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.
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.
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
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.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
Wednesday 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.
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.
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.
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.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
The 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.
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.
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.
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.
🎯 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
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.
Monday was an interesting day, with a 1.5% swing in premarket futures (after Russia’s President Putin said “okay” to his Foreign Minister saying they should continue talking to the West because there was always a chance to reach a deal). The net result was a flat open and a whipsaw day that ended up only moderately moved. All 3 major indices printed indecisive, Spinning Top type candles. On the day, SPY lost 0.33%, DIA lost 0.40%, and QQQ gained 0.12%. The VXX rose slightly to 23.31 and T2122 dropped just into the oversold territory at 18.75. 10-year bond yields spiked back up to 1.991% and Oil (WTI) spiked almost 2% to $94.92 (on intraday news that the US was closing its Embassy in Kyiv and rumors that the Russians were moving toward the border of Ukraine).
The Fed made no announcement following their emergency meeting on Monday, and based on comments made to the press it is likely they have no consensus. (Bullard called again for a 1% increase before July 1, George said she supports a more gradual approach, and Daly said she favors one modest hike in March and then wait and see.) However, Reuters reports that by afternoon, futures of the Fed Funds Rate showed that traders are now under a decreased belief the Fed will raise rates before the March Fed meeting (down to 3% implied probability from 30% last Friday). In addition, futures on the Secured Overnight Financing Rate (the topic of the emergency meeting) now show traders only believe there is a 2% chance of that rate rising before the March Fed meeting (down from 16% on Friday). These seem to indicate a strong belief there will be no rate increases prior to March. Of course, traders can be wrong, but leaks (even from the Fed) also happen.
In earnings news, after the close on Monday, AAP, AMKR, CAR, TNET, SCI, CLR, and ANET all reported beats on both lines. Meanwhile, BKD, PRI, and VNO all missed on earnings but reported beats on revenue. So far this morning, MAR, IQV, ALLE, HSIC, ZTS, and BWA have all reported beats on both lines. Meanwhile, FIS beat on earnings but came in light on revenue. Finally, LDOS just reported a miss on both lines.
Overnight, the Asian markets were mixed and varied. India (+3.03%), Shenzhen (+1.70%), and Malaysia (+1.00%) led the gainers. Meanwhile, South Korea (-1.03%), Hong Kong (-0.82%), and Japan (-0.79%) paced the losses. In Europe, stocks are nearly green across the board on the Russian “step back” news at mid-day. Only Norway (-0.34%) is in the red, while the FTSE (+0.70%), DAX (+1.84%), and CAC (+1.56%) are typical of the continent. Russia (+3.08%) is an outlier as that country has started to return some troops to their home bases (away from Ukraine). As of 7:30 am, US Futures are pointing to a large gap higher. The DIA implies a +1.29% open, the SPY is implying a +1.64% open, and the QQQ implies a +2.20% open at this hour. 10-year bond yields are spiking to 2.035% and Oil (WTI) is down more than 3.6% on the Russia-Ukraine news.
The only major economic news scheduled for Tuesday is Jan. PPI and NY Empire State Mfg. Index (both at 8:30 am). The major earnings reports scheduled for before the market include ALLE, ARCH, ABG, BWA, ECL, FIS, FSV, HSIC, HUN, IQV, LDOS, LGIH, MAR, RPRX, QSR, SABR, TRP, WCC, and ZTS. Then after the close, ACCO, ABNB, AKAM, ANDE, CF, CINF, CLW, CRK, DVN, WIRE, ENLC, GXO, IAC, INVH, LZB, MCY, MRC, REZI, RBLX, SEDG, TX, TOST, VIAC, WELL, and WYNN report
Pent-up bullish energy is likely to be released this morning as Russia has started moving some of its troops back away from the Ukrainian border. That news has sparked strong rallies in Europe and in the US futures market. So, the bulls will have the momentum early. Don’t get caught chasing, because the Russia news is not final and it does nothing to address the main overhang, Fed reaction to inflation (and inflation impacts on corporate profit). More immediately, it also does not change the fact we’ve been seeing a lot of intraday volatility/swings. So, stay nimble and/or hedged to volatility, and remember we have some potential support (at the bottom of a dreaded h pattern) not far below.
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.
🎯 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
As if the hotter than expected inflation was not enough, the sharply declining consumer sentiment report came along to kick the market while it was down on Friday morning. The threat of Russian invasion only adds to the uncertainty keeping the price volatility high waiting for the next shoe to drop. The PPI report on Tuesday, Retail Sales, and FOMC minutes Wednesday, with housing data later in the week, also clouds this week’s path forward. We have a few potential market-moving as we progress through the week to add to the highly emotional price action likely in the week ahead.
Asian markets closed mostly lower, with the Nikkei leading the selling down 616.49 points or -2.23%. This morning, European markets trade decidedly bearish with red across the board and the DAX and CAC down 3% or more. In addition, U.S. futures that opened traded last night trying to put on a brave face now point to a gap down open with Russia-Ukraine tensions and Fed rate hikes, worrying both traders and investors. As a result, expect price volatility to remain challenging throughout the week.
Economic Calendar
Earnings Calendar
We have around 100 companies listed, with many unconfirmed to begin the new trading week. Notable reports include AAP, ALX, AMKR, ANET, CAR, CLR, KRG, OTTR, SRG, VNO, WEBR.
