Back to Bullish or Book Some Profit

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Markets gapped lower Thursday on fear stoked by the huge jump in reported cases and deaths from the coronavirus.  (As noted yesterday, this jump was likely largely due to the Chinese changing the way they report cases, which may be prone to cause trends that are less smooth.)  At any rate, after the gap down, the bull immediately charged in to fade the gap.  From that point onward, the rest of the day was a sideways grind around the break-even line.  For the day, the DIA closed down 0.30%, the SPY down 0.11% and the QQQ down 0.13%.  So, we recorded a down day, but not by much considering the gap down.  The VXX remains low at 13.69 and T2122 fell again, but remains in the mid-range at 69.27.

In the news, the Fed announced it will reduce new Repo market purchases (purchases will continue, just at a lower rate).  AMZN also obtained a temporary injunction against MSFT working on the Pentagon cloud contract.  WMT also announced it would discontinue its unprofitable high-end personal shopping service called Jetblack and W reported it will cut 500 jobs (3% of its workforce).  In other market news, CSCO stock was hammered Thursday after it reported falling revenue and failed to beat earnings expectations on Wednesday evening.

However, once again coronavirus was the top story of the day.  As mentioned, China changed its reporting methods and overnight Wed. reported over 15,000 “new” cases and 250 “new” deaths.  Obviously, this scared markets and the White House did not help matters by publicly stating it did not have confidence in the information coming from China. (While true, expressing that skepticism after such an increase in the numbers was reported does not help public confidence.)

As of Friday, the counts stand at 64,000 cases and almost 1,400 deaths. The impact is continuing to spread as airlines, cruise lines and other travel-related industries have been hit hard by decreased demand.  In addition, KHC and FCAU were among the companies that closed their manufacturing operations in China within the last 24 hours.  Many other companies warned of revenue and earnings impacts, perhaps obviously including BABA.

Overnight, Asian markets were mixed.  However, as of this point in their day, Once again, Europe has shaken off the fear and is mainly green, As of 7:30 am, U.S. futures are back on the bullish side, pointing toward a gap higher of between a quarter and half a percent across the major indices.

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Major economic news today includes Jan. Retail Sales Core and Imports/Exports (both at 8:30 am), Jan. Industrial Production (9:15 am), Michigan Consumer confidence (10 am) and another Fed speaker just before noon.  In addition, both China and the US are scheduled to reduce more tariffs on Friday.  The only major earnings reports for the day are NWL and PPL, both before the open.

Friday could be a selling day as traders look to lock in gains in front of a 3-day weekend.  (Don’t forget this is a long weekend with US markets closed Monday for Washington’s Birthday.)  Certainly, there are great headline risks from coronavirus over that period, but also from the follow-on impacts/statements of businesses over the period as well.  However, the trend remains strongly and stubbornly bullish and all the major indices are very near all-time highs (including even the IWM). 

All I can do is continue to tell you to not fight the trend, but also keep locking in profits, being cautious and remaining nimble or hedged.  Remember to make the trade come to you (rather than chasing), plan the trade and trade the plan.  Don’t get complacent and let a profitable position (or several) go South on you.

Ed

No Swing Trade Ideas for your consideration and watchlist on a Friday in front of a 3-day weekend. Today is payday. So, book some profits. 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.

🎯 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

|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.

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

Virus Fears and Bullish Earnings

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Virus Fears

Bearish virus fears and bullish earnings reports will duke it out for control today after a surprising increase in confirmed cases and deaths.  The bulls clearly want to ring the 30,000 Dow bell, but this pesky microscopic virus might stand in the way.  With the confirmed cases surging to more than 48,000 and an increase of 242 deaths, the likely economic impacts are growing more difficult to ignore.  Expect substantial price volatility as the bulls and bear duke it out and remember we now face the uncertainty of a 3-day weekend.  At the risk of sounding like a broken record, avoid over-trading and consider your risk carefully.

Asian markets closed down across the board with business closures extended until the 21st.  European market are decidedly bearish this morning trading in the red across the board as virus fears rise.   US Futures point to a nasty gap down overnight reversal ahead of a big day of earnings and economic data.  Fasten your seat-belt; this could be a bumpy ride heading into a long weekend.

