U.S. stock futures climbed early Tuesday as investors eagerly anticipated the release of key inflation data this morning. The focus is on the producer price index (PPI), a critical measure of wholesale prices, which is scheduled for release at 8:30 a.m. ET. According to Dow Jones consensus estimates, the PPI is expected to show a monthly increase of 0.2% in July, mirroring the previous month’s growth.
European stocks saw an uptick on Tuesday, maintaining a cautiously positive trend following last week’s volatility. The latest data from the U.K.’s Office for National Statistics revealed that wages, excluding bonuses, increased by 5.4% year-on-year between April and June, marking the slowest growth rate in two years. Additionally, the unemployment rate dropped to 4.2% from 4.4%, defying economists’ expectations of a rise to 4.5%, as per a Reuters poll.
Asia-Pacific markets experienced a general uptick, reflecting investor optimism despite a turbulent session in the U.S. overnight. This volatility in the U.S. was largely due to anticipation surrounding the upcoming release of the U.S. consumer price index (CPI) for July, a crucial metric for gauging the health of the U.S. economy. Meanwhile, in Asia, market participants were busy analyzing Japan’s producer price index data and Singapore’s second-quarter GDP growth figures, both of which are significant indicators of economic performance in the region.
Economic Calendar
Earnings Calendar
Notable reports for Tuesday before the bell include HD, HBM, HUT, HUYA, HIS, JHX, LOAR, MLCO, MRSN, MSGS, ONON, PSFE, SE, SLF, TLN, & TME. After the bell include DUOT, FNV, IBTA, INTA, KYTX, MRCY, NATL, NPCE, NU, USPH, & XP.
News & Technicals’
Share transactions in China have plummeted to their lowest level in over four years, driven by a fervent local bond rally amidst a weakening economy. The world’s second-largest stock market is on course for its fourth consecutive year of losses, exacerbated by an unprecedented housing crisis that has severely restricted investors’ options. This situation has led to a surge in demand for government bonds, raising concerns among regulators. Historically, similar episodes in China have triggered panic-driven selling, pushing the market to new lows, and the current scenario appears to be following this troubling pattern.
Shares of Home Depot dropped over 2% in premarket trading after the home improvement retailer issued a warning about weaker-than-expected sales for the second half of 2024. The company now anticipates full-year comparable sales to decline by 3% to 4%, a significant adjustment from its earlier forecast of a roughly 1% decrease. This revised outlook has raised concerns among investors about the company’s performance and the broader economic environment affecting consumer spending.
Carry trades, a popular foreign exchange strategy where investors borrow in low-interest currencies like the Japanese yen to invest in higher-yielding assets, have gained significant traction in recent years. This popularity stemmed from expectations that the yen would remain cheap and Japanese interest rates would stay low. However, this trend took a sharp turn last week when the Bank of Japan’s interest rate hikes strengthened the yen, triggering an aggressive unwinding of yen-funded carry trades. This sudden shift led to a dramatic sell-off in global markets, highlighting the volatility and risks associated with such strategies.
The Social Security Administration (SSA) is grappling with a “record-breaking backlog” of open cases, which has resulted in an estimated $1.1 billion in improper payments to beneficiaries, according to a recent report from the SSA Office of the Inspector General. This backlog has highlighted significant challenges within the SSA, with experts emphasizing the urgent need for increased budgetary funding to address what they describe as a “customer service crisis.” The situation underscores the critical importance of adequate resources to ensure timely and accurate service delivery to beneficiaries.
The wait for the key inflation data of the PPI report. The question now, will it inspire the bulls or bears? We should also consider the possibility of a sideways move as we wait for the more important CPI numbers on Wednesday. That said, be prepared for anything including gaps and big point whipsaws as the market reacts.
Markets opened modestly lower Friday. SPY opened down 0.16%, DIA opened down 0.09%, and QQQ opened down 0.34%. From there, all three of the major index ETFs meandered back-and-forth around the opening gap until 12:30 p.m. Then the market saw a sharp rally for a little over an hour, followed by a weaker selloff for an hour, with all three then drifting modestly bullishly the rest of the day. This action gave us small gap-down, white-bodied candles, with wicks at both ends in SPY, DIA, and QQQ. DIA was a prototypical Spinning Top candle. All three crossed back above their T-line (8ema), although DIA only did so by a dime. This happened on average volume in DIA and QQQ as well as less-than-average volume on the SPY.
On the day, nine of the 10 sectors were green with Technology (+0.57%) and Financial Services (+0.56%) out front leading the others higher. Meanwhile, Industrials (-0.10%) was the only sector in the red (barely). At the same time, SPY gained 0.44%, DIA gained 0.16%, and QQQ gained 0.52%. VXX plummeted 12.12% to close at 55.78 and T2122 fell but remained in its mid-range at 38.79. On the bond front, 10-year bond yields fell to 3.94% and Oil (WTI) popped another 1.04% to close at $76.98 per barrel. So, Friday was a meandering day with less energy that the other days in the week. As a result, the magnitude of the whipsaws Friday was muted.
This action ended a tumultuous week that started with a huge gap lower and featured heavy volatility, especially early in the week. That said, the week ended as “much ado about nothing” as stocks rallied back from the huge INTC-inspired gap lower Monday. SPY ended the week up 0.02% after trading in nearly a 5% range during that time. DIA did end the week 0.50% lower after having been down more than 3% at one point. And QQQ was the show-stealer, closing the week up 0.37% after having been down 5.59% at one point and trading in almost a 7% range for the 5-days.
There was no major economic news scheduled for Friday. In addition, there were no earnings reports after the close Friday.
In Fed speak news, on Saturday, Fed Governor Bowman softened her normal very hawkish tone. She noted “welcome” evidence of inflation reduction and seemed to indicate rate cuts will be needed if inflation stays on a downward trajectory. Bowman said, “Should the incoming data continue to show that inflation is moving sustainably toward our 2% goal, it will become appropriate to gradually lower the federal funds rate to prevent monetary policy from becoming overly restrictive on economic activity and employment.” The prepared remarks were delivered to a Kansas City Banking Assn.
In stock news, on Friday, STLA announced it is planning to lay off 2,450 US workers later this year as it plans to end production of the “Ram 1500 Classic” truck. (Layoffs may begin as soon as October 8.) Later, SBUX gained on a Wall Street Journal report that activist fund Starboard Value had taken a significant position in the company. At the same time, BA announced it had been awarded a $2.56 billion contract from the USAF for the development of two rapid prototypes of airborne warning and control aircraft. Later, after the close, C announced it has initiated a process to sell its Trust Services business unit. (No details were provided.) On Saturday. Reuters reported that CSCO will cut thousands of more jobs in a second round of layoffs this year. (CSCO laid off 4,000 employees in February.) Also on Saturday, TSLA stopped taking orders for the cheapest version of its Cybertruck ($61k) and not only has the $100k version available for sale.
