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Stimulus Not Done Trump Wants Change

December 23, 2020 by Ed Carter

Tuesday brought us a small gap down in the large-caps and a small gap up in the QQQ. After the open, the DIA slowly ground lower, the SPY and QQQ undulated more sideways. The DIA printed a Bearish Harami and the QQQ printed a long-legged Doji, while the SPY printed a run-of-the-mill black-bodied candle. On the day, QQQ gained 0.27%, SPY lost 0.17%, and DIA lost 0.69%. The VXX fell a little under 2% to 18.11 and T2122 rose near, but just outside of the overbought territory at 77.03. 10-year bond yields fell to 0.921% and Oil (WTI) fell almost 2.5% to $46.80/barrel.

President Trump felt the need to lash out again overnight. This time his tweet called the Stimulus bill a disgrace and demanded Congress change the $900 Billion bill to add bigger direct payments to Americans. He did not overtly threaten a veto, but the threat was implied. This came out of the blue, especially since his own Treasury Sec. (Mnuchin) was one of the lead negotiators. The President’s demand for larger direct payments also flies in direct opposition to the Senate GOP position that there should have been no additional direct payments (which was then negotiated up to the final agreed number of $600). If vetoed, the move would also kill the $1.4 trillion omnibus spending bill, which would close the government. Treasury yields climbed and futures moved down on the news.

In other after-hours Tuesday news, the NYSE announced that most of their trading floor personnel will go back to remote work as of December 28. This includes all the market makers. This follows the same rules as the historic floor operations shutdown back in March and is based on a new level of outbreak in the New York City area.

Related to the virus itself, US infections continue to rage as the US. The totals have risen to 18,684,628 confirmed cases and 330,824 deaths. The weekend saw another small reduction in new cases and deaths Monday, but the 7-day daily average remains 219,171 new cases and the average number of deaths rose to 2,781 deaths per day. This comes after we reported the second-highest number of daily deaths on Tuesday.

Globally, the numbers rose to 78,476,586 confirmed cases and the confirmed deaths are now at 1,726,558 deaths. As a reference, the world is averaging about 648,000 new cases and almost 11,700 new deaths per day. In Europe, France agreed to reopen border crossing with the UK, but only for people who can present a negative test that had been taken within 72-hours of the crossing. However, with a queue that has already grown for 48 hours, it will take time to get drivers the test and clear the backlog. In the meantime, German airline Lufthansa has begun flying special cargo flights of fresh produce to the UK. (Sort of the opposite of the Western airlift into Berlin during the Berlin Blockade.) That said, Germany reported its highest daily death toll since the beginning of the virus.

Overnight, Asian markets were mostly in the green. Among the major exchanges, South Korea (+0.96%) and Hong Kong (+0.86%) led the way. The only losses were in smaller exchanges like Thailand (-0.59%) and Indonesia (-0.24%). Europe is also mixed, but leans to the green side so far today. Among the big 3 bourses, the FTSE (-0.09%) is on the red side of flat, but the DAX (+0.52%) and CAC (+0.46%) are green and more typical of the continent. As of 7:30 am, US futures are pointing to a flat, but mixed open. The DIA is implying a slight gain of +0.15%, the SPY also implying a slight gain of +0.16%, and the QQQ implying a small loss of -0.09%.

The major economic news on Wednesday includes Nov. Core PCE, Nov. PCE Price Index, Nov. Personal Spending, and Weekly Jobless Claims (all at 8:30 am), Univ. of Michigan Cons. Sentiment and Nov. New Home Sales (bot hat 10 am), and Crude Oil Inventories (10:30 am). The only major earnings report on the day will be PAYX before the open.

With the holiday fast approaching, more and more traders will be away from the market. The President’s ojection to the stimulus deal and fear over the virus (and almost inevitable new wave after people ignore the advice and congregate for Christmas and New Year’s Day) are fighting against holiday cheer for the mind of th market. Remember that the bulls are extremely resilient. So, be careful, but don’t take any rash actions. Stick to the chart.

Respect the trend, support and resistance, and price action. Focus on maintaining your trading rules. Keep booking those profits (and especially goals) when you have them…its all about base hits. Don’t let greed get in the way of you achieving goals. Success is built one trade at a time, not by trying to hit the lottery. In short, get rich slowly…one trade at a time, just consistently achieving goals.

