Friday saw the Bears in control early and then a drift sideways all afternoon.  SPY opened 0.05% higher, DIA opened up 0.13%, and QQQ gapped down 0.20%.  At that point, QQQ led the way by selling off sharply until 11 a.m. and then more modestly for another 60 minutes.  SPY followed through to the upside for 5 minutes before following QQQ in a sharp selloff until 11 a.m. and then more modestly for an hour.  Meanwhile, after the open, DIA rallied for 20 minutes before it too followed QQQ by sharply selling until 11 a.m. and then more modestly until noon. At that point, all the air went out of the market, with all three trading sideways in a very tight range the rest of the day.  On the day, SPY and DIA retested their T-line (8ema) and failed that test.  SPY also tested and crossed below its 50sma.  This action gave us large black-body candles dropping well below the consolidations in SPY and QQQ.  This action took place on average volume in the SPY and QQQ as well as slightly below-average volume in DIA.

On the day, all 10 sectors were in the red with Technology (-2.56%) way out in front of the other sectors, leading the way lower.  On the other side, Consumer Defensive (-0.46%) and Communication Services (-0.48%) held up better than the other sectors. At the same time, SPY dropped 1.68%, DIA fell 0.98%, and QQQ dropped 2.68%. VXX popped 7.41% to close at 56.11% and T2122 dropped into the middle of its oversold territory at 10.65.  At the same time, 10-Year bond yields fell again to close at 3.716% while Oil (WTI) dropped 1.43% to close at $68.16 per barrel on demand concerns.  So, Friday a big drop, led by the TSLA (-8.45%), NVDA (-4.09%), GOOGL (-4.02%), AMZN (-3.65%), and AMD (-3.65%).  (AVGO also lost 10.35% on very heavy volume after its beat on both lines and modest forecast increase did not meet market expectations.) 

The major economic news scheduled for Friday included August Avg. Hourly Earnings, which were better than expected at +0.4% (compared to a forecast of +0.3% and July’s -0.1%).  On an annual basis, August Avg. Hourly Earnings were up 3.8% (versus a 3.7% forecast and up from July’s 3.6% reading).  At the same time, August Nonfarm Payrolls were up 142k (compared to a +164k forecast but much stronger than July’s +89k).  On the private side, August Private Nonfarm Payrolls were up 118k (versus a forecast of +139k but up strongly from July’s +74k value).  The August Participation Rate remained steady at 62.7% (with July’s reading also being 62.7%).  This led to a August Unemployment Rate of 4.2% (compared to a 4.2% forecast and down a tick from July’s 4.3% reading). 

In Fed news, on Friday, New York Fed President Williams indicated that the time has come for rate cuts.  Williams said, “With the economy now in equipoise and inflation on a path to 2%, it is now appropriate to dial down the degree of restrictiveness in the stance of policy by reducing the target range for the federal funds rate.”  However, he did hedge his bets, saying “The stance of monetary policy can be moved to a more neutral setting over time depending on the evolution of the data, the outlook, and the risks to achieving our objectives.”  He concluded, “It’s pretty clear we’re going to need over time to get interest rates back to a more normal level. The problem with that statement is I’m not sure what that more normal level is and I’m not sure at all about how long that should take.”  Later, Fed Governor Waller agreed with Williams, saying “The time has come (for the Fed to begin rate cuts).”  He continued, “If the data supports cuts at consecutive meetings, then I believe it will be appropriate to cut at consecutive meetings.”  Waller also opened the door to larger cuts, saying “If the data suggests the need for larger cuts, then I will support that as well. I was a big advocate of front-loading rate hikes when inflation accelerated in 2022, and I will be an advocate of front-loading rate cuts if that is appropriate.”

In stock news, on Friday, BAC analysts reported research showing that GOOGL’s share of the internet search market increased in August, helped by its integration of AI.  The report said, GGOL has 90.5% of the search market globally, but “only” 87.9% in the US.  At the same time, Reuters reported (and the French company confirmed) that French fir Elis had made an acquisition offer to VSTS.  Later, Reuters exclusively reported that QCOM has explored the possibility of acquiring portions of INTC’s chip design business.  At the same time, activist investor hedge fund Starboard Value filed a shareholder resolution to end NWSA’s “dual-class shares” in a bid to oust Rupert Murdoch from his control of the company.  After the close, S&P announced that DELL, PLTR, and ERIE will join the S&P500 before the open on September 23.  (These will replace AAL, ETSY, and BIO, which will be dropped from the index at the same time.)  Later, TSM announced they have achieved production yields on par with Taiwanese plants at their AZ plant. This likely means that 4nm plant is on track to achieving output goals after the initial startup in April.

Meanwhile, on Saturday, the Financial Times reported that AAPL’s new iPhone (to be announced on Monday) will use ARM chips for AI technologies.  Later, STLA recalled 1.46 million vehicles worldwide, including 1.23 million in the US, due to software malfunction in the anti-lock brake system that can increase the risk of crashes.  At the same time BA’s Starliner capsule was able to make it back to earth, parachuting into the NM desert.  (It will now be shipped to FL, where it will be examined to discover what parts failed.)  In other BA news, Sunday BA announced a it has a tentative deal with a union covering 32,000 of its workers in the US Pacific Northwest. (The deal calls for a 25% wage increase over four years, a commitment to build its next commercial aircraft in that area, 12 weeks paid parental leave, and improved retirement benefits among other things.)  At the same time, ANCTF (owner of the Circle-K convenience stores) plans to make a second offer to SVNDF (owner of the 7-eleven convenience stores) according to Bloomberg. (The first offer, of $38.6 billion, was rejected at the end of last week.) Later, CNBC reported that the CEO of NSC is being investigated by the company board over engaging in an inappropriate workplace relationship.

In stock legal and governmental news, on Friday, a federal judge rejected a COIN motion to dismiss a shareholder class action suit alleging the company had played down the risk of being sued by the SEC (for buying/selling crypto being securities).  So, the shareholder suit will continue.  At the same time, the SEC fined Esmark and its Chairman for making a “false tender offer” to acquire X at $35 per share.  (The suit alleges the tender offer was made even though Esmark had no financing in place to execute on the offer, which would have required $7.8 billion in cash.)  Later, MA state security regulators fined MS $2 million for failing to monitor insider trading by FRCB prior to the bank failing.  (MS managed the stock sales of FRCB and the small bank’s Chair was allowed to execute stock sales prior to material nonpublic information being released to the market.)  At the same time, the US State Dept. approved the sale of $691 million of RTX Sidewinder missiles to the Netherlands. 