In stock legal and governmental news, on Friday, the NHTSA announced it had opened an investigation into 330k HYMTF (Hyundai) vehicles over potentially faulty seatbelts. At the same time, the SEC announced it had reached settlements with the CEO of IDEX and two of the company’s former executives related to securities fraud and misleading financial reporting. Later, JPM asked a federal judge in Manhattan to dismiss its case against Russian VTB Bank, which was seeking to recover $439.5 million in accounts frozen after Russia’s invasion of Ukraine. JPM said it was being coerced to request the dismissal by a Russian injunction on JPM and fear of what retaliatory action would take place if the suit was not dropped. At the same time, META won an appeal by RFK Jr.’s anti-vax group which had been alleging censorship due to META’s policy against the spread of misinformation.
Overnight, Asian markets were mixed but leaned toward the green with eight of the 12 exchanges in positive territory. Taiwan (+1.42%) and South Korea (+1.15%) led the gainers while Singapore (-0.81%) paced the losses. In Europe, with the sold exception of Belgium (-0.18%) we see green across the board at midday. The CAC (+0.05%), DAX (+0.28%), and FTSE (+0.59%) lead the region higher in early afternoon trade. In the US, as of 7:45 a.m., Futures are pointing toward a modestly green start to the day. The DIA implies a +0.13% open, the SPY is implying a +0.20% open, and the QQQ implies a +0.22% open at this hour. At the same time, 10-Year bond yields are back up to 3.955% and Oil (WTI) is up another 1.09% to $77.68 per barrel in early trading.
There is no major economic news scheduled for Monday includes NY Fed 1-Year Consumer Inflation Expectations (11 a.m.), the WASDE Ag report (noon), and Fed Budget Balance (2 p.m.). The major earnings reports scheduled for before the open include GOLD, CEPU, FTRE, and BEKE. Then, after the close AGRO, PACS, AND SLF report.
In economic news later this week, on Tuesday we get July Core PPI, July PPI, and API Weekly Crude Oil Stocks report. In addition, Fed member Bostic speaks. Then Wednesday, July Core CPI, July CPI, and EIA Weekly Crude Oil Inventories report. On Thursday, we get Weekly Initials Jobless Claims, Weekly Continuing Jobless Claims, July Core Retail Sales, July Export Price Index, July Import Price Index, NY Empire State Mfg. Index, Philly Fed Mfg. Index, Philly Fed Mfg. Employment Index, July Retail Sales, July Industrial Production, Jun Business Inventories, June Retail Inventories, TIC Net Long-Term Transactions, and the Fed Balance Sheet. We also hear from Fed member Harker. Finally, on Friday, July Building Permits, July Housing Starts, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations are reported.
In terms of earnings reports later this week, on Tuesday, we hear from HD, JHX, MLCO, ONON, SE, TME, CIG, FNV, and NU. Then Wednesday, ARCO, EAT, CAE, CAH, DOLE, ESLT, ICL, PFGC, UBS, CSCO, and STNE report. On Thursday, we hear from BABA, AIT, DE, GRAB, JD, NICE, SPTN, TPR, WMT, AMCR, AMAT, COHR, GLOB, and HRB. Finally, on Friday, FLO reports.
So far this morning, GOLD and BEKE reported beats on both the revenue and earnings lines. However, FTRE missed on both the top and bottom lines.
In miscellaneous news, on Friday, the CFTC said that short bets on 5-Year Treasury Bond Futures were now the largest on record. The report stain almost 1.7 million contracts of short bets were in place as of the week ending Aug. 6. (Two-Year and 10-Year Bond Future short bets also increased during the week, but were not at record levels.) Elsewhere, the state of MI reported a human case of Swine Flu on Friday. (The source of exposure is still under investigation and no word on patient outcome was given.) Meanwhile, Sunday was the 900th day of Russia’s invasion of Ukraine (if you do not count the 2014 invasion that stole Crimea and parts of Eastern Ukraine) and the 6th day of the Ukrainian invasion of the Kursk oblast of Russia.
With that background, it looks as if markets are tepidly bullish again early today. All three major index ETFs made a modest gap higher to start the premarket. Since then, SPY and DIA have printed white-body, small-wick candles while QQQ had printed a black-body, mostly-wick candle. All three are back above their T-line (8ema) and the short-term trend remains bullish. However, the mid-term trend is bearish. Still, while the bullish trend line is broken, the longer-term charts remain bullish. In terms of extension, all three major index ETFs are now back to being close to their T-line (8ema). At the same time, the T2122 indicator is back into the mid-range. So, the market has some room to run if either side can find momentum. With regard to those 10 big dog tickers, eight of the 10 are in the green led by the biggest dog, NVDA (+0.79%), which also leads by far on the dollar-volume traded as usual, and AMZN (+0.78%). The second-largest dollar volume trader is TSLA (-0.30%), which is also the biggest loser in premarket.
As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!
See you in the trading room.
Ed
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
U.S. equity futures remained nearly unchanged on Monday as investors prepare for pending inflation data following Friday’s relief rally. Callie Cox, chief market strategist at Ritholtz Wealth Management, noted that high emotions and clustered market swings could lead to another turbulent week. Investors are particularly focused on the upcoming July producer price index report, with the consumer price index set to follow on Wednesday, both of which are expected to significantly influence market sentiment and trading strategies.
European stocks began the new trading week on a positive note, initially rising before paring some of their earlier gains. Investors are closely watching for indications that the market turbulence from the previous week has subsided. The financial services and insurance sectors were among the top performers, each advancing by approximately 0.6%. This week, market participants are particularly focused on upcoming inflation data from the U.S. and U.K., which are expected to play a significant role in shaping market sentiment and investment decisions.
Asia-Pacific markets experienced a positive start to the week, with most indices showing gains on Monday. This comes after a tumultuous week marked by significant selloffs and a subsequent sharp recovery, particularly in Japanese stocks. Investors are now turning their attention to upcoming economic indicators from India, specifically inflation and industrial output data, which are expected to be released later in the day. These figures will likely influence market sentiment and trading strategies moving forward.
Economic Calendar
Earnings Calendar
Notable reports for Monday before the bell include BLDP, ESPR, FTRE, BEKE, & MNDY. After the bell include ALC, DHT, KGS, PACS, & RUM.
News & Technicals’
Veteran investor David Roche anticipates a bear market in 2025, driven by factors such as smaller-than-expected rate cuts, a decelerating U.S. economy, and an AI bubble. He predicts these elements could lead to a market decline of around 20%, potentially beginning at the end of this year. However, Roche also notes that the Federal Reserve will have the flexibility to adjust in response to these economic challenges.
The Pentagon has deployed a guided missile submarine, and a carrier strike group equipped with F-35C fighter jets to the Middle East, citing the need to bolster U.S. military presence and capabilities in response to rising regional tensions. This move follows a statement from Iran’s leadership vowing retaliation against Israel after the assassination of Hamas’ former political chief, Ismail Haniyeh, in Tehran on July 31. The Pentagon’s actions underscore the escalating conflict and the U.S.’s commitment to maintaining stability in the region.