Swing Trade Ideas for your consideration and watchlist: WRAP, PINS, NKE, CCOI, FVRR, GTHX Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

🎯 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.

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Hear no Evil

December 22, 2020 by Doug Campbell

The bulls stampeded back into stocks after gaping substantially lower yesterday, choosing to hear no evil or see no evil in the new, more infectious strain of the virus impacting Europe. In a late-night session, the U.S. House passed the stimulus bill and spending bill, avoiding a government shutdown. Now traders will have to answer the question, is the stimulus already priced into the market? Currently, futures are flat, while yesterday’s bullish price action raises hope of a Santa Claus rally.

Overnight Asian markets dipped in reaction to the new economic restrictions weighing on investors. After a rough day of selling yesterday, European markets trade modestly higher this morning despite the new virus strain’s economic impacts. After receiving the government go-ahead for the 2^nd largest stimulus bill in government history, U. S. futures are taking a wait and see approach ahead economic reports.

Economic Calendar

Earnings Calendar

On the Tuesday earnings calendar, we have just 4-verified reports. Notable reports include KMX, CTAS, & NEOG.

News & Technicals’

After weeks of political gamesmanship, the U.S. House passed the 2^nd largest stimulus bill in government history. Americans could get the $600 direct payments as soon as next week and extend a lending program for business and up to 15 billion in aid to airlines. Google and Facebook are reportedly teaming up to battle antitrust lawsuits that have raised the possible collusion between the companies to price fix advertising prices. The SEC has been very busy of late and, according to reports, will soon sue the cryptocurrency firm Ripple for selling unregistered securities. The new strain highly contagious strain of the virus is already suspected to be here in the U.S., according to Whitehouse health officials. Scientists from the U.K. suggest the new strain is up to 70% more contagious. However, the market chose to ignore the new threat to the economy in favor of the new deficit spending bill in a highly volatile trading session yesterday. According to Johns Hopkins data, the U.S. is recording at least 215,700 new infections and at least 2600 deaths each day based on a seven-day average.

After some wild price action whipsaws, the bulls rushed back in yesterday as if they have zero concern about the overall economy’s state. However, after passing the $900 billion stimulus plan, the U.S. Futures seem to have stalled this morning. Printing bullish candle patterns on the index charts suggest there is still hope for a Santa Claus rally as we head toward the Christmas shutdown. We have many potentially market-moving data coming our way on the economic calendar today and tomorrow, so stay focused and expect price sensitivity to the news cycle. Will we continue to hear no evil and see no evil as economic impacts continue to grow?

Trade Wisely,

Doug

Stimulus Excitement vs New Strain Fear

December 22, 2020 by Ed Carter

Monday was a volatile day with stocks gapping down 1% – 1.4% at the open on fears raised by the wildfire spread of a new virus strain in the UK. However, not too long after the open, the dip buyers stepped in to lead a rally that lasted until 3pm. A small selloff at the end of a day took us to an indecisive day with large wicks (especially in the SPY) and the potential news that support had held after the gap down. On the day, the SPY was down 0.36%, the DIA flat at +0.08%, and the QQQ was down 0.37%. The VXX was up almost 8% to 18.44 and T2122 fell back again to dead center of the range at 51.31. 10-year bond yields fell just a bit to 0.94% and Oil (WTI) was off 2.5% to $47.79/barrel.

Congress passed the relief bill Monday night. Details of the $900 billion stimulus package were also released. The bill will include a $300/week supplement to unemployment through mid-March, $284 billion ins small business PPP loan/grants, and a $600 direct payment to most Americans. It also includes an extension to eviction prohibition through January, $8 billion in funding for vaccine distribution, $15 billion for airlines, $14 billion for transit systems, and $10 billion for state highways. It will also give $10 billion in childcare assistance, $15 billion for entertainment businesses, and finally another $7 billion for broadband (although none of the telecom companies have ever delivered on the string attached to the hundreds of billions of previous grants). The last major element of the bill was that it ends the Fed lending programs, stops the FOMC from starting similar programs, and takes back $429 billion previous allocated to the Fed to lend in the prior relief bills. This last measure is key as it takes a huge buyer out of the corporate bond market as well as a low-rate lender.

