Friday’s CPI reading crushed the hope that inflation had peaked, igniting uncertainty about the next FOMC decision. Will they hold the course, or will the Fed act more aggressively to curb inflation? Markets worldwide are under pressure as bond yields surge in speculation and recession fears grow. Expect a very challenging week of price action with an economic calendar heavily laden with market-moving events. Buy the dip buyers continue to get severely punished as they can no longer count on the Fed Put. Prepare for a rough week that will likely favor only the most experienced day traders, so be willing to stand aside to protect your capital.
Asian markets traded down across the board, with the Nikkei and HSI down more than 3% at the close. European markets continue Friday’s selling seeing only red this morning as bond yields surge higher. U.S. futures point to a substantial bearish open that will test 2022 market lows as support. With all the uncertainty ahead, the question is, will the support hold? Buckle up it’s going to be a wild day!
Economic Calendar
Earnings Calendar
We have a very light day on the Monday earnings calendar. Notable reports include ORCL ZDGE.
News & Technicals’
U.S. President Joe Biden has repeatedly indicated the U.S. would defend Taiwan militarily upon attack, only to have the White House deny a shift in a decades-long “one-China policy.” “We believe he is actually paying lip service to this one-China policy,” said Zhou Bo, a senior fellow at Tsinghua University’s Center for International Strategy and Security Studies. Taiwan is a democratically self-ruled island 72-year-old government in Beijing considers part of its territory. Beijing has maintained it seeks peaceful reunification with Taiwan. Bitcoin tumbled below $24,000 late Monday, hitting its lowest level since December 2020, as investors dump crypto amid a broader sell-off in risk assets. Meanwhile, a crypto lending company called Celsius has paused withdrawals for its customers, sparking fears of contagion into the broader market. Macro factors are contributing to the bearishness in the crypto markets, with rampant inflation continuing and the Federal Reserve expected to hike interest rates this week to control rising prices. Crypto lender Celsius said it pauses all account withdrawals and transfers, citing “extreme market conditions.” As of May, the firm had more than $8 billion lent out to clients and almost $12 billion in assets under management. Bitcoin and other tokens plunged, with the world’s biggest digital coin falling to lows not seen since December 2020. Global stock markets are falling sharply after May’s U.S. inflation print reignited fears that central banks will be forced into aggressive monetary policy tightening. The U.S. 2-year Treasury rate hit its highest level since 2007 on Monday morning and edged closer to an inversion with the benchmark 10-year rate – seen by many as a sign of an impending recession. “While [the Fed] can’t sit there and say their job is to end job creation for the moment, that is basically what they need to do if they are going to get inflation back under control now,” TD Securities’ Richard Kelly said. Treasury yields rose in early Monday trading, with the 10-year at 3.23% and the 10-year rising to 2.25. Unfortutually, the 5-year is inverted at 3.37 while the 2-year rose sharply at 3.19%.
The log jam broke after the Friday CPI number that showed inflation continued to rise, bringing out the bears and igniting uncertainty for the week ahead. We have a light day on the earnings and economic calendar, leaving us to ponder will the PPI number Tuesday improve or add to the inflation pressures. As a result, anything is possible so expect some wild and challenging price action today. With bond yields rising, speculation is growing that the FOMC may act more aggressively on Wednesday with more than a 50 basis point rate increase. Markets around the world are under pressure, but the big question for today is whether the May lows will hold as price support to create a possible double bottom? So, stay focused and be prepared for just about anything.
On Friday, the May CPI came in hotter than expected (8.6% vs 8.3% forecast) and a flat premarket turned into a 1.5% – 1.9% gap down at the open. From there we saw an hour of follow-through to the downside and then an all-day rollercoaster ride sideways. We ended the day on a dark pool selloff that just took us to a new low. This gave us gap-down, big black candles that closed on their lows in all 3 major indices. For the day, SPY lost 2.90%, DIA lost 2.67%, and QQQ lost 3.53%. The VXX was flat at 23.33 and T2122 fell well into the oversold territory to 6.90. 10-year bond yields spiked to 3.157% and Oil (WTI) fell two-thirds of a percent to $120.66/barrel.
In Economic news, Friday’s much hotter than expected CPI number is likely to have traders laser-focused on Wednesday’s Fed rate decision, interest rate forecast, and perhaps most importantly Fed Chair Powell’s press conference. More hawkish analysts and media said the number put a 0.75% rate hike back on the table for this week. However, a large majority of analysts reacted more like GS, which took Friday’s number as a signal to revise its rate-hike forecast to include a half-percent hike this week, in July, and in September. (Previously, GS had only forecast a quarter-point hike in September.) Futures markets have now priced in 2.55% of rate hikes in the Fed’s 5 remaining meetings this year, more than last week. For traders, the short-term implication is that we might see a low-volume, dull market until Wednesday afternoon as traders wait to see if Powell gives guidance on what will happen past July. However, expectations are for more hikes than expected this year. So, a further selloff is also on the table. As for bond markets, yields spiked by the largest amount in 13 years on Friday in response to the CPI number.
In business news, the airline industry is already back to pre-pandemic traveler levels and got another boost Friday. The CDC dropped the requirement for travelers coming from abroad to prove a negative covid-19 test before entering the country. The CDC will re-evaluate this decision after 90 days, but that will be after the summer travel season. Meanwhile, on the other side of the world, South Korea is now a week into its national trucker strike (protesting pay as their fuel costs surge). So far, there have been port slowdowns causing serious supply chain problems. Hyundai had production drop 60% at their largest factory on Friday due to component shortages. However, so far SSNLF (Samsung Electronics) has seen no disruptions and does not expect near-term stoppages given its materials and component inventories.
