Wednesday brought us a blah day with a flat open.  That led to a sideways grind as traders waited on guidance from the Fed.  However, the Fed held course and markets just kept drifting sideways into the close.  This left us with Doji-type candles in the SPY and QQQ as well as a small Bearish Engulfing candle in the DIA.  However, in general, you could say the consolidation just continued.  On the day the QQQ gained 0.38%, SPY lost 0.04%, and DIA lost 0.36%. The VXX fell almost 3% to 29.99 and T2122 rose but remained in the mid-range at 68.46.  10-year bond yields were flat at 1.238% and Oil (WTI) rose one percent to $&2.37/barrel as the dollar fell on the day.

As mentioned, the Fed kept its easy policy (not changing its rates or bond-buying programs). However, they did say the economy continues to improve, despite concern over the Delta variant. Some analysts say this is an admission that tightening is coming soon, but Fed Chair Powell went on to say “the Fed is nowhere near considering a rate hike” and “we see ourselves having some ground to cover to get there” in reference to tapering. In either case, markets stayed the course as that news was digested in the afternoon.

Virus impacts were the other story of the day, as both GOOG and FB said that they will require employees to be vaccinated before they return to the office.  The White House also announced that President Biden will (as had been rumored) require that federal employees be vaccinated as well.  In addition to vaccination requirements, GOOG also postponed its “return to office” deadline until at least October.  On the mask front, AAPL said it will adhere to CDC guidelines by requiring masks in many US stores, regardless of vaccination status.  These are all signs the virus may still be a threat to the economy and business performance, but markets have largely moved on for now.

After hours, the vast majority or earnings reports continued to be strong.  FB posted a 19% beat on earnings, but then warned of a significant growth slowdown.  However, it then warned of “significantly decelerating growth” over the second half of the year.  URI missed on the bottom line and PYPL missed on revenue.  The pattern is holding this morning with the vast majority of companies reporting beats on the top and bottom lines.  Many of those were strong beats of 20% or more (including VLO, which beat by 250%).  The only exceptions seems to be MRK and MLM, who both missed on earnings, as well as HLT and CTXS who both missed on revenue.

Overnight, Asian markets were green across the board, with the lone exception of a minor loss in Malaysia (-0.16%).  Shenzhen (+3.05%) and Hong Kong (+3.30%) led the bounce back after their recent “China Regulatory Crackdown” losses, but gains were widespread with Taiwan (+1.56%), Shanghai (+1.49%), and Singapore (+1.24%) also making significant moves.  In Europe, as of mid-day markets are following Asia and leaning strongly to the green.  The FTSE (+0.90%), DAX (+0.39%), and CAC (+0.77%) are typical of the continent so far today.  As of 7:45 am, US Futures are mixed.  The DIA is implying a +0.32% open, the SPY implying a flat +0.09% open, and the QQQ implying a -0.22% open.  The dollar is down this morning, meaning most commodities are strong and 10-year bond yields are unchanged.

The major economic news scheduled for release on Thursday is limited to Q2 GDP and Weekly Initial Jobless Claims (both at 8:30 am) and June Pending Home Sales (10 am).  The major earnings reports scheduled for the day include AER, AGCO, ACI, ADS, AB, MO, AMT, BUD, MT, ARES, AZN, BAX, BC, CARR, CBRE, CX, CTXS, CCO, CMS, CMCSA, DBD, ERJ, EME, FLEX, FTS, FCN, GTX, GVA, GPI, HSY, HLT, HBAN, ICE, IP, JHG, KBR, KDP, KEX, LH, LKQ, MDC, MMP, MLM, MAS, MA, MRK, TIGO, TAP, COOP, NLSN, NOK, NOC, ONEW, OSK, PATK, PBF, BTU, PCG, PPC, PRG, RLGY, RDS.A, SPGI, SAIA, SBH, SNY, SNDR, SAH, SO, STM, TROW, TMHC, TFX, TPX, TXT, VLO, VSTO, VC, WAB, WFRD, WST, WWW, XEL, and YUM all before the open.  Then after the close, AMZN, ATR, AJG, TEAM, AVTR, BZH, CC, DXCM, DLR, EIX, EW, ERIE, FSLR, FTNT, FTV, GILD, GFF, HUBG, KMPR, KLAC, LBTYA, LPLA, MATX, MTD, MHK, MRC, OPK, PINS, QGEN, RSG, SKYW, SWKS, SWN, TMUS, TXRH, TWLO, VRTX, WELL, WERN, and INT report.

Remember that we are very near all-time highs and the bullish trend remains in place. However, the week-long consolidation is still the short-term market direction, possibly indicating resistance above, but more likely just indicating a pause for bulls to gather direction. In this environment, the steady drumbeat of earnings beats, announcements of buyback programs, and rosy guidance give the bulls the decided edge, but certainly no guarantees on a very short-term basis.

Remember, trading success is not made in one trade, one day, or one week. It’s about batting your average and adding up those singles and doubles. So, manage your current positions first. Don’t chase, stick to your trading rules, and maintain discipline. Success comes from your consistency. This means focusing on the process and managing what you control. Limiting your losses and taking profits when we get them is the key.

Ed

Swing Trade Ideas for your consideration and watchlist: OXY, SLV, IAG, NEM, XOP, DKNG, BAC, WFC, PSTG, DISCA, KR. 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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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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