In Europe (and especially the UK), the new strain of virus is adding to the Brexit trade concerns. Since France is the primary gateway from the UK into the EU, the French-English border is crucial to trade. However, the border between the UK and France was closed to contain the new mutation of the virus. This leaves thousands of trucks, hundreds of railcars, and a large, but unknown, number cargo ships stacked up on either side of the border. This coming about 10 days before a hard Brexit where trade between the two will swap to WTO tariff rates and trade rules. So, what was expected to be a trade nightmare has come two weeks earlier than expected. In the UK, they fear their food stocks are already being impacted, though we are not talking famine.

Related to the virus itself, US infections continue to rage as the US. The totals have risen to 18,473,716 confirmed cases and 326,772 deaths. The weekend saw another small reduction in new cases and deaths Monday, but the 7-day daily average remains 218,531 new cases and the average number of deaths rose to 2,665 deaths per day. Related to the stimulus bill, airlines are promising to bring back furloughed workers when they get their aid, but UAL and AAL said the move would only be work through March unless more aid or a change in the amount of travel volume happens.

Globally, the numbers rose to 77,817,977 confirmed cases and the confirmed deaths are now at 1,711,508 deaths. As a reference, the world is averaging about 642,000 new cases and almost 11,500 new deaths per day. In Asia, the outbreak at a Thai seafood market that rocked their stock exchange Monday doubled again today (to 1,000 cases after months on none). India and Australia have now locked down individual provinces. In South Korea, the government has curtailed Christmas celebrations by declaring a “special quarantine period.” However, its not all bad news as Singapore has now received its first shipment of the PFE-BNTX vaccine.

Overnight, Asian markets leaned heavily to the red, but Thailand and India bucked the trend after an awful Monday session. Japan (-1.04%), Shanghai (-1.86%), and Shenzhen (-1.76%) were typical for Asian exchanges. However, in Europe, we see green across the board so far today. Among the big 3 bourses, the FTSE (+0.30%) is an outlier, but the DAX (+1.06%) and CAC (+1.01%) are typical. As of 7:30 am, US futures are pointing to a mixed open. The DIA is implying a flat open of +0.05%, the SPY implying a slight move up at +0.24%, and the QQQ implying a small gap higher at +0.58%.

The major economic news on Tuesday is limited to Q3 GDP (8:30 am) and Conf. Board Consumer Confidence and Nov. Existing Home Sales (both at 10 am). Major earnings reports for the day are limited to CTAS and KMX before the open. There are no major reports after the close Tuesday.

With little economic news, the open will depend on how the market views the stimulus deal details versus fear over the impacts of the “new strain” of the virus. At least at this point, the bulls seem to have a slight upper hand. Remember that we expect lower volume as traders have either taken the week off or are perhaps leaving early this week. So, be careful in this holiday-shortened week.

Swing Trade Ideas for your consideration and watchlist: NIO, AAPL, ADMA, FAS, BAC, CLF, CRSP, GNRC, FCX. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

🎯 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

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

900 Billion, but?

December 21, 2020 by Doug Campbell

The U.K. reported a new, more contagious strain of the virus on Sunday, overshadowing the 900 billion stimulus bill agreement sending the futures sharply lower. If this morning’s gap-down reversal gains momentum, it could be a painful day with price and technical supports substantially lower. Though cooler heads may prevail, make sure you have a plan to protect your capital. Expect extreme sensitivity to the news as countries extend and strengthen restrictions in reaction to the new strain.

Asian markets closed mixed but mostly lower overnight. European markets trade decidedly bearish this morning as new travel restrictions go into place. U.S. futures have bounced off overnight lows but still point to a substantial gap down ahead of a light earnings and economic calendar day. Buckle up volatility and with an extreme sensitivity to news surrounding the new strain.

Economic Calendar

Earnings Calendar

As we kick off the Holiday week, we have a light earnings calendar. Notable reports include FDS & HEI.

News and Technicals’

The second vaccine from Moderna reaches hospitals today after emergency approval last week, with infection and death rates remaining very elevated. Late Sunday afternoon, Congress agreed on a 900 billion dollar stimulus bill, the 2^nd largest in history. The House will vote on the bill later today, sending to on to the Senate for approval. Airlines are on track to receive another 15 billion in government support but must call back furloughed workers to receive the payments. Yesterday the U.K. scientists identified a new, more aggressively infectious strain of COVID. In reaction, several countries have already banned travel, and instead of the planned easing of restrictions ahead of Christmas, Parlement may add to lockdown restrictions in an emergency Parliament meeting. After hearing about the stimulus agreement, U.S. futures surged 200 points but have turned sharply bearish as new restrictions in reaction to the new strain worry investors.

