Wednesday was a nothing burger day in markets as all three major indices opened flat and then traded in a tight range all day long. A selloff the last half hour of the day took stocks out on the low end of that tight range. This left plenty of wicks as the QQQ printed an indecisive Doji and the large-cap indices just delivered small black body candles with upper wicks. On the day, SPY lost 0.09%, DIA lost 0.20%, and QQQ gained 0.05% (technically closing at another new all-time high). The VXX fell 2% to 30.26 and T2122 dropped back to 61.22. 10-year bond yields rose to 1.489% and Oil (WTI) was up half a percent to $73.28/barrel.
Late in the afternoon, the Wall Street Journal CNBC reported that the CEO of CMCSA is considering a joint venture with VIAC or even purchasing ROKU in order to bolster the company’s place in the streaming market. ROKU (+4.5%) and VIAC (+2.7%) surged on the news while CMCSA fell almost 4%. President Biden also announced he will replace the head of FNMA (and Freddie Mac) after the Supreme Court ruled that the structure of the agency is unconstitutional and should have more accountability to the White House. This came after the prior administration had tried to privatize the agency and reduce government oversight.
During the say, AMZN announced that sales of its 2-day “Prime Day” sale were more muted than prior years. With antitrust suits in full swing (to force more changes in favor of 3rd-party sellers), this year AMZN stressed the benefit to those 3rd-party sellers. AMZN says that 3rd-parties sales grew more than first-party sellers and that 3rd-party’s made sales of $3.5 billion. (AMZN never releases sales figures for the event, instead only describing it in adjectives.) However, industry analysts estimate this year’s sale brought in $10.5-$11 billion in sales.
Overnight, Asian markets were mixed, on very modest moves. Only India (+0.66%) and Malaysia (-0.58%) managed even a half percent change from the previous close. China was also mixed on small moves and Japan was unchanged. However, in Europe, markets are moving smartly higher as of mid-day. The FTSE (+0.59%), DAX (+0.68%), and CAC (+1.02%) are fairly typical of the spread across the continent, with only Russia (-0.57%) lagging. As of 7:30 am, US Futures are pointing to a gap higher with the S&P retesting all-time record highs. The DIA is implying a +0.50% open, the SPY implying a +0.48% open, and the QQQ implying a +0.56% open.
Most commodities look to start the day lower, despite weakness in the dollar overnight. Wheat, in particular, seems to be getting hit, but metals are mixed as Gold is eking out a green number early today. Interest rates are showing a slightly positive trend with the 10-yr yield up to 1.49% at 7:30 am. For their part, most cryptocurrencies are green as Bitcoin is up nine-tenths of a percent this morning.
The major economic news scheduled for Thursday includes May Durable Goods Orders, Q1 GDP, May Trade Balance, Weekly Initial Jobless Claims, and May Retail Inventories (all at 8:30 am), a Fed speaker (Williams at 11 am), and Fed Bank Stress Tests (4:30 pm). Major earnings reports on the day include CAN, DRI, GMS, RAD, and WOR before the open. Then after the close, FDX, NKE, and SNX report.
In a long, evening session, the House Judiciary Committee voted to give more funding to antitrust enforcement agencies tasked with keeping big tech companies in check. This was a blow to the likes of GOOG, AMZN, AAPL, and MSFT who had been fighting this along with several bills aimed at curbing big-tech monopolies. Interestingly, this passed with bipartisan support. So, watch the tech names for signs of rotation out…which would hurt overall markets due to their massive size in the main indices. However, inflation and the fear of Fed tightening still continue to be the main focus of the market. Along those lines, the Bank of England held steady again last night but they did acknowledge inflation may become an issue later.
The odds still favor following the trend and respecting support and resistance levels. So, if the QQQ and SPY are in blue skies on a bull trend, we have to acknowledge that in our trading. Still, all trends reverse at some point and every S/R level is breached eventually. So, don’t just assume trend, support, or resistance will always hold. Keep locking in profits, moving your stops, and maintaining discipline. Follow your trading rules, don’t chase, and stick to the trade plan. Remember that consistency is the key to long-term trading success.
Ed
Swing Trade Ideas for your consideration and watchlist: TMDX, ATEC, WKHS, EGAN, FRBK, RETA, MAXN, NIO, CNC, LI, MNKD, AGEN, GOEV. 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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