Monday saw another indecisive day with the bulls still unable to push the SPY up through the all-time highs.  However, the bears couldn’t make any headway either as TSLA held up the QQQ.  It appears the summer doldrums have hit now that we’ve regained the highs. On the day QQQ was up 1.16%, SPY up 0.32%, and DIA down 0.30%.  The VXX fell to 24.59 and T2122 dropped just outside the overbought territory at 78.13.  10-year bond yields dropped a touch to 0.687% and Oil (WTI) rose to $42.84/barrel.

Before the open this morning WMT has crushed Q2 earnings estimates on a near doubling of e-commerce sales.  HD also saw soaring sales and profits for Q2 as consumers invest in home renovations.  However, department store chain KSS saw a 23% drop in sales for the quarter. 

In non-earnings news ORCL has joined the fray to buy TikTok’s North American operations to take advantage of the President Trump-imposed fire sale.  So, at the moment Byte Dance has offers from MSFT and ORCL, as well as at least an expressed interest from TWTR.

In other China-related news, the trade war continues as the US has imposed a new rule that requires a US government license before any company can sell chips made using US-made equipment to Huawei. (This rule makes US manufacturers liable for who their customers end up selling to, even through third-parties.)   This rule could very well create a near-total cutoff of chips to Hauwei.  In somewhat related news, last week a Chinese manufacturer debuted an x86-based computer that was built entirely using Chinese components.  The result was a “surprisingly not bad” computer that can be sold throughout China to replace US-based computers.  (“Surprisingly no bad” means it had a performance on par with mid-range US computers from 12-18 back.  This is a major improvement on entirely-Chinese computer performance, which was 5-10 years behind in performance as little as a year ago.)

On the virus front, in the US, the numbers show we now have 5,613,183 confirmed cases and 173,772 deaths.  While the new cases are falling, the 7-day averages remain stubbornly just over 50,000 new cases and 1,068 deaths per day.  In NC, the UNC closed in-person classes after accepting students back to campus as 4 clusters of cases broke out and the designated quarantine dorms started to fill up.  BA announced they are offering voluntary buyouts for a second time this year in an attempt to reduce their workforce without more layoffs.

Globally, the number of cases rose to 22,079,923 confirmed cases and 778,102 deaths.  The South Korean government reimposed a ban on in-person church services after a cluster of 450 people from one church tested positive.  Case counts continue to rebound in that country who has been a model of response and virus control.  Meanwhile, the WHO said Tuesday that the pandemic is being increasingly driven by unaware people (younger than 40) who are not taking preventative measures.  The WHO official was speaking to Asia specifically.  (For example, oddly, Wuhan China held a massive water park party where thousands of young people crowded in tight proximity for a party and entertainment yesterday.)  However, that same comment certainly seems to apply to the US as well.

Overnight, Asian markets continue to stay mixed.  South Korea was down hard (-2.46%) while New Zealand (+1.51%) and India (+1.23%) paced the gainers.  Overall, the Asian markets leaned a little to the green side.  In Europe, markets are much greener, but on modest moves at this point in the day.  The DAX (+0.94%) is pacing the gainers with only Denmark (-0.80%) down significantly as of now.  In the US, good earnings news has futures pointing to a modestly positive open.  The QQQ seems to be leading with futures indicating a +0.32% open while the large-caps indices look to open up about 0.20%. 

The major economic news for Tuesday is limited to July Building Permits and July Housing Starts (both at 8:30 am).  Major earnings reports include AAP, HD, KSS, SE, and WMT before the open.  Then, after the close A reports.

The SPY remains just below its all-time high after a week of trying to break through that level.  The longer SPY sits there without failing, the more likely this bull run is to continue.  However, it seems like the bulls won’t give an inch and the bears have no traction at all. 

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. 

Ed

The Daily Swing Trade Ideas for today: EBAY, DISH, SBUX, CNP, NLS, COST, CPRI, BCRX, MPC. 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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