Monday saw the market open higher. SPY gaps up 0.28%, DIA gapped up 0.40%, and QQQ gapped up 0.24%. From there, SPY meandered sideways in the gap the rest of the day. Meanwhile, after the open, DIA continued to rally for 30 minutes before trading sideways with a slight bearish trend and ending the day about half way back to its opening level. As for QQQ, after the open gap up, it immediately sold off for 30 minutes recrossing the opening gap in the first 15 minutes before meandering sideways below Friday’s close the rest of the day. This action gave us, gap-up black-bodied Hanging Man candles in both the SPY and QQQ. (Both printed new all-time highs and SPY did manage to print a new all-time high close.) At the same time, DIA gave us a gap-up, Shooting Star or Inverted Hammer type of candle that printed another all-time high and all-time high close. This happened on above-average volume in DIA as well as below-average volume in SPY and QQQ.
On the day, eight of the 10 sectors were green with Financial Services (+1.72%) way out in front leading the gainers higher. On the other side, Basic Materials (-0.95%) was again by far the biggest loser. At the same time, SPY gained 0.10%, DIA gained 0.66%, and QQQ lost 0.06%. VXX fell slightly to close at 44.65 and T2122 rose back into the bottom of its overbought territory, closing at 83.16. Meanwhile, 10-Year bond yields rose slightly to 4.306% while Oil (WTI) dropped another 3.13% to close at $68.18 per barrel. So, Monday saw a divergent, if mostly sideways day among the three major index ETFs. It certainly felt a little toppy in nature.
There was no major economic news scheduled for Monday.
After the close, GRAB reported beats on both the revenue and earnings lines. At the same time, IAC beat on revenue while missing (massively) on earnings. On the other side, LYV missed on revenue while beating on earnings.
Overnight, Asian markets were red across the board. Hong Kong (-2.84%), Taiwan (-2.33%), and Shanghai (-1.39%) paced the losses. In Europe, we see the same picture taking shape with region-wide losses at midday. The CAC (-1.31%), DAX (-0.93%), and FTSE (-0.98%) are leading the region lower in early afternoon trade. Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward a modestly red start to the day. DIA implies a -0.10% open, the SPY is implying a -0.11% open, and QQQ implies a -0.07% open at this hour. At the same time, 10-Year bond yields are up to 4.361% and Oil (WTI) is up a quarter of a percent to $68.21 per barrel in early trading.
There is major economic news scheduled for Tuesday is limited to NY Fed 1-Year Consumer Inflation Expectations (11 a.m.). We also hear from Fed members Waller (10 a.m.), Kashkari (2 p.m.), and Harker (5 p.m.). Major earnings reports scheduled for before the open include ALIT, AZN, SID, SATS, HTZ, HD, IGT, MOS, ONON, PTVE, SE, SHOP, SGRY, TME, THS, and TSN. Then, after the close, AE, DOX, AHR, ARMN, CAE, PLUS, FIHL, FLUT, ICUI, CART, LNW, NATL, NGL, OXY, RXT, RKT, SWKS, SPOT, STNE, SU, and MODG report.
In economic news later this week, on Wednesday, we get October Core CPI, October CPI, EIS Short-Term Energy Outlook, October Federal Budget Balance, and API Weekly Crude Oil Stocks. We also hear from Fed Member Williams. On Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, October Core PPI, October PPI, EIA Weekly Crude Oil Inventories, and Fed’s Balance Sheet. We also heat from Fed Chair Powell and Fed member Williams. Finally, on Friday, October Core Retail Sales, October Retail Sales, October Export Price Index, October Import Price Index, Ny Empire State Mfg. Index, October Industrial Production, September Business Inventories, September Retail Inventories are reported.
In terms of earnings reports later this week, on Wednesday, ARCO, BKKT, DOLE, GFF, KMDA, AGRO, BZH, BRFS, BV, CSCO, DADA, EC, HP, HI, NU, SARO, and TTEK report. On Thursday, we hear from AAP, AZUL, BILI, EFXT, JD, NTES, NICE, NOMD, SBH, TLN, DIS, ZK, AMAT, GLOB, and POST. Finally, on Friday BABA and SPB report.
So far this morning, AZN, HD, and SLVM reported beats on both the revenue and earnings lines. Meanwhile, THS missed on revenue while beating on earnings. On the other side, ONON, SE, and TME beat on revenue while missing on earnings. However, IGT and PTVE missed on both the top and bottom lines.
With that background markets seem tepid at these heights. All three major index ETFs opened the premarket modestly lower and have given us indecisive Doji-like candles since that start. However, the short, mid-term, and long-term trend remain very bullish. In terms of overextension, all three are stretched above their T-line (8ema) and the T2122 indicator is now in (the lower end of) its overbought territory. So, while there may be a bit more room to run, the market is in need of a pause or pullback for the health of the rally. With that said, we have to remember that markets can stay over-baked longer that any of us can remain solvent betting on a reversal. In terms of the 10 Big Dogs, seven of the 10 are in the red this morning. INTC (-1.44%) leads the losses while NVDA (+0.41%) paces the gains. Once again, TSLA (-1.08%) is far-and-away the dollar-volume leader, having traded a very heavy $3.4 billion so far this morning…nine times as much as NVDA, which itself has traded 10 times as much as the third-place stock. (This is definitely a Trump win phenomenon.)
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
Futures remained relatively stable after stocks closed at record highs on Tuesday, with only slight declines as Wall Street continued to evaluate which sectors to invest in amid a post-election rally that has propelled equities to unprecedented levels. Investors are keenly awaiting economic data on small businesses, set to be released in the morning. Additionally, they will be closely monitoring remarks from Federal Reserve officials, including Fed Governor Christopher Waller and Minneapolis Fed President Neel Kashkari, throughout the day. Traders are also poised to analyze earnings reports from major companies like Home Depot and Shopify, which are expected to be released on Tuesday.
European markets saw a decline, primarily driven by a significant drop in mining stocks, which fell by 2.6%. In contrast, technology stocks managed a modest gain of 0.5%. Germany reported a 2.4% rise in inflation for October, as confirmed by the latest data from the country’s statistics office. Among the major indices, France’s CAC 40 slipped by 1.2%, while Britain’s FTSE 100 and Germany’s DAX fell by 0.9% and 0.8%, respectively.
Asia-Pacific markets experienced a downturn as investors adopted a cautious stance. Hong Kong’s Hang Seng index led the declines with a significant drop of 2.76%, followed by South Korea’s Kospi, which fell by 1.94%. China’s CSI 300 also saw a decrease of 1.1%, while Japan’s Nikkei 225 slipped by 0.4%. Australia’s S&P/ASX 200 had a relatively minor decline, closing 0.13% lower.