In Crypto news, Bitcoin fell to an 18-month low Friday ($29,000), and fell again over the weekend to $24,000 after failing resistance at $33,000 earlier in the week. Analysts tell Bloomberg they are expecting the fall to continue at least the mid-teen area. Ethereum price action is also suggesting there may be more pain ahead for digital currencies. Finally, crypto lender Celsius Network has halted withdrawals, swaps, and transfers on their platform as their coin (CEL) fell 53%. Rival company Nexo announced plans to acquire assets from Celsius.
S&P 500 stocks sitting at a 52-Week Low INCLUDE (but are not limited to) INTC, MU, DIS, TXN, WFC, GS, MDT, MMM, CCL, ISRG, HCA, EXPE, BSX, SWK, SYK, CFG, SPG, and LH. Meanwhile, S&P stocks sitting at a 52-Week High are limited to XOM, MPC, VLO, EOG, PSX, and DXCM.
In economic news later this week, on Tuesday we get May PPI. Wednesday, we get Retail Sales, NY Empire State Mfg. Index, April Business Inventories, Crude Oil Inventories, Q2 Interest Rate Projections, Fed Rate Decision, Fed Statement, and Fed Chair Press Conference. On Thursday, we see May Building Permits, May Housing Starts, and Philly Fed Mfg. Index. Finally, on Friday we get May Industrial Production and hear from Fed Chair Powell again.
Overnight, Asian markets were strongly red across the board. South Korea (-3.52%), Hong Kong (-3.39%), and Japan (-3.01%) led the region lower on China walking back reopening (after lockdown) as well as the nationwide trucker strike in Korea. In Europe, we see the same picture taking shape as of mid-day. The FTSE (-1.56%), DAX (-1.78%), and CAC (-2.09%) are typical and lead the region lower in early afternoon trading. As of 7:30 am, US Futures are pointing to a strong gap down to start the week. The DIA implies a -1.79% open, the SPY is implying a -2.24% open, and the QQQ implies a -2.92% open at this hour. 10-year bond yields are spiking again at 3.255% and Oil (WTI) is off 1.5% to $118.82/barrel in early trading.
The major economic news events scheduled for release Monday is limited to a Fed Speaker (Brainard at 2 pm). The only major earnings is ORCL which reports after the close.
On the earnings front, this is a very slow week. On Tuesday we hear from CNM and ASTL. Wednesday there are no major earnings reports. On Thursday we get reports from KR, CMC, JBL, and ADBE. There are no earnings reports on Friday.
Most of the talk is about last night’s Congressional hearings on the January 6 insurrection. However, the big news (and reason for premarket wait-and-see) is the CPI report at 8:30 am. Regardless of how the number comes in, we can expect it to be bad. Consensus forecasts are calling for 8.3% and even if it comes in light that does not mean inflation cannot speed up again. Nonetheless, we can expect a knee-jerk reaction, either way, the report lands…and then a whipsaw back the other direction after reconsideration by traders.
Technically speaking, the bears have the ball now that we have failed down out of the choppy consolidation area. In terms of extension, we are not in the oversold territory yet and while we are a fair way from the T-line after yesterday’s big move, I would not call this over-extended to the downside. If you are a long trader, you need to be very careful as there is room to move before the next support level. However, if you are on the bear side, just keep in mind that the move lower will likely not be in a straight line. With the weekend ahead, this may be a good day to get small, get hedged, or sit on your hands.
Remember to be very careful chasing gaps/moves early. The whipsaw is very real during times when we are thinking about changing trends and as we’ve seen lately, gap-chasers can get hurt. Trading is our job. So, do the work and work the process. Stick with your trading rules, trade with the trend, and consistently take profits when you have them. Always move your stops in your favor. Remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss. Finally, remember that you get rich steadily over the long run in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.
Ed
Swing Trade Ideas for your consideration and watchlist: No tickers today. 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.
🎯 DickCarp: 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.
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
Markets gapped down at the open by about half a percent on Thursday and then just waffled sideways until shortly after 1 pm. At that point, the bears took over and sold off the market the rest of the day, closing on the lows. This left us with large, black candles with longer upper wicks in all 3 major indices. All 3 also fell through their T-lines again today, as well as breaking down through the bottom of the recent choppy consolidation range. All 10 sectors were heavily in the red, with Technology (-2.95%) being the most bearish and Communications (-1.51%) being the least bearish. On the day, SPY lost 2.36%, DIA lost 1.92%, and QQQ lost 2.68%. The VXX climbed just under 6% to 23.06 and T2122 dropped hard and is now sitting toward the bottom end of the mid-range at 25.33. 10-year bond yields rose to 3.051% and Oil (WTI) fell three-fourths of a percent to $121.23/barrel.
In business news, in an unexpected move, the CEO of DIS fired its head of TV content, citing that the fired executive (Peter Rice) was not a team player. SFIX (reporting after the bell Thursday) also announced it is laying off 15% of its salaried workforce in a cost-cutting measure.
After the close, MTN, SFIX, and DOCU all reported beats on revenue while missing on earnings. In particular, SFIX badly missed posting a much larger loss than expected. DOCU was down as much as 20%, SFIX was down 17%, but MTN rallied almost 7% in post-market trade.
On the Russia story, Russian President Putin compared himself to Peter the Great (who led Russia during the conquest of the Baltic coast in the 1700s) and appeared to hint at further territorial expansion in the future. Elsewhere, Russia cut its key interest rate by 1.5% while also saying that the decline in economic activity (due to sanctions) was smaller than expected in April. However, the central bank justified the rate cut by saying that inflation was slowing faster than expected.
In international interest rate news, Bloomberg reports that EU area bonds are selling off today after the ECB failed to give guidance on how they would reduce the risk of fragmentation among EU members. Italy and Greece are leading the selloff while Germany and France remain the strongest. In Japan, the Finance Minister, Finance Regulator, and Central Bank all put out a joint statement that they would act if needed to prevent the further slide of the Yen. (Analysts say the Yen weakness, being at a 24-year low, is due to policy divergence of the Bank of Japan and the US Federal Reserve.
