The chop continued on Friday as a modest gap up was immediately sold in all 3 major indices.  The selling went on all day until a spike in the last 10 minutes of the day took markets up off the lows.  The QQQ got the worst of the pain as Chinese stocks and tech in general sold off.  This action left us with a Bearish Engulfing candle in the QQQ and a Dark Cloud Cover type candle in the SPY.  On the day, SPY lost 0.91%, DIA lost 0.11%, and QQQ lost 1.74%.  VXX gained almost 9% to 27.99 and T2122 fell deeper into the oversold territory at 8.03.  10-year bond yields fell hard to 1.358% and Oil (WTI) was flat at $66.45/barrel.

The November jobs report put a scare into bulls on Friday.  The number was expected to come in about 573k jobs added but actually came in at +210k jobs.  Part of this is due to the participation rate increasing to 61.8%.  The unemployment rate also fell sharply to 4.2% (from 4.5%). 

Bitcoin got crushed Friday and Saturday, plunging 25% (from $57,100 to $43,100) before rebounding to $49,000, which was still down 16% as of Saturday night.  While analysts did not cite any real reason for the freefall, one told CNBC it was likely the result of a derivative move caused by Friday’s flight to treasuries by funds.

Sunday afternoon, confirmation was given to what I’ve reported in the past.  Despite selling 10.1 million shares in the last few weeks of TSLA (7 million shares fewer than he said he would sell), Elon Musk now has 564k more shares than when he started selling.  This is because the real reason for him to sell stock had nothing to do with his TWTR poll, but was to pay for the gains made on a huge chunk of stock options that he exercised. He also still has 12.2 million shares worth of “soon to expire” stock options that he would be foolish not to exercise.  So, his holdings will increase dramatically, even if he sells more to cover taxes.

Overnight, Asian markets were mixed but leaned to the downside.  Hong Kong (-1.76%), India (-1.65%), and Malaysia (-1.22%) led the losses, but the red was widespread.  The reason behind the losses was Asian tech giants like BABA getting hammered and China Evergrande Group teetering on the edge of default again.  In Europe, markets are mixed but lean to the green side at mid-day.  The FTSE (+1.01%), DAX (+0.51%), and CAC (+0.84%) are typical of the region in early afternoon trading.  However, Russia (-2.24%) is a massive outlier.  As of 7:30 am US Futures point toward a mixed open.  The DIA implies a +0.68% open, the SPY is implying a +0.29% open, and the QQQ implies a -0.43% open at this hour.  10-year bond yields are sharply lower (1.397%) and Oil (WTI) is surging higher +3.27% in early trading.

There is no major economic news scheduled for release Monday.  For traders sick of “Fed speak” market jerks, the good news is that we are now in the dark period (no Fed speakers) until the Fed decisions next week. The major earnings reports scheduled for the day are also limited to SAIC before the open.  There are no earnings reports scheduled for after the close.

The back and forth whipsaw action continued Friday. More volatility is likely as the market adjusts to the idea that the Fed will be focusing more on fighting inflation than job creation over the next year. If you’re a swing trader, be very wary of this type of market. Chop is a condition for the very fast (scalpers) and very slow (long-term trading) with the guys in the middle..well…getting chopped up. So, if you don’t trade hedged and you are not extremely quick to be in/out, it’s past time to consider stepping back and waiting for a trending and less volatile environment.

Remember, you don’t have to trade every day or week. Stick to your trade rules and on managing the things you can control. (Not trying to force the market to obey your desires.) If you do trade, that should always include consistently taking profits when you have them and moving your stops in your favor. Trade carefully and continue to think twice before holding through earnings…especially without a hedge.

Ed

Swing Trade Ideas for your consideration and watchlist: No tickers this morning. 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.

Hit and Run Candlesticks / Road To Wealth Youtube videos

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.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service