5230, 5245 (major)
Trading Strategy
Consolidation Anticipated: Expect a period of consolidation and complex price action after the recent surge. Overtrading can lead to losses.
Long Opportunities: Look for failed breakdowns at 5127 or 5102 as potential long entry points. Prioritize bids within the current range for a cautious approach.
Short Opportunities: Target the 5185 level (resistance of the downtrend channel) for possible short positions. Consider level-to-level profit-taking within the range.
Risk Management: Maintain disciplined risk management in this potentially volatile environment.
Bull Case
Holding Support: Defending the 5127 or 5102 major supports is crucial for bulls to maintain control.
Reclaiming Resistances: Bulls need to push above the 5150/5168-71 zones for a potential run to the next major target, 5185.
Adding on Strength: In an ultra-bull case, look for bull flagging above 5127 to add exposure in anticipation of an upward move.
Bear Case
Breakdown Signals: A convincing break below 5102 could trigger a deeper retracement. True bear case resumes with a break below 5033. As always, be wary of traps – look for a bounce/failed breakdown first, then consider shorting with level-to-level profit-taking.
News: Top Stories for April 29th, 2024
Equity Market Overview
Global Performance: S&P 500 and Dow Jones rose over 10% in Q1 2024; European and Asian indices also hit highs.
Sector Trends: AI boom fuels tech sector gains; value stocks participate more in market rallies.
Bond Market Dynamics
Interest Rates: Delayed rate cuts by the Federal Reserve impacting bond yields.
Performance: High yield bonds outperforming investment-grade due to favorable risk-return amidst volatile rates.
Key Economic Indicators
Inflation and Sentiment: Persistent inflation concerns; consumer sentiment improves slightly.
GDP and Employment: Strong GDP growth and employment figures support bullish equity market sentiment.
Market Outlook and Investor Sentiment
Short-Term: Continued growth expected, but potential for increased volatility.
Long-Term: Earnings growth modest in sectors like IT, significant in "Magnificent 7" companies.
Federal Reserve Policy and Market Outlook
Fed Stance: Maintains rates; cautious on inflation.
Market Impact: S&P 500's performance influenced by rate cut expectations; market may face limited growth post-rate cuts.