The reason for Asian stock weakness is that after a brief reprieve, China will re-implement a city-wide lockdown in Shanghai on the weekend. This is scheduled to be a brief lockdown and is intended to allow another mass Covid test for all citizens as the case count is rising again. However, the release of this story does not exactly explain why mainland Chinese markets remained green today.
Overnight, Asian markets were red across the board with the exception of mainland China. Shenzhen (+1.90%) and Shanghai (+1.42%) were the only green in the region. India (-1.68%), Japan (-1.49%), and Australian (-1.25%) led the region lower. In Europe, stocks are red all across the region at mid-day. The FTSE (-1.26%), DAX (-1.42%), and CAC (-1.72%) lead the way as usual on trade volume alone in early afternoon trading. As of 7:30 am, US Futures are pointing toward a mixed, flat open well ahead of CPI data. The DIA implies a -0.23% open, the SPY is implying a -0.11% open, and the QQQ implies a +0.16% open at this hour. 10-year bond yields are down slightly to 3.038% and Oil (WTI) is up three-quarters of a percent to $122.45/barrel in early trading.
The major economic news events scheduled for release Friday include May CPI (8:30 am), Univ. of Michigan Consumer Sentiment (10 am), the WASDE Report (noon), and the May Federal Budget Balance (2 pm). There are no major earnings reports scheduled for the day.
Most of the talk is about last night’s Congressional hearings on the January 6 insurrection. However, the big news (and reason for premarket wait-and-see) is the CPI report at 8:30 am. Regardless of how the number comes in, we can expect it to be bad. Consensus forecasts are calling for 8.3% and even if it comes in light that does not mean inflation cannot speed up again. Nonetheless, we can expect a knee-jerk reaction, either way, the report lands…and then a whipsaw back the other direction after reconsideration by traders.
Technically speaking, the bears have the ball now that we have failed down out of the choppy consolidation area. In terms of extension, we are not in the oversold territory yet and while we are a fair way from the T-line after yesterday’s big move, I would not call this over-extended to the downside. If you are a long trader, you need to be very careful as there is room to move before the next support level. However, if you are on the bear side, just keep in mind that the move lower will likely not be in a straight line. With the weekend ahead, this may be a good day to get small, get hedged, or sit on your hands.
Remember to be very careful chasing gaps/moves early. The whipsaw is very real during times when we are thinking about changing trends and as we’ve seen lately, gap-chasers can get hurt. Trading is our job. So, do the work and work the process. Stick with your trading rules, trade with the trend, and consistently take profits when you have them. Always move your stops in your favor. Remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss. Finally, remember that you get rich steadily over the long run in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.
Ed
Swing Trade Ideas for your consideration and watchlist: No tickers today. 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.
🎯 DickCarp: 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.
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
Wednesday was another morning gap, then reversal, as we flip-flop in the frustrating choppy price action on light volume waiting on the Friday CPI. The intraday whipsaws favor experienced day traders and high-frequency firms but only serve’s to chop up the accounts of most retail traders. The indexes have moved hundreds of points over the last few days but ultimately remain stuck in the same trading range. So, I guess we can’t be all that surprised that today is beginning to shape up for more of the same. Perhaps the CPI numbers can give us some direction.
Asian markets were mostly lower overnight as new pandemic rules in Shanghai dampened sentiment. European markets trade in the red this morning as they wait for an ECB decision. However, in another intentionally inspired overnight gap, U.S. futures point to a bullish open to reverse yesterday’s selling ahead of Jobless Claims.
Economic Calendar
Earnings Calendar
The Thursday earnings calendar is pretty light, with less than 20 companies confirmed. However, notable reports include JG, BILI, HOFT, LAKE, NIO, RENT, SIG, SFIX, & MTN.
News & Technicals’
Bosses of major fintech players sounded the alarm about deteriorating macroeconomic conditions at the Money 20/20 Europe trade show. John Collison, the co-founder of online payments firm Stripe, said he was unsure if the company could still justify its $95 billion valuation given the current economic climate. Zopa, a digital bank based in Britain, suggested it was less likely to meet its target of going public by the end of 2022. This week, the Biden administration proposed new standards for its program to build a national network of 500,000 electric vehicle charging stations by 2030. Officials said the proposal would help establish the groundwork for states to build charging station projects accessible to all drivers regardless of the location, EV brand, or charging company. Earlier this year, the White House introduced a plan to allocate $5 billion to states to fund EV chargers during the next five years. On Wednesday, the top U.S. securities regulator, Gary Gensler, proposed rule changes to transform how Wall Street handles retail stock trades after the meme stock mania raised questions last year. The plan would require trading firms to directly compete to execute trades from retail investors to boost competition. In addition, Gensler said the new SEC rules would mandate market makers disclose more data around the fees these firms earn and the timing of trades for the benefit of investors. The Quad countries want to jointly monitor the movements of ships and submarines in the Indo-Pacific using satellites, a move analysts warn could potentially lead to the region’s militarization. “While the Quad as of now is not a security organization, it has the potential to quickly metamorphose into one,” retired Maj. Gen. Dhruv Katoch of the Indian Army told CNBC. The initiative’s military nature is also underlined by the program being driven by the respective navies of the four participating countries — the U.S., Australia, Japan, and India. The initiative will also track “dark shipping” in the Indo-Pacific. Treasury yields slipped just one basis point in early Thursday trading, with the 10-year at 3.02% and the 30-year at 3.16%.
The trading so far this week has been a morning gap followed quickly by a strong reversal, then choppy price action on weak volume. Though we have moved hundreds of points over the last 3-days, nothing has changed as the indexes remain locked between the highs and lows of the range. So, it should be no surprise we have another institutionally inspired gap setting up this morning and likely another day of frustrating chop as we wait on the Friday CPI. Expect volatile price action with a PPI reading next week and a Fed interest rate increase, but perhaps we will have a market direction.