Elsewhere, a bi-partisan group of Congressman and Senators launched an inquiry into six US retailers (including AZO and AAP) over whether they bought Chinese auto parts and evaded tariffs by trans-shipping the cargoes through Thailand.  After the close Friday, Bloomberg reported that BIG is preparing to file for bankruptcy under chapter 11.  (This comes after the company postponed earnings from Sept. 6 to Sept. 12.) Friday evening, the US Federal Energy Regulatory Commission (FERC) approved BLK’s $12.5 billion (cash and stock) deal to acquire Global Infrastructure Partners (which owns many assets in the utility space).  Then, on Saturday, as part of a money laundering case, WYNN agreed to pay $130 million to the SEC and admit that it let unlicensed money transfers from around the world funnel gambler money to its flagship Las Vegas casino. This was part of a Dept. of Justice “Non-prosecution settlement.”  Finally, on Sunday, DirecTV filed an FCC complaint against DIS for anti-competitive practices and failing to negotiate in good faith.  DIS was requiring DirecTV to take an pay for less popular channels in order to distribute ESPN, while DIS offers “skinnier” bundles direct to the public.

Overnight, Asian markets were mixed but leaned toward the red side.  Singapore (+1.22%) was the outlier of four gaining exchanges.  Meanwhile, Hong Kong (-1.42%), Taiwan (-1.36%), and Shanghai (-1.06%) paced the losses.  In Europe, we see nearly green across the board at midday with only Greece (-0.26%) in the red among the 14 bourses.  The CAC (+0.84%), DAX (+0.75%), and FTSE (+0.75%) lead the region higher in early afternoon trade.  In the US, as of 7:45 a.m., Futures are pointing toward a gap higher to start the day.  The DIA implies a +0.68% open, the SPY is implying a +0.70% open, and the QQQ implies a +0.81% open at this hour.  At the same time, 10-Year bond yields are back up to 3.746% and Oil (WTI) is up 0.78% to $68.20 per barrel in early trading.

The major economic news scheduled for Monday are limited to August NY Fed 1-Year Consumer Inflation Expectations (11 a.m.) and July Consumer Credit (3 p.m.).  There are no major earnings reports scheduled for before the open. However, after the close, ORCL reports.

In economic news later this week, on Tuesday the Weekly API Crude Oil Stocks are reported.  Then Wednesday, we get August Core CPI, August CPI, and EIA Crude Oil Inventories.  On Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, August Core PPI, August PPI, WASDE Ag report, August Federal Budget Balance, and the Fed Balance Sheet are reported.  Finally, on Friday, we get August Export Price Index, August Import Price Index, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations.

In terms of earnings reports later this week, on Tuesday, we hear from ASO, CMA, PLAY, GME, and WOOF. Then Wednesday, DBI, HEPS, and TEN report. On Thursday, we hear from BIG, CAL, KR, SIG, ABDE, and RH.  Finally, on Friday, there are no reports scheduled.

So far this morning, there are no significant earnings reports.

With that background, it looks as if the Bulls are indecisively in control this morning. All three major index ETFs gapped higher to start the premarket. Since then, all three have given us indecisive, small-body and plenty of wick candles. Despite the gap higher, all three remain below their 8ema. So, the short-term trend is bearish. At the same time, the mid-term trend is mixed with the QQQ now bearish and in the long-term we still have a Bull trend with DIA and SPY. In terms of extension, QQQ remains a bit stretched below its T-line and SPY pushed toward joining it Friday. However DIA remains close enough to the 8ema. On the other hand, the T2122 indicator is back in the middle of its oversold range. So, the market is not “crazy extended” but at least the QQQ will need a pause, bounce, or reversal soon to avoid becoming out of whack in its decline. Just remember the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, all 10 are in the green this morning, led by TSLA (+1.94%). However, five of the 10 are up more than a percent and the laggard is AAPL (+0.29%). So the Bulls are in control in the Tech sector this morning.

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.

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

Markets diverged on indecision (at least momentarily) at the open.  SPY opened flat, DIA gapped up 0.21%, and QQQ gapped down 0.35%.  However, then they all three ran modestly higher for the first hour, sold off sharply until 11:30 a.m. in the QQQ, and 12:20 p.m. in the SPY and DIA.  From that point, all three made a slow, steady rally part of the way back up before starting to sell modestly at 2:55 p.m. before chopping sideways the last 15 minutes (ending on an up-tick).  This action gave us indecisive, white-bodied Spinning Top type candles in the SPY and QQQ as well as a Bearish Engulfing candle in the DIA.  SPY retested and failed its 17ema while DIA retested and failed its T-line (8ema).  This happened on less-than-average volume in all three major index ETFs.

On the day, eight of the 10 sectors were in the red with Industrials (-1.15%) and Healthcare (-1.04%) way out front leading markets lower.  Meanwhile, Communication Services (+0.53%) held up better than the others and led the two gaining sectors higher.  At the same time, SPY fell 0.24%, DIA fell 0.48%, and QQQ gained 0.09%. The VXX fell almost 5% to close at 52.24% and T2122 dropped again, this time into the lower half of its mid-range at 37.30.  10-Year bond yields fell again to close at 3.731% while Oil (WTI) was just on the red side of flat to close at $69.12 per barrel.  So, Thursday saw the rollover continue (albeit slowly) in the SPY and DIA while the QQQ tried to hold us up in a consolidation.  It is worth noting that the big dogs tried to hold the rest of the market up with NVDA (+0.94%), TSLA (+4.90%), AAPL (+0.69%), and AMZN (+2.63%) being the four most traded (dollar-volume) in the market.  Still, this may have been a waiting day as traders wait on Friday’s August Payrolls numbers. 

