Monday was a bit of a Bull trap.  SPY gapped up 0.19%, DIA gapped up 0.18%, but QQQ opened 0.08% lower. Initially, DIA rallied to new highs during the first hour. However, SPY and especially QQQ sold off sharply for that first hour.  DIA followed them in a much more modest selling the second hour.  From there, all three major index ETFs chopped sideways in waves along their lows the rest of the day.  With that said, DIA did manage to print a new all-time high and new all-time high close by about 80 cents.  This action gave us a white-bodied, Shooting Star candle in the DIA, a Dark Cloud Cover candle in the SPY, and a black-bodied Bearish Doji Continuation Pattern in the QQQ.  All three were done on below-average volume, although DIA was close to average.

On the day, five of the 10 sectors were in the green with Energy (+1.18%) way out front (0.72%) leading the way higher.  Meanwhile, Consumer Cyclical (-1.00%) led the five laggards.  At the same time, SPY lost 0.24%, DIA gained 0.22%, and QQQ lost 0.97%.  VXX was flat, closing at 45.90% and T2122 fell but remains in the top of its overbought territory to close at 95.68.  10-year bond yields rose to close at 3.82% while Oil (WTI) spiked 3.11% to close at $77.16 per barrel on the massive Israeli airstrikes in Lebanon.  So, Monday was a case of DIA reaching for the all-time highs while the tech-heavy QQQ and still-tech laden SPY lagged.  (NVDA -2.25% traded 3.5 times more dollar volume than the next closes stock, which was TSLA -3.23% followed by AMD -3.22%.  So, both the QQQ and SPY were pushing a rock uphill all day.

The major economic news scheduled for Monday was limited to July Durable Goods, which came in MASSIVELY higher than expected at +9.9% (compared to a +4.0% forecast and a June reading of -6.9%).  On the “core” front, July Core Durable Goods actually showed weaker than predicted at -0.2% (versus a 0.0% forecast and June’s +0.1% reading). 

In Fed news, Richmond Fed President Barkin told a Bloomberg podcast he thinks the prior tight labor market has companies engaging in a “low-hiring, low-firing” approach. (In other words, they have so much trouble finding employees, they have just hired fewer but are reluctant to fire them for fear of not being able to replace them later.)  Barkin expressed fear that this could lead to a rash of layoffs later, when companies can’t take the bad financial returns if the economy softens.  However, it could also lead to a new rash of hiring if the soft landing moves ahead.  Either way, he doesn’t think the current situation will last.  Barking said, “Either demand will continue and people will start hiring again, or you will start to see layoffs.”   He continued, “We are in a low-hiring, low-firing, mode. That does not feel like something that is going to persist. It is going to move left or it is going to move right.”  Barkin went on to indicate that he is likely pointing toward a quarter-point rate cut in September that would allow the Fed to “test-and-learn” as they gauge the impacts of rate cuts on the economy. 

ILater, San Francisco Fed President Daly told Bloomberg, “The time is upon us (to cut rates.) … (It’s) Hard to imagine anything that could derail a September rate cut.”  She went on to say, “We haven’t seen any deterioration yet in the labor market.” However, she also said the Fed may have to go to a half-percent cut, rather than a quarter-point, saying, “If the labor market weakens more than anticipated, we would need to be more aggressive (than the traditional quarter-percent cuts).” 

After the close, HEI reported beats on both the revenue and earnings lines.  At the same time, TCOM missed on revenue while beating on earnings.

In stock news, on Monday, the CEO of SEDG stepped down and was replaced by insider Ronen Faier.  Later, NSC announced that all embargoes associated with the Canadian rail shutdown have been lifted.  This effectively ends the impact of the Canadian rail strike on freight shipment.  However, it may take a few weeks to recover (get backlogs worked down) from just that short disruption.  After the close, META announced it struck a deal with Sage Geothermal to supply its datacenters with 150 megawatts by 2027 (or roughly enough power for 38,000 homes).  No terms were released.  Later, SHEL announced it plans to shutdown portions of its Zydeco pipeline in LA for 3-4 days starting on September 24 for maintenance.  (The pipeline ships 375k barrels of crude per day from Houston to the state of LA.)  The oil giants released very different forecasts Monday.  XOM said it expects oil demand to stay where it is through 2050 while BP said it expects oil demand to be 25% less than XOM by 2050.  (Hence, XOM, the top US oil producer is expanding production while BP plans to cut production to less than half of XOM’s output by 2030.)  Elsewhere, AAPL officially announced it will hold its new product launch on September 9, when the company is expected to release new versions of iPhones and Apple Watches.

In stock legal and governmental news, on Monday, it was announced a US District just had received (after the close Friday) and approved a price-rigging settlement involving GS, BASFY (BASF), HSBC, and London-based ICBC bank.  The four defendants agreed to pay $20 million to settle a case for rigging the price of platinum and palladium over a six-year period ending in 2014.  At the same time, IAC agreed to pay $8.5 million to settle FTC charges it continued billing customers after they had cancelled memberships at care.com from 2019 to 2022.  Later, UBER was fined $324 million in the Netherlands for sending the personal information of Dutch taxi drivers to the US over a three-year period.  At the same time, Canada announced it is imposing a 100% tariff on Chinese electric vehicles (including TSLAs). 

Meanwhile, after the close, BK agreed to pay $5 million to settled CFTC charges for repeatedly failing to report swap transactions, violating a previous order to do so. At the same time, the 5th Circuit Court of Appeals ruled 2-1 in favor of allowing TSLA to sue the state of LA over its law that bans the direct sale of cars to consumers (as opposed to doing so via a dealer).  Later, the NLRB ruled that CMG illegally refused to give raises to workers that had unionized, while doing so to other employees and also not negotiating with their union representatives.  At the same time, a federal judge rejected a banking-industry challenge to rules adopted by the CFPB that requires lenders to gather demographic data on small business borrowers.  (The idea is that so long as the data is not collected the banks cannot be charged with discriminatory lending practices.)  Elsewhere, JPM was sued in a proposed class-action suit over sweeping customer’s idle cash into their “unreasonably low” interest rate accounts.

Overnight, Asian markets were mixed but leaned toward the red as seven of the 12 exchanges posted losses.  Shenzhen (-1.11%) and New Zealand (-1.10%) were by far the biggest losers while Malaysia (+0.81%) was by far the biggest gainer.  In Europe, we see a similar mixed picture at midday with only six of 14 bourses (CNBC has stopped sharing Russian exchange results) in the green.  The CAC (-0.03%), DAX (+0.20%), and FTSE (+0.33%) lead the region in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a start just on the red side of flat.  The DIA implies a -0.07% open, SPY is implying a -0.06% open, and the QQQ implies a -0.02% open at this hour.  At the same time, 10-Year bond yields are up to 3.85% and Oil (WTI) is off by 0.53% to $77.01 per barrel in early trading.

The major economic news scheduled for Tuesday is limited to Conference Board Consumer Confidence (10 a.m.) and API Weekly Crude Oil Stock report (4:30 p.m.).  The major earnings reports scheduled for before the open is limited to BMO, BNS, and SCSC.  Then, after the close, YY, JWN, and PVH report.

So far this morning, BNS reported a beat on both the revenue and earnings line.  At the same time, BMO beat on revenue while missing on earnings.