Stocks gapped down about half a percent Wednesday and then ground sideways in the gap until a selloff kicked in for about half an hour mid-day. From there all 3 major indices resumed their sideways grind in a tight range. This action gave us small-bodied black Harami candles with larger upper wicks. Both large-cap indices closed the day at their T-lines. However, all 3 remain in that choppy consolidation range of the last 1.5 weeks. On the day, SPY lost 1.09%, DIA lost 0.84%, and QQQ lost 0.72%. The VXX climbed six-tenths of a percent to 21.80 and T2122 fell just outside of the overbought territory to 78.15. 10-year bond yields jumped back up to 3.025% and Oil (WTI) surged another 2.7% to $122.61/barrel.
During the day, SEC Chair Gary Gensler unveiled proposed rule changes. The new rules would require trading firms (wholesalers) and exchanges to compete in open auctions for trades. In other words, the back-room deals where brokerages sell order flow to a specific outlet would be made illegal. The rule would also require brokers to disclose how this will impact both order execution and the price received. If approved, this would change the way order wholesalers do business and may impact the “zero commissions” model of some brokerages. Another rule would reduce the minimum “tick size” to fractions of a penny to align with the way dark pools are allowed to trade.
After the close, ABM and GEF both reported beats on both the revenue and earnings lines. However, FIVE missed on revenue while beating on earnings.
In business news, VWAGY CEO Keogh told CNBC that the company is actively looking for US locations for a new battery manufacturing facility and a car assembly plant. No specific amount of investment was given, but he said it was part of the German company’s $7.1 billion commitment to boost electric vehicle efforts in North America. In a surprise, AAPL also clarified that it will be providing the loans for its “buy now, pay later” service by itself, without external partners from the banking or finance industries. Finally, TWTR announced that it plans to hold a shareholder vote on the sale to Elon Musk in late July or early August. This is part of the escalating tensions where Musk constantly tweets things that hurt the value of TWTR and questions whether he will walk away from the deal while the company insists that he has an iron-clad purchase contract.
Overnight, the EU voted to ban gasoline and diesel vehicles (cars and vans) after 2035. Across the channel, the UK had already voted to prohibit those sales after 2030. So, the European stance was a compromise slower timeline to help the poorer EU nations. Also this week, the Biden Administration has announced standards for electric charging stations. (Currently, there is no standardization.) These new standards will guide the spending of $7.5 billion the bipartisan Infrastructure Bill allocates toward a national electric charging station network.
So far this morning, NIO and SIG have both reported beats on both lines. Meanwhile, BILI beat on revenue while missing on earnings.
Overnight, Asian markets leaned heavily to the downside. Only Japan (+0.04%), Thailand (+0.27%), and India (+0.74%) managed to stay in the green. However, Shenzhen (-1.85%), Australia (-1.42%), and Shanghai (-0.76%) led the rest of the region lower. In Europe, we see a similar story taking shape at mid-day. The FTSE (-0.41%), DAX (-0.66%), and CAC (-0.26%) are typical of the region with only 2 exchanges barely hanging on to green in early afternoon trading. As of 7:30 am, US Futures are pointing toward a modestly green open. The DIA implies a +0.43% open, the SPY is implying a +0.46% open, and the QQQ implies a +0.46% open at this hour. 10-year bond yields and Oil (WTI) are both flat in early trading.
The major economic news events scheduled for release Thursday brings Weekly Initial Jobless Claims (8:30 am). However, many traders will also be watching the ECB for their rate decision (as a read-through on Fed action, even as a 50 basis point move by the Fed is priced into futures as almost a mortal lock). The major earnings reports scheduled for release include BILI and SIG before the open. Then after the close, DOCU, SFIX, and MTN report.
In economic news later this week, on Friday we get May CPI, Univ. of Michigan Consumer Sentiment, the WASDE Report, and the May Federal Budget Balance.
On the earnings front for later this week, on Friday there are no major reports scheduled.
With Jobless Claims coming later this morning, premarkets look to have bounced up off the T-lines and are modestly positive at 7:30 am. Just remember that the open has not been a great indicator of where the day will close recently. The chop zone still prevails and we need to respect that range’s boundaries until it is clearly broken by a new directional move.
Technically speaking, we remain way over-bought in a choppy consolidation zone that started nearly 2 weeks ago. None of the major indices are in an uptrend yet (at least on a daily chart), but we may have a higher-low in all 3 of them. So, we remain in limbo with the mid-term downtrend broken, but a potential new uptrend that has not been confirmed. This is a dangerous area for Swing Traders. So continue to be careful, nimble, and/or hedged. (Or sit on your hands.)
Remember to be very careful chasing gaps/moves early. The whipsaw is very real during times when we are thinking about changing trends and as we’ve seen lately, gap-chasers can get hurt. Trading is our job. So, do the work and work the process. Stick with your trading rules, trade with the trend, and consistently take profits when you have them. Always move your stops in your favor. Remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss. Finally, remember that you get rich steadily over the long run in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.
Ed
Swing Trade Ideas for your consideration and watchlist: MRNA, DKNG, CRM, CTVA, LLY, ABBV, AUY, BA, NKE, ROKU, CTIC. 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.
🎯 DickCarp: 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.
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
The wide-ranging frustrating chop zone continues with a gap down open met with a low volume rally to keep us guessing as to what comes next. With the Fed GDP tracker hinting at recession, a global growth downgrade, and a new record high of $4.95 a gallon gas price, the entire world is waiting for the read on CPI Friday morning. Today we have Mortgage Applications, the Petroleum Status Report, and a rising 10-year bond auction with just enough earnings reports to keep traders on their toes. Can the bulls follow through, breaking the chop zone, or will the bears reengage to keep the chop zone active? We will soon find out.
