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Swing Trade Ideas – June 4, 2020

Market View

Premarket the world equity markets are mixed. Indices were all negative this morning until the ECB announced an addition of 600B Euro to the pandemic purchase. Germany also announced a $145B package to boost consumer spending.  The USA yield curve has flattened, which is usually a negative for the IWM and positive for TLT. Oil is down as OPEC+ is working to align production cuts as some countries are shockingly over producing.  No major earnings reports but the smaller software names were generally weak, which may cool down the sector. Premarket the casinos, airlines and gold miners are leading. The DJIA looks like the strongest index, helped by BA and IWM the weakest

Put-call ratio is getting low and sentiment indicators are looking overcooked so keep your head on a swivel.

Premarket names:

AAL UAL DAL as AAL updated flight plans. BA tagging along; SCHW AMTD received anti-trust approval; MGM WYNN LVS bounce;  NIO momentum continuation

Stock Idea: NIO

NIO is a Chinese electric car company. It has had 2 large daily gaps after GS upgraded and it’s financial situation improved. There has been high levels of call activity indicating enthusiasm. Short float is 12% which should help boost the stock. Technically has short term broken out on the weekly but entering a longer term resistance area so caution warranted. This will be day 3 so likely the limit for the surge but a day trade candidate on morning dip with risk mgmt.