The major economic news scheduled for Thursday included August ADM Nonfarm Employment Change, which came in significantly lower than expected at +99k (versus a +144k forecast and July’s +111k reading).  Later, Weekly Initial Jobless Claims were a bit lower than predicted at 227k (compared to a 231k forecast and the prior week’s 232k).  On the ongoing side, Weekly Continuing Jobless Claims were down to 1,838k (versus a 1,870k forecast and the prior week’s 1,860k value).  At the same time, Q2 Nonfarm Productivity was up BIG to +2.5% (versus a +2.3% forecast and especially versus Q1’s +0.2% reading).  Meanwhile, Q2 Unit Labor Costs were much lower than anticipated at +0.4% (compared to a +0.9% forecast and down sharply from Q1’s 4.0% value).  Later, August Global Services PMI was stronger than expected at 55.7 (versus a forecast of 55.2 and July’s 55.0 number).  At the same time, August S&P Global Composite PMI that was also stronger than predicted at 54.6 (compared to 54.1 that was forecast and the prior month’s 54.3).  Later, August ISM Non-Mfg. Employment was lower than anticipated at 50.2 (versus a 50.5 forecast and July’s 51.1 reading).  At the same time, August ISM Non-Mfg. PMI was a couple ticks better than expected at 51.5 (compared to a 51.3 forecast and July’s 51.4 number).  On the cost side, August ISM Non-Mfg. Prices were up three ticks to 57.3 (versus a 56.0 forecast and a 57.0 July reading).  Later, Weekly EIA Crude Oil Inventories showed a large drawdown of 6.873 million barrels (compared to a 0.600-million-barrel drawdown forecast and the prior week’s -0.668 million barrels value).  Finally, after the close, the Fed Balance Sheet showed a $10 billion reduction from $7.123 trillion to $7.113 trillion.

After the close, AVGO and DOCU reported beats on both the revenue and earnings lines.  In addition, both companies raised forward guidance.

In stock news, on Thursday, BNY announced it had agreed to acquire Archer (a private technology and operations service for banks).  Details were not disclosed.  At the same time, the Wall Street Journal reported on data leaked by DIS that disclosed customer and staff personal information as well as company financial and strategy information. Later, F announced that US vehicle sales increased 13.4% in August on strong SUV and pickup demand.  (In addition, in a much smaller segment, F all electric sales rose 29% while hybrid sales grew almost 50%.)  At the same time, TSLA announced plans to launch “Full Self-Driving” in China and Europe (pending regulatory approval) in early 2025.  TSLA CEO Musk said they were “likely” to get approval from both regulators by the end of the year.  (TSLA closed up 4.90% on the news.)  Later, APLD (which runs data centers) announced it will receive $160 million in funding from investors including NVDA.  (APLD closed up more than 65% on the news.)  At the same time, ABT said it will be launching a continuous glucose monitoring system, a multi-billion-dollar market. 

Meanwhile, CNOB agreed to buy smaller banking competitor FLIC for $284 million.  The combined banks will have $114 billion in assets.  At the same time, FDX announce it has invested in private AI robotics company Nimble to help scale up automation in the FDX fulfillment unit.  Later, Reuters reported that BX and Vista Equity Partners are in talks to acquire SMAR in a deal valued around $7 billion.  At the same time, T said it has made its “final offer” to the striking CWA union (which has 17,000 members on strike against T).  The union told Reuters “The offer did not meet expectations.”  Later, SLTA announced it will invest $385 million in a new plant in Argentina.  After the close, the Teamsters union threatened to expand its strike from just the Detroit MPC refinery to other refineries as the company has been unwilling to negotiate with the union.  (The Detroit refinery is one of 13 MPC refineries.)  At the same time, Bloomberg reported that after the deal with Skydance Media, ORCL co-founder Larry Ellison will control PARA and his son will serve as CEO.  Also after the close, CRM announced it would buy private firm “Own Company” for $1.9 billion to accelerate the growth of its data security and privacy products.

In stock legal and governmental news, on Thursday, the SEC announced it will no longer conduct misconduct proceedings against accountants who allegedly perform malpractice or submit fraudulent audit reports for public companies.  The move comes after the pro-business, ultra-conservative SCOTUS recently rules to curtail the agency enforcement powers. Later, the EU’s highest court rejected an appeal against antitrust fines imposed by the EU antitrust regulator on AFLYY, SINGY, and British Airways.  At the same time, TX energy regulators denied a funding request for a new power plant project that would be a joint-venture of NEE and private Aegle Power.  (This is worthy of mention because TX had named the project a finalist for award of state grants to increasing state electric generation, but NEE denied being involved or consenting to be listed as an applicant for the program.)  Later, HSY filed a motion seeking the dismissal of a lawsuit which alleges the company misled consumers with holiday-themed candy packaging (when the actual product did not contain the same festive designs and/or colors).

Elsewhere, After the close, SNAP was sued by the state of NM, which alleged the platform failed to protect children from sexual exploitation.  At the same time, Nikkei reported that TM (Toyota) and NSANY (Nissan) will invest nearly $7 billion with Japanese government support to expand battery production by 50%.  Later, the Dept. of Trans. announced it is opening an inquiry into AAL, DAL, LUV, and UAL rewards and frequent flyer programs over potential unfair, anticompetitive, and deceptive practices.  At the same time, AMZN sued the NRLB, challenging the agency which had ruled AMZN must negotiate with a union after an election at the company’s New York City warehouse.  AMZN’s suit followed the conservative playbook, saying the agency’s structure is unconstitutional and had no right to rule the election results were fair.  Later, China arrested five AZN oncology division employees in Shenzhen, possibly related to the collection of patient data that infringed China’s data-privacy laws.

In miscellaneous news, OPEC+ announced they had agreed to delay a previously planned October and November oil production increase after oil prices hit their lowest levels in nine months.  Meanwhile, the Committee on Foreign Investment in the US (made up of cabinet-level members of many departments and chaired by Treasury Sec. Yellen) sent a letter to both X and Nippon Steel.  The letter said the acquisition could create US national security risks and could lead to a reduction in domestic steel production.  (This letter reflects the feelings of the vast majority of politicians on both sides of the aisle.)  However, in Japan, the Japanese PM hopeful and current Digital Minister Kono told reporters that “Governments should not intervene in deals in an arbitrary manner.”  He went on to say, “Perhaps it is the presidential election and everyone wants the labor vote, but I would hope that the market will not be distorted by such a situation.” 

Overnight, Asian markets were mostly red with just three of the 12 regional exchanges in the green. Shenzhen (-1.44%) and South Korea (-1.21%) paced the more numerous losers while Thailand (+1.66%) and Taiwan (+1.17%) led the gainers.  In Europe, with the sold exception of Belgium (+0.16%) we see red across the board at midday.  The CAC (-0.25%), DAX (-0.54%), and FTSE (-0.24%) lead the region lower in afternoon trade.  Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward a gap lower to start the day.  The DIA implies a -0.36% open, the SPY is implying a -0.61% open, and the QQQ implies a -1.06% open at this hour (ahead of PCE data).  At the same time, 10-Yead bond yields have dropped to 3.699% and Oil (WTI) is on the green side of flat at $69.27 per barrel in early trading.