After a very volatile overnight futures market fueled on the mixed emotions of stimulus and a more infectious strain of the virus, the market points a substantial gap down at the open. Dow futures more than 600 points but has thus far rallied off the overnight lows. That said, those that were buying up positions before the weekend will likely experience a painful reversal this morning. Perhaps cooler heads will prevail, but this is the kind of event that could easily trigger a swift and significant selloff. Try not to panic and stay focused on the price action but plan to protect your capital if the run for the door gains momentum.

Trade Wisely,

Doug

New Strain in UK and Deal on Stimulus

December 21, 2020 by Ed Carter

On Friday, the large-caps made a small gap down while the QQQ made a small gap up at the open. However, all 3 major indices then immediately sold off for most of the day. A strong rally the last 20 minutes (perhaps on S&P 500 rebalancing or on Quadruple-witching preparation) still left all 3 with ugly black candles, but at least well up off the lows. (In other words, all 3 indices were black Hammer-type candles with longer lower wicks.) On the day, the SPY lost 0.82%, the DIA lost 0.52%, and QQQ lost 0.30%. The VXX rose almost 2% to 17.08 and T2122 fell just out of the overbought territory to 76.74. 10-year bond yields rose to 0.945% and Oil (WTI) rose to $49.10/barrel.

The weekend drama was about a stimulus and government spending deal as Friday ended with a government shutdown expected and no stimulus deal yet done. Late Friday night Congress kicked the can down the road by passing a 2-day stop-gap spending bill that ended at Midnight on Sunday night. The hold-up on the stimulus deal was down to a few GOP Senators who want to end the Fed’s Lending Authority (kill the programs where the FOMC has been lending to businesses and banks as well as buying bonds after emergency previous Congressional authorization). Late Sunday the two sides finally reached a deal, but Congress didn’t have time to type up and pass that agreement before the shutdown deadline. So, they passed an additional one-day stop-gap spending bill last night that the President signed to keep the doors open.

The other major news from the weekend was that Friday evening the FDA approval of the MRNA vaccine. This announcement was made at the same press conference where the White House Vaccine Chief admitted communications problems had caused 14 states to believe they were getting up to 40% more of the PFE vaccine doses than they had actually been allocated. So, the MRNA vaccine shipping may help fill some holes. The MRNA vaccine began shipping on Sunday and the first vaccinations with this drug should happen Monday. The main advantage of the MRNA vaccine is that it requires slightly less stringent (still -50 degrees) temperatures to store and ship, making its distribution easier. The CDC followed the FDA lead Sunday by authorizing hospitals to administer the new vaccine.

Related to the virus itself, US infections continue to rage across the US, but came down just a bit. The totals have risen to 18,267,579 confirmed cases and 324,869 deaths. As mentioned, the weekend saw a small reduction in new cases, but the 7-day daily average remains 217,630 (over one-third of the world’s cases) and the average number of deaths rose to 2,628 deaths per day. The apparent new threat (new strain) out of UK caused the US Surgeon General to a statement Sunday. He said it is too early to tell if the new strain of the virus would be prevented by the two current vaccines, but other vaccine candidates are on the way in the months to come…so we should trust the scientists.

Globally, the numbers rose to 77,264,853 confirmed cases and the confirmed deaths are now at 1,701,599 deaths. As a reference, the world is averaging about 640,000 new cases and almost 11,000 new deaths per day. In the UK, London was placed under emergency lockdown and PM Johnson says that the Christmas pause in restrictions will be modified as the Health Minister explained that the new virus strain (mutation) is out of control and spreading far worse than the original strain. This news caused the reimposition of restrictions on travelers from the UK in many countries as the US, Denmark, the Netherlands, and even Australia have now detected cases of this new variant. This includes a full stop of travel from the UK to France. In more positive news for Europe, the EU Drug Regulator is expected to authorize the PFE/BNTX vaccine today.

