On the strength of the Russian invasion and increased fear over what it may do to the global economy, the bears controlled the market all day long Monday.  The open was relatively flat, but from that point all 3 major indices sold off the entire day, closing on the lows.  This left us with massive black candles heading toward the breakout point of Bearish-h patterns in all those indices.  On the day, SPY lost 2.91%, DIA lost 2.37% and QQQ lost 3.69%.  The VXX was up nearly 9% to 28.49 and T2122 still has not reached oversold territory, sitting at 25.75.  10-year bond yields rose to 1.782% and Oil (ETI) fell back from the highs, but still gained 3.76% to $120.05/barrel.

The Russian invasion and sanctions continue to be the story driving markets.  MCD stock took a big hit (almost 5%) Monday as it was noted over the weekend that MCD has a larger footprint in Russia than other fast-food chains.  After the close, Russia threatened to stop gas flows to Europe and said the world will see $300 Oil if the West puts sanctions on Russian energy exports.  Russian Deputy Prime Minister Novak said, “no decision on whether to shut down the flow had been taken yet and the pipeline is running at full capacity now.”  However, the threat was not veiled.  European market gas prices surged almost 80% in reaction to the threat. (Roughly 40% of European natural gas and 25% of the oil comes from Russia.) On the front, the last major holdout RDS.A apologized for buying a shipment of Russian oil after the invasion and announced they will stop buying from Russia. They join XOM, BP, and others in boycotting Russian Oil.

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Overnight, the London Metals Exchange was forced to halt the trading of Nickel after an unprecedented 250% spike in the metal.  (Russia is the world’s largest exporter of nickel.)  As with Wheat (Russia and Ukraine produce one-third of the world’s supply) and Oil (Russia is the third-largest exporter), commodities are on a rocketship with the disruptions caused by the Russian aggression.

AAPL will hold its first product launch event of the year today.  Bloomberg reports that the company will announce a low-cost ($399) version of its iPhone, replacing a non-5G model launched in 2019.  Cupertino is also supposed to announce a new mid-range iPad Air, a revised Mac computer, and a new version (15.4) of the iOS operating system

Overnight, the Asian markets were mostly deeply in the red again.  India (+0.95%) was the lone green in the region.  However, Shenzhen (-2.62%), Shanghai (-2.35%), and Taiwan (-2.06%) led the region lower.  In Europe, stocks are mixed but lean to the green side at mid-day.  The FTSE (+0.14%), DAX (+0.98%), and CAC (+2.00%) are fairly indicative of early afternoon trading on the continent with 4 smaller exchanges in the red (Athens -2.63% is an outlier) and Russia remaining closed.  As of 7:30 am, US Futures are pointing toward a green open.  The DIA implies a +0.57% open, the SPY is implying a +0.63% open, and the QQQ implies a +0.39% open at this hour.  10-year bond yields have rebounded to 1.851% and Oil (WTI) is up another 3% to $122.96/barrel in early trading.

The major economic news scheduled for release on Tuesday is limited to January Imports/Exports and January Trade Balance (all at 8:30 am).  However, the EIA will also publish its Short-Term Energy Outlook at noon, which may garner some headlines given the Oil situation.  The major earnings reports scheduled for release before the open are limited to DKS and WOOF.  Then after the close ABM, CASY, and SFIX reports.   

The volatility parade continues as the Russian bombing of Ukrainian cities picks up pace. Today it looks like the gap will be bullish after yesterday’s all-day selloff. The question is whether the bulls can sustain momentum after the open given the overnight threats to European gas supplies and the likelihood of some sort of western energy sanctions. So, remain very cautious. If you are trading, trade small, be nimble, and be prepared to accept volatility-caused pain.

Trading is a marathon, not a sprint. So, ask yourself whether you have an edge in this sort of volatility. If not, sitting on your hands may be the best move you could make. Remember that you don’t have to trade every day (or even week) and you definitely don’t need to chase gaps and moves. So, stick to your trading rules and manage the things that you can control. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. The first rule of making money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. If you are wrong, just admit it and take your loss. (That’s why we set stops in the first place.)

Ed

Swing Trade Ideas for your consideration and watchlist: EOLS, ENPH, CLOV, OLED, OSTK, MDT, LHCG, PFE, CHPT, LUMN, FCEL, PLUG, TAN 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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