Stock futures edged up slightly on Wednesday as Wall Street eagerly awaited a long-anticipated rate decision from the Federal Reserve. This follows a prolonged period of aggressive rate hikes aimed at curbing high inflation. The Fed is set to announce its latest policy decision at 2 p.m. ET, with expectations of a rate reduction of at least a quarter percentage point. However, there is some uncertainty among traders regarding the exact size of the cut.
European markets experienced a decline on Wednesday. The U.K.’s inflation rate for August was reported at 2.2% by the Office for National Statistics, remaining unchanged from July and meeting expectations. This data precedes the upcoming Bank of England meeting, where a decision on interest rate policy is anticipated later this week.
Asia-Pacific markets saw a positive trend on Wednesday, with Australia’s S&P/ASX 200 continuing its multi-day winning streak to reach an all-time high. In Japan, the Ministry of Finance reported that imports and exports for August increased by 2.3% and 5.6%, respectively, compared to the previous year. However, these figures fell short of the Reuters poll estimates, which had projected growth of 13.4% for imports and 10% for exports. Meanwhile, markets in South Korea and Hong Kong remained closed, and mainland China resumed trading following a three-day national holiday.
Economic Calendar
Earnings Calendar
Notable reports for Thursday before the bell include GIS. After the bell includes SCS.
News & Technicals’
This week’s Federal Open Market Committee (FOMC) meeting is shrouded in uncertainty, as analysts debate whether the Federal Reserve will opt for the traditional 25-basis-point rate reduction or take a more aggressive approach with a 50-basis-point cut. The decision is eagerly anticipated by Fed watchers, who remain divided on the likely outcome. In addition to the rate cut decision, the meeting promises to be eventful, featuring updates on future rate cut projections and adjustments to economic estimates.
All seven independent directors of 23andMe resigned from the company’s board on Tuesday, effective immediately. These directors had formed a special committee in March to assist the struggling company in finding a new direction. In a memo to employees, CEO Anne Wojcicki expressed her surprise and disappointment at their decision to step down.
Tupperware Brands, along with some of its subsidiaries, filed for Chapter 11 bankruptcy protection on Tuesday. This decision comes in response to declining demand for its once-iconic food storage containers and increasing financial losses. CEO Laurie Goldman stated in a press release that the company’s financial position has been significantly affected by the challenging macroeconomic environment over the past several years.
At Salesforce’s annual Dreamforce conference in San Francisco, CEO Marc Benioff discussed the practical applications of the company’s new artificial intelligence product, “Agentforce,” with CNBC’s Jim Cramer on Tuesday. Benioff highlighted how the technology can assist overworked medical professionals, particularly those experiencing burnout after the pandemic. He emphasized that Agentforce can handle tasks such as scheduling and various aspects of patient interaction, which he believes will help alleviate the burnout issue among doctors and nurses.
The anticipated rate decision is just around the corner at 2 PM Eastern today followed by the Powell press conference. The entire financial world will be tuned into this decision and traders should be prepared for just about anything from big point moves and fast intrada whipsaws as the market reacts. Will it be a 25-basis point or 50-basis point? Will the market celebrate or be disappointed? We will soon find out, so buckle up for a wild afternoon as the market reacts.
Tuesday saw the Bulls go get their new all-time highs and then the Bears fade those gains. SPY gapped up 0.39%, DIA gapped up 0.23%, and QQQ gapped up 0.63%. After that open, all three major index ETFs chopped and then rallied to new highs by mid-morning. Having achieved new all-time highs in SPY and DIA as well as breaking the downtrend line in the QQQ, then the Bears took over to drive the market to lows by early afternoon. From there, all three chopped sideways between their lows and the previous close for the rest of the day. This action gave us black-bodied, indecisive, Spinning Top type candles in all three major index ETFs. The SPY printed a new all-time high and had a gain for the day, but closed slightly below an all-time high close. The DIA did the same, except for closing seven cents below Monday’s close. At the same time, QQQ gapped up and retested its downtrend line reaching back to the all-time high in July. However, it closed back below that line. This happened on less than average volume.
On the day, six of the 10 sectors were in the green again, with Energy (+1.07%) out in front of the others leading the market higher. On the other side, Communications Services (-0.99%) lagged behind the other sectors. Meanwhile, SPY increased 0.04%, DIA lost 0.03%, and QQQ gained 0.05%. VXX gained 2.15% to close at 50.30% and T2122 fell slightly again but remains in the top half of its over-bought range at 92.34. At the same time, 10-Year bond yields gained to close at 3.644% while Oil (WTI) gained 1.75% to close at $71.32 per barrel. So, Tuesday saw the Bulls get their new all-time highs in the large-cap indexes. However, then traders took profits, afraid to hold too much long risk going into tomorrow’s Fed decision, statement, and press conference.
The only major economic news scheduled for Tuesday included the August Month-to-Month Core Retail Sales, which were lower than expected at +0.1% (versus a forecast of +0.2% and the July reading of +0.4%). On the headline number, August Month-to-Month Retail Sales were stronger than expected at +0.1% (compared to a forecast of -0.2% but down a full percent from July’s +1.1%). Later, the August Month-on-Month Industrial Production was much stronger than anticipated at +0.8% (versus a +0.2% forecast and far better than July’s -0.9% value). For the annual number August Year-on-Year Industrial Production was improved at +0.04% versus July’s -0.74% reading. Meanwhile, July Month-on-Month Business Inventories grew by 0.4% (compared to a forecast and June value of +0.3%). On the store front side, July Retail Inventories came in as anticipated at +0.5% (versus the +0.5% forecast and up from June’s +0.3% reading). Then, after the close, Weekly API Crude Oil Stocks showed an inventory build of 1.960 million barrels (compared to a forecasted drawdown of 0.100 million barrels and the prior week’s 2.790-million-barrel drawdown).
In stock news, on Tuesday, BA and union negotiators resume contract talks as the strike against the company continues. (Analysts report the strike is costing BA $100 million per day in lost sales revenue.) At the same time, PM announced it would sell its Vectura Group (asthma inhaler maker) to Molex Asia for $198 million. Later, WMT said it will raise the pay of 100k “Sam’s Club” workers in November. The entry-level pay will go from $15/hr. to $16/hr. (This was part of a labor deal struck three years ago.) At the same time, META announced effective immediately it has rolled out “teen accounts” for its Instagram platform, which automatically puts those under age 18 in an account with extra privacy features and parental controls. Separately, META announced it had banned Russian state media RT for “foreign election interference.” At the same time, the Wall Street Journal reported that JPM is in talks with AAPL about taking over the tech giant’s credit card business from GS.
Elsewhere, Reuters reported that ARKO is planning to sell its convenience store operations (1,500 stores) for around $2 billion. (This is a reversal of company strategy and would leave it with a fuel distribution unit that serves 1,800 independent gas stations and 300 unmanned fueling sites.) Later, Nippon Steel’s CEO (who travelled to Washington to lobby for the deal) told reporters he is now confident the deal to acquire X will be approved “on the merits.” At the same time, MSFT and BLK announced they plan to launch a $100 billion fund to invest in AI infrastructure to build data centers and fund energy projects. Later, after the close, BLNK announced it will lay off 14% of its global workforce (about 100 jobs) by the end of Q1 2025 in a cost-cutting program.
In stock legal and governmental news, on Tuesday, CI-owned Express Scripts sued the FTC, alleging the agency’s recent report stating that prescription middlemen raise the cost of drugs is defamatory. They asked the federal judge to force the rescinding of the report and the recusal of FTC Chair Lina Khan from any decisions involving CI. The FTC said it plans to fight the lawsuit, saying it stands by its report and that three companies (CI, UNH, and CVS) control more than 80% of the pharmacy benefit manager market. At the same time, testimony in the case of the FTC seeking to block KR’s $25 billion acquisition of ACI ended Tuesday. However, a separate trial brought by the WA state Attorney General seeking to block the deal is just in its second day and a second separate trial brought by the Attorney General of CO will begin in Denver on September 30. (The two companies claim to have spent nearly $900 million trying to fight the three cases so far this year.)