The major economic news scheduled for Friday includes August Avg. Hourly Earnings, August Nonfarm Payrolls, August Private Nonfarm Payrolls, August Participation Rate, and the August Unemployment Rate (all at 8:30 a.m.). We also hear from Fed member Williams (8:45 a.m.) and Fed Governor Waller (11 a.m. and 11 p.m.).  The major earnings reports scheduled for before the open include ABM, BIG, DOOO, and GCO. Then, after the close, there are no earnings reports scheduled.

In late-breaking news, AAPL has approved a version of the TCEHY (Tencent) WeChat app for its phones ahead of next Monday’s iPhone 16 launch. (WeChat is China’s most used social media platform.)  This move is a nod to the fact Chinese phone makers have been taking market share from AAPL.  There was no word on the financial terms, but there had been a pushback from TCEHY about the cut AAPL was taking from app store apps.  Elsewhere, in another sign of corporate power, PriceWaterhouseCoopers (one of the “big four” accounting firms globally) has told 26,000 UK employees it will begin to use location data to track employees in order to ensure they spend at least 60% of their time each week in the office or at a client location.  Meanwhile, the US announced new export controls on advanced technology (particularly quantum computers and the chip-making tools needed to build them).  This brings the US in-line with allies such as the Netherlands (basically limiting ASML tech exports to China) and the UK.

So far this morning, ABM and GCO reported beats on both the revenue and earnings lines. Meanwhile, DOOO missed on revenue while posting a MASSIVE (+104.5%) beat on earnings.

With that background, it looks as if the Bears are in control ahead of data. All three major index ETFs gapped lower to start the premarket. Since then, all three have given us plenty of wick, but SPY does have a black-body candle in the early session, indicating some bearish follow-through. All three remain below their 8ema. So, the short-term trend is bearish. At the same time, the mid-term trend is mixed with the QQQ now bearish and in the long-term we still have a Bull trend with DIA and SPY. In terms of extension, QQQ remains a bit stretched below its T-line but the other two are not far from that average. At the same time, the T2122 indicator is back in the lower half of its mid-range. So, the market is not “too extended” but the QQQ will need more pause, bounce, or reversal soon to avoid becoming out of whack in its decline. Just remember the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, nine of the 10 are in the red this morning. Only INTC (+0.10%) holds on to green territory. However, NVDA (-1.30%) and TSLA (-0.66%), which are by far the biggest dogs in terms of dollar-volume traded, are pulling tech and the whole market lower early. Finally, don’t forget this is Friday, payday, and time to ready your account for the weekend.

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.

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

Wednesday was an up-and-down day in the market.  SPY gapped down 0.35%, DIA opened just 0.05% lower, and QQQ gapped down 0.69%.  At that point, all three major index ETFs rallied steadily until shortly after 11 a.m. when they hit the high of the day.  However, then we reversed again and all three sold off, reaching the lows of the day at about 3:15 p.m. only to bounce again the final 45 minutes.  This gave us white-bodied, Inverted Hammer type candles in all three major index ETFs.  DIA retested (and failed) its T-line (8ema) from below while SPY retested (and passed) its 50sma from above.  This happened on below-average volume in the SPY, DIA, and QQQ.

On the day, seven of the 10 sectors were in the red with Energy (-1.10%) way out front leading the market lower.  Meanwhile, Utilities (+1.00%) held up far better than any of the other sectors.  At the same time, SPY fell 0.23%, DIA gained 0.02%, and QQQ fell 0.26%. The VXX gained another 2.67% to close at 54.97% and T2122 pulled back a bit more into the mid-range at 56.19.  10-Year bond yields fell again to close at 3.759% while Oil (WTI) dropped again by 2.12% to close at $68.85 per barrel.  So, Wednesday was a volatile, but ultimately nothing day with traders waiting on Thursday’s Weekly Unemployment Claims or maybe even on Friday’s August Payrolls numbers. 

The major economic news scheduled for Wednesday included July Exports, which came in a bit higher than expected at $266.60 billion (compared to a June $265.30 billion value).  At the same time, July Imports also exceeded predictions at $345.40 billion (versus June’s $338.00 billion).  Together, those gave us a July Trade Balance that was exactly as expected at -$78.80 billion (compared to a -$78.80 billion forecast but up slightly from June’s -$73.00 billion reading).  Later, July Factory Orders were strong er than anticipated at +5.0% (versus a +4.7% forecast and vastly better than June’s -3.3% number).  At the same time, July JOLTs Job Openings were lower than predicted at 7.673 million openings (compared to a forecast calling for 8.090 million and a June reading of 7.910 million).  It is worth noting this is the lowest number of job openings since early 2021.  Finally, after the close, the API Weekly Crude Stocks report showed a MASSIVE drawdown of 7.400 million barrels (versus forecasts calling for 0.900-million-barrel drawdown and even relative to the prior week’s 3.400- million-barrel draw).

In Fed news, on Wednesday, Atlanta Fed President Bostic warned against holding rates too high for too long.  Bostic posted an essay on the Atlanta Fed website saying, “We must not maintain a restrictive policy stance for too long.”  He continued, saying that waiting on inflation to reach the 2% goal (before cutting) “would risk labor market disruptions that could inflict unnecessary pain and suffering.”  Bostic concluded by saying, “I do not sense a looming crash or panic among business contacts. However, the data and our grassroots feedback describe an economy and labor market losing momentum.”  Later, the Fed Beige Book showed that the economy expanded more slowly from the middle of July through August 26.  It stated, “Economic activity grew slightly in three districts, while the number of districts that reported flat or declining activity rose from five in the prior period to nine in the current period.”  The report continued, “Employers were more selective with their hires and less likely to expand their workforces, citing concerns about demand and an uncertain economic outlook.”  Again, the report supports the idea of a rate cut in September.

After the close, HPE reported beats on both the revenue and earnings lines. At the same time, CASY missed on revenue while beating on earnings.  However, CPRT missed on both the top and bottom lines.

In stock news, on Wednesday, the Nordstrom family made an offer to take JWN private for $23 per share in cash.  (This offer was practically no premium compared to the Tuesday close, and JWN stock ended the day down 0.18%.)  At the same time, VLVLY (Volvo) announced plans to update its hybrid line as the company shifted away from its previously-stated “pure electric by 2030” strategy.  Later, X warned of thousands of job cuts if its acquisition by Nippon Steel is blocked. This came after reports the (President Biden is prepared to block the deal and with both Presidential candidates also vowing to block it.)  At the same time, NSC announced it had reached a tentative agreement with another union, this time the one representing conductors.  (This brings the total tentative union agreements in place to cover 65% of the NSC workforce.)  

