Yesterday the bulls pulled off an impressive hold of price support and the 50-day averages of the DIA, SPY, and IWM with the oil and financial sectors leading the way. The question today is will that rally continue heading into the weekend after a big morning of economic reports that set shockingly bad market records. This morning futures are quite volatile as they wait for the big data drop. Buckle up for the possibility of a wild ride.
Asian markets close overnight little changed even after reporting there industrial output number came in better than expected. European markets trade mixed its eye on economic reports and uncertain economic reopening. US futures indicate anything is possible by the time the market opens as they grapple with a substantial economic data drop.
Economic Calendar
Earnings Calendar
On the Friday earnings calendar, we have more than 170 companies reporting quarterly results. Notable reports include DKNG, JD, MFG, PBF, & VFC.
Technically Speaking
After a very rocky start on Thursday morning, the bulls stepped up, putting in a solid defense of critical price support levels. Oil and financial stocks led the rally with JPM recovering 4% and AXP lifting more than 7%. Follow the Jerome Powells call for additional Congressional stimulus the President appears likely to support another round of direct payments to citizens. The House plans to vote on a 3 trillion dollar plan as early as today, but Senate leadership continues to say it will not support the current bill. What comes next is unclear, but it seems the pressure for policymakers to continue to rack more up historic deficit spending measures soon.
Yesterday’s rally created an impressive hold of the 50-day average on the DOW, SPY, and IWM indexes. The market-leading QQQ maintained a comfortable cushion between its price and critical averages. Futures this morning are showing a considerable amount of volatility ahead of a big day of economic data. Topping that list is Retail Sales with estimates suggesting a historic decline in consumer spending is likely. In just the last hour, futures have gone from pointing to a bullish open to now suggesting a substantial gap down. Plan for considerable volatility as we head into a weekend of uncertainty as more and more states try to reopen their economy.
Prices gapped 1% lower at the open on the back of a worse-than-expected initial jobless claims number (3mil vs 2.5mil expected). However, after the dust settled for 30 minutes the rest of the data was a strong, steady climb with prices closing near the high. Technically, the SPY and especially DIA seemed to find support off the 50sma and bounced. However, it is hard to say any of the 3 major indices broke their now 3-day downtrend. For the day, SPY gained 1.22%, DIA gained 1.69%, and QQQ gained 1.14%. The VXX was down a bit to 37.67 and 10-year bond yields fell to 0.62%. Oil (WTI) rallied nearly 10% again to close at $27.73/barrel.
The cause of the day-long rally seems to be two-fold. First, even though new initial jobless claims were worse than expected, the continuing jobless claims only rose by less than half a million. This means that although almost 3 million people filed for unemployment this week, over 2.5 million also went back to work. Secondly, in the inverse logic of markets, bad numbers mean it is more likely we will see more stimulus from both the Fed and fiscal sides of government. This was reinforced when Fed voter Kashkari told CBS that Congress will have to send Americans more money as he sees the recovery taking 12-18 months.
On the Virus front itself, the global headline numbers are 4,546,070 confirmed cases and 303,863 deaths. In Germany, the government reported the worst Q1 contraction since the 2008 Financial Crisis and projected a 10% decline in GDP for Q2. The Russian outbreak continues to run wild as they reported another 11,000 cases again. In Asia, the virus worry is limited to a few hotspots. However, India reported another 4,000 new cases and China very recently locked down several cities/provinces again.
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In the US, we have 1,457,649 confirmed cases and 86,912 deaths. Among the fallout, JCP is expected to file for bankruptcy today. CNBC reports that the White House would now likely support a new round of stimulus checks as proposed by Democrats, but this is not an official announcement and only based on sources. The House is set to vote on the Democrat’s $3 Trillion bill, but both the Republicans in the Senate and the White House had called it “DOA.” So, again, this all seems to be negotiating tactics in the political theatre.
Overnight, Asian markets were mixed, but the red boards were not that far below break-even. In Europe, the same is true, but leaning even more to the green side as France and Finland are the only red at this point in the day. However, as of 7:30 am, US futures are in the red, now pointing to a 0.70% gap lower at the open.
The major economic news for Friday includes Apr. Retail Sales and NY Fed Mfg. Index (both at 8:30 am), Apr. Industrial Production (9:15 am), Mar. Business Inventories, Mar. JOLTS, Michigan Consumer Sentiment and Mar. Retail Inventories (all at 10 am). The only major earnings on tap for Friday are JD, PBF, and VFC all before the open.