Meanwhile, the CFPB published legal guidance intended to stop banks from charging overdraft fees when consumers had not genuinely consented to the practice. (This is often done via “phantom opt-in” agreements buried in fintech (i.e. websites and ATMs). Later, T agreed to pay $13 million to resolve investigations into the data breach of the cloud vendor in January 2023. (The breach exposed the information of 8.9 million T customers.) At the same time, the US Dept. of Justice said it would allow the ALK $1.9 billion acquisition of HA after the airlines agreed to maintain Hawaiian routes, protect frequent flyer rewards, etc. Later, the Dept. of Energy announced it is accepting bids for 6 million barrels of oil for refilling the Strategic Petroleum Reserve amidst low oil prices. After the close, LUNR announced it had been awarded a $4.82 billion contract by NASA for navigation and communications services in the “near space” region.
In other news, the Insurance Institute for Highway Safety announced the results of a month-long study of TSLA’s Autopilot and VLVLY (Volvo) Pilot Assist partial driving automation systems. The study found that drivers were more likely to be distracted when using these driver assistance systems. In fact, it found they were distracted 30% of the time because the driver had been trained that they could focus attention on other matters and only need to nudge the wheel every three seconds to avoid escalation. (It is worth noting that the studied only covered 43 drivers. So, automakers might argue that the sample size is too small. However, 30% is a huge number and this may well end up meaning additional costs added to carmakers in the form of tools that guard against driver abuse of “assistance.”)
In look-ahead news, the Fedwatch tool has shown a growing number of traders are betting on a half percent rate cut today. One months ago, only 25% or interest rate futures bets were for a 50 basis-point cut. One week ago, that had risen to 34%. On Monday that had risen to 62%. Finally, Tuesday night the implied probabilities from interest rate futures trades showed a 63% chance of a half percent cut versus 37% for a quarter percent cut. (There is absolutely no trades expecting a rate hike, no cut, or a bigger than half percent reduction.)
Overnight, Asian markets were evenly split with six exchanges in the green and six in the red. Hong Kong (+1.37%) was by far the biggest winner while Taiwan (-0.78%) and New Zealand (-0.67%) paced the losses. However, in Europe, we see red across the board at midday. The CAC (-0.45%), DAX (-0.11%), and FTSE (-0.66%) lead the region lower in early afternoon trade. Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward a modestly green start to the morning. The DIA implies a +0.12% open, the SPY is implying a +0.14% open, and the QQQ implies a +0.22% open at this hour. At the same time, 10-Year bond yields are up to 3.668% and Oil (WTI) is down 1.32% to $70.25 per barrel in early trading.
The major economic news scheduled for Wednesday include August Building Permits and August Housing Starts (both at 8:30 a.m.), Weekly EIA Crude Oil Inventories (10:30 a.m.), Fed Rate Decision, FOMC Statement, Current Q3 Interest Rate Projection, 1st-Year Q3 Interest Rate Projection, 2nd-Year Q3 Interest Rate Projection, 3rd-Year Q3 Interest Rate Projection, Longer-Term Q3 Interest Rate Projection, and FOMC Economic Growth Projections (all at 2 p.m.), Fed Chair Press Conference (2:30 p.m.), and TIC Net Long-Term Transactions (4 p.m.) The only major earnings reports scheduled for before the open is GIS. Then, after the close is SCS reports.
In economic news later this week, on Thursday, we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Q2 Current Account, Philly Fed Mfg. Index, Philly Fed Mfg. Employment, August Existing Home Sales, August US Leading Economic Index, and Fed Balance Sheet. Finally, on Friday, there is no major news, but Fed member Harker speaks.
In terms of earnings reports later this week, on Thursday, we hear from CBRL, DRI, FDS, FDX, LEN, and MLKN. Finally, on Friday there are no earnings reports of note.
So far this morning, GIS reported beats on both the revenue and earnings lines.
With that background, it looks as if markets are slightly bullish in the premarket. The three major index ETFs opened modestly higher and are giving us small, white-bodied candles inside Tuesday’s black Spinning Top. QQQ looks like it wants to retest that downtrend line going back to the all-time high in mid-July. At the same time, SPY and DIA are close enough to make another run at their all-time highs again. All three remain above their T-line (8ema). So, the short-term trend is bullish. The mid-term trend remains mixed (barely) with the QQQ bearish and just below its downtrend line while the others chase clean air at their highs. In the longer-term we still have a strong Bull trend all three major index ETFs. In terms of extension, none of the three major index ETFs are extended above their T-lines yet. However, at the same time, the T2122 indicator remains in the middle of its overbought range. So, markets have room to run either direction (if one side or the other can find momentum), but the Bears have a little more slack to work with today. With regard to those 10 big dog tickers, seven of the 10 are in the green so far this morning. GOOGL (+0.89%) leads the gains. Meanwhile, NVDA (+0.17%) and TSLA (+0.30%) lead, as usual, in the dollar-volume traded.
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.
🎯 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 were a bit divergent, but mostly sideways on Monday. SPY opened 0.04% lower, DIA gapped up 0.35%, and QQQ gapped down 0.44%. After that star, all three major index ETFs were more volatile during the first hour, but then ground their way to the side the rest of the day. This action gave is indecisive candles with DIA and SPY on the upside and QQQ down. SPY printed a white-bodied, Hanging Man type candle sitting very near the August highs and even the all-time highs from July. At the same time, DIA gave us a white-body, Spinning Top, candle that printed both a new all-time high and a new all-time high close. Meanwhile, QQQ printed a long-legged Doji Harami type, perhaps indicating it had failed the downtrend line Friday. This happened on below-average volume in all three of the major index ETFs.
On the day, all 10 sectors were in the green again, with Energy (+1.28%) out in front of the others leading the market higher. On the other side, Consumer Cyclical (+0.16%) lagged well behind the other sectors. Meanwhile, SPY increased 0.15%, DIA added 0.59%, and QQQ fell 0.44%. VXX gained just less than one percent to close at 49.24% and T2122 fell slightly but remains in the top of its over-bought range at 94.93. At the same time, 10-Year bond yields fell to close at 3.621% while Oil (WTI) gained 2.65% to close at $70.47 per barrel. So, on Monday the Bulls got their new all-time high in DIA. However, for the most part, it was a “wait and see” day as traders look forward to the Fed rate decision and Chairman’s press conference on Wednesday afternoon.
The only major economic news scheduled for Monday was the NY Fed Empire State Mfg. Index, which came in quite a bit stronger than expected at 11.50 (compared to a forecast of -4.10 and the August reading of -4.70). This was the sixth straight month of increases in this indicator of manufacturing strength.
In stock news, on Monday, BA announced a hiring freeze, paused all non-essential staff travel, and are considering temporary layoffs according to CNBC. This comes after the union leader for the 33k striking BA workers said he thinks “the work stoppage will drag on for some time.” At the same time, the Teamsters Union announced that hundreds of AMZN delivery drivers in NY have joined the union. Later, TGT announced it will hire 100k season employees this year (in-line with the last three years). In addition, TGT announced it start its holiday promotions early, on October 6. At the same time, Bloomberg reported that CG is reviving its plan to IPO its Nouryon chemical business. Later, AMZN CEO Jassy announced he intends to streamline the company, eliminating management layers with a goal of increasing the employee to manager ratio by 15%. He also announced AMZN will require its employees to return to the office five days per week. During a subsequent Q/A session, Jassy also said that AMZN is eliminating a program that let employees work from anywhere for up to four months per year.
Elsewhere, Reuters reported that BX and Vista Equity Partners are in advanced talks and near a deal to acquire SMAR for roughly $8 billion ($56/share). At the same time, an ET natural gas liquids pipeline in La Porte, TX caught fire, knocking out power to nearly 1,000 homes and businesses in the area. After the close, INTC said it plans to set up its Foundry Services unit as an independent subsidiary. (Many traders see this as a potential pre-cursor to INTC potentially spinning off the unit based on recent comments by CEO Gelsinger that INTC is open to considering the sale of some units.) Separately, INTC announced a multi-year, multi-billion per year, deal with AMZN to co-invest in custom chip designs for use in AMZN’s AWS cloud computing services. Also after the close, Bloomberg reported that TUP is preparing to file for bankruptcy as soon as this week. At the same time, MSFT approved a new $60 billion share buyback program and declared a $0.83 Q3 dividend (which is a 10% increase over Q2’s dividend).
