Markets opened mixed on small gaps, but then the bears took over for an all-day selloff with prices closing near the lows.  The SPY and DIA printed large Bearish Engulfing candles and the QQQ missed only due to a small gap-down open.  In particular, TSLA was hammered (-10.34%) over poor “Battery Day” announcements, but to be fair, all the FAANGM stocks were hit hard.  On the day, DIA was down 1.92%, SPY down 2.32%, and QQQ down 3.05%. The VXX gained over 5% and T2122 fell dramatically deep into the oversold territory at 1.11.  10-year bond yields were flat at 0.674% and Oil (WTI) was only down slightly to $39.55/barrel.

JPM agreed to pay a $1 billion penalty for manipulations (spoofing) of the metals and treasuries markets to end the ongoing investigations by the Commodities Futures Trading Commission and the SEC.  However, the settlement is not expected to result in any business restrictions against JPM.  (Spoofing is the practice of floor traders submitting orders to force prices one direction or the other and then canceling the orders before they are executed.) In either an odd coincidence or a case of PR, within an hour of that announcement, JPM also announced they are spending $1 billion to for a workplace diversity program.

A couple of quick tidbits:

• Fed Chair Powell again urged the Senate to provide more fiscal stimulus. This was more of a case of pleading than the prior day’s testimony before the House.

• In an interesting twist to the trade war, TSLA has sued the US government.  They are demanding an end to tariffs on parts they import from China as well as a refund of the tariffs they have paid since 2019 (plus interest).  They may have a point when companies like AAPL got exemptions after appeals directly to the President.

• IBKR signaled that they expect a big account default risk around the election.  In a message to account holders, they said they are raising Margin Requirements to 67.5% (from 50%) and the Maintenance Requirement to 33.75% (from 25%).  They specifically noted the options prices indicate huge volatility around the election, especially the increased probability of a contested election.

On the virus front, in the US, the numbers show we now have 7,140,137 confirmed cases and 206,598 deaths.  The daily new case count was at 41,616 Wednesday, just above the 7-day average of new cases, which is 41,293 per day (about double where they were when easing began).  Deaths came back to typical numbers at 1,112 for Wednesday, well above the average of 751 per day.  CDC Chief Redfield told the Senate that over 90% of Americans are still susceptible to the virus based on a preliminary study by the CDC.  Meanwhile, 22 states reported rising new case counts.  For his part, President Trump told reporters that he has the right to overrule the FDA and their guidelines for approving the use of any vaccine.  As reported in past weeks, the JNJ vaccine just now starting Phase 3 trials could be a game-changer.  Instead of needed 2-3 doses, it requires only 1 dose, and most importantly it does not need to be stored at 50 degrees below zero like the other candidates in Phase 3.  However, the JNJ Phase 3 trial is just starting and they need 60,000 participants (when it has taken 1-2 months for others to find 30,000-40,000).

Globally, the numbers rose to 32,134,999 confirmed cases and 982,698 deaths.  Israel has significantly tightened its second national lockdown as cases continue to rise.  The new measures call for total lockdown (closed non-essential business and government offices as well as all public spaces) for 2 weeks followed by 2 more weeks of “closure.”  In the UK, the government is mulling a plan to accelerate vaccine trials by deliberately exposing participants to the virus (which would greatly decrease the time it takes to reach statistically significant numbers for the trial).  Oddly, the UK also said that at the peak of the first wave they were seeing 100,000 new cases per day, but are now only seeing 10,000/day.  This is odd because they have reported only 412,000 total cases

Overnight, Asian markets were strongly red across the board.  Japan, China, and South Korea all lost 1.5% – 2.5%.  A similar story is shaping up in Europe, but so far the red is much more modest as of mid-day.   At 7:30 am, US futures are pointing to a flat to a slightly lower open.  Only the QQQ is pointing to more than a 0.15% gap down (at -0.40%) with markets possibly waiting on jobless data for a guide.