In economic news later this week, on Wednesday, EIA Crude Oil Inventories are reported.  We also hear from Fed Governor Waller and Fed member Bostic.  On Thursday, we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Preliminary Q2 GDP, Preliminary Q2 GDP Price Index, July Goods Trade Balance, Preliminary July Retail Inventories, July Pending Home Sales, and the Fed Balance Sheet.  We also hear from Fed member Bostic.  Finally, on Friday, we get July Core PCE Price Index, July PCE Price Index, July Personal Spending, Aug Chicago PMI, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, Michigan 5-Year Inflation Expectations.

In terms of earnings reports later this week, on Wednesday, ANF, BBWI, CHWY, DCI, FL, HMY, SJM, KSS, LI, PDCO, RY, AFRM, COO, CRWD, FIVE, GEF, GES, HPQ, NTAP, NTNX, NVDA, OKTA, PSTG, CRM, VEEV, and VSCO report.  On Thursday, we hear from AEO, BBY, BIRK, BF.B, BURL, CPB, CM, DG, GMS, OLLI, PSNY, TITN, AMRK, ADSK, DELL, GAP, LULU, MRVL, and ULTA.  Finally, on Friday, JKS and MNSO report.

In miscellaneous news, on Monday BAC analysts reported that CTAs (trend-following funds) still have potential for systematic buying. It reports that an early-August pullback by the market gave entry signals to those CTA funds, which began buying.  According to the BAC model, the trend suggests buying into the end of the month at least under their median projections.  Elsewhere, the Commerce Dept. reported Monday that new orders for non-defense capital goods (a proxy for business spending) fell 0.1% in July and the June number was revised down to +0.5%.  (The initial estimate for June had been +0.9%.)  Essentially, this means businesses spent slightly less on equipment in July.  Finally, Bloomberg reports that Mpox is running ramped in Africa.  Hundreds have died and thousands have been hospitalized by virus.  Coming just four years after the COVID-19 global pandemic, the WHO is understandably worried and has issued its highest alert level.

With that background, all three major index ETFs are giving us indecisive, Doji-like candles so far in the premarket. QQQ retested its T-line (8ema), and so far has passed the test by staying above. However, all three are essentially flat from Monday’s close. All three are above their T-line and the short-term trend is still bullish. At the same time, the mid-term bearish trend is bullish and in the long-term, we are now clearly back in a Bull trend. In terms of extension, none of the three are stretched above their T-line. However, the T2122 indicator is still in the top end of its overbought range. So, the market Bulls could use more rest or pullback. However, keep in mind that the market can remain overdone longer than you can stay solvent predicting turns. Remember the mantra “follow, don’t lead, but also don’t chase” in mind. (In a volatile market, that may mean sitting on your hands.) With regard to those 10 big dog tickers, eight of the 10 are in the green with only AAPL (-0.26%) and META (-0.02%) in the red. NFLX (+0.55%) leads the pack while the biggest dog NVDA (+0.17%) has traded 3.5 times as much dollar-volume than any other ticker again this morning.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

Markets ended the week with a bullish move. SPY gapped up 0.61%, DIA gapped up 0.40%, and QQQ gapped up 0.93%.  From there, all three major index ETFs chopped sideways with an early afternoon slump followed immediately by a mid-afternoon rally that lasted into the close. This action gave us gap-up, white-bodied candles in all three.  The SPY and QQQ printed white, Spinning Top, Bullish Harami candles.  Meanwhile, DIA just printed a gap-up, strong white-bodied candle that not only closed near the highs, but within nine cents of the all-time high close.  This all took place on average volume in the DIA, as well as slightly below-average volume in the SPY and QQQ.

On the day, all 10 sectors were in the green with Basic Materials (+2.15%) out front leading the way higher.  Meanwhile, even the laggard Consumer Defensive was up 0.65%.  SPY gained 1.05%, DIA gained 1.07%, and QQQ gained 1.08%. VXX dropped 5.98% to close at 45.94% and T2122 spiked back up to the top end of its overbought territory to close at 97.91.  On the bond front, 10-year bond yields fell to 3.799% and Oil (WTI) popped 2.59% to close at $74.90 per barrel.  So, Friday saw a Bull recovery from Thursday’s profit-taking.  This was perhaps on the basis of Thursday’s Fed voter comments indicating a rate cut could be on the way in September or perhaps on the VP Harris DNC performance.  Regardless of reason, after the gap up, markets sold the news from Fed Chair Powell’s presentation (which more or less confirmed what the other Fed members had said Thursday).   However, that did not last long as an afternoon rally took us out higher…especially in the DIA.

The major economic news scheduled for Friday was limited to July Building Permits, which came in a bit stronger than expected at 1.406 million (compared to a forecast of 1.396 million and a June value of 1.454 million).  Later, July New Home Sales came in much stronger than predicted at 739k (versus a forecast of 624k and June’s reading of 668k). 

In Fed news, Fed Chair Powell all but confirmed a September rate cut.  Powell said, “The time has come for policy to adjust. The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”  On the topic of inflation, he said, “My confidence has grown that inflation is on a sustainable path back to 2 percent.”  On the employment situation, Powell pointed out, “It seems unlikely that the labor market will be a source of elevated inflationary pressures anytime soon. We do not seek or welcome further cooling in labor market conditions.”  Putting the two Fed mandates together, Powell said, “The upside risks to inflation have diminished. And the downside risks to employment have increased.” 

Later, Chicago Fed President Goolsbee also signaled his support for a September rate cut, telling CNBC, “Everything we wanted to happen to get rates down has happened.”  He continued, saying the current policy would be appropriate to cool and overheating economy, but currently the economy “is not overheating.”  He went on to say, “I don’t think inflation will get stuck above 2%.”  He also noted “warning signs” about employment (specifically citing the July Nonfarm Payrolls data).  In a separate interview with Bloomberg, Goolsbee basically flat out said he’ll vote for rate cuts and spent the interview discussing how fast and/or steadily the FOMC will cut.  Goolsbee said, “I don’t think it makes sense to get into a big debate (over 25 basis points versus 50 basis points).”  He continued, “little gradations like that aren’t what matters the most. What matters the most is the longer-run path of policy.” Goolsbee concluded by saying, “What will warrant the speed at which we cut rates, or how much we pause the cutting, will be determined by how the economy performs (during the cutting process).”

In stock news, on Friday, AMZN CEO Jassy said the company’s AI software had saved its software teams “4,500 developer-years.” Later, Reuters reported that MTH is talking with investment bankers exploring the sale of its Columbia Distributing unit for about $2 billion, with potential buyers including Columbia insiders.  At the same time, Reuters provided some background on the NSRGF (Nestle, the world’s largest food maker) CEO leaving Thursday. The report said that CEO Schneider was ousted unexpectedly for underperformance at a board meeting Thursday night.  Later, Chinese smartphone maker Honor (a former Huawei unit) announced it received an undisclosed investment from CHL as Honor gets ready for its planned IPO. 

Meanwhile, technology industry outlet “The Information” reported Friday that META has canceled plans for a premium version of its mixed-reality headset in response to poor sales performance of AAPL’s $3,500 Vision Pro headset.  In unrelated news, Bloomberg reported that AAPL is now targeting September 10 for the launch of new iPhone, watches, and AirPods.  After the dog and pony show, the products will be available for sale on September 20 according to the report.  Later, after the close, NSC announced it had reached a tentative, 5-year collective bargaining agreement with four labor unions.  The agreement covers 30% of NSC’s workforce and will provide 3.5% wage increases each of the next five years, as well as increased vacation, and enhancements in healthcare benefits.  Also after the close, CNBC reported that INTC has retained MS to help it fight off activist investors after the company has lost 60% of its stock value and a board member stepped down.