Asian markets surged higher overnight, with the very volatile HSI leading up 2.24% at the close. However, European markets see red across the board after Credit Suisse warned of a likely earnings miss next quarter. U.S. futures point to a bearish open as the morning reversals continue as we wait on the Friday CPI. Prepare for another day of weak volume price volatility where anything is possible.
Economic Calendar
Earnings Calendar
We have less than 20 confirmed reports on the Wednesday earnings calendar, with many of them very small-cap companies. Notable reports include ABM, CPB, DAKT, FIVE, GEF, JILL, OLLI, STRM, THO, & VRA.
News & Technicals’
The Atlanta Federal Reserve’s GDPNow tracker points to an annualized gain of just 0.9% for the second quarter, down from an estimated 1.3% increase less than a week ago. With first-quarter growth down 1.5%, a second consecutive quarter of negative growth meets a rule-of-thumb definition for recession. The National Bureau of Economic Research, the official arbiter, says a recession can include two straight negative GDP prints, but that’s not necessarily the case. The European Union in late May moved to impose an oil embargo on Russia after agreeing the previous month to also stop coal purchases from the country. The bloc has been heavily dependent on Russian fossil fuels, and cutting some of these supplies overnight will have a significant economic impact. Credit Suisse said despite the trading revenues benefiting from the spike in volatility, the impact of these conditions, combined with “continued low levels of capital markets issuance” and widening credit spreads, have “depressed the financial performance” of the investment bank in April and May. This is “likely to lead to a loss for this division and a loss for the Group in the second quarter of 2022,” the trading update said. While inflation for the 19-member euro area hit another record high in May, a rate hike would only come in July as the ECB first needs to formally end its net asset purchases, according to its forward guidance. The ECB will also publish new staff projections for growth and inflation. And market participants are likely to closely monitor the 2024 inflation print as this constitutes the ECB’s medium-term price target. Cryptocurrencies are a “threat to the safety of our payment schemes,” Anne Boden, CEO of U.K. digital bank Starling, warned Tuesday. Regulators are concerned about the financial system becoming more entwined with the volatile world of crypto. Roughly $400 billion has been erased from the combined value of all cryptocurrencies in the past month. Treasury yields traded higher early Wednesday, with the 10-year pricing at 3.01% and the 30-year moving to 3.15%.
The indexes remain stuck in a frustrating chop zone with just two more trading days until we get a read on inflation that may provide us a directional resolution. Though the bulls managed a mighty recovery, printing some bullish engulfing patterns yesterday, the volume was noticeably weak and possibly untrustworthy signals. Overhead resistance levels remain intact, much to the disappointment of the bulls. In addition, global growth received a downgraded yesterday, and the Fed’s GDP tracker suggests the U.S. is on the brink of recession. Oil and gas continue to trend higher as we hit another record high in the national gas price of $4.95. Though some talking heads are trying to make light of the rising energy prices, the consumer is forced to make some tough spending decisions that are not likely to bode well for 2nd quarter earnings results. I suspect we have a rough summer of trading ahead of us!
Markets gapped down 0.8%-1.2% at the open Tuesday. However, the intraday reversal theme held as the bulls stepped in to fill that gap by 10:30 am. From there we saw a rollercoaster ride with a bullish trend that drove into the close not far from the high. The action left us with gap-down, large, white candles that have climbed back above the T-line and back into the upper end of the recent choppy trading range. The SPY and DIA both printed Bullish Engulfing candles while the QQQ printed a Bullish Piercing Candle. The energy and Healthcare sectors led the market throughout the session. On the day, SPY gained 0.90%, DIA gained 0.83%, and QQQ gained 0.86%. The VXX fell 1.63% to 21.67 and T2122 climbed even deeper into the overbought territory at 94. 10-year bond yields fell to 2.985% and Oil (WTI) gained 1.4% to $120.14/barrel.
During the day Tuesday, AAPL outlined its new Apple Pay features that include “Buy Now, Pay Later” which will now directly compete with AFRM and PYPL. The idea behind this offering is to capture users and keep them inside the iOS ecosystem instead of looking elsewhere for “Buy Now, Pay Later” services. AAPL was up 1.75% while PYPL gained 1.96% and AFRM gained 2.74% on the day. On the other side of the pond, AAPL agreed to a deal with the EU to remove their proprietary charging cables and go-to industry-standard USB-C cables for charging iPhones by 2024. The deal will allow the company to avoid further fines and sanctions on the issue.
After the close, CASY reported beats on both lines. So far this morning CPB, THO, and BLCO all reported beating on the top and bottom lines as well.
In business news, after the close 5 automakers backed President Biden’s push to restore California having the ability to set its own, stricter than Federal, emissions standards. Former President Trump had stripped states of that authority and the Biden administration is backing an EPW decision to restore it. The companies supporting the measure include F, HMC, VWAGY, BMWYY, and VOLAF. Surprisingly not on that list is TSLA, NIO, RIVN, NKLA, LCID, or even TM who might all benefit from the tighter rules on emissions. Elsewhere, PYPL announced that it will now allow users to send and receive cryptocurrencies between PYPL wallets and other exchanges. (PYPL users had previously been able to buy and sell crypto only to PYPL itself.)
SEC Chair Gary Gensler is scheduled to speak today. He is expected to address plans to change rules forcing exchanges to openly bid on brokerage order flows (rather than have unknown back-room deals) and for brokerages to be required to disclose how this will impact both order execution and the price received. Industry forces (such as order wholesalers) are lobbying against Gensler’s plan even before they are announced. We should note that the “Payment for Order Flow” is the mechanism that let many brokers go to a zero commissions business model. So, depending on what Gensler says and how the SEC eventually implements his vision, brokerage commission structures may be changing again. Another topic Gensler is expected to address is “Dark Pools” which now account for 40% of all market volume and are hidden from most market participants until the end of the day.