The major economic news for Thursday is limited to Initial Jobless Claims (8:30 am), August New Home Sales (10 am) and 3 speakers (Fed Chair Powell at 10 am, Tres. Sec. Mnuchin at 10 am, and FOMC member Williams at 2 pm).  However, there are several earnings reports with CAN, DRI, JBL, KMX, and RAD reporting before the open.  Then after the close COST reports.

The major economic news for Wednesday is limited to September PMI (9:45 am), Oil Inventories (10:30 am), and 3 Fed Speakers (Chair Powell testifies again at 10 am, Mester at 9 am, and Quarles at 2 pm).  However, there are major earnings reports with CTAS, GIS, and JKS before the open. Then FUL reports after the close.

Given Wednesday’s heavy selloff, the fact we are near potential short-term support, and the extreme oversold T2122, it is possible we see a rest day today.  However, the bears do smell blood and the high-flying FAANGM stocks that have dragged markets up for months are showing no signs of life.  Be careful of volatility and remember that you do not have to trade every day.  You won’t miss anything.  There will be another train coming into the station tomorrow.  If you do trade, as always, stick to your plans, follow the trend, and don’t chase moves you have missed.  Keep locking-in profits, because it’s the singles and doubles that add up to championships, not the occasional home runs. 

Ed

Swing Trade Ideas for your Consideration and Watchlist: BBBY, SQQQ, SQ, MAS, XRT, URI, NVR. 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.

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

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

Tuesday saw just under a one percent gap higher in the QQQ and a half percent gap up in the SPY.  This was followed by intraday fading of the gap followed by the normal volatility up to mid-day. At that point, a rally lasting all afternoon ran all 3 major indices to close near their highs.  This gave us white hammer type candles in all those indices.  On the day, DIA closed up 0.50%, SPY up 1.02%, and QQQ up 1.86%.  VXX also gained slightly to 25.36 and T2122 rose, but still remains in the oversold territory at 14.47.  10-year bond yields were flat at 0.672% and Oil (WTI) rose slightly to $39.55/barrel. All-in-all, not a bad day given the September selloff we have seen so far.

As expected, Fed Chair Powell told Congress more fiscal stimulus is needed in his testimony.  Treasury Sec. Mnuchin agreed, but put in a qualifier on the statement, saying “I believe a targeted package is still needed”  However, Chief Economic Advisor Kudlow told reporters that more stimulus was not needed, but a targeted package could be a great help to a V-shaped recovery.  In an unrelated story, a deal was reached overnight to keep the government open and was passed by the House last night and sent to Senate. The deal includes more funds for school meals and more funds for farm aid.

Bloomberg reported interesting news in the vaccine race.  PFE has said they will do a results analysis as soon as they reach 32 vaccinated but also infected patients (vaccine failures) and expect this to be next week. They will consider any participant who both tests positive and has any symptom to be one of their cases. So, I guess a positive test alone does not count as a vaccine failure.  (32 seems like an awfully small number to draw any conclusions from in a test planned to use 44,000 subjects, but they are looking at failures.)  This will also be the first of four attempts (an unprecedented number apparently) with the last being when they reach 164 cases, to find a good enough ratio to prove efficacy.  This approach gives PFE a leg up on finding a “first proven vaccine” over rivals like MRNA (which won’t take a first peek until they find 53 failure cases on their way to 151 cases) and AZN (which will take its first look at 75 cases on the way to 150 cases).

In addition, apparently none of the current Phase 3 trials will know if their vaccine candidate actually lowers the number of hospitalizations until February.  Yet PFE is said to expect to have reached a conclusion on their candidate sometime in October, based on an extrapolation from a much smaller dataset than the actual whole trial.  This multi-look approach gives PFE an edge on being first to find a “viable vaccine,” which is all the market likely cares about at least initially.  In an unrelated story, the FDA said Tuesday it is tightening the approval standards, which may well slow vaccine emergency use approval.  This seems contrary to the Bloomberg article, but the FDA “tightening” may just be a vaccine acceptance PR tactic.  Additionally, JNJ has said this morning they are also entering Phase 3 trials of their own candidate vaccine with hopes of enrolling 60,000 participants in the weeks and months to come.