Economic Calendar
Earnings Calendar
Notable reports for Thursday before the bell include ALIT, ALMS, AZN, AVDL, CAMT, DAVA, EVGO, FA, GENI, HD, HTZ, HBM, HUYA, IAC, LEGN, LYV, MIRM, MOS, NMRA, NWN, NVAX, ONON, PTVE, PGY, PLL, PLUG, RGEN, ROIV, SRRK, SDGR, SE, FOUR, SHLS, SDHC, SPHR, SWTX, SHO, SGRY, SLVM, TH, TME, THS, TGI, TSN.
After the bell reports include DOX, AHR, AZTA, CAE, CNNE, CAVA, CHGG, CRNX, DHT, EVCM, GRAB, HPP, ICUI, CART, IAS, LNW, MARA, NTRA, NATL, NPCE, OXY, OUT, FNA, PAY, PRDO, PGNY, PRTA, PUBM, RXT, RPAY, RKLB, SDRL, SWKS, SOUN, SPOT, SU, TTGT, MODG, XENE, & ZI.
News & Technicals’
Home Depot reported quarterly earnings and revenue that surpassed analysts’ expectations, driven by increased sales from its acquisition of SRS Distribution, as well as a surge in demand for hurricane-related repairs and the impact of warmer-than-usual weather across much of the U.S. Despite these positive factors, the company noted that consumers are exercising caution following a period of elevated interest and mortgage rates.
On Tuesday, a Dutch court dismissed a landmark climate ruling against Shell, which had previously mandated the oil giant to significantly cut its global carbon emissions. This decision overturns the May 2021 ruling by The Hague district court that required Shell to reduce its greenhouse gas emissions by 45% from 2019 levels by 2030. The outcome represents a significant development in a precedent-setting case with potential far-reaching implications for future climate litigation.
U.S. Treasury yields saw a notable increase, with the 10-year Treasury yield rising by over four basis points to 4.3550%. The 2-year Treasury yield, which is particularly sensitive to interest rate expectations, climbed by more than six basis points to 4.3149%. Investors are also closely watching key economic data set to be released throughout the week, including the NFIB Business Optimism Index on Tuesday, which will provide insights into the performance of small businesses in October.
Germany is preparing for a federal election in February, earlier than initially proposed by Chancellor Olaf Scholz, following the collapse of his ruling coalition last week. A confidence vote is now scheduled for December 16, a crucial step before the early elections can proceed. This parliamentary vote is necessary for the chancellor to formally call for the election. According to sources within Scholz’s Social Democratic Party (SPD), the federal election is set to take place on February 23.
The record highs continued Monday though we did see a little weakness, beginning to show up by the close of the day. With another light day on the economic calendar traders will look for inspiration in earnings reports. Bond yields continue to be problematic as markets grapple with the pending CPI and PPI reports as well as the changes the new administration will deliver. If some profit taking does begin be prepared for the possibility of some big point moves.
Markets gave us a mixed start to the day Friday. SPY opened 0.09% higher, DIA gapped up 0.23%, and QQQ opened 0.08% lower. We also saw a divergence from that point, at least early. SPY immediately began to rally and chased new highs right up to 2:45 p.m. From there, SPY saw profit-taking all the way into the close. At the same time, after the open, DIA sold for 10 minutes off from the open before joining SPY in a rally until 11:30 a.m. It then chopped sideways until 2 p.m. before rallying again to the highs at 2:45p.m. At that point, DIA also took profits into the close. For its part, QQQ sold off a quarter percent after the open, chopping around until 11 a.m. when it followed the larger-cap index ETFs in a rally that lasted until 1:45 p.m. Then QQQ ground sideways for an hour only to selloff back to Thursday’s close and grind sideways just above that the rest of the day.
This action gave us, white-bodied candles in all three major index ETFs. The DIA gave us a gap-up Spinning Top candle that registered as a new all-time high and a new all-time high close. SPY printed a gap-up, white-bodied candle with significant upper wick. It came within 36 cents of the $600 level while delivering a new all-time high and all-time high close. Meanwhile, QQQ gave us a gap-down, white-bodied Spinning Top that also printed a new all-time high and all-time high close. For the week, QQQ gained 5.48%, SPY gained 4.76%, and DIA gained 4.69%.
On the day, seven of the 10 sectors were green with Utilities (+1.21%) way out in front leading the gainers higher. On the other side, Basic Materials (-1.10%) lagging way, way behind all other sectors (by more than 1%). At the same time, SPY gained 0.43%, DIA gained 0.62%, and QQQ gained 0.12%. VXX dropped another 0.71% to close at 44.77 and T2122 fell back to just outside of its overbought territory, closing at 77.27. Meanwhile, 10-Year bond yields fell to a still high 4.302% while Oil (WTI) dropped 2.63% to close at $70.46 per barrel. So, Friday saw more of the Bulls being in control as the election day and post-election rally continued.
The major economic news scheduled for Friday included Preliminary Michigan Nov. Consumer Sentiment, which came in up to 73.0 (compared to a forecast of 71.0 and a October reading of 70.5). At the same time, Preliminary Michigan November Consumer Expectations were also up to 78.5 (versus a 74.1 October value). Meanwhile, the Preliminary Michigan November 1-Year Inflation Expectations fell a tick to 2.6% (compared to a forecast and October reading of 2.7%). Finally, Preliminary Michigan November 5-Year Inflation Expectations were up a tick to 3.1% (versus a forecast and October value of 3.0%).
After the close, PBR reported a beat on both the revenue and earnings lines.
In stock news, on Friday, PNC announced plans to expand by adding 100 new bank branches with an investment of $500 million. Later, BA announced it plans to repay the employees it furloughed during the recent strike for the wages they lost. However, BA still plans to proceed with the 10% cut in its global workforce (17,000 jobs worldwide). At the same time, Reuters reported that STLA and its Chinese partner Leapmotor have scrapped plans to build a second electric vehicle model at the STLA plant in Poland. Instead, the joint venture is considering making that second model a STLA plant in Germany. Later, Bloomberg reported that BA is considering a sale of its Jeppesen navigation business for $6 billion. Reportedly, potential suitors include private equity firms, which have expressed interest in that unit. At the same time, Reuters reported exclusively that BA and SPR are very close to reaching a funding agreement that would give SPR a lifeline of cash. (The deal will reportedly be announced as soon as this weekend. The exact details on amounts were not disclosed.)
Elsewhere, TSLA closed above the $1 trillion market cap level for the first time. This comes after a massive 29% gain for the week on speculation the Trump administration will pay back CEO Musk for hi support. After the close, BNKG announced it expects to cut jobs as part of a broader cost-cutting program. (No specifics were announced.) At the same time, ENPH said it would be cutting about 500 employees and contractors (about 17% of the workforce). Later, BROS CEO Barone told CNBC that it plans to open 160 new coffee shops in 2025. (BROS currently has 950 locations.) Meanwhile, CRM announced it needs to hire more than 1,000 workers to help it sell its generative AI agent product.
