Markets gapped up about half a percent Monday to start the new month. However, that was it for the large-caps as they ground sideways in a tight range after the open.  The QQQ faded the gap and then some before starting its own tight-range sideways grind about 11am.  This left us with indecisive candles in the SPY and DIA and a small Bearish Engulfing candle in the QQQ. However, all 3 major indices remained inside the tight range of the last week.  On the day, SPY gained 0.21%, DIA gained 0.64%, and QQQ lost 0.53%.  The VXX fell 3.5% to 38.75 and T2122 climbed back to the edge of overbought territory at 80.65.  After having climbed in premarket, 10-year bond yields fell during the day to 1.601% and Oil (WWTI) rose over 1% to $64.44/barrel.

After hours, US announced it will pay a $9 million fine to settle an accounting fraud charge.  In other legal news, a trial began in WV with local authorities suing the 3 major drug distributors (MCK, ABC, and CAH) for failing to better monitor distribution of opioids as required by federal law.  (The companies shipped 36 million doses to a community of 100,000 over an 8-year period.)  Also, the AAPL vs Epic Games trial got underway with opening arguments from both sides on Monday.  The trial will greatly impact whether AAPL can continue to prohibit alternatives to the AAPL App Store for devices in the APPL device userbase.  Epic is arguing the 30% commission and arbitrary app approval process are wrong.  AAPL is arguing it needs control because it does not want to devolve into being like the Android marketplace.

PFE reported beats on both the top and bottom lines this morning.  The company said it will file for full (non-emergency) approval of its Covid vaccine by the end of the month.  If approved, this would allow the company to market the vaccine directly to consumers.  UA also posted beats on both lines and raised guidance for the full year.  CVS joined the crowd, also beating on revenue and earnings as testing, vaccinations and prescriptions all outpaced forecast.

Related to the virus, US infections are rising again after plateauing at a level above the fall level.  The totals have risen to 33,230,992 confirmed cases and deaths are now at 591,514.  The number of new cases has ticked lower again and are back down below the peak level from last summer to an average of 50,665 new cases per day. However, deaths have plateaued again, now at 716 per day. In some good news, for perspective, US new cases and deaths are both less than 20% of their peak values in early January of this year. In addition, 40% of adults and 70% of all seniors are now fully-vaccinated.  However, the CDC reports that demand for vaccine has also plummeted 27% and each day tens of thousands of available vaccination appointments are going unused daily in the US.  

Globally, the numbers rose to 154,241,017 confirmed cases and the confirmed deaths are now at 3,228,632 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 now at the all-time peak and with 812,341 new cases per day.  Mortality, which lags, is also rising sharply again at 13,336 new deaths per day. India continues to be the current epicenter of the pandemic with yet another Indian state entering lockdown. This comes as a new tragedy happened Monday, when another hospital ran out of oxygen, causing at least 20 deaths.  However, international aid is now starting to arrive (though national logistics is very challenging in the country) and that includes a ramping up of India’s vaccination program which was expanded to everyone over age 18 yesterday.

Overnight, Asian markets were mixed.  New Zealand (+1.12%) was an outlier to the upside, with South Korea (+0.64%) and Hong Kong (+0.70%) being more typical of gainers.  Taiwan (-1.68%), India (-0.94%), and Japan (-0.83%) paced the losers on the day.  In Europe, markets are also mixed so far today.  The FTSE (+0.83%) and CAC (+0.75%) are leading the gainers, but the DAX (-0.10%) and a number of the smaller exchanges remain on the red side of flat.  Denmark (-0.88%) is an outlier to the downside.  As of 7:30 am, US Futures are pointing toward a flat and mixed open.  The DIA is implying a +0.05% open, while the SPY is implying a -0.11% open and the QQQ is implying a -0.35% open at this point.

The major economic news scheduled for Tuesday is limited to Mar. Imports/Exports and Mar. Trade Balance (both at 8:30 am), Mar., Factory Orders (10 am), and a Fed speaker (Daly at 1 pm).   Major earnings reports on the day include AME, APO, ARCB, ARNC, BHC, BERY, BR, BEP, BG, CWH, CTLT, CRL, CQP, LNG, COP, CMI, CVS, D, DD, ETN, EXPD, RACE, BEN, IT, GPN, HSC, HSIC, IDXX, INCY, INGR, KKR, LCII, LDOS, LGIH, LPX, MPC, MLM, NXST, PFE, SEE, SYY, TRI, UA, UAA, VIRT, VSH, VMC, WMG, WLK, XYL, ZBRA, and ZBH before the open.  Then, after the close, ATVI, AKAM, ALC, AMCR, AFG, ANDE, ANET, AIZ, BKH, CZR, CTVA, DK, DVN, ENLC, PEAK, HLF, HI, JAZZ, KAR, LYFT, MANT, DOOR, MTCH, MCFE, MCY, PKI, PXD, PAA, PRU, RYAM, SMCI, TMUS, TTEC, VRSK, WU, XLNX, and ZG report.

Markets continue to feel as if the bulls have run out of energy to push higher. However, the bears have no traction either. This leaves us in a tight-range sideways grind. This is a very difficult market to trade as the day-to-day chop crushes traders, even as the indices go nowhere. Even with blowout earnings and generally raised outlooks, the bulls have not been able to run lately. So, be careful on the long side. Still, the trend has not changed direction. We do not have a bearish trend. So, also don’t be too quick to take shorts either. Stuck between the trend and the chop is a tough place to make money.

Remember, you don’t have to trade every day or every week. Respect potential support and resistance levels. Stick with the trend (when you have one), but also avoid chasing trades you have missed and be nimble. Lock in your profits when you achieve your trade goals and maintain your discipline by following those trading rules. Don’t let your emotions get the better of you. Consistency is the key to long-term trading success.

Ed

Swing Trade Ideas for your consideration and watchlist: SHIP, BIG, MDLZ, JNJ, FAST, DHI, NOK. 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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