On the virus front itself, in the US, the numbers show we now have 7,098,291 confirmed cases and 205,491 deaths.  The daily new case count was down at less than 36,000, but the 7-day average of new cases remains over 41,000 per day.  Deaths came back to a more typical number of 969 after the unexpected drop on Monday.  However, that drop did pull down the average deaths to 735/day.  The President said Tuesday that the US will remain open regardless of the new measures underway in Europe or the UK. 

Globally, the numbers rose to 31,824,908 confirmed cases and 976,155 deaths.  So, the globe is seeing about 300,000 newly reported cases and 6,000 reported deaths per day.  As expected, the UK re-entered a partial national lockdown Tuesday.  UK PM Johnson urged workers to work from home if at all possible, reduced pub/restaurant hours, reduced permissible gathering sizes, etc. However, he stopped short of an actual 14-day national lockdown that some advisors were urging.

Overnight, Asian markets were mixed on moderate moves with the obvious exception of Australia which was up almost 2.5%.  Japan, South Korea, and Shanghai were just on the green side of break-even while Japan was on the red side of flat.  Taiwan was down half a percent.  However, in Europe we are seeing green across the board so far today on significant moves.  The FTSE is up 2.3%, DAX up 1.65%, and CAC up 1.9% at midday.  As of 7:30am, US futures are pointing higher.  The QQQ is lagging with an implied open up 0.2%, but the SPY is looking toward a 0.4% gap up and the DIA 0.8% higher open. 

The major economic news for Wednesday is limited to September PMI (9:45 am), Oil Inventories (10:30 am), and 3 Fed Speakers (Chair Powell testifies again at 10 am, Mester at 9 am, and Quarles at 2 pm).  However, there are major earnings reports with CTAS, GIS, and JKS before the open. Then FUL reports after the close.

The strong close Tuesday and apparent gap coming this morning certainly look like the rebound is in play. Remember that we still have a number of potential resistance levels above, but price gets the only vote that counts (especially in the short term). Continue to be wary of volatility and keep in mind that the trend still remains bearish. So, be careful chasing unless you are fast or can take the heat. However, it looks like a bulish morning. Stick to your rules, keep locking-in profits, and remember trading is a job for the long-haul…not a get rich quick scheme. 

Ed

Swing Trade Ideas for your Consideration and Watchlist: DG, PENN, DHI, CZR, FSLY. 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.

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

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

Monday saw a brutal gap down on virus concerns, another big bank scandal, and the political news related to the replacement (or not) of Justice Bader-Ginsberg.  Volatility continued all day with a later afternoon rally driving price back up into the gap.  The result as a strong white candle (if you look past the gap down) in the QQQ, but big indecision in the DIA and a white Hammer in the SPY.  On the day, QQQ gained 0.24%, SPY lost 1.04%, and DIA lost 1.84%.  Oddly, VXX did not shoot higher, rising only to 25.16, but T2122 sank clear to the bottom of the oversold range at 2.28.  10-year bond yields fell to 0.672% and Oil (WTI) also fell 3.5% to $39.65/barrel.

During the day House Speaker Pelosi proposed the Democratic bill for additional stopgap funding to keep the government running past the September 30 deadline.  However, Senate Majority Leader McConnell immediately criticized the bill because it did not contain the additional money for farm aid that the President wanted added.  To be fair, many things were not in the bill, including extra funding for the Democrat favorite food assistance program.  It was not mentioned, but another fundamental difference between the sides is that Republicans want the bill to include funding through January 2021 (when the next Congress is seated) while Democrats want funding only through the election.  In this case, the Democratic bill offered a compromise of funding through December 20.

In the pre-release of Fed Chair Powell’s testimony for today he says “Many economic indicators show economic indicators show marked improvement…Both employment and overall economic activity, however, remain well below their pre-pandemic levels, and the path ahead continues to be highly uncertain,”  He goes on to push for more virus control and stimulus as he also says “The path forward will depend on keeping the virus under control, and on policy actions taken at all levels of government.”  Both he and Treasury Sec. Mnuchin are likely to face questions on the massively unused Fed Main Street Loan program (which stimulus legislation cannot be forgiven) as opposed to the PPP loan program many expect to be forgiven.

