Market Over Initial Russia-Ukraine Shock

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Tuesday saw a modest gap down on the Russian “soft invasion” of Ukraine.  Then, after a half-hour of volatility, markets sold off most of the day.  This left us with gap-down, indecisive Spinning Top or Doji candles in all 3 major indices.  All 3 are also at the breakout point of a bearish “Dreaded h” pattern.  On the day, SPY lost 1.07%, DIA lost 1.46%, and QQQ lost 1.00%.  This put all 3 into correction territory, with the QQQ in a bear market (depending on how you measure). The VXX was flat at 23.36 and T2122 dropped down into the oversold territory at 10.24.  10-year bond yields rose to 1.944% and Oil (WTI) rose 1.32% to $92.27/day.

The US and Europe hit Russia with symbolic, but largely meaningless, sanctions as a result of the soft invasion of Ukraine. These included sanctions on a handful of smaller Russian banks (which don’t get their funding from abroad, so the impact is not heavy). Probably most notable was Germany’s decertifying the “Nord Stream 2” Natural Gas pipeline.  (50% of Nord Stream 2 funding came from Western Europe and Russia responded by threatening that Europe would soon be paying 20% more than the record price for its natural gas.) Still, this sanction has a minimal impact since the pipeline was not yet online and nobody thinks that the pipeline project won’t eventually be given a green light again.  The fear the market is likely to focus on is that Russia recognized the entire DonBas region as being separate from Ukraine, not just the area already controlled by Russian-backed Separatists.  That means they claim to support Separatist “ownership” of well over 3 times as much territory as the Separatists actually now control.  This implies a Russian offensive in support of its friends to at least the borders of the DonBas region.

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In other news, both the Mfg. and Services PMIs came in higher than expected.  Even Conf. Board Consumer Confidence slightly beat expectations.  Then, after the close, MOS, AGR, TOL, PANW, FANG, CDNS, PSA, RXT, TXRH, NDSN, O, TDOC, and MTDR all reported beats on both lines.  Meanwhile, MELI, CWH, RRC, and EXAS beat on revenue but missed on earnings.  On the other side, VRSK, missed on revenue but beat on earnings.  However, CZR and RIG missed on both lines. 

So far this morning, LOW, ETR, OMI, ODP, BCO, PSN, TNL, WWW, and NI have all reported beats on both lines.  Meanwhile, BCS, VIPS, and OSTK reported beats on earnings but came in short on revenue.  On the other side, HFC, TAP, DAN, CSTM, VRT, ARKO, and PRG all missed on earnings but beat on revenue.  As of now, there have been no reports that missed on both lines.

Overnight, the Asian markets were mixed, but mostly green.  Japan (-1.71%) was by far the most bearish with Shenzhen (+1.93%) by far the most bullish.  The rest of the region saw modest gains in the half of a percent range.  In Europe, markets are rebounding with green seen across the board at mid-day.  Of note, Belgium (+1.54%) is a full percent ahead of the rest of the continent.  The FTSE (+0.33%), DAX (+0.61%), and CAC (+0.99%) are leading the region higher in early afternoon trading.  As of 7:30 am, US Futures are pointing toward a green open.  The DIA implies a +0.52% open, the SPY is implying a +0.63% open, and the QQQ implies a +0.98% open at this hour.  10-year bond yields have risen to 1.969% as traders step back from bonds and Oil (WTI) is down half of a percent in early trading after yesterday’s rise.

There is no major economic news scheduled for Wednesday.  The major earnings reports scheduled for before the open include BCS, BHC, BCO, CLH, CSTM, DAN, ETR, FYBR, GIL, HFC, IHRT, LOW, TAP, NI, ODP, OSTK, OMI, PSN, PBR, PRG, SBGI, TJX, TNL, VRT, VIPS, and WWW.  Then after the close, AEM, AMED, ANSS, ACA, BBWI, BKNG, CHK, FIX, CTRA, CCRN, CW, DK, EBAY, WTRG, FLS, FNF, FRG, HLF, HTZ, IR, KALU, LHCG, LYV, MANT, VAC, MYRG, NTAP, OPAD, PTVE, PARR, RCII, RYI, SNBR, SUM, FTI, and UCTT report.

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The bulls would sure like to do at least a relief rally not that the S&P has entered correction territory. However, Ukraine is in the process of declaring a state of emergency and has told its citizens to leave Russia immediately. The good news is, at least as of now, there is no active fighting between formally Russian troops (as opposed to the Russians posing as Ukrainian Separatists) and Ukrainian forces. So this morning, traders are likely to be over the initial shock and happy there is no active fighting. Look for that little relief rally to ensue. However, keep in mind that the technical damage and overhead resistance are still major hurdles to the bulls getting the market into full rally mode. So, expect volatility, fear news causing market knee-jerks, and trade cautiously.

Remember that you don’t have to trade every day and you definitely don’t need to chase the premarket moves by trading early. Ask yourself whether you have an edge in this sort of volatility. If not, sitting on your hands may be the best move you could make. Trading is a marathon, not a sprint. So, stick to your trading rules and manage the things that you can control. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. The first rule of making money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. If you are wrong, just admit it and take your loss. (That’s why we set stops in the first place.)