Elsewhere, later, a GM joint venture (with Korean LG Energy) agreed to recognize the UAW union at its battery plant in TN.  At the same time, the founder of LOGI lost a proxy battle in which he had tried to oust current board chairman Becker.  (Becker was re-elected with 86% of the shareholder votes.)  Later, the Wall Street Journal reported that VZ is in “advanced talks” to acquire FYBR.  (FYBR closed up almost 38% on the report.)  At the same time, LYFT announced it will stop offering standalone dockless bikes and scooters and eliminate one percent of it jobs as part of a restructuring. Later, BX announced it will buy Aussie data center company AirTrunk for $16.10 billion.

In stock legal and governmental news, on Wednesday, tow of the Consumer Products Safety Commission Commissioners called for the agency to investigate two Chinese e-tailers (Temo, owned by PDD, and Shein) after products the agency has labeled “deadly baby and toddle products” were sold from the site to US customers. At the same time, the NHTSA announced it has closed an investigation into 1.3 million GM vehicles over seatbelt issues.  Later, EU antitrust regulators announced they are seeking comment on GOOGL’s proposed resolution to comply with EU fair competition rules. (The GOOGL proposal is to create a separate “product box” for competitors to be located below the GOOGL “featured products” box on its various pages.  The idea is expected to face stiff opposition from competitors.) 

Elsewhere, at the same time, a DE judge ruled JNJ owes Auris Health shareholders $1 billion in damages for breaching a 2019 agreement to acquire the private robotics developer.  Later, Reuters reported that JNJ plans to add another $1.1 billion to its settlement proposal over talc damage claims. (The previously announced settlement was $8 billion over 25 years.)  After the close, Reuters reported that ASML CEO Fouquet is pushing back against restrictions.  He told the news outlet that the US-led campaign (which the Dutch government supports) to restrict technology exports to China is “economically motivated” and that making a case for the sanctions based on national security “is getting harder and harder.” Later, HOOD agreed to pay $3.9 million to settle allegations brought by the CA Attorney General for failing to allow customers to withdraw cryptocurrency from their accounts from 2018 to 2022.

In miscellaneous news, C reported the results of its survey of 500 brokers and other firms that are involved in trade settlement.  The survey found that the shift to “T+1 settlement” had a bigger impact than expected for 44% of firms on both the buy and sell side.  Both sides also cited “stock lending” (shorting) as the most impacted and challenging.  52% reported they needed to add staff, which interestingly showed they had a preference for adding headcount rather than using automation and indicated a risk (according to C) because hiring was not scalable in short timeframes.  Meanwhile, the job openings data on Wednesday caused a shift in the Fedwatch September rate cut outlook.  On Tuesday 38% of Fed Fund Futures contracts predicted a half point cut while 62% were betting on a quarter point cut. (Zero current contracts expect no cut or a raise.)  However, as of Wednesday’s close that had shifted to 45% expecting a 50-basis point cut on the 18^th while 55% expect only the quarter-point reduction.

Overnight, Asian markets were mixed but leaned toward the green with seven of the 12 exchanges in the region posting gains.  Thailand (+2.94%) was by far the biggest gainer while Japan (-1.05%) was by far the big loser.  In Europe, we also see a mixed picture taking place at midday with six of the 14 exchanges above water.  The CAC (-0.28%), DAX (+0.30%), and FTSE (-0.10%) leading the region in early afternoon trade.  In the US, as of 7:45 a.m., Futures are pointing toward a mixed and flat start.  The DIA implies a +0.08% open, the SPY is implying a +0.03% open, and the QQQ implies a -0.11% open at this hour.  At the same time, 10-Year bond yields are at 3.77% and Oil (WTI) is up 0.33% to $69.42 per barrel in early trading.

The major economic news scheduled for Thursday include August ADM Nonfarm Employment Change (8:15 a.m.), Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Q2 Nonfarm Productivity, and Q2 Unit Labor Costs (all at 8:30 a.m.), August S&P Global Composite PMI and August Global Services PMI (both at 9:45 a.m.), August ISM Non-Mfg. Employment, August ISM Non-Mfg. PMI, and August ISM Non-Mfg. Prices (all at 10 a.m.), Weekly EIA Crude Oil Inventories (11 a.m.), and Fed Balance Sheet (4:30 p.m.).  The major earnings reports scheduled for before the open include GIII, KFY, NIO, SAIC, and TTC.  Then, after the close, AVGO and DOCU report.

In economic news later this week, on Friday, we get August Avg. Hourly Earnings, August Nonfarm Payrolls, August Private Nonfarm Payrolls, August Participation Rate, and the August Unemployment Rate.  We also hear from Fed members Williams and Waller (twice).

In terms of earnings reports later this week, on Friday, we hear from ABM, BIG, DOOO, and GCO.

So far this morning, KFY, NIO, and SAIC reported beats on both the revenue and earnings lines.  Meanwhile, GIII missed on revenue while beating on earnings.

With that background, it looks as if markets are undecided. All three major index ETFs gapped modestly higher to start the premarket. However, all three have also printed small black-body candles since then to get back to either side of flat in the early session. DIA retested its T-line, but all three remains below their 8ema. So, the short-term trend is bearish. At the same time, the mid-term trend is still bullish (although it is being pressed hard in the QQQ) and in the long-term, remains in a Bull trend with DIA and SPY still close to all-time highs. In terms of extension, QQQ remains stretched below its T-line but the other two are not far from that average. At the same time, the T2122 indicator is back in the middle of its mid-range. So, the market is not “too extended” but the QQQ will need a pause, bounce, or reversal soon to avoid becoming out of whack in its decline. Just remember the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, seven of the 10 are in the red this morning. However, TSLA (+3.03%) is by far the biggest mover both in terms of price and not far from leading in volume. (TSLA has traded nearly the same amount as that biggest dog NVDA (-0.10%) and both are about 10 times as much dollar volume traded as the next most traded ticker this morning.

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.

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

The Bears were in control Tuesday as a traditionally weak September kicked off.  SPY gapped down 0.54%, DIA gapped down 0.50%, and QQQ gapped down 0.65%.  After that open, DIA sold off sharply for 45 minutes, SPY did the same for 80 minutes, and QQQ sold off sharply until 11 a.m.  From there, all three ground mostly sideways until 1:30 p.m. when the next leg down started and ran until the last 5 minutes.  This action gave us large, black candles with lower wicks.  All three major index ETFs crossed below their T-line (8ema), with SPY and QQQ also crossing below their 17ema while DIA bounced up off its own 17ema.  This all happened on average volume in the SPY, QQQ, and DIA. 