On the virus front, in the US, the numbers show we now have 7,046,444 confirmed cases and 204,515 deaths.  The 7-day average of new cases is rising again, now over 41,000 per day.  However, deaths dropped dramatically for some unknown reason to just 388 on Monday.  This dropped the average to just under 800/day.  Republicans in the Senate proposed $28 billion in aid for the airline industry ($3 billion more than asked) in an attempt to stave off 30,000 job cuts now planned in two weeks.  This is likely a DOA proposal since the two parties have not agreed to an overall stimulus plan.

Globally, the numbers rose to 31,517,736 confirmed cases and 970,077 deaths.  In the UK, there were ominous signs Monday.  The country’s 2 top scientists addressed a presser where they said the UK is back to 10,000 new cases per day in a growth rate that may send them to 50,000/day by mid-October unless the spread is arrested (implied as a new national lock-down).  The government then raised the alert level to 4 (transmission if high or rising exponentially).  Level 5 is another national lockdown.  PM Johnson is set to address an emergency meeting, Parliament, and the Public Tuesday where many expect additional measures to be announced.  (JPM says that if another 2-week lockdown were to happen, it would knock another 2% off the UK’s 2020 GDP.)  Elsewhere in Europe, Spain has reentered partial national lockdown (and full lockdown in Madrid) and France cases continue to spike in various cities

Overnight, Asian markets were mostly in the red again.  Japan eked out a small gain while New Zealand and Malaysia managed slightly better, but still modest gains.  However, China, Taiwan, and Hong Kong were all down over 1% and South Korea lost 2.4% on the day.  In Europe, the picture is brighter as we find modest green numbers across the board as of mid-day. Again today, the DAX leads the way, up just under 1% so far.  As of 7:30 am, US futures are mixed.  The Large-Caps are on either side of flat, but the NASDAQ is pointing to a half-percent gap higher at the open.

The major economic news for Tuesday is limited to August Existing Home Sales (10 am) and, as mentioned, Fed Chair Powell testifies (10:30 am).  On the earnings front, the only major announcements scheduled are AZO before the open and KBH and NKE after the close.

Markets may be looking to bounce back from Monday’s ugly start to the week. Possibly Fed Chair Powell’s soothing talk of “more stimulus as long as it’s needed” will do the trick. However, no more progress on the fiscal stimulus side and political rancor will not help. News of the expansion of virus-fighting measures in the UK (and the rest of Europe) is also going to be a damper.

Remember that we’ve seen “gap and fade” or “gap and indecision” for some time. So, be careful chasing unless you are fast or can take the heat. Follow the trend, which is clearly bearish now, don’t think you can pick bottoms, but also don’t chase moves that have gotten away. Stick to your rules, keep locking-in profits, and remember trading is a job for the long-haul…not a get rich quick scheme. 

Ed

Swing Trade Ideas for your Consideration and Watchlist: PENN, NVTA, DDOG, FDX, PGR, LH, TGT, CZR, WHR, DGX, FSLY. 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.

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

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

Markets saw a minor gap down Friday, but it was immediately followed up by a strong selloff that lasted until 1:30 pm.  However, the bears called a week at that point and the bulls put in a relief rally into the close.  On the day we still saw ugly black candles that failed the 50sma, including a Bearish Engulfing in the QQQ.  At the close, DIA was down 1.09%, SPY down 1.55%, and QQQ down 1.28%.  The VXX was flat at 24.37 and T2122 fell back to 34.91.  10-year bond yields were up slightly to 0.697% and Oil (WTI) was flat on the day at $40.98/barrel.  This culminated a 3^rd consecutive down week, in volatile trading.

On Saturday President Trump approved the ORCL / WMT and Byte Dance deal but did so while saying it includes a $5 billion fund to pay for an educational project.  Byte Dance announced they were unaware that any such fund was part of the deal.  So, that part of the announcement appears to be more gamesmanship by the President.  The deal will also still need the approval of the Chinese government.  However, Monday a Chinese state-backed media outlet called the deal “unfair but reasonable” in a possible preview of the official reaction.