Ed

Swing Trade Ideas for your consideration and watchlist: ABBV, SYY, FTNT, KO, CHKP, CVS, FFIV, CHD, T. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

TC2000 Discount

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Russia Invading Ukraine

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Russia Invading Ukraine

The guessing is over, and now the market has the increased uncertainty of what comes next with Russia invading Ukraine.  So it should be no surprise that oil prices are surging while currency, crypto, world markets, and U.S. futures experienced some extreme price volatility overnight.  Add in a big day of earnings events possible market-moving economic data, and it’s fair to say anything possible.  So plan carefully and expect substantial point whipsaws that could quickly test overnight futures lows as the uncertainty unfolds.

Asian markets experienced a very volatile session, with Hong Kong leading the selling down 2.69%.  Somewhat surprisingly, European markets chop around the flatline, trying to shake off the invasion concerns.  As earnings roll out, U.S. futures are well off the overnight lows, with Case-Shiller, PMI Flash, and Consumer Confidence numbers just ahead.  Be ready for anything with the market likely susceptible to the geopolitical news cycle.

Economic Calendar

Earnings Calendar

Kicking off a short trading week, we have a busy earnings calendar with more than 200 companies listed.  Notable reports include CZR, A, AU, CDNS, CNP, CBRL, CVI, FANG, EXAS, EXPD, FLR, HALO, HR, HL, HD, KTOS, DNUT, LPX, M, MDT, MELI, MOS, NXST, NU, PANW, PSA, RXT, RDN, RRC, O, RNG, TDOC, PTX, TXRH, TOL, RIG, & SPCE.

News & Technicals’

Home Depot on Tuesday said sales grew 11% in the fiscal fourth quarter, as the retailer topped Wall Street’s expectations and said it sees sales growth ahead for 2022.  The home improvement retailer said it expects earnings per share growth to be in the low single-digits and sales growth to be “slightly positive” in the coming fiscal year.  The company recently named chief operating officer Ted Decker its new CEO, as of March 1.  The world is waiting to see what happens next in Ukraine after Russian President Vladimir Putin ordered Russian forces to move into breakaway regions of the eastern part of the country.  Putin said Russia would recognize the independence of two self-proclaimed and pro-Russian republics in eastern Ukraine.  He said he would send Russian troops to the region on a “peacekeeping” mission.  Global financial markets were rattled by the latest developments in the Ukraine-Russia crisis, with European stocks falling at the open.  On Monday evening, Russian President Vladimir Putin ordered forces into two breakaway regions of eastern Ukraine and said he would recognize the independence of Donetsk and Luhansk.  Rising tensions have sent jitters through markets, driving oil prices higher.  Treasury yields fell in early Tuesday trading, with the 10-year falling to 1.9009% and the 30-year dipping to 2.2185%.

With Russia invading Ukraine, currencies, crypto, and U.S. futures markets experienced extreme price volatility with wild swings that saw the Dow futures down more than 700 points before rallying to near even by 6 AM eastern.  Overnight prices swing this rough sets up a day where anything is possible.  As a result, markets will likely be susceptible to substantial point whipsaws that could include a restest of overnight lows.  However, experienced day traders could have the upper hand with uncertainty so high due to geopolitical pressures, inflation concerns, and the pending Fed tightening.  As a result, swing and position traders may find it very difficult to nearly impossible to have an edge in this market environment.  Remember, Cash Is A Position is often underutilized in times of such wild price volatility.  This morning we have a significant number of earnings events and Case-Shiller, PMI Flash, and Consumer Confidence numbers to keep markets guessing.  Plan your risk carefully!

Trade Wisely,

Doug

Russia Into Ukraine But Futures Recover

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On Friday, markets opened more or less flat.  Then, after waffling for the first hour, all 3 major indices sold off to the lows about 1:20 pm.  Then the options expiration buying took all 3 on a rally into 3 pm.  However, the last hour saw another, smaller, down wave.  This left us with black candles with fairly large wicks including Spinning Tops in the two large-caps indices.  On the day, SPY lost 0.65%, DIA lost 0.79%, and QQQ lost 1.14%.  Meanwhile, the VXX gained over 2% to 23.45 and T2122 dropped closer to the oversold territory at 22.49.  10-year bond yields fell back to 1.927% and Oil (WTI) was flat at $91.80/barrel.

On Monday, Russia recognized Ukrainian Separatist Regions as independent nations and ordered his armed forces into those regions under the pretense of protecting them against Ukrainian aggression.  This and the Western reactions to it are likely to be the main market drivers Tuesday.  Among these reactions are the likely halt of Natural Gas imports to Western Europe from Russia and the cancellation of a Biden-Putin meeting this week.  Nonetheless, as of 7 am, US futures have recovered most of the overnight losses (that occurred when the soft invasion started).

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The market is down 10%-20% from the all-time highs.  However, many have recently asked, ”given heavy inflation, huge government debt, unprecedented supply chain snarls, etc., why hasn’t the market fallen off a cliff.”   The short answer is that the market is not the economy.  A more nuanced answer is that most companies simply have more pricing power and consumers are more resilient to inflation than expected.  So, companies are able to charge prices even higher than their cost increases and this has/is resulting in strong profits.  In other words, we hear a lot of tales of woe about inflation, but we do not hear a lot of stories about companies shutting down operations because they are unable to pass on increased costs.  