On the Calendar

On the Thursday earnings calendar, we have our biggest day this week, with more than 230 companies fessing up to results.  Notable reports include ROKU, NVDA, ANN, AEM, BABA, AIG, AVP, BAM, CC, DLR, DISH, EXPE, FTS, GNC, GDDY, IRM, KHC, LH, MANU, MAT, PEP, R, SSTK, TRUP, WM, WH, AUY, YELP, YETI, & ZTS.

Acton Plan

Although a very big day of earnings reports, the market is facing a nasty overnight reversal this morning as the virus outbreak comes back into focus.   China said it confirmed more than 15,000 new cases and 254 additional deaths bring the death toll to more than 1300.  Total cases now exceed 48,000.  Global oil demand expects to see it the first quarterly decline in over 10-years as a result of the outbreak.  Hubei province once again extended business shutdowns to Feb, 21, and Hong Kong extended school closures for the 3rd time in the virus battle.  One has to wonder with this huge surge in confirmed cases and a 3-day weekend just around the corner if the fear of uncertainty will begin to encroach on the unbridled bullishness of late.

After the bell yesterday, AMAT made investors cheer with stock leaping nearly 3% but NTAP and CSCO disappointed with share prices dropping 12% and 4.5% respectively.  Before the bell today, BABA reports, and it will be very interesting to find out if the outbreak helped or hurt the huge online retailer.  Overnight reversals such as the one we face this morning are not only damaging to those unprepared but also brings the possibility of a big emotional response.  Remember it was only 10-days ago when the Dow dropped 600 points on virus fears.  I have to wonder what kind of reaction could be possible after rallying more than 1200 points in 9-days as we approach the uncertainty of a 3-day weekend.  Expect significant price volatility in the days ahead.

Trade Wisely,

Doug

Another Gap But A Different Direction

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The bulls gapped markets higher Wednesday and then slowly ground higher the rest of the day.  All three indices closed near their highs and at new all-time high closes.  The QQQ gained 0.97%, DIA gained 0.95%, and SPY lagged at a gain of 0.64%.  At the same time VXX fell to 13.40 and T2122 inched closer to overbought territory at 79.81. In short, the bulls continue to run hard and although we are extended from the moving averages, they are only in the mood to hear good news these days.

On the news front, Fed Chair Powell testified in the Senate, largely reprising his Tuesday Congress testimony.  Essentially, he said the economy is in a good place, the Fed has a close eye on the impact of the coronavirus and that no more Fed moves are needed in the immediate future.  He also said that economists should have a better handle on the virus’ impact on the US economy “soon.”  In other economic news, the Federal Deficit has jumped 25% in the last year and now stands at $1.1 trillion per year.  Federal revenue (taxes) are up slightly over that period, while spending has increased 9.6%. 

In the virus arena, China has changed the way they report new cases going forward.  Under the new method, there must be not only a positive test, but also a fever before a patient is counted as a confirmed case.  This has the effect of lowering the number of new cases reported on an individual day and may lead to erroneous optimism.  On the other hand, it could lead to pooling of reports causing more jumpiness in the trend line.  For example, the number of cases jumped 15,000 last night due to this effect.  As of now, the confirmed count remains over 60,000 and the death toll 1,369. 

As far as virus impact is concerned, more than 85,000 flights to/from China have been canceled so far (with BA claiming this is having a major impact on sales due to reduced travel and cargo activity).  A major technology conference in Europe has also been canceled over virus fear (after most major companies had pulled out and forbidden employee attendance).  Finally, OPEC has slashed its global oil demand forecast by 19%, citing virus impacts.

Overnight, Asian markets were in the red as the jump in reported virus cases spooked investors.  Once again, Europe has followed Asia as we see red across the board.  As of 7:45 am, U.S. futures are again pointing to follow the rest of the world with a gap lower of between six and eight-tenths of a percent.

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Major economic news on Thursday is limited to Initial Jobless Claims and Core CPI (both at 8:30 am).  In terms of earnings, AIG, BWA, DUK, FIS, HII, IPGP, INCY, IRM, KHC, LH, PEP, R, WM, and ZTS all report before the open.  Meanwhile, ANET, DLR, EXPE, LBTYA, LBTYK, MHK, NVDA, and RSG report after the close.