In stock legal and governmental news, on Friday, China approved a $1.4 trillion plan to bolster its economy by selling bonds and allowing local governments to refinance their massive, “hidden” (off books) debt loads. The theory is that this will free up resources for the local governments to spend elsewhere, thus stimulating the economy. At the same time, a US District Judge in CA ruled that META CEO Zuckerberg is not personally liable in the 25 lawsuits alleging that his company purposefully addicted children to social media. However, the cases against META itself (brought both by many States Attorney General and the families of alleged victims) were allowed to proceed. Later, TM “announced” that CA-led (but now in place in 12 states and the District of Columbia) electrical vehicle mandates that begin being phased in next year are “impossible to meet.” TM went on to say, if the mandates are not changed, US customers will see fewer car choices in many states.
In stock legal and governmental news, on Thursday, the NHTSA announced that VLKAF (Volkswagen) is recalling 114k vehicles in the US over airbag concerns. Later, TPR announced it has paused integration of CPRI while it appeals a US court decision to clock the $8.5 billion acquisition. At the same time, a US federal appeals court ruled that WBD’s CNN unit must face a now-revived defamation lawsuit from “Project Veritas” which CNN had reported was responsible for promoting disinformation and doxing. Later, the CA Public Utilities Commission increased reporting requirements on autonomous vehicle “incidents” (now at a trip level) for collisions, traffic citations, and stoppage events (when the self-driven vehicles get stuck). GM, GOOGL, and TSLA are the companies immediately impacted.
Meanwhile, AAL lost its appeal of the US Justice Dept. decision to block the airline’s partnership with JBLU. The US 1st District Court of Appeals three judge panel ruled unanimously that the lower court judge’s decision was correct in siding with the Justice Dept. and FTC. (However, this may be a non-event as the Trump administration is widely expected to be more corporate-friendly, including in terms of mergers and acquisitions. So, the partnership could be floated again after January.)
In miscellaneous news, on Friday, the New York Times reported sources tell it the new Trump administration is preparing to withdraw from the Paris climate agreement and also shrink the size of some national parks and monuments to open up land for the oil industry to drill. (The US is already the world’s largest oil producer, but one campaign mantra of Republicans was “drill baby drill.”) In other oil news, the Dept. of Energy announced Friday that it had purchased its last batch of oil to replenish the Strategic Petroleum Reserve with a contract to buy another 2.4 million barrels for delivery in April through May. (This is the final batch because the Republican House rescinded about $2.05 billion of the funds the previous Democratic House had earmarked to replenish the reserve.) So, 180 million barrels was released from the reserve at a sale price of $95/barrel. Then the Dept. of Energy has replenished 59 million barrels at an average cost of $76/barrel, netting about $3.5 billion in profit but leaving the reserve 121 million barrels short of full capacity but also with $20.5 billion more money in hand and presumably falling oil prices under the new administration should they decide to complete the replenishment. Elsewhere, MCO said Friday that the risks to US fiscal health increased after the election of Trump. (However, this is based on an assumption that Trump will actually implement the policies he promised during the campaign. This includes corporate and personal tax cuts, across the board import tariffs, and deporting a significant chunk of the US labor force. That is far from certain as Trump isn’t known for keeping promises.)
Overnight, Asian markets were mostly in the red with just four of the 12 exchanges above break-even. Shenzhen (+2.03%) was by far the biggest gainer while Hong Kong (-1.45%) and South Korea (-1.15%) paced the losses. However, in Europe, we see green across the board at midday Monday. The CAC (+1.17%), DAX (+1.37%), and FTSE (+0l.75%) lead the region high on broad-based gains in early afternoon trade. In the US, as of 7:45 a.m., Futures are pointing toward more gains. The DIA implies a +0.43% open, the SPY is implying a +0.38% open, and the QQQ implies a +0.39% open at this hour. At the same time, 10-Year Bonds are down to 4.306% and Oil (WTI) is down 1.85% to $69.08 per barrel in early trading.
There is major economic news scheduled for Monday due to Veteran’s Day. US Bond markets are closed for the day, but stock markets are open as usual. Major earnings reports scheduled for before the open include ARMK and ICL. Then, after the close, GRAB, IAC, LYV, and TALO report.
In economic news later this week, on Tuesday, NY Fed 1-Year Consumer Inflation Expectations are reported. We also hear from Fed members Waller, Kashkari, and Harker. Then Wednesday, we get October Core CPI, October CPI, EIS Short-Term Energy Outlook, October Federal Budget Balance, and API Weekly Crude Oil Stocks. We also hear from Fed Member Williams. On Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, October Core PPI, October PPI, EIA Weekly Crude Oil Inventories, and Fed’s Balance Sheet. We also heat from Fed Chair Powell and Fed member Williams. Finally, on Friday, October Core Retail Sales, October Retail Sales, October Export Price Index, October Import Price Index, Ny Empire State Mfg. Index, October Industrial Production, September Business Inventories, September Retail Inventories are reported.
In terms of earnings reports later this week, on Tuesday, we hear from ALIT, AZN, SID, SATS, HTZ, HD, IGT, MOS, ONON, PTVE, SE, SHOP, SGRY, TME, THS, TSN, AE, DOX, AHR, ARMN, CAE, PLUS, FIHL, FLUT, ICUI, CART, LNW, NATL, NGL, OXY, RXT, RKT, SWKS, SPOT, STNE, SU, and MODG. Then Wednesday, ARCO, BKKT, DOLE, GFF, KMDA, AGRO, BZH, BRFS, BV, CSCO, DADA, EC, HP, HI, NU, SARO, and TTEK report. On Thursday, we hear from AAP, AZUL, BILI, EFXT, JD, NTES, NICE, NOMD, SBH, TLN, DIS, ZK, AMAT, GLOB, and POST. Finally, on Friday BABA and SPB report.
So far this morning, ICL reported beats on both the revenue and earnings lines. At the same time, ARMK missed on revenue while reporting in-line on earnings.
With that background, it looks like the market is bullish again early Monday. All three major index ETFs made modest gaps higher to start the premarket. Since then, they have all followed-through with white-body candles so far in the early session. SPY, DIA, and QQQ all sit at new all-time highs again as we await the opening bell. Obviously, all three being far above their T-lines (8ema), the short-term trend is very bullish. The mid-term trend is now also very bullish and the longer-term trend remains strongly Bullish in all three as it has been for years. However, with regard to extension, all three major index ETFs are extended far above their T-line while the T2122 indicator remains just outside the bottom of its overbought territory. So, the market is stretched, but theoretically still has some room to push even higher. (Just remember that markets can remain too far extended longer than we can stay solvent betting on the reversal.) At the very least, we can say the Bulls have momentum but are in need of at least a rest, if not pullback. With regard to those 10 big dog tickers, seven of the 10 are in the green this morning with TSLA (7.09%) far out in front of the rest on what presumably is more of the “Trump paying back Musk” trade. INTC (-0.61%) is by far the weakest of the 10. In terms of trading volume, TSLA has traded five times more than NVDA (+0.70%), which is usually the dollar-volume leader. (That situation has been the new normal under the post-Trump win market, but is exactly the opposite of the “AI is the new thing” trade of the last 18 months.) Finally, do not forget that it’s Veteran’s Day, with Bond markets closed, but not a stock market holiday.