Another factor is that many of the biggest corporations are putting a floor in markets in a sense.  For example, Bloomberg reported Saturday that the 10 largest stock buyback programs this year are 30% larger than they were a year ago.  So, companies like AAPL, FB, GOOG, MSFT, CSCO, PG, CHTR, V, SBUX, and WMT are spending tens of billions of dollars to essentially prevent their stock prices from falling.  In addition to those big boys, a large number of “smaller” companies had suspended their buybacks during 2020 and the first half of 2021, but they are also now using that saved money to protect their share prices again.  As a result, well over $265 billion (a record, which broke the record set just the previous quarter) was spent on buyback programs in Q4-21.  And those numbers are expected to rise again in Q1-22.  The estimate is that 2021 saw a record near $900 billion in stock buybacks in the S&P500 members and more expected this year.  So, simply put, it’s hard for prices to fall too far with massive buy orders sitting out there to absorb sell orders.

Overnight, the Asian markets were down across the board, but in varying degrees on the Russian soft invasion.  Hong Kong (-2.69%), Japan (-1.71%), Taiwan (-1.38%), and South Korea (-1.35%) paced the losses.  Thailand (-0.19%), New Zealand (-0.34%), and Malaysia (-0.36%) were the closest thing to gainers in the region.  Quite interestingly, European markets are mixed on fairly modest moves at mid-day.  The FTSE (+0.25%), DAX (-0.25%), and CAC (-0.02%) lead the region, but there are 5 green exchanges, and only Russia (-4.52%) is down hard on the Monday news.  As of 7:30 am, US Futures are pointing toward a down open (but significantly recovered from overnight lows).  The DIA implies a -0.19% open, the SPY is implying a -0.03% open, and the QQQ implies a -0.38% open at this hour. 10-year bond yields are up to 1.942% and Oil (WTI) is the big winner on the geopolitical news, up 3.69% in early trading.

The major economic news scheduled for Tuesday is limited to Mfg. PMI and Services PMI (both at 9:45 am), and Conf. Board Consumer Confidence (10 am).  The major earnings reports scheduled for before the open include CNP, CFX, CBRL, CVI, EXPD, FLR, HD, HSBC, JELD, KBR, LPX, M, MDT, MIDD, NHYDY, TPX, BLD, TRU, VNTR, and WLK.  Then after the close, A, ARGO, AGR, BTG, BWXT, CDNS, CZR, CWH, CSGP, FANG, ESI, JBT, MELI, MOS, NDSN, PANW, PSA, RXT, RRC, O, TDOC, TXRH, TOL, RIG, TA, and VRSK report.

So far this morning, HD, M, FLR, CNP, WLK, NXST, LPX, CFX, BLD, and CEQP have all reported beats on both lines.  Meanwhile, MDT and KBR reported beats on earnings while missing on revenue.  On the other side, JELD and TRU missed on earnings, but beat on revenue.  However, HSBC, TPX, and VNTR all missed on both lines.

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News of talks between the US Sec. of State and Russian Foreign Minister Russian, tentatively scheduled for next week have given European and US stocks a little help this morning. However, we have to remember there will be a long 3-day news cycle before US markets open again. So, while some may run with the potentially good news, be very careful joining that crowd. The truth is we don’t know what will happen or when. And frankly, with 150k Russian troops plus tens of thousands of “Ukrainian Separatist Militia” on the Ukrainian border or inside Eastern Ukraine, it would not take much for a mistake to turn into war. (Fighting is already in progress between Ukraine and Separatists.) So, the prudent course is to go into the weekend flat or hedged. Just keep fighting the urge to put on rose-colored glasses and trade like you’re making up time.

Stick to your trading rules and manage the things that you can control. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. The first rule of making money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. If you are wrong, just admit it and take your loss. (That’s why we set stops in the first place.) Remember that you don’t have to trade every day and you definitely don’t need to chase the premarket moves by trading early. Trading is a marathon, not a sprint.

Ed

Swing Trade Ideas for your consideration and watchlist: Rick is back, but no trade ideas today til the turmoil settles a bit. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

TC2000 Discount

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Index Technicals Suffer

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Ahead of a three-day weekend filled with uncertainty, index technicals suffered more damage creating lower lows at price resistance and failing at or near their 200-day averages.  Rising inflation, indications of a slowing economy, a hawkish Fed, and geopolitical issues have created a perfect storm of uncertainty.  Markets hate uncertainty, and as we move toward a long weekend, it is understandable that the bulls face a difficult task in defending recent lows.  So expect another day of volatility.

Asian markets finished the week mixed with Hong Kong leading the selling down 1.88%.  However, this morning, European markets are trying to put on a brave face with modest gains as cautious traders weigh the Russia-Ukraine tensions.  Ahead of a light day of earnings and economic reports, the U.S. futures point to a modest recovery from yesterday’s selling with an uncertain 3-day weekend ahead.  

Economic Calendar

Earnings Calendar

As we wrap up the week, we have a light day on the earnings calendar with just 27 companies listed, several unconfirmed.  Notable reports include DKNG, ABR, B, BLMN, DE, & PPL.