In stock legal and governmental news, on Friday, Reuters reported that despite US sanctions, 11 Chinese state-linked entities have access to the most advanced chips and AI tools via contracts with AMZN cloud services.  The report states that federal agencies are considering if action can be taken. In addition, the Biden Administration is talking to the House Foreign Affairs Committee on potentially changing legislation to close the loophole.  Later, Reuters reported that JNJ that has halted the count of votes (from plaintiffs on whether or not to accept the terms of the company’s $6.48 billion settlement offer) and resumed negotiations with talc-caused cancer plaintiffs.  This comes a month after the company reported it “had” more than 75% support and would ask the judge to force remaining holdouts to accept the settlement.  After the close, UK newspaper the Telegraph reported that the British NHS is expected to reject the LLY early Alzheimer’s drug donanemab. This comes less than a week after a separate UK agency, Medicines and Healthcare products Regulatory Agency, had said that a different Alzheimer’s drug (Lecanemab) was a poor value for taxpayers.

Overnight, Asian markets were mostly green with only two of 12 regional exchanges in the red.  Hong Kong (+1.06%), India (+0.76%), and Thailand (+0.73%) led the region higher.  In Europe, we see a similar picture taking shape with five of the 15 bourses in the red.  The CAC (+0.15%), DAX (-0.21%), and FTSE (+0.48%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a start just on the green side of flat.  The DIA implies a +0.13% open, the SPY is implying a +0.16% open, and the QQQ implies a +0.04% open at this hour.  At the same time, 10-Year bond yields are at 3.81% and Oil (WTI) has spiked to $76.79 per barrel in early trading.

The major economic news scheduled for Monday is limited to July Durable Goods and July Core Durable Goods (8:30 a.m.).  The major earnings reports scheduled for before the open is limited to PDD.  Then, after the close, BHP, HEI, and TCOM report.

In economic news later this week, on Tuesday we get Conference Board Consumer Confidence and API Weekly Crude Oil Stock report.  Then Wednesday, EIA Crude Oil Inventories are reported.  We also hear from Fed Governor Waller and Fed member Bostic.  On Thursday, we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Preliminary Q2 GDP, Preliminary Q2 GDP Price Index, July Goods Trade Balance, Preliminary July Retail Inventories, July Pending Home Sales, and the Fed Balance Sheet.  We also hear from Fed member Bostic.  Finally, on Friday, we get July Core PCE Price Index, July PCE Price Index, July Personal Spending, Aug Chicago PMI, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, Michigan 5-Year Inflation Expectations.

In terms of earnings reports later this week, on Tuesday we hear from BMO, BNS, SCSC, YY, JWN, and PVH.  Then Wednesday, ANF, BBWI, CHWY, DCI, FL, HMY, SJM, KSS, LI, PDCO, RY, AFRM, COO, CRWD, FIVE, GEF, GES, HPQ, NTAP, NTNX, NVDA, OKTA, PSTG, CRM, VEEV, and VSCO report.  On Thursday, we hear from AEO, BBY, BIRK, BF.B, BURL, CPB, CM, DG, GMS, OLLI, PSNY, TITN, AMRK, ADSK, DELL, GAP, LULU, MRVL, and ULTA.  Finally, on Friday, JKS and MNSO report.

So far this morning, PDD missed on revenue while beating on earnings.

In miscellaneous news, on Friday, the UK Maritime Operations agency said three fires have been seen on a Greek-flagged tanker in the Red Sea. The crew of the tanker was evacuated on Thursday after an attack by Yemeni Houthi rebels.  (The tanker contains 150,000 metric tons or 1,050,000 barrels of crude oil.)  Then, on Saturday, NASA made the decision to leave the BA Starliner crew at the International Space Station until they can be retrieved by a by a SpaceX ship in February.  NASA decided that it was too risky to have humans aboard the attempt to return BA’s Starliner to earth.

With that background, all three major index ETFs gapped modestly higher to start the premarket. However, they are diverging just a bit since that start. SPY and DIA both are giving us small white-bodied candles in the early session. Meanwhile, QQQ has printed a slightly larger black-body candle that is fading its premarket gap. All three remain well above their T-line (8ema) and the short-term trend is still strongly bullish. At the same time, the mid-term bearish trend is bullish. In the long-term, we are now clearly back in a Bull trend. In terms of extension, SPY and DIA are a bit stretched above their T-line. At the same time, the T2122 indicator is up at the top of its overbought range. So, the market is in need of more rest or pullback. However, keep in mind that the market can remain overdone longer than you can stay solvents predicting turns. Remember the mantra “follow, don’t lead, but also don’t chase” in mind. (In a volatile market, that may mean sitting on your hands.) With regard to those 10 big dog tickers, they are evenly split, led by the biggest dog NVDA (+0.67%) and lagged by META (-0.63%).

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

Mr. Market gave us a Bull trap on Thursday on all-day profit-taking after a strong two-week rally.  The SPY gapped up 0.33%, DIA opened 0.18% higher, and QQQ gapped up 0.48%.  However, that was pretty much it for the Bulls for the day. From there all three major index ETFs sold off the rest of the session.  This action Black-bodied, Bearish Engulfing candles in all three. However, all three of them also remain above their T-line (8ema).  It also gave us a higher high in the SPY, DIA, and QQQ.  Still, once again this took place on below average volume in all three major index ETFs.

On the day, nine of the 10 sectors were in the red with Technology (-1.82%) way out front leading the others lower.  On the other side, Financial Services (+0.09%) held up better than the others and was the only green sector.  Meanwhile, SPY lost 0.78%, DIA lost 0.37%, and QQQ lost 1.59%.  VXX popped 4.20% to close at 48.86% and T2122 dropped back out of its overbought territory and back into the top end of its mid-range to close at 73.58.  On the bond front, 10-year bond yields popped to 3.865% and Oil (WTI) popped another 1.42% to close at $72.94 per barrel.  So, Thursday we had reversal (or more likely a profit-taking day ahead of Fed Chair Powell’s presentation set for Friday at 10 a.m.  

The major economic news scheduled for Thursday included Weekly Initial Jobless Claims, which were just as expected at 232k (compared to a 232k forecast and up just a bit from the prior week’s 228k).  At the same time, Weekly Continuing Jobless Claims came in up but still below expectations at 1,863k (versus the 1,870k forecast and the prior week’s 1,859k).  Later, S&P Global Mfg. PMI was a bit light at 48.0 (compared to a 49.5 forecast and the July 49.6 reading).  At the same time, S&P Global Services PMI were a bit stronger than predicted at 55.2 (versus the 54.0 forecast and the July 55.0 value).  This gave us an S&P Global Composite PMI that was also better than anticipated at 54.1 (compared to the 53.2 forecast and July’s 54.3 reading).  Later, the July Existing Home Sales were slightly better than predicted at 3.95 million (versus a forecast of 3.94 million and up from June’s 3.90 million number).  Then, after the close, the Fed Balance Sheet showed a $16 billion increase on the week, rising from $7.178 trillion to $7.194 trillion.  (Note: The Fed balance sheet reduction or QT caused some market disruption when first started.  The Fed then promised to stop QT prior to wider trouble taking shape.  Since the ECB, Bank of Japan, and Bank of England have now all also started tightening, Bloomberg speculates the Fed is regulating its own balance sheet reduction to avoid trouble.)

