After another gap-up open, there was a struggle for control as markets rode the rollercoaster for an hour.  However, after 11am the bears were firmly in control the rest of the day.  Another late-afternoon selloff led to closing on the lows as the SPY lost 0.68% on a Bearish Engulfing candle, the DIA lost 0.81% on a big black candle, and the QQQ managed to gain 0.62% on a Doji-like candle.  The VXX gained slightly to close at 39.21 and T2122 remains in the mid-range.  The 10-year bond yield rose to 0.708% and Oil (WTI) finished slightly down at $24.15/barrel.

The big story pre-market was ADP Payrolls reported down over 20 million jobs for April.  However, this number still was not as bad as estimates or even just the total of the most recent 4 weeks of new Unemployment Claims.  So, I don’t know how much read-through this might give for Friday’s official April number.  During the day, Oil reflected the recent rally with some profit-taking and at the same time, US production cuts showed as oil inventories came in much lower than expected.

On the Virus front itself, the global headline numbers are 3,843,204 confirmed cases and 265,657 deaths.  In Europe, Russia continues to report record daily new cases.  At the same time, the Mayor of Moscow took his life in his hands when he said he believes the true number of cases in his city is at least 3 times the official number.  In the UK, the Bank of England said the UK economy may shrink 14% in 2020.  Germany also reported an uptick in cases as PM Merkel announced “Emergency Brake” plans in case the spread grows too much post easing.   

In the US, we have 1,263,243 confirmed cases and 74,809 deaths.  Wednesday the President reversed himself again, saying the coronavirus task force will remain in place indefinitely, but again said they now are focused on vaccine development.  At the same time, Trump’s rhetoric on China continues to escalate and the trade leaders of the two countries will be meeting again.

Overnight, China reported April Exports rose 3.5% (expectation was a 15.7% decline).  Still, Asian markets were mixed and did not show as many big moves as typical of the last few months.  In Europe, markets are green across the board so far today.  However, they too are not giving huge moves, but instead steady climb so far.  As of 7:30 am, US futures are pointing to a one percent gap higher at the open. 

The major economic news for Thursday is limited to Weekly Initial Jobless Claims and Q1 Nonfarm Productivity (both at 8:30 am) and a Fed speaker (4 pm).  However, on the earnings front, AAN, AAWW, ABC, AES, AMRK, BCE, BDX, BGG, BHC, BLL, BMY, BUD, CBRE, CFX, CLMT, CNP, CNQ, CRL, CTB, CTVA, DHR, DISH, ENB, ES, FIS, FOLD, GCI, HES, HFC, HII, HLT, IRM, IT, JBLU, MT, NRG, PENN, PWR, RLGY, RTX, TEVA, VIAC, and XEL all report before the open.

The bulls ran out of steam yesterday.  However, the bears are not exactly “killing it” either.  It’s as if the market were waiting on Friday’s payroll report, expecting it to be some sort of surprise.  Regardless, we may see a new lower-low Thursday as that is the direction of drift now.  Volatility remains a constant companion for traders.  So, all we can do is focus on the chart in front of us.  Continue to be cautious about longer swing trades, unless you can take some short-term pain.  

Ed

Trade Ideas for your consideration and watchlist today: CGBD, RYAM, ALGN, NKE, FFIV, FMC, BWA, JAZZ. 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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