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
Stock futures rose on Monday as Wall Street aimed to extend last week’s impressive rally to new record highs. This follows a remarkable week for U.S. stocks, with the Dow, S&P 500, and Nasdaq all closing at all-time highs. The Dow and S&P 500 had their strongest weeks in about a year, with the Dow briefly surpassing 44,000 for the first time. While no significant economic data is expected on Monday, investors are eagerly anticipating inflation reports due later in the week. Additionally, companies like Live Nation, the parent of Ticketmaster, and Aramark, a food and facility service provider, are set to report their earnings on Monday.
European stocks opened the week on a positive note, with the pan-European Stoxx 600 index trading higher on Monday. This uptick comes as investors brace for a busy week filled with key economic data releases, including inflation figures from Germany and the U.S., as well as GDP data from the U.K. Leading the gains were construction and materials stocks, which rose by over 1.8%. Despite this positive start, it’s worth noting that the benchmark index recorded its third consecutive weekly loss by the end of last week, reflecting ongoing market volatility.
Asia-Pacific markets experienced a downturn on Monday following China’s latest stimulus measures, which failed to meet expectations and raised concerns about the recovery of the world’s second-largest economy. Japan’s benchmark Nikkei 225 showed a slight increase, closing at 39,533.32, while the broader Topix index dipped by 0.09% to 2,739.68. In contrast, Hong Kong’s Hang Seng index saw a significant decline of 1.62%, South Korea’s Kospi dropped by 1.15%, and Australia’s S&P/ASX 200 fell by 0.43%. This mixed performance highlights the ongoing uncertainty in the region’s markets.
Economic Calendar
Earnings Calendar
Notable reports for Thursday before the bell include ARMK, & MNDY. After the bell reports include AROC, AGO, JRVR. KYTX, LAZR, NVRO, TALO, & ZETA.
News & Technicals’
In a recent filing with a Delaware court, FTX highlighted a 2021 transaction where Binance, along with its CEO Changpeng Zhao and others, divested their investment in FTX. This involved selling a 20% stake in FTX and an 18.4% stake in its U.S.-based entity, West Realm Shires, back to the company. This litigation represents the latest escalation in the ongoing tensions between two of the largest players in the cryptocurrency market, following the dramatic collapse of FTX that sent shockwaves through the industry.
In a research note last week, Citi strategists pointed out that cryptocurrency remains one of the “few Trump trades that has yet to retrace.” During his campaign, President-elect Donald Trump made numerous promises to the crypto industry, including a bold pledge to make the U.S. the “crypto capital of the planet.” Looking forward, some analysts are optimistic about the continued rise of cryptocurrencies, with several predicting that bitcoin could reach the $100,000 milestone by the end of the year.
Last month, policymakers introduced new subsidies and tax breaks aimed at supporting households with children under the age of three. However, analysts have pointed out that these measures primarily benefit existing families rather than incentivizing the formation of new ones. Additionally, the success of these policies heavily depends on the capacity of local governments to effectively implement them. This comes at a time when the United Nations has projected a significant demographic shift for China, predicting that the country, currently the second most populous in the world, could see its population decline by more than half by 2100, marking the steepest drop of any nation.
Thought the impressive rally continues this morning with another gap up open keep in mind that the banks and bond markets are closed today so choppy conditions would not be a surprise after the open. The IWM is the only index not at record highs and there appears to be concerted efforts to push toward that goal this morning. That said, the parabolic nature of the current rally also warrants a bit of caution not to case already extended stocks and be watching for a profit-taking pullback that could begin at any time.
On Thursday, markets opened higher again. SPY gapped up 0.35%, DIA opened 0.10% higher, and QQQ gapped up 0.57%. From there, SPY and QQQ followed-through with a rally that lasted until 12:50 p.m. At that point, both had an afternoon rest before QQQ began to rally again at 2 p.m. and SPY followed at about 2:45 p.m. However, both SPY and QQQ also took profits the last 30 minutes of the day. At the same time, after its open, DIA just meandered sideways around that opening gap all day long. This action gave us gap-up white bodied candles in the SPY and QQQ as well as a modestly gap-up Doji in the DIA. SPY and QQQ did have smaller upper wicks on large white bodies. All three major index ETFs are stretched above their T-line (8ema) now. This happened on above-average volume in the DIA, average volume in the QQQ, and below-average volume in the SPY.
On the day, seven of the 10 sectors were green with Technology (+2.08%) way, way out front leading the gainers higher. On the other side, Financial Services (-1.26%) and Communication Services (-1.07%) lagged far behind the other sectors. At the same time, SPY gained 0.77%, DIA gained 0.04%, and QQQ gained 1.58%. VXX dropped another 3.53% to close at 45.09 and T2122 fell but remained just inside of its overbought territory, closing at 80.80. Meanwhile, 10-Year bond yields fell sharply to a still high 4.330% while Oil (WTI) rose 0.50% to close at $72.05 per barrel. So, the day saw follow-through (especially in the tech area) to Wednesday’s post-election spike. The mega-cap DIA was torn between big profit-taking among financials and the pops from INTC (which is soon going bye-bye from that index), AMZN, AAPL, and MSFT. Among the market’s big dogs TSLA (+2.90%), led NVDA (+2.25%) in dollar-volume traded although both were over $30 billion and less than $35 billion. So, it was a lot closer than it normally is in terms of trading. It is also worth noting that SPY, DIA, and QQQ all printed another new all-time high and another new all-time high close.
The major economic news scheduled for Thursday included Weekly Initial Jobless Claims, which were up slightly but also slightly better than expected at 221k (compared to a forecast of 223k and a prior week reading of 218k). On the ongoing front, Weekly Continuing Jobless Claims came in higher than expected at 1,892k (versus a 1,880k forecast and the prior week’s 1,853k value). At the same time, Preliminary Q3 Nonfarm Productivity (Qtr.-on-Qtr.) was up but not as strong as predicted at +2.2% (compared to a +2.6% forecast and a Q2 reading of +2.1%). Meanwhile, the Preliminary Q3 Unit Labor Costs were both down sharply but still far higher than anticipated at +1.9% (versus a forecast of +1.1% and a Q2 reading of +2.4%). Later, Sept. Consumer Credit came in DRAMATICALLY lower than predicted at $6.00 billion (less than half of the $12.20 billion forecast and down from August’s $7.64 billion number). Then, after the close, the Fed Balance Sheet showed another decline, falling $19 billion on the week down to $6.994 trillion.