News & Technicals’

The Ukrainian government and Russian state-controlled media exchanged fresh accusations of ceasefire violations near the country’s eastern border on Friday.  U.S. Secretary of State Antony Blinken warned at the U.N. Security Council meeting on Thursday that Russia plans to “manufacture a pretext for its attack” on Ukraine.  St. Louis Federal Reserve President James Bullard cautioned that inflation could become an even more severe problem without action on interest rates.  “We’re at more risk now than we’ve been in a generation that this could get out of control,” he said during a panel talk at Columbia University.  Bullard has called for a full percentage point in rate hikes by July.  Roku’s revenue growth slowed to a lower rate than analysts had expected.  However, the company said during the quarter that it would be able to keep YouTube and YouTube T.V. on its streaming service.  Finally, the Senate passed a short-term government spending bill, sending it to President Joe Biden’s desk and preventing a government shutdown.  The legislation will keep the government running through March 11.  Lawmakers hope to reach a long-term spending agreement during those three weeks.  Treasury Yields moved slightly lower in early Friday morning trading, with the 10-year dipping to 1.9685 and the 30-year falling to 2.2941%. 

It has been a rough week for the index technicals, new lower highs created at price resistance, and failures at or near 200-day moving averages.  Yesterday’s economic data continues to confirm a slowing economy as the Fed moves becomes more aggressive in fighting inflation.  A combination that could easily trigger a recession as we head toward spring and summer.  Add in the geopolitical tensions rising just before a 3-day weekend only intensifies market uncertainty.  With a light day on earnings and only the Existing Home Sales report to inspire the bulls or bears, I suspect the sensitivity to the Ukrainian border news cycle will play a substantial role as the long weekend approaches.  So plan your risk carefully because anything is possible.

Trade Wisely,

Doug

US-Russia Talks Set For Next Week Helps Mood

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Markets gapped down Thursday on more Russia invasion news/fear.  After an hour of follow-through, all 3 major indices ground sideways until early afternoon.  At that point, we got the final wave downward before going out on a half-hour of sideways action. This left us with large black candles that have failed the T-line in all 3 major indices.  On the day, SPY lost 2.13%, DIA lost 1.71%, and QQQ lost 2.97%.  The VXX rose almost 12% to 22.96 and T2122 dropped all the way back down to 30.94 (in the lower end of the mid-range).  10-year bond yields fell again to 1.965% and Oil (WTI) fell 2.21% to $91.59/barrel, which is a bit odd if a Russian invasion is truly the main Oil market driver.

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Economic data for the day was a mixed bag but leaned to the bearish side again.  January Building Permits came in a couple hundred thousand higher than expected, but January House Starts came in about 70,000 less than expected.  Weekly Initial Jobless Claims also came in 30k higher than was expected and the Philly Fed Mfg. Index came in even worse than the expected terrible number at 16 (20 expected, 50 means expanding).  To top it off, Fed Hawk Bullard, reiterated his calls for fast, aggressive, and continuing Fed action as he repeated his claims that the Fed has waited too long to tackle inflation and it could get out of control.

After the close Thursday, TDS, KEYS, QDEL, AL, RDFN, and EXEL all reported beats on both revenue and earnings.  Meanwhile, USM and ROKU beat on earnings but missed on revenue.  On the other side, DLR and VTR both missed on earnings, but beat on revenue.

So far this morning DKNG, BLMN, and DE have reported beats on both lines.  However, PPL and ARNC beat on revenue but missed on earnings.  On the other side, B beat on earnings but missed on revenue.  There have been no reports yet today that missed on both lines.

Overnight, the Asian markets were mixed, but mostly in the red.  Hong Kong (-1.88%), Australia (-1.02%), and New Zealand (-0.94%) led the region lower. However, Shanghai (+0.66%) and Shenzhen (+0.27%) managed to stay green.  In Europe, stocks are mixed but lean to the green side at mid-day. The FTSE (+0.33%), DAX (-0.13%), and CAC (+0.52%) are pacing gains with a few smaller exchanges as well as Russia (-0.88%) lagging.  Fear of a Russian invasion of Ukraine remains the main story in Europe in the early afternoon.  As of 7:30 am, US Futures are pointing toward a green start to the day.  The DIA implies a +0.37% open, the SPY is implying a +0.48% open, and the QQQ implies a +0.62% open at this hour.  10-year bonds are up slightly to 1.974% and Oil (WTI) is down over 2% in early trading on news of scheduled tentative Russia-US talks next week.

The major economic news scheduled for Friday includes Jan. Existing Home Sales (10 am), a Fed Monetary Policy Report (time TBA), and 3 Fed speakers (Waller at 10:45 am, Williams at 11 am, and Brainard at 1:30 pm).  Also, remember that US Markets are closed on Monday.  The major earnings reports scheduled for before the open include ARNC, BLMN, DE, DKNG, and PPL.  There are no reports scheduled for after the close

LTA Scanning Software

News of talks between the US Sec. of State and Russian Foreign Minister Russian, tentatively scheduled for next week have given European and US stocks a little help this morning. However, we have to remember there will be a long 3-day news cycle before US markets open again. So, while some may run with the potentially good news, be very careful joining that crowd. The truth is we don’t know what will happen or when. And frankly, with 150k Russian troops plus tens of thousands of “Ukrainian Separatist Militia” on the Ukrainian border or inside Eastern Ukraine, it would not take much for a mistake to turn into war. (Fighting is already in progress between Ukraine and Separatists.) So, the prudent course is to go into the weekend flat or hedged. Just keep fighting the urge to put on rose-colored glasses and trade like you’re making up time.