To give that deal time to reach approvals, the President did extend the deadline for a ban on TikTok until next week.  However, on Sunday a Federal judge blocked the Administration ban of TikTok and WeChat altogether. (Although a long back-and-forth legal battle is expected up through the tiers of courts.)  So, momentarily it appeared that ORCL and WMT had gotten what they wanted (a toehold in the Social Media space) and they still may. However, that clarity was quickly replaced in favor of more political and legal limbo.

The big US banks are reportedly back in hot water (and reacting in pre-market). US Government files were leaked this morning showing that at least JPM and BK, had joined Germany’s Deutsche Bank and the UK’s Standard Chartered to launder $2 trillion in illicit funds over nearly 2 decades.

On the virus front, in the US, the numbers show we now have 7,004,990 confirmed cases and 204,118 deaths.  The 7-day average of new cases is rising again at 41,330 per day.  However, the average for deaths (which lags) is still trending down at 800 per day.  Meanwhile, on Friday, the CDC reversed its caving to political pressure and changed its guidance for asymptomatic individuals.  The new guidance says that anyone who is exposed to an infected person needs a be tested, regardless of whether or not they show symptoms.  Bloomberg reported that this change was planned earlier, but delayed by a long “review and approval” by Administration outside the CDC.  On Sunday we learned that 31 states have more new cases this week than last and 25 of those states have a higher test result positivity than the previous week.  The fear is that this is another example of a holiday-caused surge as too many Americans ignore guidelines or have relaxed their adherence

Globally, the numbers rose to 31,263,651 confirmed cases and 965,398 deaths.  Even with the new lock-down in the Northeast of their country, UK cases are rising.  Sunday talk was that London is the next potential “local” mini-lockdown (2 weeks) as the Mayor met with the City Council in private session Sunday while UK PM Johnson is expected to address the country again as soon as Tuesday.  In Germany, mandatory mask use has been reintroduced in areas (Munich region).  Elsewhere, the recent Australian whole state lockdown has been vindicated as restrictions are beginning to ease and the new case count has dropped by a factor of 60.

Overnight, Asian markets were back to being mixed, but the largest economies leaned positive.  China was up 1.5-2%, while Japan and South Korea were on the green side of flat.  Europe has seen a similar situation so far this morning.  However, European moves have been more modest and lean more to the red side at this point.  The FTSE and CAC are on the red side of flat while the DAX is up a third of a percent at mid-day.  As of 7:30 am, US futures are mixed with the large-caps split modestly on either side of break-even and the NASDAQ pointing toward a half percent gap higher.

The major economic news for Monday is limited to 3 Fed speakers (Chair Powell at 10 am, Brainard at noon, Williams at 2 pm).  Once again there are no major earnings reports on the day.

Coming off the first 3-week losing streak since March, markets look set to gap lower at the open Monday. However, “gap and rebound” volatility has been the norm in volatile markets recently.  So, be careful, but, as always, stick to your plans. Follow the trend, but don’t chase moves you have missed.  (There is always another trade coming soon…no need to suffer FOMO.)  Hang in there with your rules and keep locking-in profits. 

Ed

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

Thursday saw a strong gap lower (about 1.6%).  This was met with a strong rally that faded most of that gap by 11:15 am, but then the bears stepped back in and sold back off back to the lows by 12:30 pm.  The rest of the day was smaller waves in the roller coaster ride.  The 50sma held as support in the SPY, but the QQQ has given up the 50sma and the DIA has not reached it yet.  On the day, QQQ lost 1.56%, SPY lost 0.87%, and DIA lost 0.52%.  All closed up off the lows, but far from the highs as well.  The VXX closed down again to 24.38 and T2122 was back down to 46.63.  10-year bond yields were up slightly to 0.689% and Oil (WTI) rose again to $41.04/barrel.