The Biden Administration has launched a comprehensive, multi-agency regulatory initiative aimed at curbing corporate practices that are perceived to waste consumers’ time and impose unnecessary bureaucratic hurdles. White House domestic policy advisor Neera Tanden highlighted that these practices often involve companies delaying services or making it excessively difficult for consumers to cancel services, thereby retaining customers’ money for extended periods. Central to this new effort are a series of rulemakings by the Consumer Financial Protection Bureau, which aim to address and mitigate issues related to customer service “doom loops” and the use of chatbots.
U.S. short seller Hindenburg released a report on Saturday alleging that Madhabi Puri Buch, the chair of the Securities and Exchange Board of India, had previously invested in offshore funds also utilized by the Adani Group. In response, Buch dismissed the claims as baseless. According to the report, Adani Group companies experienced a significant market impact, losing approximately $2.4 billion in value on Monday.
There is a good chance of a choppy hurry up and day with the markets highly anticipating the Tuesday PPI and Wednesday CPI reports. Earnings numbers will decline sharply by mid-week removing a major source of inspiration and price volatility. However, the economic data this week could keep the wild whipsaws going as the market reacts to the results.
Jobless Claims data helped the Bulls who were in-charge Thursday. SPY gapped up 1.03%, DIA gapped up 0.45%, and QQQ gapped up 1.43%. From there, DIA continued higher immediately and strongly for an hour. Meanwhile SPY and QQQ pulled back for 20 minutes before the Bulls followed the DIA in a strong rally, which lasted until 10:50 a.m. At that point, all three major index ETFs ground sideways until 1 p.m. Then the entire market rallied again to new highs of the day at 2:25 p.m. From there, we saw a 75-minute, moderate pullback followed by a 20-minute bounce at the end of the day to take all three major index ETFs out near the highs of the day. This action gave us large white-bodied candles in all three. All three had small upper wicks, with DIA having very little lower wick, SPY having a modest lower wick, and QQQ having a large lower wick. All three retested their T-line (8ema) from below and closed just below that level. This happened on average volume in SPY and QQQ as well as less-than-average volume on the DIA.
On the day, all 10 sectors were green with Technology (+3.60%) way out front leading the others higher. Meanwhile, Utilities (+0.70%) and Consumer Defensive (+0.77%) lagging well behind the others. At the same time, SPY gained 2.31%, DIA gained 1.75%, and QQQ gained 3.06%. VXX plummeted 7.96% to close at 63.47 while T2122 climbed back out of its oversold area to 42.22. On the bond front, 10-year bond yields jumped up to 3.989% and Oil (WTI) popped another 1.10% to close at $76.06 per barrel. So, Thursday was bullish revenge day where NVDA (+6.13%) led the charge of the 10 big dogs leading the rest of the market higher. In fact, it was the best day for SPY since 2022.
The major economic news scheduled for Thursday was limited to the Weekly Initial Jobless Claims, which showed a bit less than expected filings at 233k (compared to a forecast of 241k and the prior week’s 250k). At the same time, Weekly Continuing Jobless Claims were higher than predicted at 1,875k (versus a 1,870k forecast and the previous week’s reading of 1,869k). Together, this Jobless Claims data calmed market fears about recession, causing a premarket surge. Later, after the close, the Fed Balance Sheet was down by $3 billion, from $7.178 trillion to $7.175 trillion.
In Fed speak news, on Thursday, Richmond Fed President Barkin played down the idea of a need for urgent (especially inter-meeting) rate cuts. He said the FOMC has time to determine where the economy is, saying “I think you’ve got some time in a healthy economy to figure out whether this is an economy gently moving into a normalizing state … it this one where you really do have to lean into it (meaning cuts).” Speaking about the labor market, he said “What I hear from folks on the ground in the labor market is that people are cutting back on hiring, but not firing.” In relation to inflation, he said, “I’m actually pretty optimistic that over the next few months we’re going to see good readings on the inflation side.” Later, Chicago Fed President Goolsbee reiterated his earlier statements that the Fed’s job is not to respond to the stock market or political considerations. He said, “The Fed’s out of the election business. The Fed is in the economic business.” He went on to say, “We’re not in the business of responding to the stock market. We’re in the business of maximizing employment and stabilizing prices.”
After the close, AKAM, AMN, CCU, DTEGY, DBX, DXC, EDN, EVH, EXPE, G, GILD, NWSA, NWS, PBI, REZI, RXT, SOLV, and TTD all reported beats on both the revenue and earnings lines. Meanwhile, ATSG, IAG, PARAA, PBA, and PARA missed on revenue while beating on earnings. On the other side, CPRI, CENX, PODD, PAAS, and TTWO beat on revenue while missing on earnings. However, NGL, SSP, and TTEC missed on both the top and bottom lines.
In stock news, on Thursday, Reuters reported that DAL, UAL, RYAAY, and ESYJY among other airlines have suspended flights to various parts of the Middle East due to rising tensions between Israel, Hamas, Hezbollah, Yemeni Houthis, and Iran. Later, GM made an odd announcement, saying it is committed to building a profitable operation in China. The GM CFO said he did not “necessarily accept” the idea that GM is struggling to make money in China, despite the company reporting a $104 million loss in the country in Q2. At the same time, Reuters reported that AMZN CEO Jassy is happy with the progress of the company’s “Prime Video” and is planning a significant expansion. (AMZN increased its investment into Prime Video from $1.7 billion to $13.6 billion for 2024.) Later, TMICY (Trend Micro) is exploring a sale after getting buyout interest in the last few weeks. After the close, as part of its earnings announcement, PARA said it would be cutting 15% of its workforce. (The stock was up on the earnings and job cut announcement.)
In stock legal and governmental news, on Thursday, NTSB Chair Homendy said the agency would like to complete its probe of the BA 737 MAX 9 mid-air door blow-out early in 2025. She told Reuters that 12-14 months from the time of the January 5 incident would be the target, adding that a survey of BA’s workers in Renton WA will begin soon. Later, the NHTSA announced that BMWYY (BMW) will recall just under 106k crossover and sedan cars to fix a starter motor overheating issue via a software update. At the same time, the Fed announced it had imposed an enforcement action on CUBI for “significant deficiencies” related to its risk management and money-laundering practices. Later, AAPL announce it has changed its EU app store policy and will now charge app developers a fee of 1% on apps, as well as reducing AAPL commissions on all digital goods and services sold through the AAPL’s EU App Store. (This move came after an investigation and anti-trust finding against AAPL by the EU, but prior to announcement of final punishments.)
