Friday was another indecisive day, with the bulls unable to push the SPY up through the all-time highs and the bears unable to get any traction either.  This all came after July Retail Sales which at the same time was improved and much lower than expected.  The SPY closed dead-flat, the DIA up 0.14%, and the QQQ down 0.12%.  The VXX remained flat at 25.44 and the T2122 (4-week New High/Low Ratio) rose slightly back up into the overbought territory at 85.06.  10-year bond yields were also flat at 0.709% and Oil (WTI) was also flat, closing at $2.23/barrel.

After the close, the US-China Trade Deal Phase 1 review (scheduled for video conference Saturday) was canceled.  This may or may not have had something to do with the President’s renewed threats/pressure on Byte Dance (TikTok) to divest US operations.  However, it does give extra time for potential cooling off and, if planned, for China to buy additional goods prior to the review. 

Over the weekend, large parts of CA have gone back into rolling power blackouts as their electric grid is unable to keep up with demand.  The proximate cause of the grid trouble was a combination of region-wide wildfires and a major heatwave.  Places like Sacramento are forecast to hit well in excess of 100 degrees early this week and the “heat dome” that is preventing rain and causing high temperatures is projected to last for 2 weeks.  While the main news from the story is residential, a large number of businesses will also be impacted.  Not least among them will be the state’s largest electrical utilities, PCG and EIX.

On the virus front, in the US, the numbers show we now have 5,567,765 confirmed cases and 173,139 deaths.  While the new cases are falling, the 7-day averages remain stubbornly just under 53,000 new cases and 1,065 deaths per day.  The good news includes 20 states with falling rates, 17 holding roughly stable, and only 13 states with rising infection rates.  In a testing-related story. Saturday, CNBC reported their survey of 9,400 Americans, which found that 40% of virus test results are coming too late to be useful for either clinical or tracing purposes. In an unrelated story, the number of tests being done remains 10% below where it was a few weeks ago with no reason given for the reduction. 

Globally, the number of cases rose to 21,852,024 confirmed cases and 773,586 deaths.  In Europe, the recent uptick in cases continues. Over the weekend France saw a post-lockdown record high of new cases on both Saturday and Sunday.  The UK has had 6 straight days over 1,000 new cases. Italy has also reinstituted a nation-wide mandatory mask mandate while also closing all bars and nightclubs.  However, in Spain, hundreds of people protested in Madrid against mask requirements.  In Asia, the outbreak in India continues to grow.  Current 7-day averages are now at 62,500 new cases and 950 virus deaths in that country. (Keep in mind that Indian numbers are suspected to be under-reported and must be weighed against a population of 1.4 billion.)

Overnight, Asian markets continue to stay mixed.  China and New Zealand led to the upside.  Meanwhile, South Korea and Japan led to the downside.  Europe is also mixed at this point, but leans more to the green side with modest moves.  The FTSE leads the gainers at +0.61% so far today.  In the US, as of 7:30 am futures are on the green side of flat.  Nasdaq is the leader with its futures pointing to a gap up of 0.68%.  The large-caps are positive, but much closer to flat. 

The only major economic news for Monday is the NY Fed Empire State Mfg. Index (8:30 am).  Major earnings reports are also very limited with JD reporting before the open and BEST reporting after the close.

The SPY still sits just below its all-time high after 4 straight days of testing resistance at that level.  The longer SPY sits there without failure, the more likely this bull run is to continue.  It just seems like the bulls won’t give an inch and the bears have no traction at all.  However, markets do seem hesitant as politicians have given up on a stimulus deal for now. 

Follow the trend and stick to your trading rules.  Don’t try to predict reversals or chase moves you have missed.  Above all, take profits as you go.  Remember, our job is to be consistently profitable, not get rich in a few months.  And welcome back to a new week.  Happy Monday all.

Ed

The Daily Swing Trade Ideas for today: RIOT, DXC, Z, VIAC, NBL, RCL, AMAT, DG, XOP. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers 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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Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

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