In stock legal and governmental news, on Monday, Reuters reported that forty of the world’s leading banks have joined the G-7 pilot digital currency project run by the New York Fed. This list includes JPM, HSBC, UBS, and MUFG. Later, INTC was awarded up to $3 billion to develop a “Secure Enclave” (which are critical component chips used across a variety of weapons and national security products). At the same time, a US District Appeals Court ruled in favor of XOM, CVX, DVN, ET, OXY, PSX, and CLR by ruling against an appeal made by two dozen consumers of their 2020 lawsuit. The court said there was a lack of proof of the companies’ collusion with Russia and Saudia Arabia to cut oil production to keep oil prices higher. Later, an OR state judge threw out a $260 million jury verdict against JNJ related to the company’s talc (which contained asbestos) causing a woman’s mesothelioma. The judge ordered a new trial, saying the plaintiff’s lawyers had committed “egregious errors.” After the close, the UAW union filed unfair labor practices charges with the NRLB against STLA.
In miscellaneous news, on Monday, the US offshore energy regulator announced that 20% of US Gulf of Mexico oil production and 28% of its natural gas output in the area remain offline following Hurricane Francine. Elsewhere, interest rate futures indicated that more traders are expecting a 50-basis-point rate cut on Wednesday. Probabilities of a half percent cut increased from 30% a week ago, to 50% on Sunday to 62% after the close Monday.
Overnight, Asian markets were mostly green. Hong Kong (+1.34%) led eight gaining exchanges higher while Japan (-1.03%) and Shenzhen (-0.88%) led four lower. The picture is even more green in Europe as 12 of the 14 bourses are above break-even at midday. The CAC (+0.57%), DAX (+0.59%), and FTSE (+0.61%) lead the region higher in early afternoon trade. In the US, as of 7:30 a.m., Futures are pointing toward a modestly green start to the day. The DIA implies a +0.19% open, the SPY is implying a +0.25% open, and the QQQ implies a +0.42% open at this hour. At the same time, 10-Year bond yields are down to 3.61% and Oil (WTI) is just on the green side of flat at $70.16 per barrel in early trading.
The major economic news scheduled for Tuesday includes August Core Retail Sales and August Retail Sales (both at 8:30 a.m.), August Industrial Production (9:15 a.m.), July Business Inventories and July Retail Inventories (10 a.m.), and Weekly API Crude Oil Stocks (4:30 p.m.). The only major earnings reports scheduled for either before the open or after the close is FERG prior to the open.
In economic news later this week, on Wednesday, August Building Permits, August Housing Starts, Weekly EIA Crude Oil Inventories, Fed Rate Decision, FOMC Statement, Current Q3 Interest Rate Projection, 1st-Year Q3 Interest Rate Projection, 2nd-Year Q3 Interest Rate Projection, 3rd-Year Q3 Interest Rate Projection, Longer-Term Q3 Interest Rate Projection, FOMC Economic Growth Projections, Fed Chair Press Conference, and TIC Net Long-Term Transactions are reported. On Thursday, we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Q2 Current Account, Philly Fed Mfg. Index, Philly Fed Mfg. Employment, August Existing Home Sales, August US Leading Economic Index, and Fed Balance Sheet. Finally, on Friday, there is no major news, but Fed member Harker speaks.
In terms of earnings reports later this week, on Wednesday, GIS and SCS report. On Thursday, we hear from CBRL, DRI, FDS, FDX, LEN, and MLKN. Finally, on Friday there are no earnings reports of note.
So far this morning, FERG missed on revenue while beating on earnings. FERG also raised its forward guidance.
With that background, it looks as if markets are bullish again in the premarket. All three major index ETFs opened higher (with QQQ providing the biggest gap up) and have traded modestly bullish from that open. DIA is sitting at another all-time high, SPY is retesting its own all-time high, meanwhile QQQ is back up to retest its mid-term downtrend line stretching back to early-July. All three remain above their T-line (8ema). So, the short-term trend is bullish. The mid-term trend remains mixed (barely) with the QQQ bearish and just below its downtrend line while the others chase clean air at their highs. In the longer-term we still have a Bull trend all three major index ETFs. In terms of extension, none of the three major index ETFs are extended above their T-lines yet. However, at the same time, the T2122 indicator remains in the top end of its overbought range. So, markets have room to run either direction (if one side or the other can find momentum), but the Bears have a little more slack to work with today. With regard to those 10 big dog tickers, nine of the 10 are in the green so far this morning. INTC (+7.13%) is far and away the percentage gainer on the news of the split out of its Foundry business. Meanwhile, NVDA (+0.71%) is, as always, the dollar-volume leader. Only AAPL (-0.17%) lags among the big dogs.
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.
🎯 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
Investors are keenly awaiting the release of August retail sales data on Tuesday, which will provide crucial insights into the health of the U.S. consumer just before the Federal Reserve’s rate decision. Economists surveyed by Dow Jones predict a 0.2% decline in retail sales, though they expect a 0.2% increase when excluding auto sales. These figures could significantly influence the Fed’s decision on rate cuts. Wall Street is particularly attentive, with the possibility of a 50-basis point cut still on the table. However, the chief global strategist advocates for a more measured approach, suggesting a 25-basis point reduction would be more prudent.
European stocks experienced an uptick on Tuesday, driven by anticipation surrounding upcoming central bank meetings. Commerzbank shares reached a 12-year high following reports that UniCredit is seeking European Central Bank approval to acquire a 30% stake in the company, although the shares later leveled off to trade nearly flat. In the retail sector, stocks rose by 2.15%, with British home improvement firm Kingfisher leading the charge, surging 6.4% after raising the lower end of its profit forecast due to improved sales.
In August, Singapore’s non-oil domestic exports saw a significant increase of 10.7% compared to the same period last year. Meanwhile, India’s wholesale prices for August are expected to show a year-on-year increase of 1.85%, a slight decrease from the 2.04% rise observed in July. Additionally, Chinese appliance manufacturer Midea Group made a strong debut on the Hong Kong stock exchange, with its shares surging over 9% following the city’s largest IPO in more than three years.
Economic Calendar
Earnings Calendar
Notable reports for Tuesday before the bell include FERG. There are no notable reports after the bell today.
News & Technicals’
The Biden administration has granted Intel up to an additional $3 billion under the CHIPS and Science Act for the “Secure Enclave” program, aimed at boosting the supply of microelectronics for the Department of Defense. This funding supports Intel’s efforts to construct foundry plants in four states, enhancing domestic semiconductor manufacturing capabilities for various suppliers. Earlier in March, Intel received up to $8.5 billion under the same act, underscoring the administration’s commitment to strengthening the U.S. semiconductor industry and ensuring a secure supply chain for critical technologies.
Amazon CEO Andy Jassy has announced a new directive requiring corporate employees to work from the office five days a week, a shift from the previous policy of three days a week. This change aims to foster greater collaboration and productivity. Additionally, Amazon is restructuring its corporate hierarchy by reducing the number of managers in each organization, which is intended to streamline operations and enhance decision-making efficiency.
Amazon CEO Andy Jassy has announced a new directive requiring corporate employees to work from the office five days a week, a shift from the previous policy of three days a week. This change aims to foster greater collaboration and productivity. Additionally, Amazon is restructuring its corporate hierarchy by reducing the number of managers in each organization, which is intended to streamline operations and enhance decision-making efficiency.
On Monday, Apple unveiled iOS 18, the latest iteration of its iPhone software, marking the company’s most significant update of the year. Despite the anticipation, this version does not feature Apple Intelligence, the company’s upcoming AI system. The release focuses on enhancing user experience with various improvements and new features, setting the stage for future innovations. As users explore iOS 18, the tech community eagerly awaits the integration of Apple Intelligence in subsequent updates.
Oracle Chairman Larry Ellison has ascended to the position of the second-richest person in the world, boasting a net worth of $206 billion. This milestone unseats Amazon founder Jeff Bezos, who had intermittently held the title since 2016. Oracle’s shares surged by 20% in September, setting them on course for their best month since October 2022. This remarkable stock performance is largely attributed to Oracle’s pivotal role in the burgeoning artificial intelligence sector.