Overnight, Asian markets were mostly green to end the turbulent week. Taiwan (+2.87%), Australia (+1.25%), South Korea (+1.24%), and Hong Kong (+1.17%) led the region higher. In Europe, we nearly see green across the board at midday with only AEX (-0.10%) in the red. Meanwhile, the CAC (+0.32%), DAX (+0.15%), and FTSE (+0.39%) lead 14 of the 15 bourses higher in early afternoon trade. In the US, as of 7:45 a.m., Futures are pointing toward a modestly red start to the morning. The DIA implies a -0.05% open, the SPY is implying a -0.10% open, and the QQQ implies a -0.11% open at this hour. At the same time, 10-Year bond yields are down to 3.944% and Oil (WTI) is up two-thirds of a percent to $76.67 per barrel in early trading.
There is no major economic news scheduled for Friday. The major earnings reports scheduled for before the open include AQN, AMCX, AXL, AMRX, CLMT, ROAD, ERJ, EVRG, and NFE. Then, after the close, there are no major reports scheduled.
So far this morning, AMRX, CLMT, ROAD, and SLVM have all reported beats on both the revenue and earnings lines. Meanwhile, AMCX and ERVG beat on revenue while missing on earnings. However, SATS and NFE missed on both the top and bottom lines.
In miscellaneous news, on Thursday, despite market rumors, the Russian natural gas deliveries to Europe through the pipeline from Russia continue according to both the Ukrainian and German Energy Ministers. Ukrainian forces captured a transit/pumping station of the pipeline (located in Sudzha, Russia) during an offensive into Russia earlier this week. (It is worth noting that 50% of all Russian natural gas exports to Europe flow through that station.) Elsewhere, CBOE announced it is taking the term “derivatives” to a whole new level. The exchange plans to launch options tied to the futures of the VIX, which itself is a based on the options that track the S&P 500. (Take a minute and try to grasp that in full. CBOE will sell options based on futures of an index that is based on options that are based on another index.) This new vehicle is scheduled to begin trading on October 14, pending regulatory review.
With that background, it looks as if markets are somewhat calm again so far this morning . All three major index ETFs opened higher in the premarket, but then sold back into the red before recovering into the very modest green just now. The very short-term trend is now bullish while the mid-term trend is bearish. However, while the bullish trend line is broken, the longer-term charts remain bullish. (For example, look at a Monthly chart. There is no way to call SPY, DIA, or QQQ bearish based on those monthly charts.) In terms of extension, all three major index ETFs are now back to being close to their T-line (8ema). At the same time, the T2122 indicator is now back up out of its oversold area and into the mid-range. So, the market has some room to run if either side can find momentum. With regard to those 10 big dog tickers, they are evenly split between red and green. However, NVDA (+1.28%) leading the tech in terms of gain and is by far the largest dollar-volume trader The second-largest dollar volume trader is TSLA (+0.08%) which is also (barely) on the green side. Finally, remember its Friday. Monday morning’s gap should have been a warning that you need to prepare your account for weekend news cycles.
As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!
See you in the trading room.
Ed
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
Markets did another trap Wednesday, this time trapping the Bulls. The SPY gapped up 1.22%, Dia gapped up 0.72%, and QQQ gapped up 1.62%. At the point, all three major index ETFs chopped sideways in a volatile manner until just after 11 a.m. Then, the rout was on as the selling started and drove all three back down across the open gap and on to new lows at 3 p.m. From they all made a modest bounce that didn’t quite make it back to the previous close before rolling over again. This led to the sharpest selling of the day during the last 10 minutes and led to SPY and QQQ closing very near their lows of the day while DIA closed not too far up from its own lows. SPY and QQQ both retested and failed their T-line (8ema) during the day and DIA came close, but did not quite reach a retest before selling off. This action gave us large, black-body candles with upper wicks in all three major index ETFs. SPY and QQQ printed Bearish Engulfing candles while DIA missed that shape by just a bit. This all happened on just a tad more than average volume in all three major index ETFs.
On the day, six of the 10 sectors were red with Basic Materials (-1.75%), Healthcare (-1.40%), and Consumer Cyclical (-1.39%) being the biggest movers. Meanwhile, Communications Services (0.46%), Utilities (+0.43%), and Energy (+0.36%) were the only appreciable gaining sectors. At the same time, SPY lost 0.67%, DIA fell 0.57%, and QQQ dropped 1.08%. VXX fell 1.77% to close at 69.22 while T2122 dropped back down into the top end of its oversold area at 16.67. On the bond front, 10-year bond yields jumped up to 3.95% and Oil (WTI) spiked 3.10% to close at $75.47 per barrel. So, Wednesday was a Bull Trap with a large gap higher, followed by chop, and then the floor fell out. (The gap was likely the result of US markets following the rest of the world higher on Bank of Japan calming tones leading traders to think the “Carry Trade” (borrowing money at cheap interest in Japan and investing it in higher-yielding stock in the US) may not be dead. It felt like the Bears waited for Europe to close and then pulled the rug out from under the Bulls.
The major economic news scheduled for Wednesday was limited to EIA Crude Oil Inventories, which fell 3.728 million barrels (compared to a forecasted drawdown of 1.600 million barrels but only slightly larger than the previous week’s 3.436-million-barrel drawdown). Later, the June Consumer Credit report showed a reduction to $8.93 billion (versus a $9.80 billion forecast and well down from the May $13.95 billion reading). In other words, spending on credit cards and other borrowing dropped 30% month-on-month.
After the close, APP, CACI, CF, CPAY, CW, ENS, FWRD, HUBS, ICUI, JXN, LNW, MMS, MKSI, OXBC, PRI, HOOD, RGLD, SM, STN, TALO, UVV, VSAT, WES, WTS, ZG, and Z all reported beats on both the revenue and earnings lines. Meanwhile, DOX, ATO, BHF, CENT, CENTA, CPA, EQIX, HI, MATV, MCK, MFC, OXY, SBGI, UGI, and MODG missed on revenue while beating on earnings. On the other side, AE, CHRD, ET, MTW, and MRO beat on revenue while missing on earnings. However, ALTG, NVST, MNST, MODV, and WBD missed on both the top and bottom lines.
In stock news, on Wednesday, Reuters reported that major US natural gas producers are preparing to further cut production in order to prop up natgas prices. The article cites sources at EQT and APA indicate each will cut 90 billion cubic feet per day in production in the second half. In addition, CHK, AR, and EGO are deferring completion of natural gas projects. Later, EQR announced that it had agreed to acquire 11 major apartment properties (nearly 3,600 apartments total) from BX for $964 million. At the same time, during its earnings call, DIS announced it may have to pay $5 billion more to acquire CMCSA’s minority stake in Hulu. The unexpected expense would stem from a CMCSA request that the deal’s appraiser value Hulu at $40 billion.
