Markets opened flat on Wednesday despite a blowout quarter announced during pre-market by JPM.  The DIA had a small rally the first hour, traded sideways until mid-afternoon and then sold off the rest of the day.  The SPY did the same minus the morning rally and the QQQ sold off all day long.  This left us with a Bearish Engulfing candle in the QQQ, a Shooting Star type candle in the DIA and just a black candle in the SPY. No record high closes, but none of the 3 are more than 1.25% from their all-time high close.  VXX gained 2% to 10.29 and T2122 climbed back into the overbought territory at 87.50.   10-year bond yields rose slightly to 1.632% and Oil (WTI) spiked more than 4.5% to $62.93/barrel.

Banks continue to top estimates on blow-out trading gains even amidst loan losses.  Today BAC and C followed the lead of JPM, WFC, and GS yesterday in beating on both the top and bottom lines.  In other sectors, UNH and PEP also posted beats on both lines.

“Expert” analysts are also expecting a pop from Retail Sales numbers this morning. The driver expected for this move is the $1400 stimulus checks the public has gotten during the last month. In fact those analysts are expecting more than a 6% increase, with some going as far as to say they expect a 10% increase over February. So, the potential exists for disappointment of a miss versus expectations and also for a beat that drives infation fear. Be careful.

Related to the virus, US infections are rising again after plateauing at a level above the fall level.  The totals have risen to 32,149,223 confirmed cases and deaths are now at 578,092.  The number of new cases has ticked higher again and are back above the peak of last summer to an average of 72,688 new cases per day.  However, deaths are just starting to plateau again, now at 746 per day. After hours, the CDC decided to postpone a decision on resuming use of the JNJ vaccine while more research can be done on the potential blood clotting issue.  In better news, the country will go over 200 million vaccination doses delivered on Friday as the country went over 195 million on Wednesday according to the CDC.  Finally, a Duke University report says the US will have 300 million excess vaccine doses by July due to anti-vaxxers, science-skeptics, and evangelicals.

Globally, the numbers rose to 138,976,244 confirmed cases and the confirmed deaths are now at 2,988,801 deaths.  The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently.  The world’s average new cases continue to rise and is very near the all-time peak and are now at 722,922 per day.  Mortality, which lags, is also rising sharply again at 11,543 new deaths per day. In Asia, India has imposed more restrictions, including a curfew in the capitol amidst another record high number of new cases that has caused banquet halls and hotels to be converted into make-shift hospitals.  In Japan, a high-ranking official did not rule out cancelling the Olympics again during an interview with the Tokyo Broadcast System.  Closer to home, Brazil is seeing its outbreak continue to see record deaths. 

Overnight, Asian markets were mixed again.  Taiwan (+1.25%) was an outlier to the upside with Thailand (-1.61%) an outlier to the downside.  Most regionals exchanges showed moderate moves in either direction.  In Europe, markets are mostly green on modest moves at this point in the day.  The FTSE (+0.33%), DAX (+0.19%), and CAC (+0.22%) are typical with Russia (-0.81%) and Portugal (-0.79%) leading the losses.  As of 7:30 am, US Futures are pointing to a green open.  The DIA is implying a +0.40$ open, the SPY implying a +0.44% open, and the QQQ implying a +0.67% open. Bond yields slipped again overnight as well with the 10-year yield now at 1.618%.

The major economic news scheduled for Thursday includes Weekly Initial Jobless Claims, Mar. Retail Sales, NY Empire State Mfg. Index, and Philly Fed Mfg. Index (all at 8:30 am), Mar. Industrial Production (9:15 am), Feb Retail Inventories (10 am) and 2 Fed speakers (Bostic at 11:30 am and Daly at 2 pm).  Major earnings reports on the day include BAC, BLK, C, DAL, PEP, RAD, TSM, TFC, USB, and UNH before the open.  Then after the close, AA, JBHT, PPG, and WIT report.

Despite yesterday’s less than stellar day, the bulls remain in control of the trend and spirits seem buoyed by earnings reported so far. This is shaping up to be a tremendous quarter for growth, meaning the next cycle should be even better than this one for earnings. However, the fear of inflation remains the ghost in the room for markets. With a number of reports coming this morning that could be seen as good or bad despite what they report.

Follow the trend, don’t predict reversals, and don’t chase trades you have missed. Respect support and resistance. Keep taking your profits off the table when you can and maintain your discipline. Stay on the right side of the market trend and follow those trading rules. As we know, consistency is the key to long-term trading success.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas for Thursday. You can find Rick’s review of tickers on his YouTube Channel here. 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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