In Economic news, Bloomberg reported a few rays of light in the dark cloud of inflation we have been facing. As I mentioned in the past, the price of semiconductors has been coming down for months now. However, Bloomberg reported last night that the price of shipping containers has fallen 28% since the September 2021 highs. In addition (and too late for the current US crop) nitrogen fertilizer prices have dropped like a rock from the $1400/ton March price to $675/ton as Brazil reported a glut in Brazilian ports with no place left to store it. These will take some time to ripple through the economy and by no means does this mean inflation is falling yet, but these are signs of hope. On the opposite side of the spectrum, citing the Russian invasion of Ukraine, the World Bank lowered its global GDP forecast to +2.9% for 2022. This is down dramatically from the 2021 +5.7% number or even the World Bank’s own January forecast of 4.1%. Finally, mortgage demand has fallen again this week, reaching the lowest level of this century as 30-year, fixed-rate, conforming rates rose to 5.40%.
Overnight, Asian markets mixed, but leaned to the green side. Hong Kong (+2.24%) was an outlier with Japan (+1.04%), Taiwan (+0.95%), and Shenzhen (+0.82%) being the more typical leaders of the region. In Europe, stocks are mostly in the red at mid-day. The FTSE (-0.33%), DAX (-0.42%), and CAC (-0.68%) are typical of the region with outliers like Russia (+1.71%) and Denmark (-1.23%) in early afternoon trading. As of 7:30 am, US Futures are pointing toward a modestly lower start to the day. The DIA implies a -0.34% open, the SPY is implying a -0.26% open, and the QQQ implies a -0.11% open at this hour. 10-year bond yields have climbed back to 3.012% and Oil (WTI) is up another percent to $120.66/barrel in early trading.
The major economic news events scheduled for release Wednesday we see Crude Oil Inventories (10:30 am) and the 10-year bond auction (1 pm). Treasury Sec. Yellen will also testify before Congress at 10 am. The major earnings reports scheduled for release include BF.B, BLCO, CPB, and OLLI before the open. Then after the close, ABM, FIVE, and GEF report.
In economic news later this week, Thursday brings Weekly Initial Jobless Claims. Finally, on Friday we get May CPI, Univ. of Michigan Consumer Sentiment, the WASDE Report, and the May Federal Budget Balance.
On the earnings front for later this week, on Thursday we hear from BILI, SIG, DOCU, SFIX, and MTN. Finally, on Friday there are no major reports scheduled.
The bears are offering only a slight pushback on the strong candles the market printed yesterday. Even at that, the premarket action has been positive (white candle) since the start of the early session. So, we should keep our eyes on the top of the recent chop range to see if the bulls can get going. However, remember that until that level is broken with some strength, we have to assume the back-and-forth chop of the last week and a half will continue.
Technically speaking, we remain way over-bought in a choppy consolidation zone that started after a one-week rally inside a longer-term downtrend. None of the major indices are in an uptrend yet (at least on a daily chart), but we do have a higher-low in all 3 of them. So, we remain in limbo with the mid-term downtrend broken, but a potential new uptrend that has not been confirmed. This is a dangerous area for Swing Traders. So continue to be careful, nimble, and/or hedged. (Or sit on your hands.)
Remember to be very careful chasing gaps/moves early. The whipsaw is very real during times when we are thinking about changing trends and as we’ve seen lately, gap-chasers can get hurt. Trading is our job. So, do the work and work the process. Stick with your trading rules, trade with the trend, and consistently take profits when you have them. Always move your stops in your favor. Remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss. Finally, remember that you get rich steadily over the long run in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.
Ed
Swing Trade Ideas for your consideration and watchlist:NEWR, PLUG, DHR, OXY, LKQ, DVN, VERU, WMB, F, T, VALE. 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.
🎯 DickCarp: 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.
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
We kicked off Monday with a big gap up that turned out to be a disappointing pop and drop for traders that rushed in buy at the open. This morning with the futures suggesting a gap down, could we see another intraday reversal after testing the price support of the wide-rangeing chop zone? Your guess is as good as mine! With the national average gas price hitting a new record high of $4.92, the insidious tax of inflation naturally dominates the majority of the market conversation. Friday’s CPI will likely keep traders guessing and price action challenging as we wait.
During the night, Australia announced a 50 basis rate hike which was more than forecast, creating mixed results for Asian markets. European markets trade mainly lower this morning as inflation worries keep the bear active. Ahead of trade numbers and earnings results, the U.S. futures point to a lower open to test the support of the chop zone. The big question is will the bulls find the energy to defend, or will the bears fight to resume control?
Economic Calendar
Earnings Calendar
The Tuesday earnings calendar has just under 20 companies listed, with only about a dozen confirmed reports. Notable reports include ASO, CASY, CHS, CBRL, PLAY, GIII, SJM, SOL, UNFI & VRNT.
News & Technical’s
Sens. Cynthia Lummis and Kirsten Gillibrand said Tuesday that they are ready to debut the first major attempt from Capitol Hill to create a regulatory framework for crypto. The Lummis-Gillibrand bill, the product of months of Capitol Hill collaboration, amounts to a regulatory overhaul that would classify the vast majority of digital assets as commodities. The Responsible Financial Innovation Act would empower the Commodity Futures Trading Commission to regulate most existing digital assets. Tech companies including Amazon, Google, Salesforce, and Uber are urging the Department of Homeland Security to revise its aging out policies for children of high-skilled visa holders. They point to the more than 200,000 children who have grown up in the U.S. while their parents held visas, including the high-skilled H1-B visa that’s particularly common in the tech industry. Once those children turn 21, they must apply for a green card, a process that can drag on and even force some to leave in the interim. Kohl’s said it has entered into exclusive negotiations with retail holding company Franchise Group, proposing to buy the retailer for $60 per share. Such a price tag would value Kohls at roughly $8 billion. According to a person familiar with the matter, Franchise Group is working with Oak Street Real Estate Capital to finance the deal mostly through real estate. Monday’s vote saw Johnson win the backing of most of his Conservative lawmakers, but by a much slimmer margin than his supporters had hoped. The vote — triggered by his lawmakers amid increasing dissatisfaction with his leadership — resulted in 211 Tory MPs voting in favor of the prime minister while 148 voted against him. His days are “numbered,” according to Kallum Pickering, a senior economist at Berenberg Bank. Treasury yields moved slightly lower in early Tuesday trading, with the 10-year slipping to 3.02% and the 30-year dipping to 3.17%.