Overnight, Asian markets were very mixed. China was green as Shenzhen (+1.87%), Taiwan (+0.95%), and Shanghai (+0.76%) led the gainers. However, most Asian exchanges were red with Thailand (-5.44%) and India (-3.14%) far outpacing the pack. In Europe, markets are red across the board on massive fear stoked by the new virus strain in the UK. Losses have been in the 2%-3% range as of mid-day. Among the big 3 bourses, FTSE is at -2.03%, DAX at -2.84%, and CAC at -2.63%. As of 7:30 am, US futures are pointing to a significant gap lower. Right now the DIA is implying a -1.38% open, the SPY implying a -1.55% open, and the QQQ implying a -0.99% open.

There is no major economic news or major earnings reports for Monday.

With no economic data or earnings to change the storyline, markets are being dragged South by the new strain of virus in the UK. Expect the details of the stimulus agreement to also get some traction, but its a question of whether Mr. Market focuses on what didn’t make the deal or what did. At least at the start, the Bears have the upper hand. The new MRNA vaccine is the wildcard, but remember PFE sold off in the days after the approval and release of their vaccine. So, be careful and remember this is a holiday-shortened week with light volume expected. It remains very possible that all the big money has already left town for Christmas vacation.

Focus on maintaining discipline. Respect the trend, support and resistance, and price action. Keep working the process and booking those base hits. Don’t let greed get in the way of you achieving goals. Success is built one trade at a time, not by trying to hit the lottery. In short, get rich slowly…one trade at a time, just consistently achieving goals.

Swing Trade Ideas for your consideration and watchlist: No Trade Ideas for Monday. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

🎯 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

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

Waiting on Congress

December 18, 2020 by Doug Campbell

The bulls and bears stood toe to toe yesterday, duking it out with either side unable to gain any momentum as we wait on Congress. Evidence continues to show that pandemic restrictions are slowing the economy, and with infection rates exploding to about 1 million every 4-days, I suspect that will only get worse. Has this rally already priced in the stimulus bill? Maybe, so be careful overtrading and consider your risk carefully heading into the weekend and the holiday week ahead.

Asian markets closed the week red across the board in reaction to the Bank of Japan rate decision. European markets this morning show modest gains even as a no-deal Brexit weighs on investor minds. U.S. Futures are trying to shake off overnight lows during the morning pump up that has become all too familiar of late. With a light earnings and economic calendar day, expect an extra dose of news sensitivity as we head into the weekend.

Economic Calendar

Earnings Calendar

We have a light day on the Friday earnings calendar, but we still have a few meaningful reports. Notable reports include APOG, DRI, NKE, & WGO.

News & Technicals’

With an afternoon vote, the FDA endorses the second vaccine choice, with Moderna gains approval for emergency use. A good thing as the infection rate explodes around the country, adding about 1 Million new positive tets in just 4-days. According to reports, the widespread hack included a breach at Microsoft. They are not suggesting millions of Americans may have been affected by the attack. The deadline for a Brexit trade deal is drawing near with several key disputes yet to resolve. A no-deal Brexit could create some stock market and currency market fluctuations. Keep an eye on this developing story.

After gapping higher on high hopes of a stimulus bill, the market seemed to lose momentum quickly and chopped in a narrow range the rest of the day. The Absolute Market Breadth Indicator continues to decline, and the T2122 indicator suggests a very extended condition in the indexes. That said, the bears don’t appear to have any teeth, and the trends remain bullish as we wait for a congressional decision. The indexes appear pensive and wound pretty tight, waiting on a news event that can create an explosive move in either direction. As you plan your risk into this weekend, keep in mind volume tends to decline quite sharply, heading into the Christmas holiday shutdown.

Trade Wisely,

Doug

Waiting on Relief and Vaccine Approval

December 18, 2020 by Ed Carter

On Thursday, markets gapped about half a percent higher after unexpectedly high Initial Jobless Claims offset optimism stemming from stimulus deal and a second vaccine approval. After the open, prices ground sideways the rest of the day. This left us with all three major indices printing indecisive Dojis at new all-time high closes. On the day, SPY gained 0.56%, DIA gained 0.44%, and QQQ gained 0.65%. The VXX fell almost 1.5% to 16.75 and T2122 rose deeper into the overbought territory at 94.21. 10-year bond yields rose to 0.935% and Oil (WTI) rose over a percent to $48.33/barrel.