Stick to your trading rules and manage the things that you can control. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. The first rule of making money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. If you are wrong, just admit it and take your loss. (That’s why we set stops in the first place.) Remember that you don’t have to trade every day and you definitely don’t need to chase the premarket moves by trading early. Trading is a marathon, not a sprint.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas today (Rick is on vacation this week). You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

TC2000 Discount

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Retail Sales Better than Expected

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Retail Sales

Wednesday traded like an opposite day with better than expected retail sales numbers bringing out the bears, and then the bulls went to work when the FOMC confirmed a more hawkish Fed ready to raise rates.  However, par for the course in this down-trending volatile price action still has significant overhead resistance despite the recent relief rally.  Expect more of the same today with a bevy of earnings reports, with economic data including housing starts, jobless claims, and the Philly Fed. 

During the night, Asian markets closed mixed but mainly higher though gains were relatively modest.  European markets traded mixed this morning, weighing the geopolitical tensions as Russia adds more troops to the Ukraine border.  Ahead of a busy day of data, U.S. futures point to a lower open after a mixed after the bell reaction to tech earnings.

Economic Calendar

Earnings Calendar

We have another busy Thursday with nearly 200 companies listed on the earnings calendar.  Notable reports include WMT, AFLYY, EADSY, AAWW, AN, BAX, BJRI, BRC, CIM, CHUY, ED, DLR, GPC, GMED, IDCC, KEYS, LBTYA, LKQ, MATX, MERC, OGN, PLTR, PK, POOL, RDFN, ROKU, SEE, SHAK, SWI, SO, RUN, SKT, TSEM, UEIC, WFRD, WST, AUY, & YETI.

News & Technicals’

Nvidia reported fiscal fourth-quarter earnings on Wednesday.  Datacenter sales rose 71%.  Nvidia has boosted as cloud providers and enterprises turn to graphics processors the company makes for artificial intelligence applications.  The U.S. government’s “dithering” has left the country “well behind” China in the race to build out 5G technology, former Google CEO Eric Schmidt said in a Wall Street Journal op-ed.  Schmidt and co-author Graham Allison, a Harvard professor, urged the Biden administration to make 5G a “national priority”; otherwise, “China will own the 5G future.”  The authors said 5G development is key as applications could “advantage a country’s intelligence agencies and enhance its military capabilities.”  Amazon and Visa agree to end the global dispute over credit card fees.  The deal means Amazon customers in the U.K. can continue using Visa credit cards, as previously announced by the two companies.  Amazon will also drop a 0.5% surcharge on Visa credit card transactions in Singapore and Australia, introduced last year.  Amazon has been piling pressure on Visa to lower its fees, signaling growing frustration from retailers over the costs associated with major card networks.  Treasury yields declined Thursday morning, with the 10-year falling to 2.0015% and the 30-year declining to 2.3211%. 

Wednesday traded began with slightly more robust than expected retail sales, but the bears continued to apply pressure until the FOMC minutes confirmed rates are going up next month.  The bulls took that as a reason to rally, recovering early losses closing the indexes essentially flat on the day.   Tech earnings after the bell had some mixed reviews from investors with CSCO indicated higher at the open, but NVDA is indicated slightly lower despite its upbeat report.  Geopolitical concerns continue to hang a dark cloud over the market, with NATO reporting that Russia has added more troops to their Ukraine border activities, keeping uncertainty high.  Today we will turn our attention to housing numbers, jobless claims, and the Philly Fed numbers, along with another busy day of earnings data to keep the price volatility challenges.  Also, keep an eye on the comments from Jame Bullard today as one of the most hawkish Fed members; his words could move the market at 11 AM eastern today.  Although we have seen a slight relief in the selling, technically, not much has changed in the charts, so keep a close eye on the overhead resistance levels for entrenched bears. 

Trade Wisely,

Doug

Denied Russian Claim Sets Tone Ahead of Data

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Markets gapped down a half of a percent or so on Wednesday as overnight word from NATO said that actually Russia is continuing to bring more troops to the border of Ukraine.  After that gap, we saw a little morning follow-through to the downside before grinding sideways in a tight range until 2pm.  Then the Fed minutes came out with no big unexpected news and markets rallied to the highs of the day before grinding sideways into the close.  This left us with white Spinning Top type candles in all 3 major indices and little change.  On the day, SPY gained 0.11%, DIA lost 0.16%, and QQQ lost 0.03%.  The VXX fell 4% to 20.53 and T2122 was flat and remains just inside the overbought territory at 81.52.  10-year bond yields fell just a bit to 2.029% and Oil (WTI) fell almost 2% to $90.47/barrel.