In Fed news, the Jackson Hole Symposium began.  Kansas City Fed President Schmid told CNBC that he has an open mind about rate cuts in September.  Schmid said, “It bears looking harder at it (the unemployment rate).  I’m going to let the data show where we lead (but) I would agree with several of my colleagues that you probably want to act maybe before (inflation) gets to two (percent) but that sustainability toward two I think is really important.”  Later, Boston Fed President Collins indicated she feels it will soon be appropriate to cut interest rates. Collins said, “We’ve seen quite a lot of reduction in inflation. The reduction to me is consistent with more confidence that we are on that trajectory and with labor markets healthy overall, I do think that soon it is appropriate to begin easing.”  She also seemed to signal that quarter-point rate cuts are the way to go, saying “I think a gradual, methodical pace once we are in a different policy stance is likely to be appropriate.”  By mid-morning, Philly Fed President Harker told Reuters that as of now he is ready to cut rates in September.  Harker said, “For me, barring any surprise in the data we’ll get between now and then, I think we need to start this (rate cut) process.”

After the close, BBAR, NDSN, SNOW, TBBB, URBN, and ZM all reported beats on both the revenue and earnings lines. Meanwhile, A, CAAP, and SNPS reported misses on revenue while beating on earnings. However, BMA missed massively on both the top and bottom line.

In stock news, on Thursday, Reuters reported that Japanese company Softbank is in serious talks to invest $684 million in SHCAY (Sharp electronics).  At the same time, AMKAF announced it is evaluating but has not decided upon contingency strategies in Canada after the two top Canadian freight railroads (CP and CNI) locked out their employees and shut down operations Thursday.  Later, research firm Jato Dynamics reported that BMWYY (BMW) overtook TSLA to become that largest-selling electric vehicle maker in Europe in July.  At the same time, Bloomberg reported that CME and SPGI are in discussion about the sale of their OSTTRA joint venture. (Bloomberg says the joint venture is values between $2 billion and $4 billion.)  Later, AAP announced it had struck a deal to sell its Worldpac unit to CG for $1.5 billion in cash.  At the same time, WMT announced it has partnered with QSR (Burger King) to offer meal discounts to the retailers paying members.  The move is designed to let WMT to better compete with AMZN Prime. 

Meanwhile, F announced it had cancelled its planned 3-row electric SUV. (That vehicle had been scheduled to roll off assembly lines in 2025.)  Later, the PARA buyout saga continued as private media veteran Bronfman raised his bid from $4.3 billion to $6 billion.  At the same time, miners TECK and RIO joined the crowd of companies looking for alternatives after the Canadian rail shutdown.  The two said they would need to truck some products and defer shipment on many commodities.  (They mainly produce iron ore, aluminum ore, copper, and molybdenum in Canadian mines.  The diamonds RIO mines there are not shipped by rail.)  Later, Reuters reported that ELH is in talks with private equity firms TPG, KKR, and others over a potential sale.  ELV (an insurer) is also among the suitors.  At the same time, ACDVF (Air Canada) pilots voted to authorize a strike.  (Any strike cannot take place prior to a 21-day “cooling off” period.)  After the close, GM and UBER announced a multi-year partnership to deploy Cruise robotaxis on the UBER platform.  (UBER already has a similar deal with GOOGL’s Waymo unit in Phoenix, AZ, which has been in operation since October.)

In stock legal and governmental news, on Thursday, the NHTSA announced that GM has agreed to recall 1,200 Cruise robotaxis over hard braking issues.  Later, Reuters reported that AAPL will change how users choose browsers and other default apps (in the EU only) in response to European Digital Markets Act.  (This will end the billions of dollars in fees GOOGL previously paid AAPL to have Chrome be the default browser on iPhones and iPads.)   At the same time, a Washington DC Appeals Court ruled to revive an antitrust lawsuit against AMZN that had been brought by the district. The suit alleges that AMZN pricing policies (restrictions on third-party sellers and their own suppliers) illegally stifle competition.  Later, GOOGL announced it has struck a “first in the nation” deal with the state of CA to fund newsrooms in the state in exchange for ending legislation that would have forced GOOGL and other tech giants to pay in order to distribute new content generated in the state.  The plan calls for GOOGL to pay $15 million the first year, while the state will pay $30 million.  During the next four years, CA’s contribution drops to $10 million per year while GOOGL’s increases to $20 million per year.  (The deal was immediately criticized by journalists because it will help create AI tools to support journalists, which they feel will replace journalists with computers.) 

Meanwhile, after the close, NASA said it expects to announce the decision on how the two-person BA Starliner crew will be brought back to earth on Saturday.  The crew has been stranded at the International Space Station since the start of June after the glitchy Starliner leaked helium propellent before, during and after it travelled to the ISS.  Also after the close, the Financial Times reported that AZN has warned it would seek to relocate its vaccine manufacturing site to the US (from the UK) amidst a negotiation deadlock with the UK over a planned cut in state aid. (The previous Conservative party administration had pledged $118 million in grants for the operation, but the new Labour government, which was left with a broken budget, has said it expects to cut the grants to $53 million under newly-required austerity measures.)  Later, the NRLB determined that AMZN is a “joint employer” of subcontracted drivers who delivered packages for the company in CA.  This ruling came after an unfair labor practices charge resulted in an investigation by the agency.

Overnight, Asian markets were mostly green on modest moves with just four of the 12 regional exchanges showing red.  Thailand (+1.03%) was the outlier and leader of the gains while Malaysia (-0.36%) had the worst showing.  In Europe, the picture is even brighter with just one bourse in the red against 14 in the green at midday.  The CAC (+0.53%), DAX (+0.57%), and FTSE (+0.33%) lead the region higher in early afternoon trade.  Meanwhile, in the US, at 7:30 a.m., Futures are pointing toward a gap higher to start the day.  The DIA implies a +0.35% open, the SPY is implying a +0.51% open, and the QQQ implies a +0.75% open at this hour.  At the same time, 10-Year bond yields have backed down to 3.848% and Oil (WTI) is up 1.3% to $73.96 per barrel in early trading.

The major economic news scheduled for Friday is limited to July Building Permits (8:30 a.m.), and July New Home Sales (10 a.m.).  We also head from Fed Chair Powell at 10 a.m. as the Jackson Hole Symposium also continues.  The major earnings reports scheduled for before the open include GFI.  Then, after the close, there are no major earnings reports schedule.

So far this morning, UI missed on revenue while beating on earnings.

In miscellaneous news, on Thursday, the Equipment Leasing and Finance Assn. reported that US companies increased their borrowing to finance equipment in July.  The report stated that July credit for equipment by US companies were up 11% from June’s $10 billion figure. Elsewhere, after the close, the Canadian government stepped in to end the freight rail shutdown in the country.  The government ordered the railways and union to enter into binding arbitration.  However, according to the AP, it’s uncertain how quickly the workers will return to work.  Still, the Canadian Labour Minister said he expects the trains to be running again within days. CNI said they had ended their lockout within an hour of the government’s order. However, there was no word from CP as of 9 p.m. eastern.