Prior to the Fed announcements, the ever attention-needy Trump camp leaked to CNN that the ex-President “would likely allow” the FOMC Chairman to serve out the rest of his term rather than firing him. During his Press Conference, Fed Chair Powell said he gave one-word “No” answers indicating he would not resign, even if asked, and also that Presidents do not have the legal authority to fire a Fed Chairman. (However, it is worth noting that Chair Powell’s term ends in 2026.)
In Fed news, on Thursday, the Fed Interest Rate Decision was to cut rates 0.25% as expected. This reduces the Fed Funds rate to 4.75% – 5.00%. The vote for this cut was unanimous. In its statement, the FOMC said, “The economy has continued to expand at a solid pace,” going on to say “Inflation has made progress toward the Committee’s 2 percent objective but remains somewhat elevated.” It is also worth noting that the FOMC removed a line from the September statement which had said the committee had “gained greater confidence that inflation was moving toward its 2% target.” (This may reflect the reasoning for, or result from the decision to, cut only a quarter point instead of the previous half percent cut.) The statement summation was, “The Committee judges that the risks to achieving its employment and inflation goals are roughly in balance.” Regarding labor markets, the statement said, “(labor market) conditions have generally eased, and the unemployment rate has moved up but remains low.” (This was a change from language noting a slowing labor market in September.)
In other news from the Fed Chair press conference, Powell said “In the near term, the election will have no effects on our policy decisions.” He continued to be pestered by questions about what a new Trump administration means for Fed policy, answering that, “We don’t guess, speculate, and we don’t assume what future policy choices will be” (going on to state the Fed boilerplate “data driven” approach). This press focus on Trump and what Trump means for the economy led to a shortened press conference.
After the close, AFRM, AKAM, AMN, ANET, AXON, CIVI, ED, DBX, DXC, FTNT, G, PODD, MTD, MSI, NWSA, OPEN, OVV, PINS, QDEL, REZI, RNG, TOST, and TTD all reported beats on both the revenue and earnings lines. Meanwhile, CPAY, EOG, and EXPE missed on revenue while beating on earnings. On the other side, AL, ABNB, AMRC, BHF, CPRI, EXPI, LGFA, and SOLV beat on revenue while missing on earnings. However, AGL, SQ, DKNG, EVH, MNST, RIVN, and RUN missed on both the top and bottom lines.
In stock news, on Thursday, Mercury Research reported that INTC’s share of the notebook, desktop, and server market segments is the lowest since 2006. The report said that AMD and ARM were the competitors picking up the lost share. (Still, it is worth noting that INTC continues to have a 66% in the desktop, 69% in the notebook, and a 70% share in the server space.) Later, USM announced it has agreed to sell some of its spectrum licenses to T for $1 billion. At the same time, DUK announced that it expects to see between $2.4 billion and $2.9 billion in costs to restore facilities damaged by Hurricanes Debby, Milton, and Helene. Later, GM announced it is ending production of Cadillac XT4 SUVs as the company shifts more toward electric vehicles. After the close, Bloomberg reported that BLK is in talks with $70 billion hedge fund Millenium Mgmt. over purchasing a stake in the private fund.
In stock legal and governmental news, on Thursday, the NHTSA announced that VLKAF (Volkswagen) is recalling 114k vehicles in the US over airbag concerns. Later, TPR announced it has paused integration of CPRI while it appeals a US court decision to clock the $8.5 billion acquisition. At the same time, a US federal appeals court ruled that WBD’s CNN unit must face a now-revived defamation lawsuit from “Project Veritas” which CNN had reported was responsible for promoting disinformation and doxing. Later, the CA Public Utilities Commission increased reporting requirements on autonomous vehicle “incidents” (now at a trip level) for collisions, traffic citations, and stoppage events (when the self-driven vehicles get stuck). GM, GOOGL, and TSLA are the companies immediately impacted.
In miscellaneous news, on Thursday, the Bank of England also cut its based rate by 25 basis-points to 4.75%. Elsewhere in Europe, German Chancellor Scholz is now facing increasing pressure from business groups (and opposition parties) to call new elections after the collapse of its three-way coalition. Back in the US, after the Fed rate cut, the Fed Funds Futures market is showing that trades are indicating a 74.5% probability of another quarter-point cut in December. The other 25.5% probability foresees no cut or increase in December.
In Middle-East War news, on Thursday, the IDF announced it expanded its operations in Northern Gaz, claiming that Hamas has regrouped. In addition, Israeli strikes in that area killed dozens Thursday, including 27 in one airstrike on a multi-story building in a refugee camp. Elsewhere, the Gaza Ministry of Health reported nearly 44k Palestinians have been killed and another 103k injured since Israel’s responses to the Oct. 7, 2023 Hamas attack began.
Overnight, Asian markets were mixed with five of the 12 exchanges in green and the other seven below break-even. Hong Kong (-1.07%) was well out in front of the other losers while New Zealand (-1.50%) and Singapore (+1.39%) were well in front of the other gainers. In Europe, we see a similar picture taking shape with nine of the 14 bourses showing red at midday. The CAC (-0.64%), DAX (-0.60%), and FTSE (-0.78%) lead the region lower in early afternoon trade. In the US, as of 7:30 a.m., Futures are pointing toward a modestly lower start to the day. DIA implies a -0.02% open, the SPY is implying a -0.12% open, and the QQQ implies a -0.31% open at this hour. At the same time, 10-Year bond yields are down to 4.308% and Oil (WTI) is down 1.24% to $71.46 per barrel in early trading.
The major economic news scheduled for Friday brings Michigan November Consumer Sentiment, Michigan November Consumer Expectations, Michigan November 1-Year Inflation Expectations, Michigan November 5-Year Inflation Expectations and Sept. Retail Inventories (all at 10 a.m.). We also hear from Fed Governor Bowman (11 a.m.). The major earnings reports scheduled for before the open include ADNT, WMS, ATSG, AMCX, AXL, AMRX, BAX, BLMN, BEPC, BEP, CLMT, CNH, ERJ, FLO, FLR, FTRE, GLP, GTN, IEP, KOP, LAMR, NRG, PAA, PAGP, RBA, SONY, TIXT, and PARAA. Then, after the close, CEPU reports.
So far this morning, ADNT, AMRX, BAX, ERJ, PARAA, and TIXT have all reported beats on both the revenue and earnings lines. Meanwhile, BLMN, FLO, and SONY missed on revenue while beating on earnings. On the other side, CLMT, FTRE, IEP, and NRG beat on revenue while missing on earnings. However, WMS, FLR, GTN, and LAMR missed on both the top and bottom lines.