As we wait on the highly anticipated rate decision from the FOMC, we will still have to parse the results August retail sales and industrial production reports early this morning. The T2122 indicator is nearly at its upper limit so once again watch for a potential whipsaw on this morning’s gap up open that may finally make a near record high in the SPY. Don’t be too surprised after the morning volatility if choppy price action conditions return with the uncertainty of the Fed decision looming.
On Sunday night, stock futures remained relatively stable as investors eagerly awaited the Federal Reserve’s highly anticipated policy meeting. This meeting, scheduled for Tuesday and Wednesday, is expected to result in the first rate cut since 2020. The current overnight lending rate stands at 5.25% to 5.5%, and traders are divided on whether the Fed will reduce rates by 25 or 50 basis points, according to the CME Group’s FedWatch tool. This decision is being closely watched, as it could have significant implications for the financial markets.
On Monday, European stocks showed a mixed performance as investors braced for a significant week of interest rate decisions. Mining stocks declined by 0.6%, while the retail sector saw a modest increase of 0.4%. Despite the mixed start to the week, the regional benchmark closed higher on Friday, gaining 1.09% over the week as positive momentum returned to the market. Investors are particularly focused on the upcoming Bank of England meeting on Thursday, with the market divided on whether the central bank will opt to cut rates for the second time in two months.
Markets in mainland China and South Korea are closed in observance of the Mid-Autumn Festival, while Japan’s markets are shut for Respect for the Aged Day. Over the weekend, China released concerning economic data, revealing that August’s factory output, retail sales, and investment figures fell short of expectations. Additionally, the urban jobless rate climbed to a six-month high, and year-on-year home prices experienced their steepest decline in nine years. Meanwhile, Typhoon Bebinca has caused significant disruptions, leading to the cancellation of hundreds of flights in China, with Shanghai bracing for what could be the strongest storm since 1949.Economic Calendar
Economic Calendar
Earnings Calendar
There are no Noteworthy earnings reports before or after the bell on Monday.
News & Technicals’
The Federal Reserve’s highly anticipated two-day meeting, starting on Tuesday, is set to take center stage this week. In addition to the Fed, Brazil’s central bank will hold its policy meeting on Wednesday. Thursday will see decisions from the Bank of England, Norway’s Norges Bank, and South Africa’s Reserve Bank. The week of central bank activity will conclude with the Bank of Japan’s latest rate decision on Friday. This series of meetings is expected to have significant implications for global financial markets.
Pfizer announced that its experimental drug, ponsegromab, has shown promising results in a midstage trial for treating cancer cachexia, a serious condition that leads to appetite and weight loss in cancer patients. The trial revealed that patients taking ponsegromab experienced improvements in body weight, muscle mass, quality of life, and physical function. These positive outcomes suggest that ponsegromab, a monoclonal antibody, could potentially become the first approved treatment specifically for cancer cachexia, offering new hope for patients suffering from this debilitating condition.
Analysts are examining the link between China’s real estate slump and local government financing to understand the country’s persistent consumption slowdown. According to Wenyin Huang, director at S&P Global Ratings, macroeconomic challenges are undermining the revenue-generating capabilities of local governments, particularly through taxes and land sales. Additionally, Morgan Stanley’s chief Asia economists, Chetan Ahya and Robin Xing, noted in a September report that weak investment is resulting in sluggish nominal GDP growth. This, in turn, is pressuring the corporate sector to cut wages and contributing to a sharp rise in debt ratios.
Columbus, Ohio, experienced a significant cyberattack over the summer, attributed to a new wave of ransomware from a group known as Rhysida, which some security experts suspect is linked to Russia or neighboring states. An IT researcher in Columbus, who monitors the dark web and cybercrime, accessed three terabytes of hacked data, taking over eight hours to download. He alerted the media that the breach was far more extensive than the city had disclosed to residents. In response, the city sued the researcher, claiming legal action was necessary to protect sensitive information. This move surprised experts, who warned it could have a chilling effect on hacking disclosures and public transparency.
New record highs look very possible as we wait for the anticipated policy meeting and the FOMC rate decision on Wednesday afternoon. However, I would not rule whipsaws keeping in mind the corporate buyback blackout, uncertainty over next quarter earnings, possible government shutdown on the 30th, and of course the last two weeks of September track record of being historically volatile.
Friday was a bullish but mostly sideways day in the market. SPY opened up 0.12%, DIA opened 0.15% higher, and QQQ opened 0.17% lower. At that point, all three major index ETFs rallied all morning, with DIA reaching the high of the day at noon, SPY hitting its high at 1:40 p.m., and QQQ reaching the high of day at 1:55 p.m. From there, all three went on a modest, undulating selloff the rest of the day. This gave us white-body candles with upper wicks. SPY gapped up for its fifth-straight gain on well-below average volume. Meanwhile, DIA gapped up for a third-straight gain and a backing off from the all-time high retest and did this on above-average volume. At the same time, QQQ gapped down, but closed higher for the fifth-consecutive time and closed just down from its downtrend line going back to the all-time high in early July. QQQ did this on below-average volume.
On the day, all 10 sectors were in the green again, with Basic Materials (+1.63%) and Utilities (+1.61%) well out in front leading the market higher. On the other side, Energy (+0.70%), Communications Services (+0.77%), and Consumer Defensive (+0.78%) were the laggard sectors. Meanwhile, SPY gained 0.52%, DIA gained 0.72%, and QQQ gained 0.45%. VXX fell slightly to close at 48.79% and T2122 jumped higher into the top of its over-bought range at 95.09. At the same time, 10-Year bond yields fell to close at 3.657% while Oil (WTI) gained 0.39% to close at $69.24 per barrel. So, on Friday saw a strong week come to an end on another positive note. For the week, SPY gained 4.01%, QQQ gained 5.94%, and DIA “lagged” while gaining 2.59%. (This was collectively the best week in the market of 2024.)
The major economic news scheduled for Friday included the August Export Price Index, which came in much lower than expected at -0.7% (compared to a -0.1% forecast and July’s +0.5% reading). At the same time, the August Import Price Index was also lower than anticipated at -0.3% (versus a -0.2% forecast and well below the July +0.1% value). Later, Preliminary September Michigan Consumer Sentiment was reported at 69.0 (above the 68.3 forecast and 67.9 August number). At the same time, Preliminary September Michigan Consumer Expectations also came in above the predictions at 73.0 (versus the 71.0 forecast and 72.1 August value). On the future outlook front, Michigan 1-Year Inflation Expectations were reported down at 2.7% (less than the 2.8% forecast and August reading). However, the Michigan 5-Year Inflation Expectations were up to 3.1% (compared to a forecast and August reading of 3.0%).
In stock news, on Friday, UBER announced an expansion of its partnership with GOOGL’s Waymo self-driving taxi unit. The partnership will bring automated ride hailing to Austin TX and Atlanta GA in early 2025. At the same time, Danish DSDVF announced it had agreed to acquire German logistics firm Schenker for $15.85 billion. Later, Bloomberg reported that DBRG is considering the sale of its Southeast Asian unit (EdgePoint Infrastructure) for roughly $4 billion. At the same time, BCSF (Bain Capital) has hired advisers to help in the sale of its British home and car insurer Esure for roughly $1.31 billion). Later, the CFO of BA told reporters the company is eager to return to talks after a strike of 33k workers at its Pacific Northwest plants have shut down production of the company’s best-selling 737 MAX jets. He went on to say the strike now puts delivery targets for 737 MAX planes in jeopardy and will have a financial impact unless settled quickly.
Separately both MCO and Fitch announced they will reduce their credit ratings on BA to “junk status” unless the strike ends quickly. However, no exact definition of “quickly” was provided in either announcement.) On Saturday, DIS and DirecTV announced they had reached a deal that allowed the latter to resume broadcast of ESPN and DIS’s other channels to DirecTV’s 11 million customers after a two-week shutdown. (DirecTV appears to have gotten what they wanted from the negotiation. Specifically, that was the ability to offer DIS channels on an “ala carte” and “skinny package” basis to its customers…as opposed to DIS requiring “all or nothing” offerings of its channels.) At the same time, Reuters reported that T is again in talks with SATS over the merger of their Dish and DirecTV companies. (The initial merger attempt was blocked by the US Justice Dept. in 2002 over anti-trust concerns. However, the entertainment market has obviously changed dramatically since then with streaming and cable market growth.)