What a difference a night makes. Today it seems Mr. Market is saying “on second thought, let’s worry.” Certainly, the signs of risk have been there with OPEC cutting global oil demand forecasts and companies left and right decrying the impact on their expected operations. However, we (or at least I) cannot predict the market’s reaction.

The trend remains strongly bullish and all the major indices are now in blue sky territory (if maybe a bit extended).  It sure hasn’t paid to be short lately, despite the risks, All I can do is continue to tell you to keep locking in profits, being cautious and remaining nimble or hedged.  Don’t get complacent and let a profitable position (or several) go South on you.

Ed

Swing Trade Ideas for your consideration and watchlist: SPGI, TWTR, XPO, AAPL, TGT, APO, SPXS, TZA, THC, SQQQ, VXX. 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.

🎯 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

|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.

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

Don’t bother us with warnings!

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Don’t bother us with warnings

Don’t bother us with warnings of possible virus economic impacts; we’ve got money to spend no matter how high the price rises!  LOL, a little sarcasm as the bulls continue to the relentless push higher while more central banks warn of the financial and economic effects of the outbreak.  Even though some profit-takers took advantage of yesterday’s morning gap the SP-500 and the Nasdaq held on to new closing record highs.  What looked like the setup for a possible pullback by the end of the day now appears to have been just a brief rest as the bulls continue to party like its 1999.  Stay long, continue to profit, but be very careful chasing already very extended stocks.

Asian markets shrugged off the virus’s concerns surging upward and closing green across the board.  The European markets also in rally mode this morning and decidedly bullish across the board.  Ahead of more than 150 earnings report and busy day Fed speak US Futures once again leap higher with the Dow expected to gap more than 100 points.  Buckle up and enjoy the ride.

On the Calendar

On the Hump Day earnings calendar, we have a busy day with just over 150 companies reporting results.  Notable reports include AB, NLY, AMAT, ARCC, ARES, GOLD, BG, CTL, CSCO, CAME, CVS, EFX, EQIX, FOSL, HUBS, IPG, LGC, MRO, MGM, SHOP, TAP, MCO, NTAP, NBL, STAG, SPWR, TEVA, TRIP, TRVG, & WELL.

Action Plan

Bernie Sanders comes out as a de-facto leader after a narrow win in New Hampshire with former Vice-President Joe Biden slipping to 5th place showing.  Latecomer Mike Bloomberg has chosen not to participate in the first few contests placing his bet not on the people but instead on the hundreds of millions he is willing to spend to bypass the process.  The outbreak numbers continue to grow with several more central banks sounding the alarm of financial and economic impacts.  With more than 44,000 confirmed cases and over 1100 dead the market continues to charge forward definitely.  Though parabolic chart patterns have developed in some of the leading stocks, investors seem willing to cover their eyes hold their nose and buy no matter the elevation. 

Although the morning gap found some profit-takers, the SP-500 and Nasdaq both squeaked out new closing record highs while the DIA closed flat.  What looked like a possibility of a pullback developing now appears to have been nothing more than a little rest with the US Futures pointing to another gap up open.  So with a big day of earnings reports and another busy day of Fed speak lets party like its 1999!  Then again, if you’re like me disciplined to a trading plan and a set of rules, you’ll avoid chasing extended stocks, continue to plan your risk carefully, taking profits along the way and watchful for changes in sentiment that could happen at any time.

Trade Wisely,

Doug

Another Day Another Gap

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Markets gapped higher on Tuesday, following through on Monday’s rally.  However, after the gap and initial rally, markets faded the gap the remainder of the day.  At day end, the SPY closed up 0.17%, the DIA closed dead flat and the QQQ up 0.02%.  While all three printed new all-time highs during the day, only the SPY and QQQ closed at new high closes, and even then, just barely.  The VXX gained very slightly but it remains extremely low at 14.12.  Meanwhile, the T2122 has climbed back near, but not in overbought territory at 76.02.