With that background, it looks like the market is basically undecided so far in the premarket. SPY and QQQ did gap modestly higher to start the early session, but have printed black-bodied candles since that point and are back to basically flat. Meanwhile, DIA started premarket a bit lower, and has printed a small white-body candle to also climb back to basically break-even from Thursday’s close. With all three being far above their T-lines (8ema), the short-term trend is very bullish. The mid-term trend has also reversed since the surprise election result and is now bullish and the longer-term trend remains strongly Bullish in all three. Basically, the only thing you need to know is that all three major index ETFs now sit at all-time highs. With regard to extension, all three major index ETFs are extended far above their T-line. However, the T2122 indicator remains just inside the bottom of its overbought territory. So, the market is stretched, but theoretically still has some room to push even higher. At the very least, we can say the Bulls have the momentum but are in need of at least a rest. (Just remember that markets can remain too far extended longer than we can stay solvent betting on the reversal.) With regard to those 10 big dog tickers, nine of the 10 are in the red this morning with only AAPL (+0.10%) clinging to green territory. Meanwhile, INTC (-0.91%) leads the pack lower after leading the gains Thursday. In terms of trading volume, NVDA (-0.07%) and TSLA (-0.03%) are neck-and-neck in terms of dollar-volume traded and both have traded 12 or more times as much as the next closest stock. However, it is a lighter volume trading premarket than usual. Finally, do not forget that it’s Friday…pay day. So take some money off the table to pay yourself and prepare your account for the weekend news cycle. (Happy Birthday on Sunday to my fellow Marines and don’t forget Monday is Veteran’s Day, but not a market holiday.)
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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Following a significant market rally spurred by the decisive presidential election, stock futures saw a slight gain. Bitcoin, the U.S. dollar, and bank stocks all surged in Wednesday’s post-election trading. Conversely, several international funds and solar stocks faced declines as investors anticipated negative impacts from the President-elect’s policies. On Thursday, market participants are keenly awaiting the Federal Reserve’s interest rate decision and Chair Jerome Powell’s press conference. Additionally, quarterly earnings reports are expected from Moderna and Warner Bros. Discovery before the market opens, with Block, Pinterest, and Rivian set to report in the afternoon.
European markets saw an uptick on Thursday morning, buoyed by investor anticipation of rate cuts from both the U.S. Federal Reserve and the Bank of England. The trading session was marked by a flurry of earnings reports from major European companies. Among the notable movements, Adyen’s shares plummeted by 10%, making it the day’s worst performer. In contrast, GN Store Nord, a Danish manufacturer, emerged as the top performer, with its shares surging over 10% following the release of its latest financial results.
Asia-Pacific markets experienced a mixed trading session on Thursday, with most indices showing gains despite some volatility. The yen, which had weakened to an intraday low of 154.7 against the dollar on Wednesday, reached its weakest point since July 30, rebounding slightly to 153.81 on Thursday. Leading the gains in the region, China’s CSI 300 index surged by 3.02%, while Japan’s Nikkei 225 was the only major index to close in the red, falling by 0.43%. In other news, Chinese state media reported that the National People’s Congress Standing Committee had reviewed a plan to increase local government debt, following initial discussions earlier in the week.
Moderna reported a surprising profit for the third quarter on Thursday, significantly exceeding Wall Street expectations. This positive outcome was driven by effective cost-cutting measures and higher-than-anticipated sales of its Covid vaccine. The company highlighted that its latest Covid vaccine benefited from receiving U.S. approval three weeks earlier than the previous version did in 2023. Additionally, this quarter marked the first time sales of Moderna’s vaccine against respiratory syncytial virus (RSV) were included, representing the company’s second commercially available product.
As the Federal Reserve concludes its meeting on Thursday, it is expected to implement another interest rate cut. Market participants will be keenly focused on Chair Jerome Powell’s remarks regarding future monetary policy directions. Historically, Fed policymakers have aimed to remain apolitical, so Powell is likely to steer clear of making direct comments about the anticipated policies of President-elect Donald Trump. Instead, his focus will likely be on the economic outlook and the Fed’s strategy moving forward.
Qualcomm announced impressive fourth-quarter earnings on Wednesday, surpassing Wall Street’s expectations for both earnings and revenue. The company also provided a strong outlook for the December quarter, which contributed to a surge in its stock during extended trading. Additionally, Qualcomm’s board approved a substantial $15 billion in additional share repurchases, signaling confidence in the company’s future performance and commitment to returning value to shareholders.
After yesterday’s significant market rally the question will be follow-through? We have a big day of earnings and economic reports including a trade decision from the FOMC. Though premarket activity suggests another gap up open be watchful for any clues of profit taking that could pull the market back with big point moves. That said, it is also possible that the election celebration continues through the end of the week so just be prepared to protect your profits.
Following Donald Trump’s victory in the 2024 presidential election, stocks are set for a significant rally on Wednesday. Bitcoin surged to an all-time high of $75,000, likely to benefit from expectations of relaxed regulations. The dollar index reached its highest level since July, and the 10-year Treasury yield rose to approximately 4.43%. Bank shares experienced a notable boost, with JPMorgan, Bank of America, and Wells Fargo, each jumping by at least 6%. Additionally, futures for the small-cap benchmark Russell 2000 increased by 6%.
European stocks continued their upward trajectory, with the pan-European Stoxx 600 rising by 1.2%. This broad-based increase saw most regional bourses and sectors gaining, with media stocks leading the charge by adding 2.6%. However, the automotive sector faced challenges, declining by 2%. Among individual companies, Commerzbank reported a 6.2% drop in net profit to 642 million euros for the third quarter, attributed to a broader decline in net interest income and increased risk provisions.
Asia-Pacific markets presented a mixed performance. Japan’s Nikkei 225 led the gains, surging by 2.61%, buoyed by the Bank of Japan’s September monetary policy meeting minutes, which revealed a consensus among members to raise rates. Conversely, South Korea’s Kospi fell by 0.52%, and Hong Kong’s Hang Seng index dropped significantly by 2.5%. Australia’s S&P/ASX 200 also saw a decline, closing 0.83%. Meanwhile, investors are closely monitoring the ongoing five-day meeting of China’s National People’s Congress for potential announcements on additional economic stimulus measures.
CVS Health reported mixed results for the third quarter, with higher medical costs impacting its profitability. The company anticipates that these elevated costs will continue to pressure its performance throughout the year, leading them to withhold a formal outlook at this time. This earnings report marks the first under the leadership of CEO David Joyner. Additionally, CVS announced the appointment of Steve Nelson, former CEO of UnitedHealth Group, as the new president of its health insurer, Aetna, effective immediately.
Super Micro, the embattled server maker, reported a sharp 17% decline in its preliminary first-quarter results on Tuesday. The company is grappling with several corporate governance challenges, including the recent resignation of its auditor. Despite these issues, the board of directors stated that there was no evidence of fraud or misconduct by management. This statement comes as the company seeks to reassure stakeholders amid ongoing scrutiny.