In stock legal and governmental news, on Friday, the Washington Post reported that the White House has signaled a delay in making a decision on the Nippon Steel buyout of X. The news comes after Nippon Steel executives flew to Washington to lobby for the deal and the two companies sent a letter to the President urging him to approve the deal or delay the decision until after elections (despite other resistance from both political parties and the Committee on Foreign Investment in the US opposing the deal). Later, Reuters exclusively reported that sources tell it that EU antitrust officials are considering exactly what practices GOOGL will be ordered to end. However, they will not order the breakup of GOOGL (separating ad technology business from the ad sales unit). Meanwhile, a DE judge overruled a Newsmax (planning to IPO in late 2024) motion and ruled the company must face trial for its defamation of Smartmatic (as part of a campaign in support of the disgraced former President’s election lies).
Elsewhere, Bloomberg reported that the EU is planning a final vote on raising tariffs on Chinese EVs on September 25. Later, the State Dept. approved the sale of $7.2 billion of LMT F-35 fighter jets to Romania. Later, the US EPA said it has found that ADM violated federal safe drinking water laws as well as the company’s underground injection permit with leaks at its carbon sequestration facility in IL. At the same time, IEP won the dismissal of a lawsuit alleging the company artificially inflated its share price by issuing “unsustainably high dividends.” Later, after the close, the Dept. of Justice announced WBA had agreed to pay $106.8 million to settle charges it fraudulently billed the US government (Medicare / Medicaid) for prescriptions it never filled. Alsos after the close, Bloomberg reported that INTC has officially qualified for as much as $3.5 billion in federal grants to make chips for the Dept. of Defense. Saturday, HD agreed to pay $1.98 million to CA for over-charging CA consumers via “checkout scanner violations” where checkout scanners charged higher prices than were listed on the item or shelf.
In miscellaneous news, on Friday, China announced it will raise its retirement age for the first time since 1978. The Chinese male retirement age will go from 60 to 63 while women’s retirement will be pushed from 50 to 55. For women in management jobs the increase goes from 58 instead of 55. However, the Chinese government will implement these changes slowly to avoid public unrest. (This seems to be the country’s first real public acknowledgement, without saying it out loud, of the country’s demographic crisis.) Elsewhere, on Saturday, China’s Commerce Minister announced that foreign direct investment in China, covering January through August, had fallen 31.5% year-on-year.
Overnight, Asian markets were mixed but leaned toward the green with just four of the 12 exchanges in the red. Malaysia (+0.84%) and Thailand (+0.78%) led the gainers while New Zealand (-1.00%) and Shenzhen (-0.88%) paced the losses. In Europe, we see a similar picture taking shape with six of the 15 bourses under water at midday. The CAC (+0.02%), DAX (-0.26%), and FTSE (-0.04%) in early afternoon trade. In the US, as of 7 a.m., Futures are pointing toward a mixed start to the day. DIA implies a +0.21% open, the SPY is implying a flat +0.03% open, and QQQ implies a -0.19% open at this hour. At the same time, 10-Year bond yields are down to 3.646% and Oil (WTI) is up almost half a percent to $68.98 per barrel in early trading.
The major economic news scheduled for Monday is limited to the NY Fed Empire State Mfg. Index (8:30 a.m.). here are no major earnings reports scheduled for either before the open or after the close.
In economic news later this week, on Tuesday, we get August Core Retail Sales, August Retail Sales, August Industrial Production, July Business Inventories, July Retail Inventories, and Weekly API Crude Oil Stocks. Then Wednesday, August Building Permits, August Housing Starts, Weekly EIA Crude Oil Inventories, Fed Rate Decision, FOMC Statement, Current Q3 Interest Rate Projection, 1st-Year Q3 Interest Rate Projection, 2nd-Year Q3 Interest Rate Projection, 3rd-Year Q3 Interest Rate Projection, Longer-Term Q3 Interest Rate Projection, FOMC Economic Growth Projections, Fed Chair Press Conference, and TIC Net Long-Term Transactions are reported. On Thursday, we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Q2 Current Account, Philly Fed Mfg. Index, Philly Fed Mfg. Employment, August Existing Home Sales, August US Leading Economic Index, and Fed Balance Sheet. Finally, on Friday, there is no major news, but Fed member Harker speaks.
In terms of earnings reports later this week, on Tuesday we hear from FERG. Then Wednesday, GIS and SCS report. On Thursday, we hear from CBRL, DRI, FDS, FDX, LEN, and MLKN. Finally, on Friday there are no earnings reports of note.
In overnight news, according to Bloomberg the Dollar fell to its lowest level in nine months, with the move driven by a strong Yen, which reached a 14-month high. Most of these machinations come from speculation on not only the Fed but other central bank rate decisions due this week. Speaking of anticipated central bank decisions, the Fedwatch tool tells us the futures trader positions indicate a 59% probability of a half percent Fed rate cut Wednesday while a quarter-point cut has a 41% chance. This is a 30% shift toward half point in the last week. However, those probabilities are volatile, with 15%-20% moves in a day recently. Finally, PFE published mid-stage trial results in the New England Journal of Medicine which say its experimental cancer treatment ponsegromab has shown positive results treating the weight loss (loss of appetite) that is caused by the cancer. (That condition, cachexia, impacts 9 million people worldwide and results in 80% of them dying within one year due to the inability to withstand the actual cancer treatments.)
With that background, it looks as if markets are undecided early in the premarket. DIA opened slightly higher and has put in a white-body candle with almost no wick as it moves to retest its all-time high in the early session. However, SPY opened down modestly and has printed an indecisive Doji candle in the Premarket. At the same time, QQQ opened flat but has printed a black-body candle with little wick as it is working on a Bear Harami candle at this point. All three remain above their T-line (8ema). So, the short-term trend is bullish. The mid-term trend remains mixed with the QQQ bearish and just below its downtrend line. In the longer-term we still have a Bull trend all three major index ETFs. In terms of extension, none of the three major index ETFs are extended above their T-lines. However, at the same time, the T2122 indicator is back in the top end of its overbought range. So, markets have room to run either direction (if one side or the other can find momentum), but the Bears has a little more slack to work with today. With regard to those 10 big dog tickers, they are split evenly between gainers and losers early, but the dollar-volume trading leaders are in the red, led by NVDA (-1.60%), AAPL (-2.34%), and TSLA (-0.03%).
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.
🎯 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
Thursday gave us another bullish day with much less whiplash than Wednesday. SPY opened 0.11% higher, DIA opened up 0.12%, and QQQ opened up just 0.07% higher. From there, all three major index ETFs meandered sideways for the morning before starting a midday rally that took us to the highs of the day at about 2 p.m. At that point, SPY and DIA ground sideways in a tight range and QQQ had a 15-minute selloff at 2:45 p.m. before following the others sideways in the same tight range. This action gave us white-bodied candles with lower wicks in all three. SPY and DIA both retested their T-line (8ema) and 17ema before rebounding to close at the top of the candle. For its part, QQQ crossed back above its 50sma. This all happened on below-average volume for all three major index ETFs.
On the day, all 10 sectors were in the green, with Basic Materials (+1.82%) well out in front leading the market higher. On the other side, Healthcare (+0.30%) lagged behind the other sectors. Meanwhile, SPY gained 0.84%, DIA gained 0.66%, and QQQ gained 0.98%. VXX fell slightly to close at 48.94% and T2122 jumped back up into the middle of its over-bought range at 88.54. At the same time, 10-Year bond yields rose to close at 3.685% while Oil (WTI) jumped up another 2.79% to close at $69.19 per barrel. So, on Thursday saw the fourth-straight day of gained in SPY and QQQ (also a second-straight for DIA). It was big tech names NVDA (+1.91%), TSLA (+0.74%), AVGO (+3.97%), and META (+2.69%) that drove the SPY and QQQ on dollar-volume.