In late afternoon Bloomberg reported that the stimulus deal is being hindered by GOP efforts to end virus lending programs. However, at the other end of the spectrum, 2 Senators (one from each party) are continuing to fight for a $1,200 direct payment to Americans instead of the $600 agreed by the 4 Leaders on Tuesday night. So, it seems while the Leaders came to an agreement, the rank and file still have other ideas. As of early Friday morning, House and Senate leaders said they expect a short government shutdown (funding runs out at midnight Friday), followed by a weekend approval vote on a deal covering both government funding and stimulus.

For the second time in two days (and third time in two months), GOOG was sued for antitrust activities on Thursday. This time by a bipartisan group of Attorneys General from 38 states. This suit focuses on allegations GOOG has maintained a monopoly in general search and search advertising. While all these suits will take years to wind through the courts, the repeated announcements don’t help the stock one bit.

Related to the virus itself, US infections continue to rage as the US. The totals have risen to 17,627,070 confirmed cases and 317,929 deaths. Thursday did not see any more bad records but was still a bad day with almost 232,000 new cases and nearly 3,300 deaths. This brings the 7-day averages to 220,690 new cases and 2,599 deaths per day. Of course, the FDA Advisory Panel did recommend the MRNA vaccine for emergency use and FDA and FDA Head Dr. Hahn promised swift action (it will be approved today). If all goes as planned, shipments of MRNA vaccine is expected to start Monday. This comes not a moment too soon as arguments between states, the federal government and PFE surfaced last night over how much vaccine was promised this week and whether shipment allotments have been reduced for the next couple weeks.

Globally, the numbers rose to 75,407,507 confirmed cases and the confirmed deaths are now at 1,671,135 deaths. As a reference, the world is averaging about 642,000 new cases and almost 11,000 new deaths per day. In Asia, Australia is beginning new travel bans between some of its states after a new cluster of cases was found around Sydney (at beaches). In South Korea, 500 Covid-19 patients are waiting on a hospital bed to open up and have waited more than a day at this point.

Overnight, Asian markets leaned heavily to the down side. Only a flat South Korea and India avoided red ink. New Zealand (-1.60%), Malaysia (-1.31%), and Australia (-1.20%) led the losses. In Europe, markets are mostly green so far today. Only Belgium (-0.12%), Portugal (-0.63%), and Russia (-0.53%) buck the trend. However, the big 3 bourses are typical of the modestly green overall picture. Among those, the FTSE (+0.20%), DAX (+0.37%), and CAC (+0.01%) are all up slightly. As of 7:30 am, US futures are pointing to a flat open. Right now the DIA is implying a +0.03% open, the SPY implying a +0.12% open, and the QQQ implying a +0.08% open.

The major economic news for Friday is limited to Q3 Current Account (8:30 am), Fed Bank Stress Test Results (4:30 pm) and a Fed Speaker (Brainard at 11:10 am). Major earnings releases include DRI and WGO before the open. Then NKE reports after the close.

Without a ton of economic data, a government stalemate, and sitting on Option Expiration Friday, the market may wait for more news before making its next move. However, we do sit at all-time highs, and a stimulus deal and new vaccine approval are expected very soon. So, the bulls do have the upper hand. Either way, be careful heading into the weekend in front of a holiday-shortened week. It is very possible all the big money has left town already.

Keep working the process and booking those base hits. Money in the bank trumps a “possible lottery ticket” every time. Keep your discipline and respect the trend, support and resistance, and price action. In short, get rich slowly…one trade at a time, just consistently achieving goals.

Swing Trade Ideas for your consideration and watchlist: PLAN, PAYC, AUY, JNJ, SHAK, KSU, ALEC, TSLA. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

🎯 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

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

Focused on Stimulus

December 17, 2020 by Doug Campbell

The market seems solely focused on stimulus, rallying the NASDAQ to new record highs. Little details such as declining retail sales, new record hospitalizations, and the highest daily death toll over 3600 Americans won’t stand in its way. Sorry for the sarcasm, but ignoring the economy’s actual state can make for a hazardous situation if the market sentiment suddenly decides to shift. Stay with the bullish trend but stay focused and have a plan to capture gains and protect your capital because a shift south could be swift and punishing.