A bounce off of support helped the bulls Thursday. However, they were unable to break the 3-day downtrend that has formed this week. While the bulls are not likely to accept the setback for long, it is Friday and a pause to absorb weekend reopening news might not be a bad thing. Weekend news on the next round of stimulus and some feedback on new cases during reopening may be something traders want in their pocket before making more big bets. So, the short-term pullback continues and high volatility remains in place. Keep watching the short-term chart in front of you. Don’t chase or predict, and remain cautious about longer-term swing trades.
Ed
No trade ideas for Friday. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
|607% in just 24 months |
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
The FOMC Chairman Jerome Powell said they stand ready to do whatever is necessary to support the economy but also warned that the recovery is likely long-lasting impacts for business and employment. He also called on Congress and the Whitehouse, suggesting more will be required to stimulate the economy. According to reports, China has launched cyberattacks against virus research firms attempting to steal possible treatment options. With friends like this who needs enemies!
Asian markets closed the day lower across the board, with Japan falling nearly 2%. European markets are trading lower this morning with the FTSE down more than 2% this morning. US Futures have flirted with a flat to slightly bearish open as we wait on earnings and, of course, another jobless report that may add 2.5 million to the 33 million already unemployed. Expect higher price volatility as we head toward the weekend.
Economic Calendar
Earnings Calendar
On the Thursday earnings calendar, we have our biggest day this week, with 300 companies reporting. Notable reports include AMAT, ACB, BAM, DENN, NOLK, PBR, SSYS, & WIX.
Technically Speaking
The futures tried to get a rally going in yesterday’s pre-market but was unable to hold onto gains gaping lower after a disappointing PPI number. Jerome Powell delivered a word of warning that the recovery is likely to be difficult and may have lingering impacts for several years. He reassured that the FOMC would continue aggressive operations as long as necessary and but said they would need more help from Congress to stimulate the economy. Long story short, this will be a costly, challenging, and likely very volatile economic recovery. In other news, the US is reporting that the Chinese government has launched cyber-attacks against virus research facilities attempting to steal research on treatments and possible vaccines. Companies are encouraged to strengthen their security and report any attacks or breaches to the FBI.
At the close yesterday, the DIA was less than 3 points away from it’s 50-day moving average and near a critical level of price support. The IWM missed testing it’s 50-day by only a few ticks before bouncing in the last few minutes of the day. The SPY held at the price support to 5/4/20 clinging to the 34 EMA, but looking at the QQQ, the selloff of the last couple days is nothing more than an overextended pullback. We have a somewhat volatile overnight future session that currently suggests a flat to moderately bearish open. However, with 300 earnings reports and another jobless number where another 2.5 million people will be added, the 33 million already unemployed, anything is possible by the open. With a big day of economic data on Friday, we should expect an extra dose of price volatility as we slide into the weekend.
Markets were unable to recover from the gloom (reality?) Fed Chair Powell spread early in the day. So, the bears had their second day in charge. The SPY fell 1.77%, the DIA fell 2.21%, and QQQ fell 1.25%. VXX climbed another 10% back to 39.65 and oddly the T2122 4-week high-low ratio climbed back into overbought territory at 85.37. The 10-year bond yield was down slightly to 0.654% and Oil (WTI) rose again to $25.70/barrel.
As mentioned, Chair Powell painted a gloomy picture of the economy and, as was expected, he also knocked the idea of negative rates as an unsettled policy without proven benefits while it is proven that it hurts banks and their ability to lend. GS later made comment on Powell’s testimony saying it fears a second-wave of virus infections and, in that case, they feel the Fed would consider negative rates. However, like Powell, they also don’t think that action would be very helpful to the economy. Later, analysts began saying, based on the gloomy picture the Fed members are painting, they now expect the Fed to announce another large QE program at or before its June meeting (which markets would love).
On the Virus front itself, the global headline numbers are 4,452,777 confirmed cases and 298,737 deaths. In Russia, the runaway spread continues with another day of record new cases (raising it to have the second most cases to the US). The EU also told its member nations to only receive tourists this summer if their situation allows, including current case trends, having enough testing/tracing capacity, etc. This was significant because tourism accounts for 10% of the EU’s GDP. Meanwhile, Japan says a treatment trial using recovered patients’ plasma will begin in July.