In the Morning Prep Video, I suggested the possibility of a pop and drop due to the overhead resistance and the short-term overbought condition indicated in the T2122 indicator. Unfortunately, that turned out to be correct as the wide-ranging choppy consolidation continues. If you’re a bull, you should note that yesterday’s selling did nothing to relieve the overbought condition, and the VIX continues to hover near 25 handles. Today we have the International Trade in Goods report before the bell, but the entire world is mainly concerned about the pending read on inflation Friday morning. In a move to battle inflation, Australia announced a rate hike of 50 basis points, which was higher than their previous forecast. I suspect the price action will remain challenging as we wait and fret over what comes next.
Stocks gapped a percent higher at the open Monday. After treading water for the first 90 minutes, the bears stepped in and drove price back down to fill the gap by about 12:30 pm. From there we have seen a whippy, rollercoaster to sideways in the gap the rest of the day. This action left us with gap-up, black-bodied, Spinning Top candles in all 3 major indices. From a sector standpoint, it is the Consumer Cyclicals that are the big loser of the day while Industrials, Basic Materials, and Financial Services led the gains. On a day where sideways intraday chop is the rule, markets remain inside the recent choppy consolidation range. On the day, SPY gained 0.30%, DIA gained 0.03%, and QQQ gained 0.33%. The VXX also was up two-thirds of a percent to 22.03 and T2122 was flat (and remains overbought) at 88.02. 10-year bond yields surged to closed at 3.04% and Oil (WTI) closed down at $119.40/barrel.
During the day, AAPL held its annual World-Wide Developer’s Conference. At the event, the company announced new M2 CPUs for Macbooks, another version of its iOS for phones and iPads, a new macOS and a new Apple Watch OS. For investors, the largest reveal was probably the entry of AAPL into the buy-now-pay-later business with an offering called Pay Later. During the event, CEO Tim Cook giggled but then refused to comment on whether the Chinese portion of AAPL’s supply chain is opening up yet. On the day, AAPL stock was up one-half of a percent but has given that back overnight, trading down half a percent in premarket.
After the close, NGL beat handily on revenue but also printed an awful miss on earnings. This is very odd for an oil refinery when gas prices have been at record levels the last few months.
In stock news, TWTR printed a Belthold type of candle as traders furiously tried to regain ground after Elon Musk threatened to walk away (at a $1 billion cost) from his purchase offer over the company not providing him data on users. On the day, TWTR close down 1.49% after being down almost 6% early. Solar stocks had a good day as on Sunday the Biden Administration announced a 2-year dropping of tariffs on solar panel imports. Among the biggest gainers were FTCI (+31.74%), SHLS (+21.48%), ARRY (+18%), and JKS (+7.98%). Among the more widely-traded solar stocks, ENPH (+5.41%), SEDG (+2.86%), and RUN (+5.94%) were the winners while domestic panel producer FSLR (-3.92%) took a hit.
Overnight a speech from a senior Chinese economist at a state-run research group on the topic of US-China relations was posted. In the speech (delivered last month, but printed today), he called for China to seize TSM if the West were to levy Russian-like sanctions on China. (For anyone who doesn’t know, TSM is the largest and leading technology semiconductor manufacturer in the world. Companies like AMD, NVDA, INTC, etc. all are dependent on TSM chips.) In the speech he went on to talk about the recovery of Taiwan and worried that TSM is speeding up the transfer of their operations to the US by building six factories (chip fabs) here. He flatly stated that China must not allow the goals of the transfer be achieved. TSM stock is down 0.87% in premarket while AMD is down 1.33%, NVDA is down 1.83%, and INTC is down 0.74%. on this potential threat.
In crypto news, a bipartisan group of US Senators and Congressmen said they are ready to debut a plan to overhaul the regulatory framework for cryptocurrencies and futures. The plan would classify the vast majority of “digital assets” as commodities and empower the CFTC (not the SEC) to regulate the market. This runs somewhat contrary to the fact that SEC Chair Gensler has been the one leading a public crusade to regulate crypto assets. This law is just being introduced and much debate, horse-trading, and voting remain before this plan becomes law. It is also worth noting that the “crypto lobby” is has a lot of sway in Congress, having contributed $30 million to various campaigns in the last 2 years according to CNBC.
Overnight, Asian markets leaned heavily to the red side. Australia announced a rate hike that was larger than expected (50 basis points with 25 basis points expected). As a result, South Korea (-1.66%), Australia (-1.53%), and New Zealand (-1.33%) paced the losses. Only Japan (+0.10%), Singapore (+0.15%), and Shanghai (+0.17%) were able to print any green across the region. In Europe, stocks are similar to Asia, with red all over the board and only 3 minor patches of green at mid-day. The FTSE (-0.16%) leads, perhaps on the fact that Boris Johnson survived a “No Confidence” vote and will remains PM of the UK, with the DAX (-1.01%) and CAC (-1.08%) more typical of the region in early afternoon trading. As of 7:30 am, US Futures are pointing toward a gap-down start to the day. The DIA implies a -0.84% open, the SPY is implying a -0.96% open, and the QQQ implies a -1.21% open at this hour. 10-year bond yields are down a bit to 3.016% and Oil (WTI) is off six-tenths of a percent to $117.75/barrel in early trading.