Overnight Asian markets recovered from early losses to close with modest gains across the board. Across the pond, European markets advance with stimulus talks in focus. Ahead of Housing Starts, Jobless Claims, and the Philly Fed MFG Index, futures currently point to a bullish open fueled up on hopes of more federal deficit stimulus spending. Stay focused as we continue to extend.

Economic Calendar

Earnings Calendar

As usual, the Thursday earnings calendar is one of your busiest days of reports. Notable reports include CAN, BB, FDX, GIS, JBL, NAV, RAD, & WOR.

News & Technicals’

Focused only on stimulus hopes and seemingly ignoring any other economic details, the futures are rising this morning. A miss on Retails Sales, a decline in PMI, with new records of more than 3600 deaths and hospitalizations while on the same day printing new a record on the NASDAQ. Jerome Powell left rates near zero and reintegrated the FOMC commitment to keep them low as long as necessary for the economy to recover. The FDA expects to vote on Moderna’s Covid vaccine later today, and Congress is making progress on the stimulus bill. Several states joined Texas in an antitrust lawsuit against Google, claiming collusion with Facebook fixing advertising prices. Antitrust against the tech giants seem to be shaping up as a theme for 2021.

At the risk of sounding like a broken record, stay with the bullish trend but have a plan to capture gains and protect capital if the market suddenly decides to care about the actual economy’s condition. Before the open, today will get readings on Housing Starts, Jobless Claims, and the Philly Fed MFG Index. The most likely to move the market would typically be the Jobless Claims, but with high hopes of newly printed stimulus debit, even a negative number could inspire new record index highs. I will reiterate that both T2122 and T2101 are both flashing clues to be cautious, so be careful not to overtrade or chase already extended stocks.

Trade Wisely,

Doug

Relief Deal, MRNA Vaccine Approval Close

December 17, 2020 by Ed Carter

The market opened flat after hope for stimulus was offset by a big November Retail Sales miss in the premarket. After that markets ground sideways the rest of the day. All 3 major indices printed indecisive candles (more wick than body), but QQQ also closed at another all-time high close. On the day, SPY was up 0.13%, DIA down 0.16%, and QQQ gained 0.55%. The VXX lost 3% on the day to 16.98 and T2122 fell a bit to 89.27 (still well into the overbought territory). 10-year bond yields were up to at 0.921% and Oil gained slightly to $47.83.

During the day, it was leaked that Congressional Leaders had more or less finalized negotiations on a $900 billion stimulus bill Tuesday night. The deal reportedly will not include either business liability waivers or aid to state/local governments. However, it will include another $600 direct payment to Americans. The hope was to introduce the bill Wednesday after having it written up. However, that did not get done. So, Senate Majority Leader McConnell told Senators to be ready for a weekend vote on the bill. This would mean the government would shut down just after midnight Friday night as the Stimulus bill will be attached to a government funding extension. Also, during the day, the Fed raised its economic forecast to 4.2% GDP growth and unemployment back down to 5% in 2021. Beyond that, Fed Chair Powell said they are holding rates the same and will continue with current policies (near-zero rates, bond buying, etc.) until we reach full employment.

GOOG was also sued Wednesday for antitrust activities by 10 states Attorneys General, led by Texas. This suit also names FB as a co-conspirator and focuses on the alleged monopoly of advertising technologies and services (data tracking, which enables ad targeting). This comes just a day after the new European law was proposed which will regulate and fine the same technologies as too invasive to personal privacy.

Related to the virus itself, US infections continue to rage as the US. The totals have risen to 17,394,314 confirmed cases and 314,629 deaths. Wednesday saw another record number of new cases (248,646) and deaths (3,538). This brings the 7-day averages of 220,217 new cases and 2,570 deaths per day. Meanwhile, the FDA approved a second over-the-counter rapid home covid-19 test (from ABT) on Wednesday. On Thursday the FDA Vaccine Advisory Panel will debate and then vote on whether to recommend the MRNA vaccine for emergency use. (Spoiler alert: they’ll recommend it.) Following a recommendation, it will take hours to a day for the FDA to approve emergency use and shipping of the vaccine will begin about a day after that approval (which will give the CDC time to approve the administration of the MRNA vaccine).