The major economic news scheduled for Thursday included the Weekly Initial Jobless Claims, which came in a bit higher at 230k (compared to a forecast of 227k and prior week value of 228k). On the ongoing front, Weekly Continuing Jobless Claims were up a bit as anticipated at 1,850k (in-line with the 1,850k forecast and up from the prior week 1,845k reading). At the same time, August Month-on-Month Core PPI was up to +0.3% (versus the +0.2% forecast but well up from July’s -0.2%). On the headline number, August Month-on-Month PPI was also up to +0.2% (compared to a +0.1% forecast and July’s 0.0% value). On the budget front, the August Federal Budget Balance showed a much higher than expected deficit at -$380.0 billion (measured against a forecast of -$285.7 billion and July’s -$244.0 billion reading). Then, after the close, the Fed Balance Sheet was up $2 billion for the week to $7.115 trillion from last week’s $7.113 trillion.
The WASDE Ag report also came out Thursday. It reported an increased 2024 corn crop forecast, up 39 million bushels from last month to 15.2 billion bushels. The silver lining for farmers is that the 55-million-bushel reduction in the beginning inventory number (due to increased usage in ethanol production). Meanwhile, the Soybean forecast was left unchanged at 4.586 billion bushels.
After the close, ABDE and RH both reported beats on both the revenue and earnings lines.
In stock news, on Thursday, LLY announced it will invest $1.8 billion to expand its Irish manufacturing operations. This doubles the company’s investment in those two plants in Ireland. At the same time, GILD reported the results of a Phase 3 trial showing that its injectable HIV prevention drug reduced infections by 96%. (This is far superior to the existing oral pill prevention treatment.) Later, GIS announced it has agreed to sell its North American yogurt business to a French company for $2.1 billion. At the same time, MSFT reported it recovered after an outage of its cloud-based Office365 suite. Later, cable provider CHTR said Thursday that it is adding WBD’s Max and Discovery+ streaming services to its cable packages at no additional charge.
Meanwhile, Reuters reported that GM is in talks to buy electric vehicle batteries (built in the US but made using Chinese company CATL’s technology). The proposed source would be a TTDKY (Japanese company TDK) plant to be located somewhere in the Southeastern US. Later, AAL flight attendants voted to ratify the new 5-year contract with the airline. At the same time, AMZN announced plans to invest $2.1 billion in its Delivery Service Partners program over the next six years. This includes an increase in DSP partner compensation of $660 million over the next year. Later, MA announced it is buying threat intelligence company “Recorded Future” from a private equity firm for $2.65 billion. At the same time, an SEC filing showed that Berkshire Hathaway’s Insurance unit leader (Ajit Jain) sold more than half of his BRKA stock on September 9th.
In stock legal and governmental news, on Thursday, the NHTSA announced it has opened a preliminary investigation into VFS (Vietnam’s VinFast electric car maker) on reports of the company’s “Lane Assist” system malfunctioning. At the same time, a Philly Court jury ruled in favor of BAYRY (Bayer) in a lawsuit alleging the company’s Roundup weed killer caused a plaintiff’s cancer. Later, the FDA approved the first over-the-counter hearing aid software that is intended to be used with AAPL’s AirPod Pro headphones. At the same time, NAVI accepted a CFPB-imposed ban on servicing federal student loans, as well as the $120 million settlement ($100 million in restitution and a $20 million fine). This action was taken over NAVI steering borrowers to delay repayment rather than taking the lower-profit repayment plans those borrowers were qualified to get. Later, Reuters reported that Indian antitrust regulators have found that AMZN and WMT (Flipkart unit) have violated India’s local competition laws by giving preference to selected sellers on their websites. Specifically, the report said that each of the antitrust charges brought against the companies were found to be true.
Elsewhere, the Office of the Comptroller of Currency announced it had entered into a formal agreement prohibiting WFC from expanding its product offerings and requiring the bank to submit action plans to fix its anti-money-laundering compliance programs. (WFC stock was down more than 4% on the news.) Later, the FAA reported that an ALK jet had to abort takeoff to avoid collision with a LUV jet at Nashville’s airport on Thursday. An investigation is underway. At the same time, the Treasury Dept. announced proposed corporate alternative minimum tax rules that would impact 100 large corporations that currently pay an average of 2.6% in taxes (60 of them paying less than 1%). The proposals will generate about $250 billion over 10 years according to Treasury. Later, a US Appeals Court threw out a $564 million jury verdict against BMO over its role in a $3.65 billion Ponzi scheme. At the same time, a federal judge overruled a CFTC decision that had prohibited betting on US elections. So, there will be betting on various election outcomes. After the close, Reuters reported that OXY will receive up to $500 million in support for its carbon capture facility in south TX.
In miscellaneous news, on Thursday, Reuters reported that more than 340k customers were without power in LA following Hurricane Francine. Meanwhile, the CDC reported it still has not identified the origin of a human case of bird flu in MO. (The patient had no known exposure to poultry flocks or dairy herds.) This was the 14th human case so far this year requiring hospitalization and the first with unknown origin. Elsewhere, the SEC announced it is set to vote on new “tick size” rules at a public meeting at 10 a.m. on September 18. The proposed changes would allow stock pricing in increments of less than a penny. (The confusing rule would have four different buckets, with some stocks pricing in penny increments, while others trade in half penny, fifth of a penny, of tenth of a penny increments.)
In what is widely seen as a precursor to Fed action next week, the ECB cut rates by a quarter point again (for the second time this year), lowering its deposit rate to 3.50%. Elsewhere, the Fedwatch tool showed that Feds Fund Futures trades are indicating a increase in the probability of a half percent cut next following the PPI data release. On Wednesday, there was only a 14% probability of a 50-basis-point cut (the other 86% being on a quarter-point cut). However, one day later, that percentage more than doubled to 31% probability of a half percent and 69% expecting a quarter percent cut. In tangentially-related news, mortgage finance agency Freddie Mac said on Thursday that the US average 30-year fixed-rate mortgage fell to 6.20%. That is the lowest rate since February 2023.
Overnight, Asian markets were mixed but mostly green with just four of the region’s 12 exchanges showing red. Malaysia (+0.84%), and Hong Kong (+0.75%) led the gainers while Shenzhen (-0.88%) and Japan (-0.68%) paced the losses. However, in Europe, we see green across the board at midday. The CAC (+0.28%), DAX (+0.52%), and FTSE (+0.30%) lead the region higher in early afternoon trade. In the US, as of 7:30 a.m., Futures are pointing toward a modestly green start to the day. The DIA implies a +0.13% open, the SPY is implying a +0.17% open, and the QQQ implies a +0.03% open at this hour. At the same time, 10-Year bond yields are down to 3.648% and Oil (WTI) is up another 1.13% to $69.75 per barrel in early trading.
The major economic news scheduled for Friday includes August Export Price Index, and August Import Price Index (both at 8:30 a.m.), Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations (all at 10 a.m.). There are no major earnings reports scheduled for either before the open or after the close.
In overnight news, aerospace giant BA’s problems increased even more as workers in the Pacific Northwest (more than 30k workers) rejected the company’s contract offer by a massive 96% vote against and promptly went on strike. This was the first BA strike since 2008 and it completely halts production of the company’s best-selling 737 line of jets. Elsewhere, President Biden proposed a rule change that would prevent low-value shipments (largely made up of Temu and Shein retail packages) from getting special custom exemptions and avoid tariffs on Chinese goods. (The White House estimates that those type of shipment have increased from 140 million per year to more than a billion over the last 10 years.)
With that background, all three major index ETFs opened the premarket just on the green side of flat and have been largely indecisive since that point. All three remain above their T-line (8ema). So, the short-term trend is bullish. At the same time, the mid-term trend remains mixed with the QQQ bearish. In the longer-term we still have a Bull trend in the DIA, SPY, and QQQ. In terms of extension, none of the three major index ETFs are extended above their T-lines. However, at the same time, the T2122 indicator is back in the center of its overbought range. So, markets have room to run either direction (if one side or the other can find momentum), but the Bears has a little more slack to work with today. With regard to those 10 big dog tickers, six of the 10 are in the green this morning, led higher by AMD (+0.68%) and GOOGL (+0.65%). On the other side, TSLA (-0.34%) is the laggard. Normalcy has returned to the pre-market dollar-volume with NVDA having traded about five times as much dollar-volume of stock as the next closest 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.