Meanwhile, BA said it has ramped up “seeker” (a key component of Patriot anti-missile systems) production after a surge in demand. BA says it expects 2024 annual production of seekers to beat its previous record production by 20%. At the same time, Bloomberg reported that BHP is considering the sale of its Brazilian gold and copper mining assets that the company acquired during its buyout of much smaller peer Oz Minerals. (BHP said the purchase of Oz was made to gain access to minerals used in batteries, as opposed to gold and copper.) Later, after the close, NASA announced that BA’s stranded Starliner crew may return on a SpaceX Dragon capsule in February 2025 since it is still deemed too unsafe to return the Starliner to Earth. (Meaning the planned 8-day Starliner flight would end up lasting 9-months.) Finally, overnight CNBC reported sources telling it that AAPL is planning to charge iPhone users roughly $20 per month for its AI offering, possibly as part of its “Apple One” subscription. This lucrative service will be rolled out across some AAPL devices later this year.
In stock legal and governmental news, on Wednesday, BLK and NDAQ jointly asked for an SEC rule change that would allow the listing and trading of options on Ethereum spot price ETFs. (Comments on the rule request are open for 21 days.) At the same time, KR won the dismissal of a lawsuit that alleged the grocery chain’s “Farm Fresh” label on eggs misled consumers not on the “fresh” claim but rather that industrial egg production plants are not “farms.” Later, the NHTSA announced it has opened a new investigation into reports of a “steering rod failure” safety issue among more than 77k NSANY (Nissan) 2021 Rogue crossover vehicles. At the same time, the Wall Street Journal reported that the Consumer Financial Protection Bureau is investigating JPM, BAC, and WFC in relation to the banks handling of peer-to-peer Zelle network funds transfers. (The banks told Reuters they are considering whether to sue the CFPB over the agency’s inquiries.)
Elsewhere, during its hearings into BA safety issues, the NTSB announced it will conduct a survey of 737 MAX factory workers related to safety (quality) culture after determining the mistakes that led to January’s mid-air blowout of a fuselage panel should have been caught years earlier (and the company could not identify what factory workers had even worked on the blown-out panel and removed the missing bolts). At the same time, passengers filed a proposed class-action suit against DAL for refusing refunds after its recent massive computer outage and thousands of flight cancellations (and thousands more delayed). Later, INTC was sued by shareholders alleging the company fraudulently concealed the problems that led to its poor Q2 results and plans to cut more than 15% of its workforce. (INTC CEO and CFO are also defendants in the suit.)
Overnight, Asian markets were mostly in the red with just three of 12 exchanges above break-even. Taiwan (-2.00%), Japan (-0.74%), and India (-0.74%) led the region lower. In Europe, we see red across the board at midday on stronger moves than Asia. The CAC (-1.13%), DAX (-0.77%), and FTSE (-1.12%) lead the region lower in early afternoon trade. In the US, as of 7:30 a.m., Futures are pointing toward a mixed, flat start to the day. The DIA implies a -0.14% open, the SPY is implying a +0.06% open, and the QQQ implies a +0.16% open at this hour. At the same time, 10-Year bond yields have backed down to 3.925% and Oil (WTI) is unchanged at $75.23 per barrel in early morning trading.
The major economic news scheduled for Thursday is limited to Weekly Initial Jobless Claims and Weekly Continuing Jobless Claims (both at 8:30 a.m.), and Fed Balance Sheet (4:30 p.m.). The major earnings reports scheduled for before the open include WMS, COLD, AVAH, AVT, AZUL, FUN, CQP, LNG, COMM, DDOG, ELAN, LLY, EDR, EPAM, FWONK, ULCC, GTN, HBI, HGV, IHRT, KELYA, KOP, LAMR, LSXMK, LSXMA, MLM, MUR, NXST, NRG, PZZA, PH, PENN, ACDC, RPRX, QSR, SBH, SEE, SN, SPB, TKO, UAA, UA, USFD, VTNR, VTRS, VST, and WMG. Then, after the close, ATSG, AKAM, AMN, BTG, CIB, CPRI, CENX, BAP, DBX, DXC, SSP, EVH, EXPE, G, GILD, IAG, NWSA, NGL, PAAS, PARAA, PARA, PBA, PBI, RXT, REZI, SOLV, TTWO, TTD, and TTEC report.
In economic news later this week, on Friday, there are no major economic news scheduled.
In terms of earnings reports later this week, on Friday, AQN, AMCX, AXL, AMRX, CLMT, ROAD, ERJ, EVRG, and NFE report.
So far this morning, ALIZY, AVAH, BN, CEIX, DDOG, ELAN, LLY, EPAM, LAMR, NRG, PENN, QSR, SBH, SEE, SN, FOUR, UA, and UAA all reported beats on both the revenue and earnings lines. Meanwhile, WMS, COLD, CQP, GTN, HBI, MUR, PZZA, and VTRS missed on revenue while beating on earnings. On the other side, COMM, PRMW, SPB, TKO, USFD, and VTNR beat on revenue while missing on earnings. However, ATS, MLM, and NXST missed on both the top and bottom lines.
In miscellaneous news, on Wednesday, global container shipping company Maersk (AMKAF) announced that it expects global container shipping (which is a measure of global GDP) to slow in the second half. The company cited blow-ups in the Middle East (following Israel’s targeting killings in Lebanon and Iran, along with Hezbollah, Iran, and Hamas retaliation expected). For the full year, Maersk expects global container demand to increase 4% – 6%, which is down significantly from the 7% growth seen in the first half of 2024. Elsewhere, GS reported hedge funds had the best first half returns that they have seen since 2021. GS said their survey of 314 hedge funds fount that the average fund made a 5.7% return during the first half, which was not far from 2023’s full-year 7.1%.
With that background, it looks as if the market has settled a bit this morning. All three major index ETFs gapped down a little to start the premarket. However, from there they have put in white-bodied candles to recover most or all of the gap. DIA is the most indecisive of the three and the QQQ gap down took it near to retesting its 200sma which may have aided its bounce in the early session. The short-term trend remains clearly bearish as is the mid-term trend. However, while the bullish trend line is broken, the longer-term charts are not yet bearish. (For example, look at a Monthly chart. There is no way to call SPY, DIA, or QQQ bearish based on those monthly charts.) In terms of extension, all three major index ETFs are a bit stretched below their T-line (8ema). At the same time, the T2122 indicator is now back down in its oversold range. So, the market is in need of some rest or a relief bounce. However, the extension is not overwhelming and the bounce does not need to be today. With regard to those 10 big dog tickers, nine of the 10 are in the green this morning with INTC (+0.95%) leading the tech in terms of gain. However, NVDA (+0.28%) is again by far the largest dollar-volume traded (as usual).
As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!
See you in the trading room.
Ed
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
On Thursday, stock market futures declined with Wall Street grappling with uncertainty after several volatile sessions. All three major indices have now fallen in four of the past five trading days. Investors remain cautious due to ongoing economic concerns, geopolitical tensions, and the upcoming November elections. Market participants are closely monitoring Thursday’s weekly jobless claims and a slew of earnings reports, which could influence market sentiment.