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In the US, we have 1,430,348 confirmed cases and 85,197 deaths. In business, AMZN said it will rollback wage increases and cut overtime rates on May 30 as it feels the hazards have now passed. (An interesting claim since it also announced separately that it is now designing and will sell face shields for frontline workers.) However, in a good sign, MA announced it is seeing signs of improvement in consumer spending as charges were down 6% from a year ago, but up 16% from a month ago.
Overnight, Asian markets were all significantly in the red. In Europe, the same is true will all major markets even more deeply red so far today. As of 7:30 am, US futures are waiting on the jobless claims number, but are on the red side of flat, now pointing to a 0.20%-0.40% gap higher at the open.
The major economic news for Thursday is limited to Apr. Imports / Exports and Weekly Jobless Claims (both at 8:30 am) and 2 more Fed speakers. Major earnings reports are also very light with JWN and NCLH reporting before the open and AMAT, CVET, and NLOK reporting after the close..
A small dose of reality has hit the bulls in the last couple of days. Those losses make the last month look both choppy and range-bound in retrospect. Don’t expect this setback to last long as every day more businesses and areas of the country reopen. However, the prospect of a second wave caused by poor adherence to guidelines will loom for months, even if it does not materialize. So, the short-term pullback continues and volatility remains high. Continue to focus on the short-term chart in front of you. Don’t chase or predict, and remain cautious about longer-term swing trades.
Ed
Trade Ideas for your consideration and watchlist today: No trade ideas for Thursday. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
|607% in just 24 months |
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
After hearing some sobering health officials testimony in congress, profit-takers rushed in at the end of the day, leaving bearish engulfing candle patterns on all the index charts. Those that got short early will now have to deal with a morning gap up inspired by a proposed 3-trillion dollar stimulus bill the includes more direct payments to citizens. Although the House plans to pass the bill, the Senate is currently suggesting it will be dead on arrival. Expect more price volatility in the coming day as a result.
Asian markets closed the day mixed but mostly lower in a modest trading session. European markets are lower across the board as virus reemergence fears weigh on investors. Fueled by the prospect of more government debt spending, the US Futures point to a gap up open ahead of earnings, Powell comments, and the latest reading on PPI. It could be a wild and woolly day, hold on tight!
Economic Calendar
Earnings Calendar
On the Hump Day earnings calendar we have just short of 150 companies reporting today. Notable reports include CSCO, JACK, SDS, & TCEHY.
Technically Speaking
After attempting to break resistance in intra-day price action, the QQQ finally found some profit-takers and the big-4 turned quickly south. Health officials in congressional testimony gave a sobering opinion and warned that reopening the economy to soon could create a wave in new infections that may get out of control. They said the chance of having a vaccine by the next school and college season is unlikely and warned of a resurgence of the virus next fall. The report seemed to shake the overall market that has strongly rallied over the last month with very optimistic views of reopening. Then overnight the House democrats unveiled a new 3-Trillion dollar stimulus bill that once again provides direct payment to citizens. As usual, the prospect of newly printed money and governmental debt spending rallied the overnight futures that currently point to a significant gap up at the open. The Senate has already stated it is unlikely to pass their chamber.
Yesterday’s closing selloff left bearish engulfing candle patterns near resistance levels on all the major index charts. Unless there is an outside influence, a bearish engulfing candle suggests a follow-through down is likely. However, this morning there is the possible 3-trillion outside influencers changing the prospect of follow-through and punishing those that took short positions. To be fair even with yesterday’s quick selloff, there was no major technical breach with all the indexes hold above support levels and their 50-day averages. However, it did offer up a quick reminder of how quickly the tide can shift and how dangerous a wide consolidation range can be when it does. Plan your risk carefully and expect a bit more challenging price volatility for the rest of the week.
Markets were rattled as they digested CPI falling in the largest drop since the 2008 financial crisis. (Fear being that the Fed may feel the need to act to curb deflation, thus turning off the faucet.) The SPY also failed at previous high resistance for the third straight day. By day end, all 3 major indices printed large, ugly Bearish Engulfing candles. On the day the SPY fell 2.03%, the DIA fell 1.90%, and the QQQ fell 2.09%. The VXX jumped 10% as you’d expect to close at 35.95. At the same time, 10 10-year bond yield fell to 0.667 and Oil (WTI) climbed to $25.34/barrel.