Solar stocks are experiencing a sell-off as clean energy investors react to the news of Donald Trump’s upcoming second term as President. Concerns are mounting among traders that Trump might repeal the Inflation Reduction Act if Republicans gain unified control of the government. This uncertainty has led to a significant drop in the Invesco Solar ETF, which was down by 7% in premarket trading.
The world’s largest automaker by sales volume reported a 20% year-on-year decline in operating profit. Despite this drop, the company upheld its full-year operating profit forecast of 4.3 trillion yen. In a positive move for shareholders, Toyota increased its full-year dividend forecast to 90 yen, up from 75 yen the previous year.
Although the stocks are set for a significant rally, I would be very cautious about rushing in chasing the exuberant moves. The T2122 indictor will likely show a very overbought condition first thing this morning so watch for the possibility of some profit taking or a substantial whipsaw. Soon markets will remember we have and pending FOMC decision Thursday afternoon and choppy price action could resume. The dollar and bond yields are zooming higher in speculation of policy changes so be very careful with commodities.
On Tuesday, markets opened modestly higher and followed-through with a rally until about 1 p.m. SPY gapped up 0.18%, DIA opened just 0.03% higher, and QQQ gapped up 0.34%. From there, all three major index ETFs rallied, more quickly at first and then slower after the first hour, but reaching about 1 p.m. before slumping sideways. SPY and DIA rallied the last few minutes to go out at or near highs while QQQ never quite regained the highs. This action gave us large, white-bodied candles in all three of the major index ETFs. SPY printed a Best Friend type candle (Spinning top followed by a gap-up Marubozu candle) to cross back above its T-line (8ema). Meanwhile, DIA gave us a large, white-bodied candle with small wicks at each end that crossed above its T-line and above its 50sma. For its part, QQQ printed another Best Friend type signal with a small wick at the top, but it also crossed above its T-line. This happened on average volume in the DIA, and below-average volume in the SPY and QQQ.
On the day, all 10 sectors were green with Utilities (+1.90%) and Industrials (+1.76%) out front leading the market higher. On the other side, Communication Services (+0.62%) lagged behind the other sectors. At the same time, SPY gained 1.20%, DIA gained 1.02%, and QQQ gained 1.28%. VXX dropped 5.36% to close at 51.55 and T2122 jumped higher to the top end of its mid-range, closing at 72.41. Meanwhile, 10-Year bond yields fell slightly to 4.289% while Oil (WTI) rose 0.88% to close at $72.10 per barrel. So, Tuesday was a bullish day across the market, maybe on relief election advertising is done or anticipation one way or the other in the election outcome. No matter the reason, it was the Bulls’ day as Bears never found any traction. For what it is worth, DIA broke through its downtrend line.
The major economic news scheduled for Tuesday includes Sept. Exports, which came in down a bit to $267.90 billion (compared to an August reading of $271.80 billion). At the same time, Sept. Imports were up to $352.30 billion (versus an August value of $342.20 billion). Together, this gave us a Sept. Trade Balance with a larger than predicted deficit of -$84.40 billion (compared to a forecast of $83.80 billion and an August reading of -$70.80 billion). Later, the Oct. S&P Global Services PMI was down to 55.0 (versus a forecast of 55.3 and a September reading of 55.2). At the same time, Oct. S&P Global Composite PMI was up, but not as much as anticipated at 54.1 (compared to forecast of 55.3 and a September value of 55.2). Later, Oct. ISM Non-Mfg. PMI were stronger than expected at 56.0 (versus a 53.8 forecast and a Sept. reading of 54.9). This included an Oct. ISM Non-Mfg. Employment Index that was up more than predicted at 53.0 (compared to forecast of 48.0 and a September value of 48.1). At the same time, the Oct. ISM Non-Mfg. Price Index were down but also a tick higher than predicted at 58.1 (versus a forecast of 58.0 and down from September’s 54.9 number). Then, after the close, the API Weekly Crude Oil Stocks were reported with a significantly larger inventory build than anticipated at +3.132 million barrels (compared to forecast of +1.800 million barrels and a previous week value of -0.573 million barrels).
After the close, AIZ, CRC, CPNG, DVN, GMED, GO, JKHY, KGC, LUMN, MASI, MCHP, MRC, NOG, VIV, and TX all reported beats on both the revenue and earnings lines. Meanwhile, AFG, FYBR, IFF, and NE beat on revenue while missing on earnings. On the other side, PAAS missed on revenue while beating on earnings. However, EXAS and PBA missed on both the top and bottom lines.
In stock news, on Tuesday, Reuters reported a survey that found that the major mass retailer like WMT, TGT have imported less holiday product this year than recent years based on the shorter and expected to be weaker holiday sales. However, even more discounted retailers like DG and DLTR imported the same amount of Christmas items than in past years. The article also noted that the US National Retail Foundation has reported that November-December sales grew 2.5%-3.5% in 2023. This was the slowest year-on-year holiday sales growth since 2018. Later, EMR proposed a buyout of the rest of AZPN at an offer of $240 per share (or $6.53 billion). This was a modest premium on Monday’s closing price for AZPN of $237.59.
Elsewhere, TSLA CEO Elon Musk responded to previous Reuters reports related to the company’s long-promised and never delivered $25k electric vehicle. Musk responded Tuesday that it was “pointless” to build a cheap electric vehicle that was not a robotaxi. Later, CVX, BP, SHEL, and OXY announced they were temporarily halting operations in the Gulf of Mexico as Tropical Storm Rafael strengthens and is expected to become a Category 1 hurricane by Wednesday morning. At the same time, Reuters reported that ADM has found additional accounting errors after the company was forced to restate six years of financials in March. (ADM will amend its 2023 annual report as well as Q1 and Q2 reports of 2024 following the finding of the new error.)
In stock legal and governmental news, on Tuesday, AMZN announced that it remains committed to a nuclear power plant adjacent to its PA data center campus…despite the plant project (from TLN) being rejected by the Federal Energy Regulatory Comm. (The deal was opposed by some utility industry groups.) It is unclear how TLN and/or AMZN intend to overcome the regulatory denial. At the same time, Reuters reported that a Moscow Court fined AAPL about $37k on Tuesday for refusing to delete two podcasts from the Apple Music platform. (This is the opposite of the ruling against GOOGL, which was for deleting YouTube channels of Moscow propaganda.) There was no word on whether the AAPL fine doubles daily after the payment deadline the way GOOGL’s fine has doubled to now be more money than exists in the world. Later, a federal judge dismissed a proposed class-action lawsuit that had been filed against GOOGL. (The case alleged GOOGL was profiting by refusing to refund millions of dollars stolen from victims in Google Play Store gift card scams.)