News & Technicals’
On Sunday evening, Ukrainian Foreign Minister Dmytro Kuleba said that Ukraine had requested a meeting with Russia within 48 hours. German Chancellor Olaf Scholz will hold talks with the presidents of Ukraine and Russia on Monday and Tuesday. U.S. national security advisor Jake Sullivan told CNN on Sunday that a Russian attack on Ukraine could happen this week. Every indication suggests that Putin continues to build up troops at the border Russia shares with Ukraine, said Michael McFaul, a former U.S. ambassador. “There’s no indication at all that Putin has stopped his march towards war, his preparedness towards war,” said McFaul, who is now a director at the Freeman Spogli Institute for International Studies. However, there remains a lot of uncertainty over what will happen with Ukraine because Putin is “isolated” and rarely speaks to his advisors. The Federal Reserve should be measured in its path to raise interest rates, San Francisco Fed President Mary Daly said Sunday. “History tells us with Fed policy, that abrupt and aggressive action can actually have a destabilizing effect on the very growth and price stability we’re trying to achieve,” Daly said. Daly supports the Fed raising rates in March and said “it’s too early to call” how many times the central bank will hike rates this year. Treasury Yields moved slightly lower in early Monday trading, with the 10-year pricing at 1.9371% and the 30-year dipping slightly to 2.2399%.
The hotter than expected inflation coupled with the sharply declining consumer sentiment brought out the bears Friday, creating lower highs and breaking support levels in the index chart. Unfortunately, the Russian / Ukraine tensions only add to the uncertainty of the path forward in the market. In this week’s economic calendar, we have PPI, Retail Sales, FOMC minutes, and housing data that will likely keep price volatility high and uneasy traders guessing. At this point, we can not rule out a retest of the January low intraday whipsaws and overnight reversals. We still have a few potential market-moving earnings reports this week that could inspire the bulls, but if Russia invades, all bets are off, and anything is possible. A dangerous market condition may be an understatement, so if you plan to trade, plan carefully and be willing to take any profits quickly because they could easily evaporate in the subsequent price gyration. Having an edge as a swing or position trader could be slim to none, while experienced day traders could have the upper hand as the market searched for clarity.
Markets opened dead flat on Friday. However, QQQ immediately headed South and by late morning the large-cap indices followed. There was no recovery as stocks closed near their lows in all 3 major indices. The proximate cause of this bad day was the word that the Fed is holding an emergency meeting to talk about rates today. That and increased fear of a Russian invasion of Ukraine. This move left us with big, ugly black candles in all 3 major indices that broke down below the February lows and seem on their way back to challenge the January lows. On the day, SPY lost 1.97%, DIA lost 1.49%, and QQQ lost 3.17%. The VXX rose over 13.5% to 23.24 and T2122 fell but remains in the mid-range at 33.16. 10-year bond yields fell back to 1.918%, but Oil (on the Russian invasion fear) was the big mover, spiking almost 4.5% to $93.90/barrel.
Both Bloomberg and CNN reported Friday that traders (funds) are now keeping a close eye on “2yr vs 10yr Bond Yields.” Last year the Fed produced research that found that every recession (at least since 1955 which was the study timeframe) was preceded by an inversion of the 2yr and 10yr bond yields. (Logically, locking up money for 10 years should deliver higher returns than locking it up for 2 years. An inversion is when the yield on a 2yr bond goes above the yield on a 10yr bond.) This indicator has preceded every recession and only produced one false-positive. As of Friday, the 2yr yield is at 1.487% while as mentioned above, the 10yr is at 1.918%. However, the 2yr yield is up 110% on the year and the 10yr yield is up only 27% during the same time. As this gap narrows and we approach inversion, expect the big money to be fleeing cyclicals and moving into recession plays.
So far this morning, AB, ARES, BRKR, IAA, MGA, COOP, SLVM, UA, UAA, and NWL have all reported beats on So far this morning, THS and some Japanese ADRs (TKOMY, JAPAY, KNBWY, STBFY) have reported a beat on both lines. However, both KELYA and KELYB reported massive beats (more than double expected) earnings, while also coming up significantly short on revenue. GTX reported in a similar way, beating (but not double) on earnings, but also missed slightly on revenue.
Overnight, the Asian markets are nearly red across the board. Only Australia (+0.37%) and Malaysia (+0.31%) managed to stay green. Meanwhile, India (-3.06%), Japan (-2.23%), and Taiwan (-1.71%) led the way lower. In Europe, we do see all red as of mid-day on Russian Invasion fears. The FTSE (-2.00%) is “leading” continent by holding up relatively well, but the DAX (-3.26%) and CAC (-3.49%) are more typical in early afternoon trading. As of 7:30 am, US Futures are pointing toward a gap-down open. The DIA implies a -0.79% open, the SPY is implying a -0.92% open, and the QQQ implies a -1.18% open at this hour. 10-year bond yields are up slightly relative to Friday and Oil (WTI) is off a quarter of a percent in early trading.
The only major economic news scheduled for Monday is any announcement or decision that comes from the emergency Fed Rate Meeting today. It is unclear if Fed Member Bullard will keep his 11 am speaking engagement, given the emergency Fed meeting. The major earnings reports scheduled for before the market include GTX, KELYA, and THS. Then after the close, AAP, ANET, CAR, BKD, CLR, HE, NTWK, PRI, and SCI report.
Russia did not invade Ukraine this weekend (as many had feared), but the brinksmanship remains underway with serious jitters (especially in Western Europe, like Germany, where the country is dependent on Russian Natural Gas). That and the emergency rate meeting by the Fed are sure to dominate the headlines and chatter among traders today. So, fear will likely be the driver early. And that forecast of mood (fear) is also what we are seeing in premarket prices this morning. So, stay nimble and/or hedged to volatility, and remember we have some potential support (at the bottom of a dreaded h pattern) not far below.
Remember that you don’t have to trade every day and you definitely do not need to trade 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. Remember that 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.
🎯 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