During the day there was a fair bit of news out of Capitol Hill. St. Louis Fed President Bullard warned of business failures on a grand scale (if the shutdown persists) and Dallas Fed President Kaplan said there will be a need for more fiscal stimulus as jobless rates continue to rise. On cue, House Democrats put forward another $3 trillion relief bill, which includes $1 trillion for state and local governments, $1,200 more per person in family relief, $200 billion for essential worker hazard pay, etc. However, this bill was known to be dead on arrival in the Senate and was primarily meant to force Republicans to put their own ideas on paper to start negotiations. Dr. Fauci (NIH) also testified that he is concerned that if states open too quickly the country risks multiple outbreaks and a setback in the economic recovery.
In business news, BA released word that customers had canceled orders for another 108 of their 737 Max planes in April. The company still has a 4,800-plane backorder list, but cancellations are accelerating and BA said they expect one of the major US Airlines (their customers) to declare bankruptcy before year-end (likely voiding that carrier’s orders). Elsewhere, 13 state Attorneys General have called for AMZN to provide data on employees who have tested positive or died, while asking the company to reinstate its policy of unlimited unpaid time off and sick leave related to the virus.
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On the Virus front itself, the global headline numbers are 4,361,654 confirmed cases and 293,287 deaths. In Europe, Italy reported a second straight day of uptick in new cases. Spain announced it will keep borders closed until July. France also extended its state of emergency through July 10, but easing measures remain in place. In the UK, Finance Minister told Parliament that they project the country will fall into a significant recession this year but also reported a contraction that was less than expected last month. Meanwhile, in Asian, India has passed a $266 billion virus relief bill and released 17,000 prisoners to curb prison outbreaks. Finally, China is scrambling to retest the entire city of Wuhan to curb its new outbreak. They said they will test all 11 million residents over the next 10 days. They have also locked down cities in the North (near North Korea) where clusters of new cases have been found.
In the US, we have 1,408,636 confirmed cases and 83,425 deaths. New Orleans announced that face coverings will be mandatory when they start to reopen on Saturday. Meanwhile, Los Angeles announced it expects to remain under lockdown for at least a few more months. Finally, Illinois reported over 4,000 new cases on Tuesday, a record high. However, this may be due to also performing a record number of tests (29,000) on the day.
Overnight, Asian markets were again mixed. The moves were smaller again as well, with the exception of India which was up 2% on their stimulus news. In Europe, markets are strongly red across the board at this point in the day. As of 7:30 am, US futures are on the green side of flat, now pointing to a 0.20%-0.50% gap higher at the open.
Fed Chair Powell speaks today (9 am) and is expected to shut down any talk of negative rates even after the President tweeted again that the US should have negative rates. However, the other major economic news for Wednesday is limited to Apr. PPI (8:30 am) and Oil Inventories (10:30 am). Major earnings reports are also light with SNE and ARCO reporting before the open and CSCO, FLO, STE, and OII reporting after the close.
The trend remains bullish, but ugly candles Tuesday prove that overhead resistance is significant. Markets seem to be pausing as analysts and experts continue to express fear over the strength of the economic recovery and the risks reopening poses. So, a pullback may be in order short-term. Either way, we are likely to keep seeing volatility every day. So, focus on the short-term chart in front of you. Don’t chase and remain cautious about longer-term swing trades, unless you can take some short-term pain.
Ed
Trade Ideas for your consideration and watchlist today: No trade ideas for Wednesday. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
|607% in just 24 months |
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
The hopefulness of the economic reopening and news of a possible democratic 2-trillion dollar stimulus bill written in private continued to inspire the bulls yesterday. As the NASDAQ stretched its rally to 6-days in a row, the DIA, SPY, and IWM continue to struggle with overhead resistance. The range of consolidation is quite wide, adding some danger to a possible pullback. For example, the Dow would have to pull back as much as 1200 points just to test its 50-day average. Plan your risk carefully as we approach price resistance.
Asian markets closed modestly lower overnight after reporting a miss in inflation data. European markets are mixed as concerns rise over a coronavirus comeback. US Futures are once again trying to put on a brave face pointing to bullish open ahead of the 8:30 AM CPI number that could double the negative reading from last month. Will, it matter or will we continue to ignore? We will find out soon.
Economic Calendar
Earnings Calendar
The Tuesday earnings calendar has just over 150 companies reporting quarterly results. Notable reports include CSPR, DUK, GAIN, HMC, IR, LOGI, MAC, & TM.