🎯 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 gave us major whiplash on Wednesday. SPY opened a small 0.01% lower, DIA gapped down 0.27%, and QQQ gapped up 0.23%. However, at the point, all three major index ETFs sold off sharply and steadily for about 60-75 minutes. Then we saw momentum switch flipped and all three rallied sharply and steadily for the rest of the day. Only profit-taking the last five minutes kept us from closing at the highs in all three major index ETFs. This action gave up large white-bodied candles with large lower wicks. SPY and DIA were white Hammer type candles while QQQ had a larger body. All three crossed above their T-line, although DIA closed only slightly above its 8ema. This happened on average volume in the SPY and DIA as well as well-above average volume in the QQQ.
On the day, seven of the 10 sectors were in the green, with Technology (+2.43%) way, way (more than 1.25%) out front leading the Bulls higher. On the other side, Consumer Defensive (-0.60%) lagged well behind the other sectors. Meanwhile, SPY gained 1.03%, DIA gained just 0.25%, and QQQ popped 2.17% higher. VXX dropped another 4.25% to close at 49.33% and T2122 rose up into the center of its mid-range at 47.68. At the same time, 10-Year bond yields rose to close at 3.655% while Oil (WTI) jumped up another 2.37% to close at $67.31 per barrel on potential hurricane impact. So, on Wednesday saw the Bears trying to make hay on flat CPI numbers until a major mid-morning reversal ripped their faces off and did not let up the rest of the day. As usual, NVDA led the market on the dollar-volume of stock traded, but this time also chipped in with a strong 8.15% gain.
The major economic news scheduled for Wednesday included August Core CPI (month-on-month), which rose a tick to +0.3% (compared to the +0.2% forecast and July reading). However, on the annual basis August Core CPI was flat at +3.2% (versus a forecast and July value of +3.2%). On the headline front, the month-on-month August CPI was flat at +0.2% (compared to a forecast and July reading of +0.2%). On the year-on-year basis, August CPI was down sharply to +2.5% (right on the +2.5% forecast but down sharply from July’2 +2.9% value). Later, EIA Weekly Crude Oil Inventories were down, about as expected, at +0.833 million barrels (versus a +0.900 million barrels forecast but up sharply from the prior week’s -6.873 million barrels number).
In “here we go again” news, we are facing another potential government shutdown at the end of September. Yet again, the GOP has put off either a budget or a continuing resolution to the last minute. And just as in so many times before, GOP in-fighting has stopped progress as the deadline looms. This time, a previously-scheduled vote on a Republican-dictated bill was canceled for Wednesday because the House Speaker did not want to go through the embarrassment of previous vote failures. So, the Speaker told reporters that the Republican caucus will “work through the weekend” to try to get enough votes for their partisan bill, which he hopes to put up for a vote next Tuesday. In the meantime, we wait for the next act in this play as the calendar ticks down with less than three weeks left.
In Fed news, on Wednesday the Fed Office of the Inspector General released a report saying its investigation had found that Atlanta Fed President Bostic had created the appearance he had traded on confidential Fed information 154 times between March 2018 and March 2023. The report said there was no evidence Bostic actually traded on inside information. However, his investment managers (who traded his personal account) had made trades 154 times during Fed “blackout periods” just ahead of FOMC announcements. In addition, the investigation found that Bostic filed inaccurate financial disclosure forms, held more Treasuries than the Fed permits, and twice made trades that were different than what he had gotten pre-approval from the Fed to make. The Fed Board of Governors will now review the report and decide appropriate action.
In stock news, on Wednesday STLA announce it will invest $406 million to retool three MI facilities to build components that can be shares between hybrid and all-electric vehicles. At the same time, GME announced it would be issuing up to 20 million more shares of stock to raise cash for “general corporate purposes.” (GME closed down almost 12% on the news.) Later, ADBE announced it will release a new AI-powered video creation and editing tool later this year. At the same time, SEC filings showed that BRKB had sold another 5.8 million shares of BAC between September 6 and September 10. (That takes the BRKB offloading of BAC to almost 175 million since mid-July.) Later, RHHBY (Roche) reported disappointing early-stage trial results or its weight-loss pill.
Elsewhere, the CEO of RTX told an investor conference that he does not see any available “transformative M&A deals” in the aerospace industry and he is open to paring down the RTX business by pruning (selling) certain units. Later, Reuters reported that BA is facing a possible strike Friday in the Pacific Northwest. It seems that despite a tentative deal, which workers vote on ratifying on Thursday, many of the workers are enraged by the deal because it offers a much lower pay increase and other benefits that had been sought. At the same time, AMZN announced it will invest $1.8 billion, this time in Brazil and by 2034, to add to its AWS cloud computing capacity. Later, NSC officially terminated its CEO (for an inappropriate relationship with the company’s top legal officer) and replaced him with the CFO.
In stock legal and governmental news, on Wednesday, a number of business trade and lobbying groups came out in favor of Nippon Steel’s acquisition of X while trying to also not criticize their target (politicians). The letter said the signers were “concerned the decision is being unduly influenced by political pressure.” (However, both sides of the political aisle are strongly and publicly against allowing the acquisition.) Later, a US District judge ruled in favor of an industry group (whose members include META, GOOGL, and SNAP) and against a UT state law requiring social media platforms to verify user age and restrict the accounts of minors. At the same time, Semaphore reported that the US Dept. of Commerce is close to approving the export of advanced NVDA AI chips to Saudi Arabia.
Elsewhere, after the close, the CFPB ordered TD to pay $28 million for repeatedly sharing inaccurate, negative information about its customers with credit reporting agencies, hurting customer credit scores. At the same time, the EU’s top privacy regulator announced it has opened an investigation of GOOGL over its AI use of European consumer personal data. Later, EA, MSFT (Activision division), and TCEHY (Tencent) were among the companies hit with an EU consumer complaint over “tricking” children game players into spending more money via in-game currencies. At the same time, evidence was presented at GOOGL’s ad network antitrust trial that an ex-executive told company employees that the goal was to crush rival ad networks.
In miscellaneous news, on Wednesday Reuters reported that Korean-listed electronics giant Samsung will cut up to 30% of its “overseas staff” across the Americas, Europe, Asia, and Africa. Samsung is the world’s leading producer of smartphones, memory chips, and TVs and has more than 147,000 employees outside of South Korea. The report said the cuts had already begun in India. Reuters reported that the story had been confirmed by six Samsung sources. Elsewhere, about 39% of US Gulf of Mexico oil production and 49% of US natural gas production in the area were shut down on Wednesday due to Hurricane Francine. Meanwhile, Rho Motion reported that global electric vehicle sales were up 20% in August, despite a 33% decrease (which caused a 19-month low) in Europe. The increase was driven by record sales in China, which were up 42%.
Overnight, Asian markets were mostly green with nine of the 12 exchanges closing above break-even. Japan (+3.41%), Taiwan (+2.96%), and South Korea (+2.34%) led the region higher. In Europe, we see green across the board at midday. The CAC (+0.78%), DAX (+1.09%), and FTSE (+0.73%) lead the region higher in early afternoon trade. In the US, as of 7:30 a.m., Futures are pointing toward a modestly green start to the day. The DIA implies a +0.14% open, the SPY is implying a +0.12% open, and the QQQ implies a +0.06% open at this hour. At the same time, 10-Year bond yields are up to 3.668% and Oil (WTI) is up 1.75% to $68.49 per barrel in early trading.
The major economic news scheduled for Thursday includes Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, August Core PPI, and August PPI (all at 8:30 a.m.), WASDE Ag report (noon), August Federal Budget Balance (2 p.m.), and the Fed Balance Sheet (4:30 p.m.) The major earnings reports scheduled for before the open include Thursday, we hear from BIG, CAL, KR, and SIG. Then, after the close, ABDE and RH report.
In economic news later this week, 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 Friday, there are no reports scheduled.
So far this morning, SIG beat on both the revenue and earnings lines. However, CAL missed on both the top and bottom lines. (KR reports at 8 a.m.)
In overnight news, MRNA announced plans to cut $1.1 billion in costs by 2027 on expectation of a rapid decline in its COVID vaccine business. However, the company also said it expects to have 10 new biotech products approved over that same period. Meanwhile, MCD announced it will extend its “$5 value meal” program through the end of the year in most US markets. (Approximately 80% of MCD franchisees have chosen to do this program extension.) Elsewhere, Bloomberg reports that both JPM and BAC are rolling out programs to reduce junior staff workloads. JPM will limit MOST junior staffers to only 80 hours per week. At the same time, BAC is rolling out a so-called “Banker Diary” system to track individual employee workloads. (I’m sure that in no way will be used for analyzing and ranking employee productivity.)