With that background, all three major index ETFs gapped higher to start the premarket and have given us white body candles since then. QQQ is the most volatile of these, showing what looks like a fat-bodied Spinning Top at this point while the others have little wick. All three remain well above their T-line (8ema) and the short-term trend is still strongly bullish despite Thursday’s candle. Meanwhile, the mid-term bearish trend remains broken, though one could argue a new mid-term bullish trend has not formed yet (due to a lack of higher high to go with yesterday’s higher low). In the long-term, we are now clearly back in a Bull trend. In terms of extension, the pullback Thursday helped relieve much of the stretch above the index ETF T-lines. At the same time, the T2122 indicator has dropped back out of its overbought territory and is in the upper end of its mid-range. So, the market has room to run either direction. However, the Bears have more slack to play with Friday. Remember the mantra “follow, don’t lead, but also don’t chase” in mind. (In a volatile market, that may mean sitting on your hands.) With regard to those 10 big dog tickers, all 10 are in the green this morning, led by the biggest dog NVDA (+1.30%) and followed by the second-biggest dog TSLA (+1.067%). Meanwhile, NFLX (+0.43%) is the laggard. Finally, remember its Friday. So, prepare your account for the weekend news cycle and don’t forget to take profits. After all, Friday is payday.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

Wednesday brought more indecision and rest.  SPY gapped up 0.20%, DIA opened 0.18% higher, and QQQ opened up 0.16%.  From there, all three major index ETFs wandered back and forth across their gaps all day long.  This action gave us Spinning Top candles in all three, with SPY and QQQ both having white bodies and DIA having a small black body.  All three also remain above their T-line (8ema).  It also gave us a higher high, higher low, and higher close in SPY and QQQ while DIA got the higher high and higher close coming up a touch short on the low front. Yet again, this took place on well-below average volume in all three major index ETFs.

On the day, all 10 sectors were in the green as both Basic Materials (+1.48%) and Consumer Cyclical (+1.43%) were well out in front leading the others higher.  On the other side, Communications (+0.01%) and Energy (+0.04%) lagging well behind the other sector.  Meanwhile, SPY gained 0.35%, DIA gained 0.10%, and QQQ gained 0.47%.  VXX climbed 1.56% to close at 46.89 and T2122 climbed back up well into its overbought territory to close at 90.97.  On the bond front, 10-year bond yields fell to 3.801% and Oil (WTI) dropped another 1.85% to close at $71.82 per barrel.  So, again on Wednesday we had an indecisive, yet bullish day.  Perhaps it could even be seen as a pause or rest day.

The major economic news scheduled for Wednesday was limited to EIA Weekly Crude Oil Inventories which had a much larger-than-expected drawdown of 4.649 million barrels (compared to a forecasted 2.000-million-barrel drawdown and the prior week’s 1.357-million-barrel inventory build).  The Bureau of Labor Statistics also released the US Payrolls Benchmark.  While widely referred to as a revision of the Nonfarm Payroll data, it really is not.  It actually is the difference between two sets of data which are derived from completely different sources. At any rate, the release was a -818k number (compared to three of the last four benchmark releases, which were each +400k to +500k).  This release was interpreted as the Nonfarm Payrolls data released monthly having over-estimated job additions by 818k jobs this year.  Theoretically, this would mean that the job market started cooling much sooner than widely noticed and could give the Fed more evidence that a rate cut is needed.  (Side note: Bloomberg reported that at least three major foreign banks, MFG, BNPQY, and NMR obtains the report early by directly calling the BLS.)

In Fed news, on Wednesday, July’s Fed Meeting Minutes were released.  The minutes summarized the opinion of FOMC voters as leaning toward a September rate cut…if the data continues as it has been trending.  Specifically, the minutes said, “the vast majority of policymakers observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policy at the next meeting.” The report also noted that “many participants” felt the current stance was restrictive and argued that if inflation data continued to show cooling, holding rates as they are would increase the drag on the economy.  It said that all the voters were on board with rates being held flat at the July meeting.  However, also saying “several” indicating recent inflation reductions and increases in joblessness “had provided a plausible case for reducing the target range 25 basis points at this (July) meeting or that they could have supported such a decision.”  Finally, the report noted a “dwindling camp” of FOMC members still feared that premature easing could rekindle inflation. 

After the close, BBAR, NDSN, SNOW, TBBB, URBN, and ZM all reported beats on both the revenue and earnings lines. Meanwhile, A, CAAP, and SNPS reported misses on revenue while beating on earnings. 

In stock news, on Wednesday, Bloomberg reported rumors that WMT plans to sell its #3.74 billion stake in JD.  At the same time, Reuters reported multiple analysts were telling clients that OXY had reached “Buffett Put” territory.  (In other words, OXY has fallen to a price, below $60, where BRKB has routinely bought millions of shares.) Later, Bloomberg reported that OKTGP is in exclusive talks and near a deal to acquire RILYN for undisclosed terms.  At the same time, Reuters reported that BN is working with UBS and BAC to arrange financing to acquire GRFS.  Later, after the close, HAL reported that it was hit by a cyberattack.  The extent and impact of the attack are not yet determined.  At the same time, TD announced the sale of 40.5 million shares of SCHW, which reduces its ownership of SCHW to 10.1%.  Later, MSFT reworked its business units and announced the changes at an investor presentation Wednesday.  MSFT lowered what it now called its “Intelligent Cloud” unit forecast by as much as $5 billion for 2024 (from a high estimate of $28.9 billion to a new low estimate of $23.8 billion).

Elsewhere, it is widely expected a lockout (or, if not, strike) will stop Canadian railroads as of today.  CNI and CP are both expected to participate in the shutdown.  This could have major impacts on many businesses such as CF, NTR, CHRW, GLNCY, MERC, as well as oil, coal, and automakers. (Update: The shutdown did take place. So, all Canadian rail transportation is offline. For anyone unfamiliar with Canada, this is the vast, vast majority of all freight movement in the country. Canadian population is heavily centered on a handful of cities with a relatively sparse road network between, but the vast distances crossed by rail. The fact that most of those cities are found at a seaport or near the US border also makes Canadian rail freight problematic for US companies.

In stock legal and governmental news, on Wednesday, India’s Commerce Minister Goyal accused AMZN of predatory pricing practices. However, he stopped short of announcing any investigation or charges.  (Many time in the past, Goyal has attacked AMZN and WMT-backed Flipkart of actions that are detrimental to India’s brick-and-mortar stores.)  At the same time, the NHTSA announced a new recall of 9,100 Model X sport utilities over a roof trim that could separate.  (This is the second such recall over the same issue since 2020.)  Later, Reuters reported that the UK’s competition watchdog has now shutdown its existing investigations of AAPL and GOOGL related to their app stores.  Sources told Reuters the agency is waiting on new UK laws covering digital markets. 

Meanwhile, C told Reuters it has added a new section to its SEC quarterly reports in response to SEC queries.  (The SEC fined C $136 million for a lack of progress in fixing its data management issues in mid-July.)  Later, after the close, TD announced it expects to finalize a settlement of both civil and criminal money laundering investigations by the end of the calendar year.  In anticipation of fines and other non-monetary penalties, TD says it will take an additional $2.6 billion provision in its Q3 results.  Also after the close, DB announced it had reached settlements with more than half of the plaintiffs who had accused the bank of underpaying them related to the acquisition of Postbank years ago. (Details of the settlements weren’t disclosed.)

Overnight, Asian markets were mixed but leaned toward the green side.  Only five of the 12 exchanges in the region were in the red as Shenzhen (-0.82%) was by far the biggest loser.  On the other side, Hong Kong (+1.44%) and Japan (+0.68%) led the gainers.  In Europe, a much rosier picture is taking shape with just two spots of red among the 13 green bourses at midday.  The CAC (+0.22%), DAX (+0.30%), and FTSE (+0.18%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modest green start to the morning. The DIA implies a +0.07% open, the SPY is implying a +0.21% open, and the QQQ implies a +0.32% open at this hour.  At the same time, 10-Year bond yields are up to 3.829% and Oil (WTI) is up half a percent to $72.29 per barrel in early trading.