Technically Speaking
The NASDAQ reached out for the 6th day in a row as the big-4 continue to carry the majority of the weight. The DIA, SPY, and IWM remain locked in a wide range of consolidation above their 50-day averages but remains challenged by overhead resistance. The bulls are drawing energy from the hopefulness of the reopening of the economy, but health officials are warning that rushing opening will cause undue suffering and death. Who’s right? No one truly knows, and I’m not going to armchair quarterback their decisions, remaining grateful these difficult decisions are not mine! With the death toll now over 81,000 and infections, nearly 1.4 million, I think the recovery will be long and very challenging.
The T2122 indicator suggests that the markets are a bit stretched, but the upside momentum continues to favor the bulls. Goldman Sachs reiterated their belief that the overall market will retract about 20% over the next 3-months while the house democrats attempt to write a 2-trillion dollar stimulus bill in private. One thing for sure, the market has a lot to grapple with as we move forward. Earnings season winding down the market will have to deal with the humbling economic numbers. Today we get the latest reading on the CPI that consensus estimates expect to come in at -0.8, doubling from the prior month. We also have a virtual parade of fed speakers, including comments from Jerome Powell on Wednesday morning. Stay focused on price action and be careful not to overtrade as the indexes test resistance levels.
The week started with a small gap lower, but the bulls stepped in quickly to lead a slow and steady recovery to the highs by mid-afternoon. However, the last 2 hours were a bit of a roller coaster ride that ended the day near where we closed Friday. That said, the tech names helped the NASDAQ outperform Monday. On the day the SPY was up 0.06%, the DIA down 0.44%, and the QQQ up 0.89%. VXX fell more than expected to 32.70 and the T2122 also fell sharply to 72.11, once again outside of the overbought area. The 10-year bond yield rose to 0.71% while Oil (WTI) was flat at $24.73/barrel.
In relief/political news, it was announced Monday that there is now a Republican co-sponsor and 2-3 Republican Senators “almost willing” to support a bill sending $500 billion in money to state and local governments. Meanwhile, on the House side, they have pushed off any vote for another relief bill until at least Friday (perhaps waiting on the Senate). Finally, Dr. Fauci (NIH) will be testifying to the Senate as Congress begins their oversight hearings of virus and relief programs. On top of that, the Fed will also start its corporate bond-buying program today by buying specific ETFs (that hold bonds downgraded during virus). There was no word on which ETFs they will buy.
On the Virus front itself, the global headline numbers are 4,274,648 confirmed cases and 287,670 deaths. In Asia, the uptick continues with clusters of new cases found in China (including Wuhan), South Korea, Japan, and Singapore. The good news there is that the clusters are small-enough and testing/tracing capability large enough in those places that the “uptick” at least has the strong potential to be stopped before it becomes widespread.
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In the US, we have 1,385,893 confirmed cases and 81,796 deaths. New York state announced that 3 of its rural regions are ready to open on Friday. In the oil patch, pipeline company ETP said about 25% of US shale fields that had been shut down have now been turned back on at least in the Permian Basin. Meanwhile, in CA, TSLA reopened its Fremont plant in spite of County Health Department orders. The Governor of CA said he was unaware but will look into the matter, but city and county law enforcement did not intervene.
Overnight, Asian markets were mixed, but mostly red for Tuesday. Again, this was mostly on small moves (closer to flat), with the exceptions of Hong Kong and Australia, which were both down over a percent. In Europe, markets are mixed so far, but on the green side, with only the FTSE (+0.96%) near a 1% move. As of 7:30 am, US futures are on the green side of flat, now pointing to a 0.20% gap higher at the open.
The major economic news for Tuesday includes Apr. CPI (8:30 am), FOMC Speakers (Harker and Quarles both at 10 am), 10-yr Bond Auction (1 pm), Apr. Budget Bal (2 pm), and FOMC Speaker (Mester at 5 pm). However, among major companies, AGN, DUK, HMC, IR, MAC, and VSH also all report before the open.
The bulls still have control of the momentum. However, resistance is close overhead and it seems like markets are showing some caution, perhaps due to fear about the speed or strength of the reopening. Keep in mind that we are seeing volatility every day, with a lot of gaps and reversal action. So, focus on the short-term chart in front of you. Don’t chase and remain cautious about longer-term swing trades, unless you can take some short-term pain. However, the trend is clearly bullish.