With that background, all three major index ETFs opened the premarket higher, but have printed small and indecisive (mostly wick) candles since that point. All three are above their T-line (8ema). So, the short-term trend is bullish. At the same time, the mid-term trend is mixed at best with the QQQ now bearish. In the longer-term we still have a Bull trend with the DIA, SPY, and QQQ. In terms of extension, none of the three major index ETFs are extended, having just re-crossed their T-lines. At the same time, the T2122 indicator is back in the center of its mid-range. So, markets have room to run either direction if one side or the other can find momentum. With regard to those 10 big dog tickers, eight of the 10 are in the green this morning, led higher by GOOGL (+1.15%). On the other side, TSLA (-0.54%) is the laggard. Interestingly, normalcy has returned to the pre-market dollar-volume with NVDA having traded more than six times as much stock as the next closest ticker.
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.
🎯 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.
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U.S. stock futures edged higher on Thursday as investors prepared for upcoming PPI inflation data following a turbulent session triggered by the release of the August consumer price index. Wall Street is keenly awaiting the August producer price index, with economists surveyed by Dow Jones predicting a 0.2% increase in both the headline and core readings, up from the previous month’s 0.1% and 0.0%, respectively. Additionally, initial jobless claims data for the week ending September 7 is expected to show a slight decrease to 225,000 from 227,000 the previous week.
On Thursday, European stocks surged, with tech and mining stocks leading the charge, rising by 2.69% and 2.87%, respectively. Investors are anticipating a 25-basis point rate cut from the European Central Bank (ECB), which would be the first reduction since June. Additionally, European markets are reacting to the latest U.S. consumer price index (CPI) report, which showed a 0.2% increase in consumer prices for August, bringing the annual inflation rate down to 2.5%, the lowest since February 2021
On Thursday, Asia-Pacific markets experienced an upswing, mirroring the positive momentum from Wall Street, which was driven by a rally in the tech sector. In Japan, the producer price index (PPI) for August increased by 2.5% year-on-year, falling short of the anticipated 2.8% and the 3% rise observed in July. Meanwhile, India is set to release its consumer price index (CPI) for August later today.
Economic Calendar
Earnings Calendar
Notable reports for Thursday before the bell include CAL, KR, LOVE, & SIG After the bell include ADBE, & RH.
News & Technicals’
Norfolk Southern has announced the immediate departure of CEO Alan Shaw, who will be replaced by the company’s finance chief, Mark George. Shaw’s exit follows an investigation by the railroad’s board into an allegedly inappropriate relationship with the company’s chief legal officer, Nabanita Nag. Mark George, who has been with Norfolk Southern as CFO for nearly five years, will step into the role of CEO.
Moderna has announced plans to reduce its expenses by $1.1 billion by 2027 as it navigates the downturn in its Covid-related business. The biotech company aims to secure approvals for 10 new products by 2027, signaling a strategic shift towards diversifying its portfolio. However, this transition involves deprioritizing certain parts of its pipeline, leading to the suspension or discontinuation of some projects.
China has issued a stern warning of retaliation in response to a U.S. bill that could lead to the closure of Hong Kong’s trade offices. The proposed legislation mandates the U.S. secretary of state to conduct annual reviews of the “privileges, exemptions, and immunities” granted to Hong Kong’s Economic and Trade Offices. Beijing has urged the U.S. to halt the progression of this act to avoid further straining China-U.S. relations and has vowed to take “strong and resolute countermeasures” if the bill is enacted.
Eli Lilly has announced a significant investment of $1.8 billion to enhance its manufacturing capabilities in Ireland, focusing on its newly approved Alzheimer’s drug and popular weight loss and diabetes treatments. The pharmaceutical giant plans to allocate $1 billion to expand its existing site in Limerick, aiming to boost the production of active ingredients, including those used in its Alzheimer’s treatment, Kisunla. Additionally, Eli Lilly will invest $800 million in expanding its facility in Kinsale, which began producing drugs last year to meet the growing demand for its diabetes and weight loss medications.
After the massive reversal yesterday can the bulls follow though with the upcoming PPI inflation data and Jobless claims report? One thing for sure is with the tremendous volatility traders should be prepared for just about anything remembering about 50% of the companies will be in their blackout period by the end of this week, ending corporate buyback activity.
U.S. stock futures declined on Wednesday as investors anticipated the release of the August CPI report. According to economists surveyed by Dow Jones, the headline Consumer Price Index (CPI) is expected to have increased by 0.2% from the previous month and 2.6% year-over-year. Kristina Hooper, chief global market strategist at Invesco, suggested that the Federal Reserve is likely to implement a 25-basis-point rate cut next week. She noted that a larger 50-basis-point cut could trigger alarm and be perceived as an admission of economic concerns.
European stocks saw an uptick as global markets awaited the latest U.S. inflation data. The tech sector experienced a 1.1% rise, while health care stocks dipped by 0.5%. Retail stocks performed notably well, climbing 1.77%, driven by a 4.2% increase in Spanish fashion house Inditex’s shares following a sales rebound. However, the U.K.’s FTSE 100 slightly declined by 0.02%, as new data revealed the economy remained stagnant in July, missing analysts’ forecast of a 0.2% growth.
Asia-Pacific markets experienced a downturn on Wednesday, with Japan’s Nikkei index suffering the most significant losses in the region. In contrast, South Korea reported a positive economic indicator, with August unemployment dropping to 2.4%, the lowest level since the data series began in 1999, as per Statistics Korea. Meanwhile, Bank of Japan board member Junko Nakagawa announced that the central bank would persist in raising interest rates, provided that the economy and inflation align with their projections.
Economic Calendar
Earnings Calendar
Notable reports for Wednesday before the bell include OXM. After the bell include CAL, KR, LOVE, & SIG.
News & Technicals’
Shares of GameStop fell by 10% in premarket trading after the video game retailer amended an open market sale agreement with the U.S. Securities and Exchange Commission. This amendment permits GameStop to sell up to 20 million additional shares of its Class A common stock. The move likely raised concerns among investors about the potential dilution of existing shares, contributing to the drop in stock price. This development highlights the market’s sensitivity to changes in corporate financing strategies.
Chinese artificial intelligence models might currently lag behind their U.S. counterparts by at least six months, according to Kai-Fu Lee, founder of the startup 01.AI and former head of Google China. However, Lee predicts that Chinese AI applications will likely see rapid growth, potentially outpacing those in the U.S. by early next year. He attributes this anticipated surge to the significantly reduced costs of training effective AI models. This suggests a dynamic shift in the AI landscape, where the speed of application development could become a critical factor in technological leadership.
The U.K. economy remained stagnant in July, with no month-on-month growth, according to preliminary data from the Office for National Statistics. This performance fell short of the 0.2% growth forecasted by economists polled by Reuters. The services sector, which is a major component of the U.K. economy, saw a modest increase of 0.1%. However, this was offset by declines in production and construction output, which fell by 0.8% and 0.4%, respectively. These figures highlight the ongoing challenges facing the U.K. economy, particularly in its production and construction sectors.
JPMorgan Chase shares dropped by 5% on Tuesday following comments from the bank’s president, Daniel Pinto, who indicated that analysts’ expectations for net interest income and expenses in 2025 were overly optimistic. Pinto stated that the current estimate of approximately $90 billion for 2025 is unrealistic due to the Federal Reserve’s interest rate cuts. Additionally, he noted that the expense forecast of around $94 billion for next year is also too optimistic, citing ongoing inflation and new investments. This decline marked JPMorgan’s worst stock performance since June 2020, according to FactSet.
Today all eyes around the world are focused on the August CPI report that will be out before bell. Although futures currently point to a bearish open anything is possible as the market reacts to this inflation data and what it might mean for next Wednesday’s FOMC rate decision. Big moves are possible, and I would not rule out big point whipsaws after the open. Keep in mind that Thursday brings us the Producer Prices report as you plan forward.