White House Chief of Staff Meadows met with Airline executives during the day and after the meeting told the press that the President supports $25 billion of “narrow” relief for the industry.  (The industry, led by UAL, AAL, and unions have been seeking that amount in additional relief funds for the last month or so.  The threat has been that if they cannot get the additional bailout funds, on top of the recent buyouts, retirements and furloughs, a major wave of new layoffs would come as soon as this fall.)  No word on plans to execute on a bailout or of specific legislation offered. However, they did get the President’s public support of the additional $25 billion (although it did not come directly from the President and the term “narrow” was not defined).

After the close, the Fed announced it will decide by the end of the month if it will continue capping Big Bank dividends.  (For reference WFC was one of the big banks to reduce dividends when the cap was announced in June.) This news comes as another stress test will be started soon.  However, in a change from the previous protocol, this time around the Fed says it will publish company-specific stress findings for each of the 34 institutions it tests.  The Fed announcement went on to outline two severe recession scenarios it will use in the stress testing of reserves this time around.

On Thursday ORCL and Byte Dance both agreed to a Treasury Dept. change of terms for their partnership deal.  The changes were aimed at heading off the White House  national security concerns (oddly that Byte Dance cannot access to user-tracking information the same way that AMZN, GOOG, AAPL, FB, MSFT, other App makers and every Internet Service Provider already use and track the same customer usage/tracking data).  The two other main provisions are ORCL getting complete access to TikTok source code and the entire board of the new company being made up of American citizens regardless of new the company being a foreign entity or what the ownership shares will be.  In a potential twist, WMT is now expected to partner with ORCL on the deal. (In last-second news, it was just announced the White House will block downloads of TikTok and WeChat as of Sunday. No word on the approval/disapproval of the Treasury-revised deal.)

On the virus front, in the US, the numbers show we now have 6,875,103 confirmed cases and 202,219 deaths.  We saw another uptick to 46,295 new cases (well above the 7-day average), but new deaths dropped off a bit to 879 (still just above the 7-day average). In good news, TX moved forward to the next step in their reopening.  They now allow all retail stores, office buildings, restaurants, factories, gyms, and museums to reopen immediately at 75% capacity as long as the hospitals in their region stay below capacity thresholds.

Globally, the numbers rose to 30,380,035 confirmed cases and 951,150 deaths.  In the UK, the Northeast region of England has re-entered lockdown in an effort to stop a new surge in cases.  Other areas of the country are implementing partial measures such as limiting gatherings to single-family and stopping counter restaurant and bar service (so-called table service only).  This comes as testing demand is over 1 million per day, but capacity is only 230,000 tests/day. In Parliament, Government Ministers blamed the public for the problem, saying that only people told by a health professional should attempt to be tested.

Overnight, Asian markets were back to being mixed, but the largest economies leaned positive.  China was up 1.5-2%, while Japan and South Korea were on the green side of flat.  Europe has seen a similar situation so far this morning.  However, European moves have been more modest and lean more to the red side at this point.  The FTSE and CAC are on the red side of flat while the DAX is up a third of a percent at mid-day.  As of 7:30 am, US futures are mixed with the large-caps split modestly on either side of break-even and the NASDAQ pointing toward a half percent gap higher.

The major economic news for Friday is limited to Michigan Consumer Sentiment (10 am).  Once again there are no major earnings reports on the day. However, this is Options Expiration Friday.

Gap and fade or indecision seems to be the standard operating procedure in markets recently.  So, be careful of volatility.  Also, don’t get caught off-guard by any pinning related to options expiration today.  (There are a lot of inexperienced options traders out there right now that Mr. Market has to introduce to the pinning trick.)  As always, stick to your plans, follow the trend, and don’t chase moves you have missed.  (There is always another trade coming soon…no need to suffer FOMO.)  Hang in there with your rules and keep locking-in profits.  Also remember that Friday is payday.  So, take a paycheck and consider whether you want to lighten up or hedge going into the weekend news cycles. 

Ed

Swing Trade ideas for your Consideration and Watchlist: NIO, DOW, DFS, GPC, COF, MMM, KSS, TRUE. 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.

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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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