The major economic news scheduled for Thursday include Weekly Initial Jobless Claims and Weekly Continuing Jobless Claims (both at 8:30 a.m.), S&P Global Mfg. PMI, S&P Global Services PMI, and S&P Global Composite PMI (all at 9:45 a.m.), July Existing Home Sales (10 a.m.), and the Fed Balance Sheet (4:30 p.m.).  The Jackson Hole Symposium also starts at 8 a.m.  The major earnings reports scheduled for before the open include AAP, BIDU, BILI, BJ, CSIQ, IQ, NTES, PTON, TD, VIK, and WSM. Then, after the close, BMA, INTU, ROST, and WDAY report. 

In economic news later this week, on Friday we get July Building Permits, and July New Home Sales.  The Jackson Hole Symposium also continues.

In terms of earnings reports later this week, on Friday, we hear from GFI.

So far this morning, BILI, BJ, BWLP, PTON, TD, and WB all reported beats on both the revenue and earnings lines.  Meanwhile, BIDU and VIK missed on revenue while also beating on earnings.  On the other side, AAP and IQ beat on revenue while missing on earnings.  However, CSIQ and NTES missed on both the top and bottom lines.

With that background, we see some divergence in the premarket. DIA opened and has remained flat in the early session. Meanwhile, SPY gapped up slightly and has followed-through with a modest white-body candle in the premarket. However, the big mover was QQQ which gapped lower but was met with buying and has printed a large white-body candle without wick in the early session. All three remain well above their T-line (8ema) and the short-term trend is still strongly bullish. Meanwhile, the mid-term bearish trend is broken, though one could argue a new mid-term bullish trend has not formed yet (due to a lack of higher low in the strong run higher). In the long-term, we are now clearly back in a Bull trend. In terms of extension, as I mentioned all three are stretched to the upside relative to their T-line. The T2122 indicator has now back up in its overbought territory. So, again, the market needs a pullback or at least a rest to maintain a healthy trend. However, remember that the market can stay overextended a lot longer than we can stay solvent predicting a reversal. So, keep the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, nine of the 10 are in the green this morning, led by the biggest dog NVDA (+1.19%) while NFLX (-1.49%) is the lone laggard. It might be worth noting that NVDA has also traded five times the dollar-volume as the next largest trading stock this morning.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

Markets were undecided on Tuesday.  SPY opened down 0.07%, DIA opened 0.12% lower, and QQQ opened down 0.16%.  At that point, SPY and QQQ rallied to recross their opening gap and reach the highs by 10 a.m. From there they sold off reaching the lows 45 minutes later and then bobbing along those lows until 1 p.m. when they rallied to recross the gap again by 2:25 p.m. and then recross it once more in a slow modest slide into the close.  For its part, DIA had a similar path for the day but with much less magnitude of waves.  This action gave us indecisive, black-bodied Doji-type candles in all three major index ETFs. It also gave us a higher high and a higher low than Monday by a lower open and close.  Again, this happened on well-below average volume in all three major index ETFs.

On the day, nine of the 10 sectors were in the red with Energy (-2.14%) a full 1.5% out in front of the other sectors leading markets lower.  On the other side, Healthcare (+0.05%) was the only sector in the green. Meanwhile, SPY lost 0.16%, DIA fell 0.13%, and QQQ lost 0.21%.  VXX popped 3.92% to close at 46.17 and T2122 dropped back out of the overbought territory to close in the top end of its mid-range at 70.83.  On the bond front, 10-year bond yields fell to 3.81% and Oil (WTI) dropped another 0.74% to close at $73.82 per barrel.  So, Tuesday was more of a rest and/or indecision day for traders as markets wandered around the small opening gap all day. By the closing bell, markets had small black bodies.  However, even at their extremes, none of the major index ETFs were more than half a percent from their Monday close.

The major economic news scheduled for Tuesday was limited to API Weekly Crude Oil Stocks after the close, which showed a 0.347-million-barrel inventory build (compared to a forecasted 2.800-million-barrel drawdown and well above the prior week’s 5.205-million-barrel drawdown). 

In Fed news, on Tuesday, Fed Governor Bowman (a hawk) told an Alaska Bankers conference that she is still cautious about changing Fed policy.  Bowman said, “it will become appropriate to gradually lower the federal funds rate to prevent monetary policy from becoming overly restrictive…”  However, she continued, “we need to be patient and avoid undermining continued progress on lowering inflation by overreacting to any single data point (apparently a reference to July’s 4.3% Unemployment value).”  Bowman noted doubts about data quality, saying “Increased measurement challenges and the frequency and extent of data revisions…make the task of assessing the current state of the economy…challenging.”  This led to her conclusion, “I will remain cautious in my approach to considering adjustments to the current stance of policy.”

After the close, KEYS, LZB, PAGS, and TOL reported beats on both the revenue and earnings line.  Meanwhile, ALC, JKHY and ZTO missed on revenue while beating on earnings.  However, COTY missed on both the top and bottom lines.

In stock news, on Tuesday, the PARA takeover saga continued as a new suitor made his interest official, submitting a $4.3 billion bid via the acquisition of National Amusements.  Later, JNJ announced they have agreed to buy V-Wave (a heart failure treatment maker) for $600 million up front and potentially an additional $1.1 billion in milestone payments (based on the development of V-Wave’s treatments).  Meanwhile, GOOGL announced its Waymo robotaxi unit had doubled its “paid rides” to 100k per week over three months of operation.  (Not bad considering Waymo only has 700 of its robotic taxis.)  Meanwhile, WFC announced it had agreed to sell its “non-agency third-party Commercial Mortgage Servicing” unit to private firm Trimont.  The terms of the sale were not disclosed.  At the same time, STLA announced it was delayed its investment plans for Belvidere, IL.  This came after the UAW filed grievances Monday alleging STLA has violated the terms of its November 2023 contract.  STLA denied this charge.  After the close, MCHP announced it had detected potentially unauthorized activity on its network systems that had disrupted operations at come facilities.  (The activity was seen Aug. 17 and again on Aug. 19.)  The company said it is working to bring all of its systems back online.  Also after the close, BBAI (and AI company) announced it had won a contract of up to $2.4 billion over 10 years with the FAA.

In stock legal and governmental news, on Tuesday, the EU announced it would slash its previously announced additional tariffs on electric vehicles imported from China. For example, TSLA will pay an additional 9% tariff (much lower than the previously-announced 20.8%).  These “punitive duties” are on top of the EU’s standard 10% tariff on imported cars.  The European Commission said that the changes come after it had verified the Chinese government subsidies EV companies had received.  At the same time, the FDA approved JNJ’s “chemotherapy-free” combination treatment for a type of non-small cell lung cancer.  (This puts the JNJ treatment in competition with AZN’s blockbuster drug Tagrisso.)  Later, DIS backed down in the face of heavy bad publicity and announced it will drop its motion to dismiss a lawsuit.  Previously, DIS claimed that a user agreement accepted for a 2019 free trial of DIS+ streaming service prevented a FL widower from suing over the wrongful death of his wife.  (His wife died from allergic reaction to food served at a DIS restaurant in 2023, after the couple had informed the restaurant of the allergy and the restaurant claimed to accommodate food allergies.) Instead of forced arbitration, DIS now says the case can be decided in court. 