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We had some good economic news for a change on Wednesday.  January Retail Sales came in almost twice the expected growth at +3.8% (month on month), which isn’t bad considering the prior month included Christmas.  January Industrial Production also came in better than expected at +4.08%.  Crude Oil inventories managed to show a build of 1.121 million barrels when a drop of 1.572 million barrels had been forecast. As mentioned, the January Fed minutes revealed nothing new. The FOMC is ready to raise rates in March but is still divided on how aggressive and how often rates should be raised and how quickly the Balance Sheet should be reduced by selling the bonds they’ve bought in the last 2 years.

After the close, NVDA, CSCO, ET, AIG, AMAT, SNPS, MRO, HST, CYH, ATUS, PXD, UFPI, CNDT, and ALSN all reported beats on both lines. Meanwhile, KGC, ALB, WAB, and OCDX missed on the revenue line but beat on earnings.  On the other side, DASH, TROX, SAM, H, and SPWR all missed on earnings, but beat on revenue.  However, WCN, AWK, CAKE, and PEGA all missed on both lines.

So far this morning, WMT, SO, BAX, WST, POOL, EPAM, LKQ, and OGN have all reported beats on both earnings and revenue.  (WMT also reiterated its forecast for the year, expecting good growth and earnings in the current economic environment.)  Only SEE has reported any miss, as it came in short of expectations on earnings, but beat on revenue.

Overnight, the Asian markets were mostly green on modest moves. Thailand (+0.60%), South Korea (+0.53%), and Shenzhen (+0.35%) led the gainers while Japan (-0.83%) and India (-0.10%) were the only losers.  In Europe, markets are mixed but lean to the downside at mid-day.  The FTSE (-0.50%), DAX (+0.14%), and CAC (+0.22%) lead as usual, but Russia (-2.09%) is an outlier after making claims the Ukrainians are shelling Separatists (really Russians) in the break-away Eastern part of Ukraine. Ukraine denies this claim and says it is a false-flag operation.  As of 7:30 am, US Futures are pointing toward a red open.  The SIA implies a -0.27% open, the SPY is implying a -0.37% open, and the QQQ implies a -0.53% open at this hour.  10-year bond yields are down significantly again (retesting 2%) and (oddly given the news from Russia) Oil (WTI) is off 1.7% in early trading.

The major economic news scheduled for Thursday includes Jan. Building Permits, Jan. Housing Starts, Weekly Initial Jobless Claims, and Philly Fed Mfg. Index (all at 8:30 am).  We also have 2 scheduled Fed speakers (Bullard at 11 am and Mester at 5 pm).  The major earnings reports scheduled for before the market include AAWW, AN, BAX, COMM, EPAM, FRO, GPC, GEO, LKQ, MD, NICE, OGN, POOL, POR, RS, SAFM, SEE, SO, SCL, SYNH, TPH, TRN, USFD, VC, VNT, WMT, and WST.  Then after the close, AL, LNT, AEL, AMN, ATR, ED, DLR, DBX, KEYS, LBTYA, MATX, RLGY, RDFN, RBA, ROKU, TDS, USM, VTR, and AUY report.

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Russian claims that the separatists (largely its own forces) in Eastern Ukraine were shelled (and Ukrainian denial and counter-claims it was a false-flag operation) have sent a shiver into European markets and ticked US futures down overnight. However, earnings news and forecasts are good (including Walmart) so far this morning and we have a fair amount of earnings coming before the bell. Expect more volatility and reversals with the market hyper-sensitive to both geopolitical tensions and Fed inflation reaction news (and yes, we have both a Fed Hawk and Fed Dove speaking today). So, stay nimble and/or hedged to volatility, and remember we have both potential support and potential resistance nearby.

Stick to your trading rules and manage the things that you can control. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. The first rule of making money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. If you are wrong, just admit it and take your loss. (That’s why we set stops in the first place.) Remember that you don’t have to trade every day and you definitely don’t need to chase the premarket moves by trading early. Trading is a marathon, not a sprint.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas today (Rick is on vacation this week). You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

TC2000 Discount

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Hot PPI Number

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Hot PPI Number

The hot PPI number didn’t dissuade the bulls from holding the morning gap, feeling the relief of the Russian troop pullback.  But, unfortunately, according to NATO, the news of a withdrawal was nothing more than a ruse.  Yesterday’s relief rally was nice, but the overhead price resistance levels remain, as does the overall downtrend in the indexes.  Expect price action to remain challenging with a hectic day of economic and earnings data coming our way.  So plan your risk carefully with the vast uncertainty ahead.

While we slept, Asian markets rebounded, led by the Nikkei up 2.22% even as China’s inflation came in hotter than expected.  However, with Russia-Ukraine tensions rising, European markets traded mixed and cautious.  With critical economic data and earnings reports before the bell, U.S. futures point to flat open when writing this report.  However, traders should prepare for just about anything at the open.

Economic Calendar

Earnings Calendar

We have a busy Wednesday with about 170 companies listed on the earnings calendar.  Notable reports include SHOP, ALB, ALKS, ATUS, AMCK, CRMT, AIG, AWK, ADI, AMAT, GOLD, SAM, CAKE, CSCO, CDE, COWN, CROX, DASH, ET, EQIX, FSLY, FSR, GRMN, GRNC, HLT, HST, H, INFN, KHC, MGY, MRO, MMLP, NE, NUS, NTR, NVDA, OC, PXD, R, SBLK, SUN, SNPS, TTD, TRIP, VECO, VMC, & WING.