On the day, eight of the 10 sectors were in the red with Technology (-3.92%) and Basic Materials (-3.67%) down hard and leading the way lower. Meanwhile, Communications Services (+0.66%) and Consumer Defensive (+0.30%) holding up better than others and being the only green sectors. At the same time, SPY dropped 2.06%, DIA dropped 1.43%, and QQQ dropped 3.04%.  The VXX spiked more than 20% to close at 53.54% and T2122 dropped out of its overbought territory and into the mid-range at 59.06. 10-Year bond yields fell to close at 3.833% while Oil (WTI) plummeted 4.28% to close at $70.40 per barrel.  So, Monday was “all Bears, all the time” as the post-holiday blues started in tech and spread everywhere.  NVDA (-9.53%) gapped down almost three percent but was down 4.67% by 9:35 a.m.  That one ticker also traded more than three times as much dollar-volume than the next biggest ticker (TSLA, -1.64%).  This meant technology created a tide the rest of the market could not swim against.

The major economic news scheduled for Tuesday includes August S&P Global US Mfg. PMI came in a tick lower than expected at 47.9 (compared to a 48.0 forecast and 49.6 July reading).  Later, July Construction Spending remained the same, but that was not as good as anticipated at -0.3% (versus a forecast of +0.1% and June’s -0.3% value).  At the same time, August ISM Mfg. Employment was up to 46.0 (compared to July’s 43.4 number).  Meanwhile, the headline August ISM Mfg. PMI was up but still a few ticks below predictions at 47.2 (versus a 47.5 forecast but also above July’s 46.8 value).  Finally, August ISM Mfg. PMI Prices were up to 54.0 (versus a 52.1 forecast and a July reading of 52.9).

In Fed news, the San Francisco Fed released a report Tuesday that said it expects housing inflation to fall over the next year based on a study of supply and demand.  The paper indicated that this will likely add to downward pressure on overall inflation.  The report stated, “In recent months housing inflation has come down, but it remains well-above pre-pandemic levels and continues to account for a large share of overall inflation.”  The study found that by year’s end shelter inflation may drop to as low as 2%, before reverting next year to its 3.3% pre-pandemic average.  This led the report to conclude, “This will contribute downward pressure to inflation overall, although the extent and speed of this adjustment in shelter inflation is highly uncertain.”

After the close, ZS reported beats on both the revenue and earnings lines.

In stock news, on Tuesday, CPCAY (Cathay Pacific Airways) announced it has conducted an inspection of its entire EADSY (Airbus) A350 fleet after an in-flight failure of an engine part.  The inspection found 15 jets where the part needed to be replaced.  Later, STZ announced it will write down the value of its wine and spirits unit and take up to a $2.5 billion charge in the current quarter due to several weak quarters of US demand.  It also trimmed its revenue growth forecast from 6%-7% down to 4%-6%.  (STZ reports the current quarter results on 10/3.)  At the same time, CG announced it is picking banks to underwrite its $4.7 billion IPO of its Acrotec Zurich unit.  Later, Reuters reported that multiple analysts tell it INTC is likely to be dropped from the DIA after the chipmaker stock has fallen 60% this year.  (This would trigger further sales as funds that own all DIA components would be forced to sell their INTC positions.)  No timeline was given.  However, the underlying DJIA does rebalance weights at the end of each quarter.  So, September 30 would seem a logical candidate date. 

Elsewhere, at the same time, the Unite Here union announced its strike at MAR, HLT, and H hotels in Seattle and Baltimore has concluded after three days.  However, the strike at hotels from the same chains in seven other cities will continue.  In other union news, the CWA union (Communications Workers of America) withdrew from mediation with T, saying the process was just a delaying tactic by the company.  17,000 of T’s workers have been on strike for more than two weeks.  After the close, CRM announced it had agreed to acquire Tenyx (an AI-powered voice agent technology startup) for an undisclosed sum.  Also after the close, Reuters reported the US gasoline futures fell 6% Tuesday (the biggest one-day loss since July 2022) to their lowest level since December 2021.

In stock legal and governmental news, on Tuesday, Reuters reported that the US (Medicare) will still pay at least twice as much for the prescription drugs where it has negotiated prices for the first time compared to what other high-income countries pay.  The lower prices will save the US $6 billion in 2026 but are still far higher than many countries with national health systems pay.  At the same time, NFE announced it has received US Dept. of Energy authorization to export liquified Natural Gas to “Non-FTA” countries (i.e. countries that do not have a free trade agreement with the US).  NFE said it is expecting incremental revenue growth from its sales to Latin America, Brazil, and Jamaica for example.  Later, ABNB asked New York City to reconsider regulations for short-term rentals that went into effect a year ago.  The company said the rules had caused it major issues (an 83% decline in ABNB rental postings for stays of less than 30 days in NYC) while having virtually no impact on the apartment vacancy rate (at least according to the data ABNB cited).  After the close, the SEC announced that six credit rating agencies have agreed to pay $49 million in civil penalties over failures in recordkeeping and reporting. This includes the three major agencies MCO, SPGI, and Fitch.

In mortgage news, this morning the Mortgage Bankes Assn. released its weekly look at the mortgage market. This week, they report mortgage refinance demand is up 94% as compared to one year ago as interest rates (modestly) continued to fall.  (However, this was down three-tenths of a percent from the week before.)  The national average 30-year, fixed-rate, conforming loan mortgage was a 6.43% last week, down one tick from the week before.  New home purchase loan mortgage applications were also up 3% for the week, but that was still 4% lower than one year prior.  Overall, this led to a 1.6% increase in mortgage applications from the previous week.

Overnight, NVDA (as well as other companies) was subpoenaed by the US Justice Dept.  This is part of a DOJ investigation into NVDA violating antitrust laws by making it harder for companies to switch suppliers of AI-accelerator processing units.  The investigation also is looking into NVDA sales practices that financially penalize buyers that don’t exclusively use NVDA chips.  (NVDA is far and away to market leader in this space with AMD the only competitor of significance although INTC has just recently announced a chip to compete in that space.)  Previously, DOJ had sent questionnaires to many companies in the AI space, but these are legally-binding information requests.