Ed
Trade Ideas for your consideration and watchlist today: MGNX, LXRX, MYGN, BECN, TLRY, JAZZ, FRPT, DISH, MUR, AMLP. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Hit and Run Candlesticks / Road To Wealth Youtube videos
|607% in just 24 months |
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
Good morning everyone. Due to a Windows Update there will be no written blog this morning however if you follow the link below I will have a link to the late Morning Market Prep Video. Sorry for the inconvenience but it was out of my control.
The bulls ran hard on Friday, gapping up over a percent and then, after brief “fade the gap” profit-taking, ran steadily all day. The “reopen stocks” such as MGM, DIS, and airlines like DAL and AAL led the way. Prices also closed very near the highs. On the day the SPY gained 1.65%, the DIA gained 1.97%, and the QQQ gained 1.37%. The VXX was down briskly to 34.95 while the 4-week High Low Ratio T2122 spiked up into overbought territory again at 91.02. The 10-year bond yield was up to 0.685% and Oil (WTI) also gained to $24.63/barrel.
As expected, the April jobs number showed heavy job losses (-20.5 million) to raise the unemployment rate to 14.7%. However, this is less than half of the 30% predictions of some unhappy with a shutdown had predicted. Even if the worse lies ahead, at the very least, the market now seems to have moved well past concern for the economy as all the major indices are up 35% off the lows at the end of March (and QQQ is within 5.5% of all-time highs again).
For their part, the Fed is comfortable enough with the economic situation (or at least the market) that they will reduce bond-buying to $7 billion per day this week. Yet, at the same time, on Sunday Fed voter Kashkari said the true unemployment rate is 23-24%. He said while the Fed will do everything it can, but he still urged the fiscal side (Congress and President) to do more to help the public as he expects a gradual (not rapid) recovery. Treasury Sec. Mnuchin seemed to agree, saying unemployment is likely higher than reported Friday and he expects things to get worse before they get better.
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However, President Trump and Republicans seem to disagree. Both say now that businesses have the stimulus needed (to survive), they are in no hurry to do additional relief. The idea is that financial hardship for individuals might help force the high unemployment numbers back down. In addition, by rejecting CDC guidelines the administration has already removed potential roadblocks to rapid rehiring (at the risk of potential relapse). Of course, this may just be posturing ahead of more negotiations with Democrats. The Republicans want more tax cuts and the Democrats want both more relief (for State/local governments and another round of payments for the public) as well as an infrastructure bill.
On the Virus front itself, the global headline numbers are 4,200,957 confirmed cases and 284,150 deaths. In Asian, South Korea reported a new outbreak (nightclub related) and Japan also saw a cluster of cases in Tokyo. However, the good news continues in Western Europe with steady declines in new case rates in most countries. The outliers are the UK (just now plateauing as the last European country to lock-down), and Russia (which is still in epidemic mode, seeing a new record high number of cases each day). However, the UK did begin its reopening by “actively encouraging” people to return to work (while also avoiding public transport) as of today. Likewise, France also began its reopening on Monday.
In the US, we have 1,367,963 confirmed cases and 80,787 deaths. The impact of reopening remains unclear at this point. Some states that have at least partially reopened, such as CA, TX, OH, CO, and NC are seeing significant increases in new case rates again. However, other states doing the same, such as FL and GA, are not seeing increases. It’s unknown if this anomaly is due to differences in testing or some other variable. On the other hand, there is no hard data yet, but there have been significant anecdotal reports that both public participation in reopening and adherence to guidelines is sporadic nationwide. So, we have not seen the hoped-for economic impact, nor have we seen a universal strong increase in spread either.
Overnight, Asian markets were mixed on Monday, but with smaller moves. The exceptions were Japan (+1.05%) and Hong Kong (+1.53%). In Europe, markets are decidedly in the red so far today. However, like Asia, more European moves have been smaller as of now, with the exception of France (-1.41%). As of 7:30 am, US futures are pointing to a half of a percent gap lower at the open.
There is no major economic news for Monday. However, AEE, AN, CAH, COTY, ET, ETR, MAR, MGLN, MYL, ON, UA, UAA, UNVR, and ZBH all before the open.
The bulls remained in rally mode last week. However, resistance is close overhead. Remember that volatility is a constant now for traders, with a lot of “gap and fade” action. So, focus on the short-term chart in front of us. Remain cautious about longer-term swing trades, unless you can take some short-term pain.
Ed
Trade Ideas for your consideration and watchlist today: GPOR, QRTEA, ITCI, AQST, SHAK, VLO, CRUS, X, LOPE, ARNA, TWTR, BSX. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
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