Elsewhere, the Dept. of Transportation announced the ALK acquisition of HA had been cleared by the Justice Dept. and was now under DOT review.  Later, the NHTSA announced BMWYY (BMW) is recalling 721k vehicles over electrical short-circuit risk due to a faulty water pump connector seal.  At the same time, the FAA has formally required the inspection of all BA 787 Dreamliner jets over the five recent “mid-air dive” reports that have been tied to pilot seat adjustment turning off the autopilot.  Later, the UK competition watchdog agency announced it had accepted META’s proposed changes to the way it uses customer’s data in advertising.  At the same time, a US Appeals Court revived a lawsuit against GOOGL.  The class-action suit alleges that GOOGL continued to collect personal data of Chrome browser users after they chose not to synchronize their browser to Google accounts.

After the close, WBD pledged to spend at least $8.5 billion to produce movies and TV shows in Las Vegas after the company received a tax incentive package.  Finally, a TX Trump-appointed federal judge struck down the FTC ban on most non-compete agreements required for employees.  (The same judge had temporarily blocked the ban in July.)  The ruling said the FTC does not have the authority to ban practices it deems as unfair competition methods, even though the agency was tasked by Congress is enforcing federal antitrust laws.  (Appeals will very likely follow, but with the uber-Republican SCOTUS, the odds of the bans coming back into effect are long at best.)

Overnight, Asian markets were mixed again as seven of the 12 regional exchanges were in the red.  Taiwan (-0.85%) and Hong Kong (-0.69%) paced the losses while Thailand (+0.73%) was by far the biggest gainer.  However, in Europe, we see green across the board at midday.  The CAC (+0.42%), DAX (+0.48%), and FTSE (+0.17%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modestly green start to the morning.  The DIA implies a +0.14% open, the SPY is implying a +0.19% open, and the QQQ implies a +0.22% open at this hour.  At the same time, 10-Year bond yields are at 3.822% and Oil (WTI) is up by a fraction to $73.31 per barrel in early trading.

The major economic news scheduled for Wednesday is limited to EIA Weekly Crude Oil Inventories (10:30 a.m.) and July FOMC Meeting Minutes (2 p.m.).  The major earnings reports scheduled for before the open include ADI, DY, M, TGT, TJX, and ZK.  Then, after the close, A, CAAP, LU, NDSN, SNOW, SNPS, URBN, and ZM report.

In economic news later this week, on Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, S&P Global Mfg. PMI, S&P Global Services PMI, S&P Global Composite PMI, July Existing Home Sales, and the Fed Balance Sheet are reported.  The Jackson Hole Symposium also starts.  Finally, on Friday we get July Building Permits, and July New Home Sales.  The Jackson Hole Symposium also continues.

In terms of earnings reports later this week, on Thursday, AAP, BIDU, BILI, BJ, CSIQ, IQ, NTES, PTON, TD, VIK, BMA, INTU, ROST, and WDAY report.  Finally, on Friday, we hear from GFI.

So far this morning, ADI, DY, M, and TGT have all reported beats on both the revenue and earnings lines.  Meanwhile, ZK missed (massive miss) on revenue while staying in line on earnings (still a loss).

In miscellaneous news, on Tuesday, a research report from CBRE said that the North American datacenter capacity has jumped 70% in the last year due to the AI craze. The electrical demand of datacenters alone now stands at 3.9 gigawatts.  The report said more than 500 megawatts of new datacenter demand went online in just the eight largest US markets in the first half of 2024.  (For reference, that 500 megawatts adding in H1 was roughly equivalent to the entire data center capacity of Silicon Valley at the end of 2023.)  Elsewhere, the SEC approved (along party lines with GOP-appointed members fighting the move) the new rules proposed in June that will allow the Public Company Accountancy Oversight to hold employees, partners, contractors, and others to be held accountable for negligence if audits are found to be in violation (fraudulent).  Meanwhile, Bloomberg reported Tuesday evening that the “Carry Trade” is back on but in reverse.  For many years, investors borrowed Yen in Japan at almost non-existent interest rates and “carried the money” to the US to invest in higher-yielding vehicles.  With July’s Japanese rate hike and the fall in the Dollar, traders are now borrowing Dollars to put into Japanese investments.  The idea is that speculators are betting that Japan will increase rates more and the US sill start cutting rates next month.  (I’m not sure I buy that reporting given the relative differences in US and Japanese interest rates even after Japan’s July hike.  Nonetheless, that is what Bloomberg reports.)

With that background, markets seem to be resting or indecisive again this morning. All three major index ETFs made a very modest gap higher to open the premarket, Since that point they have traded indecisively but have small white body Spinning Top candles at this time of the early session. With that said, all three remains far above their T-line (8ema) and the short-term trend is still strongly bullish. Meanwhile, the mid-term bearish trend is broken, though one could argue a new mid-term bullish trend has not formed yet (due to a lack of higher low in the run). In the long-term, we are now clearly back in a Bull trend. In terms of extension, as I mentioned all three are stretched to the upside relative to their T-line. However, the T2122 indicator has now pulled back out of its overbought territory into the top part of its mid-range. So, the market does still need a pullback or at least a rest. However, Tuesday’s candle helped some. Just remember that the market can stay overextended a lot longer than we can stay solvent predicting a reversal. So, keep the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, six of them are in the green, led by AMZN (+0.69%) while GOOGL (-0.60%) is the laggard. However, the biggest dog (in terms of dollar-volume traded), is NVDA (-0.01%) followed by TSLA (-0.07%), which are both undecided this morning.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

Markets started Monday in a flat manner.  SPY opened +0.08%, DIA opened up 0.13%, and QQQ opened just 0.01% higher.  From there, all three major index ETFs ground sideways for the better part of an hour.  At that point, all three saw a major volatility event with a 5-minute crash down followed immediately by a 5-minute spike right back up.  Then the Bulls took over, leading a steady rally for the rest of the day with a bullish spike the last 10 minutes in SPY and QQQ.  For its part, DIA’s rally died out at 1 p.m., after which it ground sideways with a modestly bearish trend the rest of the day until it too had a Bull spike the last 10 minutes. This action gave us large white-bodied candles in all three major index ETFs.  SPY and QQQ ended the day on the highs while DIA had a small upper wick.  This happened on well-below average volume in all three major index ETFs.

On the day, all 10 sectors were in the green with Healthcare (+1.98%) well out in front followed by Technology (+1.37%) leading the way higher. On the other side, Consumer Defensive (+0.43%) being the lagging sector.  Meanwhile, SPY gained 0.96%, DIA was up 0.58%, and QQQ gained 1.31%.  VXX fell another 1.44% to close at 44.43 and T2122 jumped back up into the top end of its overbought territory at 96.23.  On the bond front, 10-year bond yields fell to 3.875% and Oil (WTI) dropped 2.86% to close at $74.46 per barrel.  So, Monday was a less volatile but also quite bullish day as traders could not justify bearish trades, but were also afraid to pile in (with heavy volume) on the long side either.  It is worth noting that SPY and DIA closed less than one percent below their all-time high closes.  However, QQQ closed still 4.5% below its all-time high close.  Interestingly, an equal-weighted version of the SPY (where all stocks have the same weight as AAPL) hit a new all-time high Monday.

The major economic news scheduled for Monday was limited to the July US Leading Economic indicators Index, which came in below expectations at -0.6% (compared to a forecast of -0.4% and a June reading of -0.2%).  