News & Technicals’

NATO has accused Russia of increasing its troop count at the Ukrainian border a day after Moscow claimed it had begun withdrawing some of its military units.  NATO chief Jens Stoltenberg said Wednesday, “it appears that Russia continues their military buildup” at the border.  U.K. Prime Minister Boris Johnson said Wednesday that the Kremlin is sending the West “mixed signals.”  Many energy analysts say that Brent surpassing $100 a barrel is almost a given at this point.  An increasing number of forecasters predict the commodity surpassing $125 a barrel and even higher.   Money is pouring into investments in oil-related stocks, and international oil companies are raking in record profits.  The Energy Information Administration lowered its OPEC capacity estimates by 300,000 barrels per day in February.  The role of PR companies in preventing climate action has typically been overlooked, in large part because communications firms have sought to remain in keeping with the PR adage that “the best PR is invisible PR.”  However, comprehensive academic research quantifying the PR industry’s role in climate politics has been followed by pressure from external campaign groups, scientists, and environmental activists.  Now, the prospect of U.S. congressional hearings is likely to turn up the heat even further.  Airbnb beat Wall Street estimates on earnings and revenue in its fourth quarter.  The company reported 73.4 million nights and experiences booked in the fourth quarter, down nearly 8% from the prior quarter and missing estimates.  Airbnb expects its first-quarter 2022 nights and experiences booked to exceed Q1 2019 levels significantly.  Treasury Yields trade mixed in early Wednesday trading with the 10-year trading at 2.0469% and the 30-year declining slightly to t2.3550%.

Although it looks as if the Russian pullback of troops was misinformation and a hot PPI number continued to show rising inflation, the bulls were able to matain the gap throughout the day.  Today will turn our attention to Retail Sales figures, Import-Export Prices, Industrial  Production, Petroleum Statis and the FOMC minutes.  We also have a big day of earnings to keep the volatility high and traders guessing with AMAT, CSCO, and NVDA reporting after the bell.  Although the relief rally was nice little, if anything changed in the technical picture of the indexes with significant overhead price resistance and downtrends holding.  I suspect there will be a lot of eyes on the Retail numbers this morning with consumer sentiment at such low levels.  Again, prepare for volatile price action and respect price resistance with the downtrend market conditions.

Trade Wisely,

Doug

NATO Tells Bulls “Not So Fast My Friend”

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Russia started pulling back some of their troops (away from Ukraine) and the bulls jumped for joy Tuesday.  All 3 major indices gapped higher (1% – 1.5%) at the open, but then they meandered sideways, retesting the open level.  The large-cap indices continued the meander sideways for the rest of the day, but the QQQ caught a modest afternoon rally, all 3 of them closed near the highs of the day.  DIA and SPY tested but were unable to break through their T-lines, but QQQ managed to get that done.  This left us with Morningstar signals in all 3 indices.  IWM was the strongest of them all as it was clearly a risk-on day.  On the day, SPY gained 1.61%, DIA gained 1.25%, and QQQ gained 2.49%.  The VXX fell 8.24% to 21.39 and T2122 shot all the way up into the edge of the overbought territory at 81.75.  10-year bond yields rose to 2.043% and Oil (WTI) “plummeted” 3% to $92.07/barrel.

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After the close, CINF, ANDE, ALC, DVN, WELL, ENLC, ABNB, AKAM, MRC, ACCO, CLW, and WIRE all reported beats on both lines.  Meanwhile, VIAC, MCY, IAC, RBLX, CF, WYNN, LZB, and CRK all missed on earnings, but beat on revenue.  REZI and INVH missed on revenue, but beat on earnings.  However, WFG and SEDG reported misses on both lines.

Contrary to yesterday’s “the Russians are heading back to their barracks” message, this morning the market is greeted with a message from the other camp.  NATO head Jens Stoltenberg told the press today that “it appears that Russia continues their military buildup (at the border).”  British PM Johnson also told the press of troubling intelligence such as Russian Field Hospitals being constructed near the border of Belarus and Ukraine.  He went on to threaten to stop Russian companies from raising capital via London’s financial markets if an invasion does take place.  The point is, we did not have a clear picture last week, earlier this week, or today about what Putin will actually do.  So, volatility is all that a trader can say is almost certain.

Overnight, the Asian markets were green across the board with the lone exception of India (-0.17%).  Japan (+2.22%), South Korea (+1.99%), Taiwan (+1.56%), and Hong Kong (+1.49%) led the way higher.  In Europe, stocks lean to the green side on mostly modest moves, but there is a handful of red showing at mid-day.  The FTSE (-0.22%), Dax (+0.03%), and CAC (+0.05%) are the big dogs, but the smaller exchanges are showing a bit more move (both ways) in early afternoon trading.  As of 7:30 am, US Futures are pointing toward a slightly red open.  The DIA implies a -0.11% open, the SPY is implying a -0.07% open, and the QQQ implies a -0.02% open at this hour.  10-year bond yields are flat, but Oil (WTI) is up 1% in early trading.