Also overnight, Asian markets were heavily in the red with only two of the 12 regional exchanges hanging onto green territory.  Taiwan (-4.52%), Japan (-4.24%), and South Korea (-3.15%) all suffered badly on the big chip losses in reaction to the US Tuesday leading the region lower.  In Europe, we also see a red picture with just two of the 14 bourses in the green at midday. The CAC (-0.89%), DAX (-0.77%), and FTSE (-0.57%) are leading the region down in early afternoon trade.  Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward some follow-through on Tuesday’s losses.  The DIA implies a -0.19% open, the SPY is implying a -0.45% open, and the QQQ implies a -0.81% open at this hour.  At the same time, 10-Year Bond yields are down to 3.81% and Oil (ETI) has popped back 1.09% to $71.14 per barrel in early trading.

The major economic news scheduled for Wednesday includes July Exports, July Imports, and July Trade Balance (all at 8:30 a.m.), July Factory Orders and July JOLTs Job Openings (both at 10 a.m.), Fed Beige Books (2 p.m.), and API Weekly Crude Stocks (4:30 p.m.).  The major earnings reports scheduled for before the open include, CIEN, CNM, DKS, DLTR, HRL, and REVG.  Then, after the close, CASY, CPRT, and HPE report.

In economic news later this week, on Thursday, August ADM Nonfarm Employment Change, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Q2 Nonfarm Productivity, Q2 Unit Labor Costs, August S&P Global Composite PMI, August Global Services PMI, August ISM Non-Mfg. Employment, August ISM Non-Mfg. PMI, August ISM Non-Mfg. Prices, Weekly EIA Crude Oil Inventories, and Fed Balance Sheet are reported.  Finally, on Friday, we get August Avg. Hourly Earnings, August Nonfarm Payrolls, August Private Nonfarm Payrolls, August Participation Rate, and the August Unemployment Rate.  We also hear from Fed members Williams and Waller (twice).

In terms of earnings reports later this week, on Thursday, GIII, KFY, NIO, SAIC, TTC, AVGO, and DOCU report.  Finally, on Friday, we hear from ABM, BIG, DOOO, and GCO.

So far this morning, CIEN and DKS reported beats on both the revenue and earnings lines.  Meanwhile, HRL and REVG missed on revenue while beating on earnings.  However, DLTR missed on both the top and bottom lines.

With that background, it looks as if the Bears continue to have control in the premarket. All three major index ETFs gapped down to start the early session. However, since that point SPY and QQQ have printed very indecisive (wick heavy) premarket candles while DIA is more decisive, but still a small candle. All three are now well below their T-line (8ema). So, the short-term trend is bearish. At the same time, the mid-term trend is still bullish (although it is being pressed hard in the QQQ) and in the long-term, remains in a Bull trend with DIA and SPY still close to all-time highs. In terms of extension, QQQ is stretched below its T-line but the other two are not far from that average. At the same time, the T2122 indicator is back in the middle of its mid-range. So, the market is not “too extended” but the QQQ will need a pause, bounce, or reversal soon to avoid becoming out of whack in its decline. Just remember the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, nine of the 10 are in the red this morning with only AMD (+1.76%) in the green. However, the the biggest dog NVDA (-1.59%) is out front leading the way lower on heavy volume (6.5 times the volume of the second heaviest dollar-volume so far today). Part of this is the news that yesterday’s drubbing took $300 billion off NVDA’s market cap and the weak hands are still abandoning ship.

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.

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

Friday was a volatile, bullish day to end the pre-holiday week and month.  SPY gapped 0.45%, DIA opened 0.17% higher, and QQQ gapped up 0.90%.   After the open, all three major index ETFs traded sideways until 10:50 a.m.  At that point, all three sold off, reaching the lows of the day at 12:40 p.m.  From there, all three rallied the rest of the day, spiking to new highs the last 10 minutes.  This action gave us white-bodied, Hammer-type candles in all three major index ETFs.  All three retested and passed the test of their t-line (8ema) as support and closed at the top end of their candles. This happened on slightly above-average volume in the SPY, slightly below-average volume in the QQQ, and below-average volume in the DIA. 

On the day, nine of the 10 sectors were in the green with Consumer Cyclical (+1.07%) and Technology (+1.03%) leading the way higher.  On the other side, Energy (-0.03%) lagged and was the only sector in the red. Meanwhile, SPY gained 0.95%, DIA gained 0.56%, and QQQ gained 1.19%. The VXX fell 3.01% to close at a very low 44.50% and T2122 rose slightly to remain in the top half of its overbought territory at 93.18. 10-Year bond yields rose to close at 3.909% while Oil (WTI) fell a bit to close at $75.55 per barrel.  So, Friday ended the week (and month) on another strong note. DIA printed yet another new all-time high and all-time high close.  For its part, QQQ also crossed back above its 50sma. 

For the week, SPY gained 0.28% and DIA gained 1.06% on their fourth consecutive week of gains.  Meanwhile, QQQ lost 0.78% on a Bearish Harami that retested and stayed above its T-line while printing the its first down week after three weeks of gains.   Looking at the month, SPY was up 2.34% on a white Hammer or Hanging Man that retested and passed the test of the monthly T-line.  DIA did the same on a 1.89% monthly gain and QQQ also followed suit on a 1.10% increase.

The major economic news scheduled for Friday included July Year-on-Year Core PCE Price Index, which stayed flat at +2.6% (compared to a forecast of +2.7% and June’s 2.6% value). On a Month-on-Month basis, July Core PCE Price Index, was flat at 0.2% (versus the forecast and June reading which were both +0.2%).  On the headline side, the July PCE Price Index (Year-on-Year) also came in flat at +2.5% (lower than the +2.6% forecast but in-line with the June reading of 2.5%).  On the monthly basis, the headline July PCE Price Index was just like the Core numbers, flat at 0.2% (versus the forecast and June reading which were both +0.2%).  Meanwhile, the July Personal Spending was up, as predicted at +0.5% (compared to a +0.5% forecast and June’s +0.3% reading).  Later, the August Chicago PMI was stronger than predicted at 46.1 (versus a 45.0 forecast and July’s 45.3 value).  Shortly afterward, Michigan Consumer Sentiment was reported as up and also a tick better than predicted at 67.9 (compared to a 67.8 forecast and July’s 66.4 reading).  At the same time, Michigan Consumer Expectations were up and in-line with forecasts at 72.1 (versus a July value of 68.8).  On the inflation front, Michigan 1-Year Inflation Expectations were down a tick to 2.8% (compared to a forecast and previous reading of 2.9%).  Looking further out, Michigan 5-Year Inflation Expectations stayed flat at 3.0% (compared to a forecast and prior value of 3.0%).