Globally, the numbers rose to 74,662,200 confirmed cases and the confirmed deaths are now at 1,658,062 deaths. As a reference, the world is averaging about 637,000 new cases and almost 11,000 new deaths per day. French President Macron has tested positive shortly after a meeting with other EU leaders. So, many other EU leaders are also now in isolation. In Seoul South Korea, they have experienced the first case of a Covid-19 patient dying while waiting on a hospital bed to open up. This comes as Japan also reported another increase in ICU patients. Interestingly, in Russia, President Putin told his media that mass vaccinations using the Russian “Sputnik” vaccine were necessary for the country. However, he said he would not personally be getting vaccinated because he was “too old.” (This from a man who constantly promotes the idea of his strength, vigor, and fitness.)

Overnight, Asian markets were mixed, but leaned to the green side. Australia (+1.16%), Shanghai (+1.13%), and Shenzhen (+0.93%) led the gainers. Singapore (-0.51%) and Malaysia (-0.42%) led the modest losses. In Europe we see a similar picture so far today. Russia (+1.07%) is an outlier, but the FTSE (+0.01%), DAX (+0.80%), and CAC (+0.40%) are typical. The only losses are very modest and seen among the smaller exchanges in Europe. As of 7:30 am, US futures are pointing to another modestly bullish open. The SPY is implying a +0.52% open, the DIA implying a +0.42% open, and the QQQ implying a +0.48% open at this point in the premarket.

The major economic news for Thursday includes Nov. Building Permits, Nov. Housing Starts, Weekly Initial Jobless Claims, and the Philly Fed Mfg. Index (all at 8:30 am). The major earnings reports include CAN, GIS, JBL, NAV, RAD, SAFM, and WOR all before the open. Then after the close BB and FDX report.

With a considerable amount of economic data at 8:30 am, it is hard to gauge the open just yet. However, the bulls have the upper hand at the moment. With the announcement of a stimulus deal ready for voting and the approval of another vaccine expected, they should have the edge later in the day as well. However, we are counting on politicians and bureaucrats to deliver as expected. So, continue to be careful not to bank too much on the news. Remember a lot of potentially bad news from the virus itself is still possible.

Swing Trade Ideas for your consideration and watchlist: WYNN, CHFS, SONO, VALE, AMD, CLF, X, BLNK, DKNG, CELH, FTCH. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

🎯 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

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Stimulus Funding on the way.

December 16, 2020 by Doug Campbell

Just 2-weeks before Christmas, Senate leader McConnell congratulates Biden as the president-elect, and he and Schumer say a stimulus funding deal is on the way. That has the futures pointing to new record highs at the open, assuming the data deluge on the economic calendar doesn’t trip up the bulls. Keep in mind that shortly after the open price, action could become light and choppy as we wait for the FOMC decision and press conference beginning a 2 PM Eastern time. Stay on your toes and prepare for the possibility of some price volatility.

During the night, Asian markets closed the day mixed but mostly higher following the U.S. rebound on Tuesday. European indexes are advancing across the board following a positive global growth trend. Here in the U.S., the bulls are fueled up on stimulus hopes ahead of a big day of economic reports. Buckle up it could prove to be a wild ride.

Economic Calendar

Earnings Calendar

The hump day earnings calendar is a light one, but we have a couple of reports worth a look. Notable reports include LEN & TTC.

News & Technicals’

After meeting yesterday on the stimulus bill, Senators McConnell and Schumer hope to soon progress on the funding deal. Hopefulness that the spending bill will soon be on the way is inspiring the bulls once again this morning, likely setting new record highs at the open today. However, attention will quickly turn to the busy economic calendar with Retail Sales, PMI Composite, Business Inventories, Housing Market Index, and EIA Petroleum Status. If that’s not enough to keep traders guessing, we have the FOMC Announcement and the Chairman’s press conference to keep the price volatility alive. In a move that seems to put the presidential election to rest, Senate Leader McConnell congratulates Biden on his win and urges Republicans not to reject the president-elect’s victory.

The bullish trends remain, and with hopes of more stimulus futures point to more record highs this morning. That said, clues are warning that a little caution is warranted. The Absolute Market Breadth indicator continues to downtrend even as the market rallies, suggesting fewer and fewer stocks keep the rally alive. Also, the T2122 indicator is once again suggesting a short-term over-extension. Stay with the trend but have a plan to protect your profits and capital if sentiment begins to shift quickly. Monday’s big rehearsal should serve as a reminder that bears still exist and how quickly the bullish tide can recede from this elevation.

Trade Wisley,

Doug