European markets experienced a downturn, struggling to maintain positive momentum. The technology sector saw a significant decline, shedding 1.85%, while mining stocks also pulled back by 1.39%. The absence of major data releases contributed to the lackluster performance, leaving investors without new information to drive market sentiment.
Asia-Pacific markets largely mirrored the downturn seen on Wall Street, with most indices closing in the red. In a widely anticipated move, the Reserve Bank of India maintained its key interest rate at 6.5% for the ninth consecutive meeting, aligning with economists’ expectations. Meanwhile, Mainland China’s CSI 300 index managed to recover from earlier losses, finishing the day nearly unchanged at 3,342.94.
Walmart, McDonald’s, and Kroger have become focal points in the political debate over rising prices and other financial pressures affecting American consumers. Politicians on the campaign trail are leveraging public frustration with high costs, though Republicans and Democrats attribute these issues to different causes. According to Cait Lamberton, a marketing professor at the University of Pennsylvania’s Wharton School, pledging to address everyday expenses is a strategic move, especially for politicians in swing states, during these contentious times.
A state of emergency has been declared in Kursk due to a Ukrainian incursion into the Russian border region. Acting regional Governor Alexey Smirnov reported that the “operational situation” in the border areas of Kursk remained “complicated” as of Wednesday. This development underscores the ongoing tensions and instability in the region, highlighting the challenges faced by local authorities in managing the security situation.
Following the assassination of its former political chief, Ismail Haniyeh, Hamas has appointed Yahya Sinwar as the leader of its political wing. Sinwar, known for his ruthlessness and widely regarded as the mastermind behind the October 7 attack, now stands as the most powerful figure within the organization. The transition to a more hardline leader in the wake of Haniyeh’s killing is expected to significantly diminish the prospects for a cease-fire, further complicating the already tense situation.
On Thursday, German industrial technology giant Siemens reported a quarterly operating profit that exceeded expectations, reaffirming its full-year outlook. The company achieved an industrial profit of 3 billion euros ($3.3 billion) for the quarter ending in June, marking an 11% increase compared to the same period last year. This strong performance underscores Siemens’ resilience and effective strategies in navigating the current economic landscape.
Jobless claim and a huge number of earnings will likely be very important in shaping Thursday’s market sentiment while grappling with uncertainty of the economy, political landscape and geopolitical pressures. With the VIX closing above 27 plan for the challenging price action conditions to continue.
On Tuesday, markets continued its rebound after Monday’s brutal gap down. The SPY gapped up 0.39%, DIA opened 0.12% higher, and QQQ gapped up 0.45%. From there, all three major index ETFs rallied most of the day to reach the highs just before 3 p.m. At that point, all three sold off sharply the last 75 minutes of the day. This action gave us gap-up, white-bodied Spinning Top candles in all three major index ETFs. However, all three had large upper wicks. DIA also retested and failed its 50sma from below. This all happened on slightly above-average volume in all three major index ETFs.
For the day, all 10 sectors were in the green with Communications Services (+1.41%) leading the way higher. Meanwhile, Consumer Defensive (+0.74%) lagged behind the other sectors. At the same time, SPY gained 1.02%, DIA gained 0.88%, and QQQ gained 1.07%. VXX dropped sharply (but not nearly as sharply as it spiked Monday) to close at 72.38. Meanwhile, T2122 jumped up out of the bottom of its oversold territory into the lower end of the mid-range at 30.68. On the bond front, 10-year bond yields spiked up to 3.902% and Oil (WTI) gained 0.26% to close at $73.13 per barrel. So, Tuesday saw a modest recovery from Monday’s brutal losses. However, late profit-taking wiped out much of the bounce. So, again, volatility was the watchword of the day.
The major economic news scheduled for Tuesday included the June Exports, which came in up at $265.90 billion (compared to a May $262.00 billion value). On the other side, June Imports were also up, but not quite as much at $339.00 billion (versus a May reading of $337.00 billion). Together, these resulted in a lower Trade Deficit as the June Trade Balance was at $73.10 billion (higher than the $72.50 billion forecast and down from May’s $75.00 billion reading). Finally, after the close, the API Weekly Crude Oil Stocks showed a very minor build of 0.180 million barrels (compared to an expected 0.850-million-barrel build and far larger than the prior week’s -4.495-million-barrel drawdown).
At noon, the US EIA released its EIA Short-Term Energy Outlook update. In it, the EIA increased its 2024 forecasts for US oil demand by 100k barrels per day to 20.5 million bpd. However, it left its world oil demand growth forecast unchanged at 102.9 million bpd. Meanwhile, the EIA predicts US oil production will reach a new record of 13.23 million bpd this year, up 300k bpd. At the same time, EIA cut its forecast annual avg. oil price for WTI by 2.2% to $80.21 per barrel. Despite this, the agency expects Brent prices to remain between $85 and $90 by year end. On the Natural Gas side, the EIA cut its US production forecast to 103.3 billion cubic feet per day (down from the prior forecast of 103.5 bcfpd.
After the close, AMGN, AIZ, AXON, CLW, CPNG, DVA, DVN, EXEL, FBAK, FTNT, GMED, GO, HY, ILMN, CART, IFF, MASI, MRC, PR, SKY, STE, SNEX, LRN, SU, RUN, TOST, and VFC all reported beats on both the revenue and earnings lines. At the same time, AGL, AFG, ASH, PARR, and TRIP missed on revenue while beating on the earnings line. On the other side, IAC, LUMN, RIVN, SVC, and SMCI beat on revenue while missing on earnings. However, ABNB, ARKO, CRC, ENLC, PLUS, MOS, TSE, and WYNN missed on both the top and bottom lines.
In stock news, on Tuesday, UAL began negotiations with the Teamster union for a contract related to 10k aviation maintenance and related workers. At the same time, MSFT fired back at DAL (similar to how CRWD had done on Monday) saying the airline refused help and unlike its competitors had failed to upgrade and maintain its global IT infrastructure. MSFT said these failures have made the airline’s recovery to normal operations much longer and harder to accomplish than what their peers experienced. Later, SCHW said that high trading volumes and a technical issue with a “key vendor” was the cause of the brokerage’s Monday outage and long customer service wait times. At the same time, NASA announced Tuesday that problems with BA’s Starliner spacecraft has caused it to push back the next scheduled launch of astronauts for at least one month. (The most recent Starliner launch remains stuck at the International Space Station since the beginning of June.) Later, after the close, SMCI announced a 10-for-1 stock split on September 30 (trading split on October 1). At the same time, Reuters reported that VFC, LEVI, BRKB (via its Fruit of the Loom brand), TPR and TGT are the apparel makers with the biggest exposure to the political turmoil in Bangladesh.