Elsewhere, the UK Anti-trust Regulator approved the $19 billion merger of VOD with British firm Hutchinson’s Three UK, stating that the country’s need for investment outweighed the competition concerns. (The agency had blocked the merger nine years prior on the basis of its anti-competitive impacts.) Later, Reuters reported that NFLX is under investigation for tax fraud in France and the Netherlands with searches of the offices of the company in the two countries took place Tuesday. At the same time, South Korea fined META $15.67 million over its collection of user personal data and giving it to advertisers without user consent. Later, Reuters reported that AAPL will be the first company y to face fines under the EU’s Digital Markets Law after regulators found that AAPL did violate the law back in June. The report said the fine will likely be announced this month. (The maximum fine would be 10% of AAPL’s global sales.) After the close, the FTC sued DAVE, alleging the fintech company misleads consumers by claiming to offer cash advances to gain users of its app, but which few users receive.
In miscellaneous news, on Tuesday, NVDA passed AAPL to again become the world’s most valuable company based on market cap. NVDA closed at a market value of $3.43 trillion, slightly ahead of AAPL’s $3.38 trillion. (Poor MSFT is a distant third at $3.06 trillion.) Elsewhere, Bloomberg reported Tuesday that bond investors have priced in scenarios that would benefit from a Harris election victory while under-investing on positions likely to benefit from a Trump victory. (They gave no specifics on the exact trades or amounts or how they came to the conclusion one trade would benefit from a Harris win and the other would benefit from a Trump win. However, I wanted to include the info for anyone who is a savvier bond trader.)
In geopolitical news, on Tuesday, Israeli PM Netanyahu fired his rival and now-former Defense Minister Gallant. Netanyahu promoted his ally Foreign Minister Katz to take the Defense Minister spot and unassigned cabinet member Sa’ar to replace Katz as the new Foreign Minister. Protests erupted across Israel over the firing. In unrelated news, Israeli police arrested a Netanyahu aid over accusations of leaking information (that gave Netanyahu cover for refusing cease fire proposals) after an Israeli court loosened a government gag order on the info that underlies the case. Meanwhile, on the ground, an Israeli strike in the north of Gaza killed 30 (mostly women in children according to the AP) on Tuesday. Elsewhere, in Russian invasion news, in the Kursk region, Ukrainian forces clashed with North Korean troops for the first time Tuesday. (Some North Korean troops were killed a week ago, but that turned out to be due to “friendly fire” from Russian artillery.) The skirmishes were small-group in nature and there was no word on casualties.
Overnight, Asian markets were mixed with half of the 12 regional exchanges in the red and the other half in the green. Japan (+2.61%) was by far the biggest gainer while Hong Kong (-2.23%) was by far the biggest loser. Meanwhile, in Europe, the bourses lean toward the upside at midday with just four of the 14 exchanges below break-even. The CAC (+1.20%), DAX (+0.83%), and FTSE (+1.27%) lead the region higher in early afternoon trade. In the US, as of 6:40 a.m., Futures are pointing toward a significant gap higher. The DIA implies a +2.93% open, the SPY is implying a +2.22% open, and the QQQ implies a +1.63% open at this hour. At the same time, 10-Year bond yields are spiking higher to 4.477% and Oil (WTI) has fallen 1.40% to $70.98 per barrel in early trading.
The major economic news scheduled for Wednesday includes EIA Weekly Crude Oil Inventories (10:30 a.m.). The major earnings reports scheduled for before the open include AEP, BCO, COR, CTRI, GIB, CRL, CLVT, CNDT, CVS, DK, ENOV, HMC, HWM, IRM, JCI, JLL, LINE, NVO, ODP, OC, PFGC, PRGO, PNW, RPRX, SNDR, SRE, FUN, SWX, STWD, SUN, TEVA, TM, TRMB, and VSH. Then, after the close, AMRK, AGI, ALB, AMC, AEE, APA, APP, ARDT, ARM, ASH, ATO, BTG, BALY, BBSI, BKD, CHRD, COHR, CCU, CTVA, COTY, CAPL, DLX, ET, EMS, ENLC, EQX, FG, FNF, FBIN, FNV, GFL, GILD, HG, HST, HUBS, JXN, JAZZ, KD, LILA, LYFT, MFC, MRO, VAC, MTCH, MATV, MCK, MELI, MEOH, MKSI, MODV, NTR, PAM, PR, PRI, PTC, QGEN, QCOM, RNR, RGLD, SVC, SBGI, SSRM, STE, STRL, SUI, TTWO, TKO, TS, TRIP, TTEC, TPC, UHAL, VSAT, VSTO, WES, WMB, ZG, and Z report.
So far this morning, AEP, COR, GIB, CRL, CRARY, CVS, DK, DDL, ENOV, KMT, ADRNY, OC, TEVA, TRMB, and VWDRY all reported beats on both the revenue and earnings lines. Meanwhile, CLVT, HWM, IRM, JCI, LINE, and PRGO missed on revenue while beating on earnings. On the other side, HMC and PFGC beat on revenue while missing on earnings. However, NVO, ODP, SUN, TM, and VSH all missed on both the top and bottom lines.
In economic news later this week, on Thursday, we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Preliminary Q3 Nonfarm Productivity, Preliminary Q3 Unit Labor Costs, Sept. Retail Inventories, Fed Interest Rate Decision, FOMC Statement, Fed Chair Press Conference, Sept. Consumer Credit, and Fed Balance Sheet. Finally, Friday brings Michigan November Consumer Sentiment, Michigan November Consumer Expectations, Michigan November 1-Year Inflation Expectations, and Michigan November 5-Year Inflation Expectations.
In overnight news, America chose four more years of the felon, ex-President as it elected him again over current-VP Harris. The country also gave his party control of both the Senate and House, ensuring that faction now has complete control over all three branches of the US government as of January. Markets seem to love the idea, or are at least expressing relief that the election process is done, and are looking like they want to revisit the recent all-time highs. The Dollar is spiking, which at least in part helps explain the 10-Year bond yield spike, which is contributing to falls in commodity prices early.
With that background, it looks like the market is spiking higher and strongly bullish again early on Wednesday. All three major index ETFs gapped higher to start the premarket. Since that point, all three have also printed large white-bodied candles. (DIA is back at all-time highs.) With all three gapping far above their T-line (8ema), the short-term trend is bullish. However, the mid-term trend is also reversed and is now again bullish and the longer-term trend remains strongly Bullish in all three. With regard to extension, all three major index ETFs will open extended far above their T-line. However, at least until the market opens the T2122 indicator remains in the top end of its mid-range. So, the Bulls will run this morning. However, markets will also be stretched. Just remember that markets can remain too far extended longer than you can stay solvent betting on the reversal. With regard to those 10 big dog tickers, eight of the 10 are in the green again this morning. TSLA (+12.64%) is getting paid back for Musk getting in bed with Trump. TSLA is also far-and-away the largest dollar-volume trader, having traded nearly six times the traditional leader NVDA (+1.12%). The laggard of the group is META (-1.00%), perhaps on the premise that it will be punished by a pro-Musk government since it competes with Musk’s own social media company.
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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