In Fed news, on Monday, the Wall Street Journal reported Minneapolis Fed President Kashkari said it was appropriate to discuss potentially cutting interest rates at the FOMC meeting in September.  The article quoted Kashkari as saying, “The balance of risks has shifted, so the debate about potentially cutting rates in September is an appropriate one to have.”  The WSJ went on to say that Kashkari indicated progress has been made on inflation but the labor market has shown some “concerning signs.”  The article quoted him as saying, “I’m still unclear how tight policy is, but the balance of risks in my view have shifted more towards the labor market and away from the inflation side of our dual mandate.”   Elsewhere, Fed Governor Waller did not comment on the economy or monetary policy.  However, he did address say the Fed is looking into the financial stability risks related to stablecoins and non-bank holders.

After the close, FN and PANW reported beats on both the revenue and earnings lines.  It is worth noting that FN raised forward guidance while PANW lowered its guidance.

In stock news, on Monday, Reuters reported that LUV has started a campaign to fight off Elliott Investment Management’s attempt to replace two-thirds of its board members as a prelude to ousting the CEO and the LUV board Chairman.  (Elliott did the same thing at SBUX in the past.)  In a letter to employees, (seeking union and individual employee shareholder support) CEO Jordan said “Don’t be fooled – this is a battle for the heart of our company and our future – your future.”  At the same time, Reuters reported that APA is exploring the sale of its Permian Basis oil and gas properties for roughly $1 billion.  The article said APA has retained two investment banks to help facilitate a sale.  Later, Reuters also reported that ANCTF (operator of the Circle-K convenience stores) has made a preliminary takeover bid for SVNDF (large Japanese 7-Eleven store operator) for roughly $38 billion. 

Elsewhere, GM laid off 1,000 salaried software and services unit employees globally on Monday.  (Roughly 600 of those jobs are located in MI with the rest spread around the world.)  Later, the UAW union said it was filing a number of grievances against STLA and could launch a nationwide strike against the automaker.  The UAW says STLA is not honoring the production (job) commitments it has made in later-2023 contract negotiations.  After the close, GPRO announced it will cut about 15% of its workforce (only 139 jobs) as it seeks to restructure.  At the same time, Reuters reported that BA has grounded its test fleet of 777X jets after inspections found a failure of the engine mounting structure.

In stock legal and governmental news, on Monday, the US State Department approved the sale of $100 million of Javelin missiles (produced by GD) to Australia.  Later, KR sued the FTC seeking to block the regulator from reviewing its proposed $25 billion acquisition of ACI.  In the suit, KR alleges that the FTC is unconstitutional.  After the close, Reuters reported that two dozen state Attorney’s General have amended their lawsuit against LYV.  The new filing shows that the AGs are looking for three times the damages incurred for each customer in the suit they filed in May.  In related news, 10 more states joined the lawsuit Monday, bringing the total to 36 plus the District of Columbia. 

Elsewhere, also after the close, PPC agreed to pay $100 million to settle claims it had conspired with rivals to reduce the pay given to chicken farmers.  (TSN, SAFM, and others had previously settled the same case for much lower amounts.)  At the same time, the FAA issued a airworthiness directive for BA 787 jets after receiving five reports of sudden mid-flight dives.  (The dives were found to be related to movement of the captain’s seat disconnecting the autopilot without notice.)  Meanwhile, IEP and its CEO Carl Icahn settled charges from the SEC of operating a “Ponzi-like scheme.”  In the settlement, IEP agreed to pay $2 million.

Overnight, Asian markets were mixed with five of the 12 exchanges in the red.  Japan (+1.80%) was by far the biggest gainer while Shenzhen (-1.25%) and Shanghai (-0.93%) paced the losses.  In Europe, the picture is a little more red with only four of the 15 bourses in the green at midday.  The CAC (+0.09%), DAX (-0.07%), and FTSE (-0.70%) are leading the region lower in early afternoon trade.  Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward a mixed and flat start to the morning.  The DIA implies a -0.04% open, the SPY is implying a +0.09% open, and the QQQ implies a +0.11% open at this hour.  At the same time, 10-Year bond yields are at 3.873% and Oil (WTI) is just on the green side of flat at $74.42 per barrel in early trading.

The major economic news scheduled for Tuesday is limited to API Weekly Crude Oil Stocks (4:30 p.m.). Fed members Bostic (1:35 p.m.) and Vice Chair Barr (2:45 p.m.) also speak.  The major earnings reports scheduled for before the open are is limited to RERE, AS, FUTU, HTHT, LOW, MDT, VIPS, and XPEV.  Then, after the close, ALC, SQM, COTY, JKHY, KEYS, LZB, PAGS, TOL, and ZTO report.

In economic news later this week, on Wednesday, we get EIA Weekly Crude Oil Inventories and July FOMC Meeting Minutes. One Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, S&P Global Mfg. PMI, S&P Global Services PMI, S&P Global Composite PMI, July Existing Home Sales, and the Fed Balance Sheet are reported.  The Jackson Hole Symposium also starts.  Finally, on Friday we get July Building Permits, and July New Home Sales.  The Jackson Hole Symposium also continues.

In terms of earnings reports later this week, on Wednesday we hear from, ADI, DY, M, TGT, TJX, ZK, A, CAAP, LU, NDSN, SNOW, SNPS, URBN, and ZM.  On Thursday, AAP, BIDU, BILI, BJ, CSIQ, IQ, NTES, PTON, TD, VIK, BMA, INTU, ROST, and WDAY report.  Finally, on Friday, we hear from GFI.

So far this morning, AS, FUTU, and MDT reported beats on both the revenue and earnings lines.  Meanwhile, LOW and XPEV missed on revenue while beating on earnings.  On the other side, VIPS beat on revenue while missing on earnings.  It is worth noting that LOW also lowered its forward guidance.

In miscellaneous news, on Monday, major US freight-forwarder CHRW announced it has begun to divert some US customer ocean cargo away from Canadian ports.  This is being done in anticipation of a Canadian rale strike as soon as August 22.  (Much of ocean cargo continues its journey on rail prior to switching to truck for the last leg of delivery.)  Elsewhere, GS analysts cautioned their clients that next week’s US Non-Farm Payroll data revision is likely to overstate labor market weakness.  GS suggests the overstatement will be due to the quarterly census of Employment which does not account for employment of illegal immigrants.  Secondly, GS says even if it did take immigrants into account, that this census is consistently revised upwardly later.  All told, GS believes the revision will be 300k-500k jobs too low.

With that background, it looks like traders are uncertain early this morning. All three major index ETFs gapped up modestly to start the premarket. However, all three have also sold back down printing small black-body candles in the early session. With that said, all three are still far above their T-line (8ema) and the short-term trend is clearly strongly bullish. Meanwhile, the mid-term bearish trend is broken, though one could argue a new mid-term bullish trend has not formed yet (due to a lack of higher low in the run). In the long-term, we are now clearly back in a Bull trend. In terms of extension, as I mentioned all three are stretched to the upside relative to their T-line. At the same time, the T2122 indicator is now in the top half of its overbought territory. So, the market is in need of a pullback or at least a rest. Just remember that the market can stay overextended a lot longer than we can stay solvent predicting a reversal. So, keep the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, seven of them are in the green, led by AMD (+1.10%) again. However, the biggest dog (in terms of dollar-volume traded), is NVDA (-0.39%), which is leading the losers in that group lower.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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