In stock legal and governmental news, on Tuesday, SPWR filed for to request Chapter 11 bankruptcy and agreed to sell some of its assets for $45 million. At the same time, the NHTSA released documents at the start of two 10-hour days of hearings into the BA 737 MAX 9 jet mid-air panel blowout incident from January. Later the UK antitrust regulator announced it has begun its review of the IBM acquisition of HCP. At the same time, Chinese regulators announced that TSLA will be performing a “remote recall” (over-the-air update) on 1.7 million cars in that country to fix a defect that files to indicate when the hood is latched. At the same time, the SEC and CFTC announced that PIPR will pay a total of $16 million in civil penalties to resolve investigations into its trading record-keeping practices. (These very innocuous words cover the fact that the cases stem from unauthorized business communications with other traders via off-books communications platforms. In other words, collusion between major market participants.)
Elsewhere, legal analysts said that Monday’s blockbuster antitrust ruling against GOOGL may actually aid AAPL in its own antitrust case brought by the same Dept of Justice and states). The only part of the case where the court ruled in favor of GOOGL was in upholding the ultra-conservative SCOTUS ruling that companies (even monopolies) almost never have a duty to deal with competitors. This is a key point in AAPL’s defense of its own antitrust case. Later, many major advertisers such as CVS, UL, and others as well as a major ad industry group were sued by the former Twitter as Elon Musk alleges, they are unlawfully conspiring to boycott advertising on his social media platform.
Overnight, Asian markets were nearly green across the board with only Shenzhen (-0.17%) preventing a clean sweep. Taiwan (+3.87%) continued its big rebound from Monday while South Korea (+1.83%), Hong Kong (+1.38%), and India (+1.27%) led the main pack of gainers. In Europe, we do see green across the board on multi-percent moves from all 15 bourses at midday. The CAC (+1.69%), DAX (+1.28%), and FTSE (+1.10%) lead the region higher in early afternoon trade. In the US, as of 7:30 a.m., Futures are pointing to a gap higher to start the day. The DIA implies a +0.86% open, the SPY is implying a +1.25% open, and the QQQ implies a +1.51% open at this hour. At the same time, 10-Year bond yields are higher to 3.933% and Oil (WTI) has popped 1.76% to $74.49 per barrel in early trading.
The major economic news scheduled for Wednesday is limited to EIA Crude Oil Inventories (10:30 a.m.) and June Consumer Credit (3 p.m.). The major earnings reports scheduled for before the open include ADV, BCO, BAM, CRL, CCO, SID, CNDT, CRH, CVS, DBD, DDL, EMR, ENOV, GEO, GLP, GPN, GFF, HLT, HMC, IEP, KMT, LPX, LYFT, NEUE, NYT, NI, NOMD, NVO, DNOW, ODP, OGE, OSCR, PLTK, RCM, RL, REYN, ROK, RXO, SHOP, SONY, SUN, TGNA, PRKS, VSTS, VSH, DIS, and ZBH. Then, after the close, AE, ALTG, DOX, APP, ATO, BHF, CACI, CENT, CENTA, CF, CHRD, CPA, CPAY, CPAY, CAPL, CW, EFXT, ET, ENS, NVST, EQIX, FWRD, HG, HI, HUBS, ICUI, JXN, LNW, MTW, MFC, MRO, MATV, MMS, MCK, MKSI, MODV, MNST, NTR, OXY, PRI, HOOD, RGLD, SBGI, SM, STN, TALO, MODG, UGI, VSAT, WBD, WTS, WES, ZG, and Z report.
In economic news later this week, on Thursday we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, and the Fed Balance Sheet. Finally, on Friday, there are no major economic news scheduled.
In terms of earnings reports later this week, on Thursday, we hear from WMS, COLD, AVAH, AVT, AZUL, FUN, CQP, LNG, COMM, DDOG, ELAN, LLY, EDR, EPAM, FWONK, ULCC, GTN, HBI, HGV, IHRT, KELYA, KOP, LAMR, LSXMK, LSXMA, MLM, MUR, NXST, NRG, PZZA, PH, PENN, ACDC, RPRX, QSR, SBH, SEE, SN, SPB, TKO, UAA, UA, USFD, VTNR, VTRS, VST, WMG, ATSG, AKAM, AMN, BTG, CIB, CPRI, CENX, BAP, DBX, DXC, SSP, EVH, EXPE, G, GILD, IAG, NWSA, NGL, PAAS, PARAA, PARA, PBA, PBI, RXT, REZI, SOLV, TTWO, TTD, and TTEC. Finally, on Friday, AQN, AMCX, AXL, AMRX, CLMT, ROAD, ERJ, EVRG, and NFE report.
So far this morning, BCO, CTTAY, DBD, GPN, HMC, KMT, ADRNY, LPX, LYFT, NYT, OSCR, RCM, REYN, ROK, SHOP, SONY, SUN, VSH, DIS, and ZBH all reported beats on both the revenue and earnings lines. Meanwhile, CRL, CVS, EMR, ENOV, HLT, NI, NOMD, PLTK, and RXO missed on revenue while beating on earnings. On the other side, BAM, DDL, GEO, and OGE beat on revenue while missing on the earnings line. However, CCO, NVO, DNOW, ODP, and PRKS missed on both the top and bottom lines.
In miscellaneous news, on Tuesday, an independent council charged with governance of carbon credits reported that about one-third of all existing carbon credits fail to meet the new standard. The new standard is that the ventures from which the credits are bought must not depend on carbon credit sales revenue to exist. Elsewhere, 110k customers remain without power in Northern FL following the passing of storm Debby. Meanwhile, the Fed released its Household Debt survey results for Q2. The headline is that total US Household Debt edged higher (+0.6%) in the quarter, but the rate of loan delinquencies remained at 3.2%. (For reference, that delinquency rate hit an all-time high of 4.7% at the end of 2019, before the pandemic.) Elsewhere, overnight the global market recovery was given a boost by hints that the carry trade (borrowing money at negative interest in Japan to invest at a higher rate elsewhere) is not dead. The Deputy Bank of Japan Governor gave dovish signals by pledging to refrain from hiking interest rates when stock markets are unstable. (This caused the Yen to fall 2% against the Dollar.)
With that background, it looks as if the Bulls are in control early this morning. All three major index ETFs gapped higher to start the premarket and have printed large, white-body candles (almost no wick) since that gap up. However, be aware that DIA is now retesting its 50sma from below and the SPY and QQQ may also be retesting a potential resistance level above. One candle does not make a trend. So, the short-term trend remains clearly bearish as is the mid-term trend. However, while the bullish trend line is broken, the longer-term charts are not yet bearish. (For example, look at a Monthly chart. There is no way to call SPY, DIA, or QQQ bearish based on those monthly charts.) In terms of extension, the premarket moves have moved all three major index ETFs back closer to their T-lines above and relief a lot of their over-extension, but more relief may be in order. At the same time, the T2122 indicator is now out of its oversold range. So, the market has a little more slack to work with in either direction than it did after Monday’s huge gap down. With regard to those 10 big dog tickers, all 10 are in the green this morning with NVDA (+2.02%) leading the rebound again both in terms of gain and dollar-volume traded. The bottom line is that markets are bullish early today but this may just be a relief rally. Remain cautious and be careful of intraday volatility. The whipsaw is real.
