The bulls were in charge again Monday, apparently on optimism as various states are now reopening parts of their economies.  Markets gapped about 0.75% at the open and meandered upward slowly most of the rest of the day.  Interestingly, the tech-heavy Nasdaq lagged on the day as it traded sideways and down from its gap slightly.  On the day, the SPY gained 1.46%, the DIA gained 1.43%, and the QQQ gained 0.80%.  The VXX fell back to 38.44, but the T2122 4-wk. High/Low Ratio is now very high into overbought territory at 97.32.  The 10-year bond yield rose slightly to 0.664%.  All this occurred while Oil (WTI) got crushed again, losing 24% to close at $12.88/barrel.

After the close, the Fed announced it is expanding its municipal bond-buying program to include states, counties, and smaller municipality community bonds.  This is seen as a necessary stop-gap since there is at least some opposition (notably Sen. Majority Leader McConnell) on Capitol Hill to relief for states and then Monday the President publicly asked why the federal government should bail out the “poorly-run Democratic states.”

In business news, TSLA reversed itself from early in the day and cancelled their plans to request workers to resume work at their California plant this week.  On the food front a third of American pork processing capacity is closed and 20% of beef and chicken capacity is shit as well.  One major plant was forced to kill 2 million birds earlier this month due to a lack of workers to process them.  TSN CEO had said Sunday that he feels the US food supply chain is close to breaking as millions of pounds of meat will simply disappear from stores as a result of closures.

On the Virus front itself, the global headline numbers are 3,081,502 confirmed cases and 212,337 deaths. The WHO reminded the public that the pandemic is far from over.  They said they were specifically concerned about new case trends in Eastern Europe, Latin America, and Africa.  Meanwhile, Russia said that any call for a reopening date would be nothing but a “shot in the dark” at this point.  In the UK, PM Johnson said it is still too risky to relax their COVID-19 lockdown.

In the US, we have breached the million-case mark, with 1,010,507 confirmed cases and 56,803 deaths.  The administration announced guidelines where it hopes to see tests reach just 2% of the public.  These guidelines require states to provide the vast majority of tests while the federal government acts as the “supplier of last resort” for testing that 2% of people.  At the same time, the President claimed the federal parts of the plan are mostly done, since they will just be a back-stop. 

Overnight, Asian markets were mixed, but lean to the green side.  In Europe, markets are strongly green across the board so far today.  And as of 7:30 am, US futures are pointing to another one percent gap higher at the open. 

The major economic news for Tuesday is limited to Mar. Trade Balance and Mar. Retail Inventories (both at 8:30 am) and Conf. Board Consumer Confidence (10 am).  However, on the earnings front, MMM, CAT, CNC, GLW, CMI, DHI, DTE, ECL, HOG, IQV, MRK, MSCI, NUE, OMC, PEP, PFE, ROK, ROP, SPGI, SIRI, LUV, TROW, TEL, UPS, WAT, and XRX report before the open.  Then after the close, AKAM, AMD, GOOG, GOOGL, BXP, CHRW, CERN, CSGP, DXCM, F, JNPR, MXIM, MDLZ, OKE, and SBUX all report. 

The uptrend remains intact.  However, resistance remains just above and gaps remain the norm.  Bulls clearly want to run and are in ignore bad news more again.  Still, there are just as many bad economic reports, dividend and guidance cancellations, and potential for another new wave of infections than ever.  In this environment, traders need to continue to remain focused and either quick (day trade) or slow (long-term holds).  Be very cautious about any swing trades you take in this market, unless you can handle significant short-term pain. 

Ed

Trade Ideas for your consideration and watchlist: KSS, GL, WYNN, DLTR, FIVE, SNAP, SCHW, GS, FDX, STZ, MKC, HAL Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

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