Markets mostly moved sideways on the day with a little more bullish energy in the Tech sector.  SPY opened up 0.08%, DIA opened down 0.08%, and QQQ gapped up 0.31%.  From there, SPY and QQQ followed through to the upside until 11:45 a.m. before they gave back about a third of their post-open gains in a long, slow, mostly sideways slide that lasted the rest of the day.  Meanwhile, DIA meandered sideway back and forth across its opening “gap” all day.  This action gave us indecisive candles in all three major index ETFs.  SPY and QQQ both printed white-bodied Spinning-Top, Bullish Harami candles that remained below their T-line (8ema) without testing.  For its part, DIA printed a Doji candle that retested and failed its own T-line.  This happened on well below-average volume in all three major index ETFs.

On the day, nine of the 10 sectors were green as Energy (+1.50%) and Basic Materials (+1.24%) were way out front leading the market higher. On the other side, Healthcare (-0.13%) was the only sector below break-even.  At the same time, SPY gained 0.41%, DIA lost 0.07%, and QQQ gained 0.69%.  VXX fell 3.65% to close at 44.89 and T2122 popped up out its oversold territory into the bottom half of its mid-range to close at 40.82.  Meanwhile, 10-Year bond yields fell to 4.414% while Oil (WTI) popped 3.27% to close at $69.21 per barrel.  So, Monday was a divergence day the Big Dogs of Tech, like TSLA (+5.62%), AMD (+2.99%), NFLX (+2.80%), etc., dragged the broader index ETFs higher while the mega-cap DIA lagged.

There was no major economic news scheduled for Monday.

After the close, ACM, BRBR, SYM, and TCOM reported beats on both the revenue and earnings lines.  At the same time, ADM missed on revenue while coming in in-line on earnings.

Overnight, Asian markets were nearly green across the board.  Only Malaysia (-0.11%) was in the red.  Meanwhile, Shenzhen (+1.89%) and Taiwan (+1.34%) led the gainers.  However, in Europe, we see the opposite picture with red across the board at midday. The CAC (-1.16%), DAX (-1.14%), and FTSE (-0.43%) lead the region lower in early afternoon trade.  In the US, as of 7:15 a.m., Futures are pointing toward a down start to the day.  DIA implies a -0.52% open, the SPY is implying a -0.27% open, and the QQQ implies a -0.14% open at this hour.  At the same time, 10-Year bond yields are down to 4.373% and Oil (WTI) is down two-thirds of a percent to $68.71 per barrel in early trading.

The major economic news scheduled for Tuesday is limited to October Building Permits and October Housing Starts (both at 8:30 a.m.), and API Weekly Crude Oil Stocks report (4:30 p.m.).  The major earnings reports scheduled for before the open include AS, ESLT, ENR, FUTU, LOW, MDT, VIK, VIPS, WMT, and XPEV.  Then, after the close, QFIN, KEYS, LZB, SNEX, and ZTO report. 

In economic news later this week, on Wednesday, EIA Weekly Crude Oil Inventories are reported.  On Thursday, we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Philly Fed Mfg. Index, Philly Fed Mfg. Employment, October Existing Home Sales, US Leading Economic Index, and the Fed Balance Sheet.  Finally, on Friday, Preliminary November S&P Global Mfg. PMI, Preliminary November S&P Global Services PMI, Preliminary November S&P Global Composite PMI, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan Consumer 1-Year Inflation Expectations, Michigan Consumer 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Wednesday, RERE, BERY, DY, NIO, TGT, TJX, WSM, YSG, ZIM, BBAR, SQM, CPA, MMS, NVDA, PANW, and SNOW report.  On Thursday, we hear from ATKR, BIDU, BJ, ROAD, DE, IQ, BEKE, PDD, VSTS, WMG, CPRT, GAP, INTU, NTAP, ROST, and UGI.  Finally, on Friday, there are no major reports scheduled.

So far this morning, AS, ESLT, J, LOW, MDT, VIK, VIPS, and WMT have all reported beats on both the revenue and earnings lines.  Meanwhile, ENR, FUTU, and XPEV missed on the revenue line while beating on earnings. 

With that background, the broader markets seem be remaining indecisive relative to the last two closes.  Both SPY and QQQ gapped up modestly to start the premarket, but have sold down since that point (although it is worth noting that both candles have significant lower wicks, meaning they are well up off the early session lows at this point).  For its part, DIA opened the premarket modestly lower and has followed through to the downside since then, showing it is more decisively bearish. All three major index ETFs remain below their T-line (8ema), so, the short-term trend is bearish (although we don’t yet have a lower high and lower low to complete a true bear trend).  Still, the mid-term and longer-term trends remain bullish.  In terms of extension, none of the major index ETFs are stretched from their T-lines and the T2122 indicator is now back in its mid-range.  So, there is plenty of room to run for either the Bulls or Bears, if either can get some momentum. In terms of the 10 Big Dogs, nine of the 10 are in the red this morning.  GOOGL (-0.45%) is leading the way lower while NVDA (+1.57%) is holding up best.  As has been the case since the election, TSLA (-0.10%) is out front leading the dollar-volume traded by about 1.5 times over NVDA. 

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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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