In stock news, on Friday, Bloomberg reported that a large-scale study started during the pandemic found that NVO’s weight loss and diabetes drug Wegovy also reduced both deaths and hospitalizations from Covid-19.  At the same time, NSC announced it had reached tentative 5-year labor contracts with five unions covering thousands of its employees.  The contracts, which provide a 3.5% average annual wage increase as well as more paid time off and better healthcare must still be ratified by members of the unions.  Later, GM and LAC “agreed to delay” an additional investment from GM into the lithium miner until the end of the year.  At the same time, Reuters reported that the Chinese state-backed Sinochem is planning to sell its 40% stake in a shale oil joint venture it is part of with XOM.  The sale would end an 11-year Sinochem involvement in the shale oil business in the TX Permian Basin. 

After the close, GS announced it will lay off “a few hundred” employees as part of its annual performance review process. (In 2023, this process resulted in between 1% and 5% of its staff being let go.)  GS said this is normal and it still expects to have more employees at the end of 2024 than it did at the end of 2023.  (GS had 44,300 employees as of June 30.)  At the same time, BRKB filed with the SEC, saying it had sold another 21.1 million shares of BAC for $845 million between August 28 and August 30.  (This makes more than $6 billion of BAC that Buffett’s BRKB has sold during August.)  On Sunday, 10k hotel workers went on strike against 24 locations run by MAR, H, and HLT hotels.  The union said the strike will be multi-day and will be rolling (on-again, off-again) to cause maximum disruption until a new contract has been reached.

In stock legal and governmental news, on Friday, India approved the $8.5 billion merger between DIS’s Indian unit and Reliance Industries.  Later, China announced that TSLA is recalling 870 imported TSLA vehicles.  At the same time, RTX agreed to pay a $200 million fine to settle allegations that the company violated US export laws by shipping product and data to prohibited countries (China).  (Among other violations, RTX gave China details about an aluminum instrument display component of the F-22 fighter aircraft.)  Later, the FDA authorized the use of NVAX’s COVID vaccine, which had been updated to fight the new JN.1 variant of the disease.  At the same time, CAH, MCK, and COR (the three largest US drug distributors) agreed to pay $300 million to resolve claims by health insurers that the companies had helped fuel the opioid crisis.   (The same companies had agreed to pay $21 billion to states and local governments to settle the same charges.)  

Elsewhere, after the close, CTLT reported that it is unable to file its annual report (which was expected on August 29) while it is waiting on the closing of the $16.5 billion takeover by NVO that was announced in February.  On Saturday, the NHTSA announced F will recall almost 91k vehicles over engine valve intakes that may break during operation.  (F will perform tests on each vehicle and replace engines as required as part of the remedy.)  On Monday, HPQ said it would continue its $4 billion lawsuit against now-deceased British billionaire Mike Lynch related to what it alleges was fraudulently-inflated value of a company HPQ acquired from Lynch in 2011.

In miscellaneous news, on Friday Bloomberg reported that the level of conviction in the economy is soaring.  It reported that August was the fourth straight month of gains in ETFs tracking for government debt, corporate debt, and equities.  That was the longest consecutive stretch of correlated gains across those assets since 2007.  At the same time, the S&P 500 is up 25% in the past 12 months…that most it has climbed in the run up to a first rate cut in history.  So, the Fed got it right and we got the soft landing we had all hoped would happen.  Elsewhere, in a deeper-dive into PCE data, Bloomberg reported that the metric economists say is a more accurate gauge of inflation, the 3-month annualized average, showed a 1.7% increase…the slowest since 2023. 

Overnight, Asian markets were mostly red with only four of the 12 regional exchanges in the green.  With that said, the big movers were green as Shenzhen (+1.17%) and Thailand (+0.81%) led the gains and Taiwan (-0.64%) and South Korea (-0.61%) paced the losses.  In Europe, we nearly see red across the board with just two of the 14 bourses in the green at midday.  The CAC (-0.23%), DAX (-0.38%), and FTSE (-0.48%) lead the region lower in early afternoon trade.  Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward a gap down to start the day.  The DIA implies a -0.48% open, the SPY is implying a -0.53% open, and the QQQ implies a -0.76% open at this hour.  At the same time, 10-Year bonds are up to 3.911% and Oil (WTI) is down 1.9% to $72.17 per barrel in early trading.

The major economic news scheduled for Tuesday includes August S&P Global US Mfg. PMI (9:45 a.m.), July Construction Spending, August ISM Mfg. Employment, August ISM Mfg. PMI, and August ISM Mfg. PMI Prices (all at 10 a.m.).  There are no major earnings reports scheduled for before the open.  Then, after the close, the only significant report scheduled is ZS.

In economic news later this week, on Wednesday we get July Exports, July Imports, July Trade Balance, July Factory Orders, July JOLTs Job Openings, Fed Beige Books, and API Weekly Crude Stocks. The Thursday, August ADM Nonfarm Employment Change, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Q2 Nonfarm Productivity, Q2 Unit Labor Costs, August S&P Global Composite PMI, August Global Services PMI, August ISM Non-Mfg. Employment, August ISM Non-Mfg. PMI, August ISM Non-Mfg. Prices, Weekly EIA Crude Oil Inventories, and Fed Balance Sheet are reported.  Finally, on Friday, we get August Avg. Hourly Earnings, August Nonfarm Payrolls, August Private Nonfarm Payrolls, August Participation Rate, and the August Unemployment Rate.  We also hear from Fed members Williams and Waller (twice).

In terms of earnings reports later this week, on Wednesday we hear from CIEN, CNM, DKS, DLTR, HRL, REVG, CASY, CPRT, and HPE.  Then Thursday, GIII, KFY, NIO, SAIC, TTC, AVGO, and DOCU report.  Finally, on Friday, we hear from ABM, BIG, DOOO, and GCO.

With that background, QQQ gapped lower to start the premarket session and has printed an indecisive, black-body candle since then that did more price back below its T-line (8ema) as that retest begins again. Meanwhile, SPY and DIA opened the early session more or less flat before trading decidedly bearish in larger black-body candles. (To be fair, both are still not down to a retest of their T-line. So the damage is not heavy.) So, the short-term trend is still bullish. At the same time, the mid-term trend is bullish and in the long-term, we are now clearly back in a Bull trend with DIA sitting just below all-time highs on the pre-market pullback and SPY less than a percent from its own high-water mark. In terms of extension, none of the major index ETFs are too far extended from their T-line. However, the T2122 indicator is in the top half of its overbought territory. So, the market could use a pause or pullback. However, remember the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, nine of the 10 are in the red this morning with the the biggest dog NVDA (-2.03%) out front leading the way lower the second biggest TSLA (+0.76%) holding up by far the best.

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.

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