The major economic news scheduled for Wednesday includes Jan. Retail Sales and Jan. Import/Export Price Indices (both at 8:30 am), Jan. Industrial Production (9:15 am), Dec. Business Inventories (10 am), Crude Oil Inventories (10:30 am), and Jan. FOMC Meeting Minutes (2 pm).  The major earnings reports scheduled for before the market include AMCX, ADI, GOLD, BGCP, CRL, CROX, DNB, GRMN, GNRC, HLT, KHC, NUS, OC, R, SHOP, SITE, SAH, SUN, VMC, and WAB.  Then after the close, ALB, ALSN, ATUS, AIG, AWK, AR, AMAT, APP, SAM, BFAM, CAKE, CSCO, CYH, COMP, CNDT, CPRT, DASH, ET, EQIX, HST, H, KAR, KGC, MRO, NTR, NVDA, OCDX, PXD, RUSHA, SNPS, TROX, UFPI, VMI, and WCN report.

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The premarket futures are flat this morning ahead of Retail Sales numbers. With cold water tossed on the bullish knee-jerk reaction (assuming Russian-West tensions were over) this morning, it’s possible markets wait to see if anything can be learned by picking through the tea leaves of the Fed minutes. With that said, the public statements make it clear the Fed is divided into at least 2 factions (Hawks who want to see at least a half of a percent hike in March and 1% before July and Doves who want a quarter percent hike in March, followed by a “let’s see what that does before we do anything else” approach). That leaves markets uncertain…and the one thing markets hate most is uncertainty. So, stay nimble and/or hedged to volatility, and remember we have both potential support and potential resistance nearby.

Remember that you don’t have to trade every day and you definitely don’t need to chase the premarket moves by trading early. Stick to your trading rules and manage the things that you can control. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. The first rule of making money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. If you are wrong, just admit it and take your loss. (That’s why we set stops in the first place.) Trading is a marathon, not a sprint.

Ed

Swing Trade Ideas for your consideration and watchlist: No trade ideas today (Rick is on vacation this week). You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

TC2000 Discount

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Rumors and Speculation

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On Monday, index price action surged and fell violently as rumors and speculation swirled over a Russian invasion.  However, after hearing that Russia is sending some troops back home, futures point to another overnight reversal.  So could we see a short squeeze, a big whipsaw, or a pop and drop this morning with another PPI reports expected to come in hot.  Your guess is as good as mine as this emotional market swings wildly.  So, plan your risk carefully and keep a close eye on overhead price resistance.

Asian markets traded mixed but mainly lower overnight due to geopolitical tensions.  However, hearing the news of a partial troop drawdown, European markets trade decidedly bullish this morning.  U.S. future also points to a substantial overnight reversal ahead of PPI data and a busy earnings day.  So prepare for another day of wild price action from this emotionally charged market.

Economic Calendar

Earnings Calendar

The Tuesday earnings calendar ramps up the reports, with around 130 companies fessing up to quarterly results.  Notable reports include AKR, ABNB, AKAM, ANDE, ANGI, BWA, CEVA, CF, CINF, CRK, DENN, DVN, FELE, GXO, HSIC, HUN, IAC, IQV, LZB, MAR, PACB, QSR, RSLX, SEDG, UPST, VIAC, WH, WYNN, & ZTS.

New & Technicals’

The Russian government has announced that Moscow is beginning to return troops at the Ukrainian border to their bases.  Igor Konashenkov, a spokesman for the Russian Ministry of Defense, said troops recently posted along the border with Ukraine had begun moving back to their military garrisons.  Timothy Ash, the emerging markets senior sovereign strategist at BlueBay Asset Management, said the move could signal a significant defeat for Putin.  As a result, global attention is focused on Russia and whether President Vladimir Putin will order an invasion of Ukraine.  Until earlier this month, China had been mostly silent as tensions have risen between NATO and Russia.  In 2021, global semiconductor industry sales reached a record $555.9 billion, up 26.2% year on year, the U.S.-based Semiconductor Industry Association (SIA) said.  In addition, the SIA said that they expect demand to “rise significantly” in the coming years.  China remained the biggest market, with sales totaling $192.5 billion in 2021.  St. Louis Fed President James Bullard told CNBC on Monday that he thinks the Fed needs to push interest rates up quickly.  “Our credibility is on the line here,” he said as he advocated for a rapid interest rate increase of a full percentage point.  This year, markets have begun pricing in seven rate hikes since Bullard first made his hawkish position known last week.  Treasury Yields moved higher in early Tuesday trading, with the 10-year rising to 2.0294% and the 30-year moving up to 2.3277%. 

As rumors and speculation swirled around about a Russian invasion, index prices proved to be very volatile on Monday.  The wild price moves continued overnight, with some troops leaving the border, raising hopes of a de-escalation of tensions.  The next hurdle for the market to cross is the PPI report that many suspect will come in hot, adding to inflationary concerns and pressuring Fed to act aggressively.  Along with the big day of inflation data, we have a large group of earnings reports adding to the potential price volatility.  The significant overnight reversal could trigger a short squeeze this morning, but with so much data coming our way, traders will have to also watch for the possible pop and drop or large point whipsaws.  Market emotion is high, so be prepared for almost anything and remember the Retail Sales figures could add to the wild price gyrations with low consumer sentiment.

Trade Wisely,

Doug