As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!
See you in the trading room.
Ed
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
Stock futures surged on Wednesday as the recovery rally continues, with the indexes quickly closing in on substantial overhead resistance. Investors were eager to recoup more of the losses on Monday. Despite the broad-based rally on Tuesday, which saw gains across all 11 sectors of the S&P 500, the sustainability of this rebound remains uncertain. LPL Financials’ chief global strategist, Quincy Krosby, cautioned that turbulent times may still lie ahead, reflecting the ongoing volatility and unpredictability in the market.
European stocks saw an uptick on Wednesday as global markets attempted to recover from Monday’s significant downturn. The regional markets have been volatile, experiencing sharp declines at the start of the week. On Tuesday, European markets opened on a positive note but later reversed course, ending the day lower amid choppy trading. This seesaw pattern reflects the ongoing uncertainty and cautious sentiment among investors as they navigate the fluctuating global market conditions.
Asia-Pacific markets experienced a positive uptick on Wednesday, buoyed by a rebound in major Wall Street indexes that ended a three-day losing streak. Investors in the region closely analyzed China’s July trade balance data, which revealed a faster-than-anticipated growth in imports. However, this optimism was tempered by the fact that exports fell short of expectations. This mixed trade data from China played a significant role in shaping market sentiment across Asia.
Claudia Sahm, chief economist at New Century Advisors, asserts that the U.S. Federal Reserve does not need to implement an emergency rate cut, despite the recent economic data falling short of expectations. Sahm’s perspective suggests confidence in the current monetary policy framework, indicating that the weaker-than-expected data does not warrant immediate intervention. This stance reflects a measured approach to economic fluctuations, emphasizing stability over reactive measures.
A recurring theme in the latest earnings reports from U.S. companies is the negative impact of the China market. Starbucks reported a significant 14% drop in same-store sales in China for the quarter ending June 30, compared to a modest 2% decline in the U.S. McDonald’s chairman and CEO, Christopher Kempczinski, highlighted the weak consumer sentiment in China during the same period. Similarly, General Mills CFO, Kofi Bruce, noted that after a strong start to the year, the quarter ending May 26 experienced a notable downturn in consumer sentiment. These reports underscore the challenges U.S. companies are facing in the Chinese market, reflecting broader economic uncertainties.
A recurring theme in the latest earnings reports from U.S. companies is the negative impact of the China market. Starbucks reported a significant 14% drop in same-store sales in China for the quarter ending June 30, compared to a modest 2% decline in the U.S. McDonald’s chairman and CEO, Christopher Kempczinski, highlighted the weak consumer sentiment in China during the same period. Similarly, General Mills CFO, Kofi Bruce, noted that after a strong start to the year, the quarter ending May 26 experienced a notable downturn in consumer sentiment. These reports underscore the challenges U.S. companies are facing in the Chinese market, reflecting broader economic uncertainties.
The vacation rental company, Airbnb, has cautioned investors about a potential slowdown in year-over-year growth for its key “Nights and Experiences” category in the upcoming quarter. The company noted a trend of shorter booking lead times globally and observed some signs of decreasing demand from U.S. guests. Despite these concerns, Airbnb reported a record-breaking 125.1 million Nights and Experiences booked in the second quarter, marking its highest result for this period. This mixed outlook highlights both the company’s recent successes and the challenges it anticipates in maintaining growth momentum.
Another day and yet another big overnight gap as the recovery rally continues but I highly recommend caution as we approach significant price and technical overhead resistance. According to JP Morgan the yen carry trade still has about 50% unwind left so avoid chasing with the fear of missing out. Remember the VIX remains very elevated so along with big gaps comes the possibly of big point whipsaws.
S&P 500 futures experienced a relief rally following the broad index’s worst day in nearly two years, triggered by a global market sell-off. Many investors see Monday’s downturn as a necessary correction in a market characterized by high valuations and record highs. However, caution remains, with some experts, like Keith Lerner, Truist’s co-chief investment officer, warning that the market may still face further challenges. Lerner noted that significant damage has been done and that the recovery process will likely be gradual.
European stocks showed a mixed performance as markets attempted to recover from Monday’s significant sell-off. Banks and tech stocks, which had been among the hardest hit, managed to regain some ground in the early hours of trading. Tech stocks maintained their upward momentum, ending the day 1.03% higher. However, bank stocks faced a slight setback, closing 0.06% lower.
Japan’s stock market experienced a remarkable surge on Tuesday, with the Nikkei index soaring by 10.23% to close at 34,675.46. This marks its largest daily gain since October 2008 and the highest spike in index points ever recorded. Similarly, the Topix index saw a significant rise, finishing the day up 9.3% at 2,434.21. Meanwhile, the Reserve Bank of Australia announced that its cash rate would remain steady at 4.35%, providing a stable outlook for the Australian economy.
Morningstar DBRS analysts have cautioned that ongoing market declines following the recent global sell-off could potentially become a “self-fulfilling prophecy,” leading to a recession. Despite banks being one of the most heavily affected sectors, the analysts believe that the impact of market volatility on banks will likely be limited. The end of last week and Monday saw global markets tumble amid growing fears of a U.S. recession. However, there were signs on Tuesday that stocks might begin to recoup some of their losses, offering a glimmer of hope amidst the uncertainty.
Aramco reported a net income of $56.3 billion for the first half of the financial year, a decrease from $62 billion during the same period last year. Despite this decline, the company reaffirmed its second-quarter base dividend of $20.3 billion and announced a performance-linked dividend of $10.8 billion to be paid in the third quarter. Meanwhile, the kingdom’s gross domestic product has contracted for four consecutive quarters, a trend economists attribute largely to oil production cuts. This financial performance and economic context highlight the challenges faced by the oil industry and the broader economy.
John Schulman, who has been instrumental in refining the models behind OpenAI’s ChatGPT chatbot, is set to join the company’s safety and security committee following the departure of two safety leaders. Schulman emphasized that OpenAI’s executives have consistently demonstrated a strong commitment to safety and security. This move underscores OpenAI’s ongoing dedication to maintaining robust safety standards and ensuring the responsible development of its AI technologies.
West Texas Intermediate (WTI) has erased most of its gains for the year, while Brent crude is now down for 2024. This downturn has been driven by weak economic data from the U.S., which has sparked a sell-off in equity markets amid growing fears of a looming recession. Additionally, ongoing economic softness in China has been unsettling oil market traders, further contributing to the decline in oil prices. This combination of factors highlights the current volatility and uncertainty in the global oil markets.
The T2122 indicator continues to show a significant short term oversold condition so a relief rally is likely, but I would not expect it zoom all the way back. With volatility so high, plan for very challenging price action with big point whipsaws. With little on the economic calendar markets will focus with much more scrutiny on earnings results. Plan carefully and have a great day.