The major economic news events scheduled for release Tuesday include April Imports, April Exports, and April Trade Balance (all at 8:30 am). However, keep an eye on unannounced guidance changes (lowering) as the market looks for clues of how bad the inflations and slow-down will impact companies. For example, this morning TGT warned their profits will be lower than expected in the short-term as it pays to cancel orders and marks down inventory to sell slow-moving products. The major earnings reports scheduled for release include ASO, CHS, CBRL, GIII, PLAY, MOMO, HOLX, SJM, REVG, and UNFI before the open. Then after the close, CASY reports. So far this morning UNFI, SJM, MOMO, GIII, and CHS all reported beating on the top and bottom lines. Meanwhile, REVG missed on both revenue and earnings.
In economic news later this week, Wednesday we see Crude Oil Inventories and the 10-year bond auction. Thursday brings Weekly Initial Jobless Claims. Finally, on Friday we get May CPI, Univ. of Michigan Consumer Sentiment, the WASDE Report, and the May Federal Budget Balance.
On the earnings front for later this week, on Wednesday we get reports from CPB, OLLI, ABM, FIVE, and GEF. Thursday brings reports from BILI, SIG, DOCU, SFIX, and MTN. Finally, on Friday there are no major reports scheduled.
It looks like the bears will retest the bottom of the recent chop range (and the T-line) on the gap-down open across all 3 major indices. This will be a key level and if it fails, the bulls may run for cover in the short term. With that said, until that level is broken, we have to assume this is just more chop inside the consolidation zone.
Technically speaking, we remain over-bought in a choppy consolidation after a one-week rally inside a longer-term downtrend. None of the major indices are in an uptrend yet (at least on a daily chart). So, we remain in the no-mans-land where the mid-term downtrend has been broken, but a new uptrend has not been confirmed. This is a dangerous area for Swing Traders. So continue to be careful, nimble, and/or hedged. (Or sit on your hands.)
Remember to be very careful chasing gaps/moves early. The whipsaw is very real during times when we are thinking about changing trends and as we’ve seen lately, gap-chasers can get hurt. Trading is our job. So, do the work and work the process. Stick with your trading rules, trade with the trend, and consistently take profits when you have them. Always move your stops in your favor. Remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn. If you have a loss, just admit you were wrong and take it before it grows. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss. Finally, remember that you get rich steadily over the long run in Trading…not by striking it rich on one or two trades. So, give up that lottery ticket mentality.
Ed
Swing Trade Ideas for your consideration and watchlist:CC, MO, COP, VLO, PG, AAPL, W, WMT. 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.
🎯 DickCarp: 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.
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
Friday proved to be just another day in the wide, choppy consolidation range, with the bears taking their turn at the helm. I suspect we will have a challenging summer of price action, as many big investment banks have warned. With key inflation data coming on Friday, bond yields are rising this morning, and I think the Fed members have been clear that the Fed put is no longer there to prop up the market. So, as we push higher this morning, remember to respect overhead resistance where the bears may be building defenses.
Asian markets traded mostly higher as China relaxed lockdown restrictions, as Hong Kong surged by 2.71%. European markets trade green across the board this morning but keeping a close eye on inflation data later this week. With a light day on the Earnings and Economic calendars, the bulls are back on the job this morning, pointing to a gap open as the choppy range-bound trading continues.
Economic Calendar
Earnings Calendar
We have a light day with just 11 confirmed earnings reports to kick off the new week of trading. Notable reports include COUP, HQY, NGL & SAIC.
New & Technicals’
According to Morgan Stanley co-President Ted Pick, global markets are beginning a fundamental shift after a 15-year period defined by low interest rates and cheap corporate debt. The transition from the economic conditions that followed the 2008 financial crisis and whatever comes next will take “12, 18, 24 months” to unfold, he said last week at a New York financial conference. However, pick said that out of the ashes of this transition period, a new business cycle will emerge. The U.K.’s Prime Minister Boris Johnson will face a vote of confidence later on Monday amid increasing dissatisfaction with his leadership. To trigger a vote of confidence, 15% of Conservative lawmakers (or 54 of the current 360 Tory MPs) are required to write letters to Graham Brady, chairman of the 1922 Committee, which oversees the party’s leadership challenges. On Monday, Brady announced that the threshold had been exceeded. According to official data, after a surge of omicron cases across the country since March, the nationwide daily Covid case count has fallen to below 50. “Our high-frequency trackers suggest that barring another severe Covid resurgence and related lockdowns, mobility, construction and ports operation could recover to pre-lockdown levels in around one month,” Goldman Sachs China Economist Lisheng Wang and a team said in a report Saturday. In a significant step toward normality, the capital city of Beijing allowed most restaurants to resume in-store dining Monday after a hiatus of about a month. Amid the fanfare of U.S. President Joe Biden’s new Indo-Pacific strategy, China flew under the radar, focusing instead on growing trade under RCEP. Consistent with its support of multilateralism and globalization, China is likely to continue promoting the adoption of RCEP, which grants member states market access that IPEF lacks. Beijing has laid out a blueprint for how Chinese businesses expand trade and find opportunities through RCEP, and Chinese provinces were on board. Treasury yields moved higher in early Monday trading, with 10-year up to 2.96% and the 30-year trading at 3.11%.
On Friday, the choppy consolidation range continued to challenge and frustrate traders when the bears showed up to end the week on a selling note. However, with bonds rising ahead of key inflation data at the end of the week, the bulls are back at work in the futures market this morning. As a result, the VIX fell just slightly below the 25 handles, and the T2122 indicator shows a short-term oversold condition as the new trading week begins. Though we have a lot of clues that our economy is in decline due to intense inflationary pressures, speculation buying remains remarkably resilient. Through I expect a push to test the DIA 50-day average, traders should watch the overhead resistance levels for clues of the next bearish attack. I suspect we still have a very challenging summer ahead of us, as many big investment banks have warned. Remember, the Fed Put is no longer in place as they raise rates and roll off the balance sheet.