The main news on the day came from the Fed.  They announced that US Household Debt is now at the highest level in 12 years.  This, along with climate change, severe weather, and the coronavirus are all risk factors impacting economic forecasts.  Chairman Powell again rejected the idea of negative rates.  However, while he was testifying, President Trump (as is his norm) repeated his demand that the Fed go to negative rates and then blamed Powell for the afternoon selloff in the US markets.  Meanwhile, market analysts blamed the tiny intraday pullback on over-extension and possibly too much prior nonchalance about the coronavirus impact as more companies are warning of its impact. 

In other news, the Federal Trade Commission announced that in a 5-0 decision, they have chosen to investigate how previous acquisitions of small companies by the largest tech companies were used to amass market power, consumer data, and market monopoly.  However, just hours later, President Trump met with the CEOs of the Trillion Dollar Club (MSFT, AMZN, GOOG, and AAPL).  He lauded those four companies, calling them MAGA (his campaign slogan).

On the coronavirus front, the count of confirmed cases now stands at 45,000 and the death tolls is over 1,100.  In terms of impact, Hilton closed all 150 of their hotels in China, UA estimates a mild $60 million impact in Q1, and AAL extended their cancelation of all flights to/from China.  Also making news was a cruise ship stranded at sea (not allowed to dock in several countries), but overnight Cambodia allowed it to dock.  In addition, the W.H.O. said that even with governmental fast-tracking, the public should not expect a vaccine until at least next year, let alone wide availability of any such vaccine.

Overnight, Asian markets were in the green.  Once again, Europe has followed Asia as we see green across the board.  As of 7:30 am, U.S. futures are again pointing to another gap higher of between three-tenths and half a percent.

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Major economic news on Wednesday is limited to Fed Chair Powell’s Senate testimony (10 ma) and Crude Oil Inventories (10:30 am). However, there will also be another Fed speaker during pre-market hours.  In terms of earnings, CME, CVS, GPN, IPG, IQV, TAP, MCO, and NBL all report before the open.  Meanwhile, AMAT, CDNS, CF, CSCO, CTL, EFX, EQIX, IFF, MGM, MRO, NTAP, REG, TRIP, and WELL report after the close.

The DIA sits at potential resistance for a second straight day.  However, in general, the bulls continue to see nothing but the upside.  The trend remains clearly bullish, and we are a little less extended than yesterday.  Don’t get complacent, expecting the bulls to run every day forever. Remember to keep locking in profits.  Don’t let a profitable position go South on you. 

Ed

Swing Trade Ideas for your consideration and watchlist: HCA, SC, MNST, AVY, ZBH, FAST, BLL, YNDX, ALL, ITW. 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.

🎯 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

|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.

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

Record Highs Continue

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Record Highs

Shaking off any and all concerns of potential economic impacts from the coronavirus buyers pushed up the SP-500 and Nasdaq setting new record highs.  How long this can continue is anyone’s guess but traders should be very careful not to become complacent over-trading a rally that is already quite extended.  Although the price action of MSFT appears, parabolic buyers didn’t hesitate to push the stock up making the company the biggest company in the world by valuation yesterday.  With a big day of Fed speak, more than 100 companies reporting and the New Hampshire caucus anything is possible.

Yum Taco’s!

Asian markets closed mixed but mostly higher overnight as Chinese banks scramble to support business requiring huge capital injections due to the outbreak impacts.  European markets are bullish across the board on positive earnings results.  US Futures indicate another gap up open and more new records as the rally continues to extend with no concern of future virus related impacts.

On the Calendar

On the Tuesday earnings calendar, we have a busy day with more than 100 companies reporting quarterly results.  Notable reports include AKAM, AN, DENN, DBD, D, EXAS, EXC, GT, GRPN, HAS, HILT, LPX, LYFT, MAS, MLCO, NNN, ONDK, TGNA, UAA, VIRT & WU.

Action Plan

The bulls continue to shake off coronavirus concerns and the obvious economic impacts pushing the SP-500 and Nasdaq to new record highs on Monday.  While the absolute breadth index (T2101) remains in a month over month downtrend select, large market cap companies continue to lift the indexes.  The relentless buying without regard to valuation is very reminiscent of the 1999 tech bubble though the economic particulars are very different.  A report yesterday suggested GDP may fall by as much as 50% due to the outbreak impacts on the economy in the coming months.  However, in the short-term earnings continue to inspire the bulls to buy.  Yesterday, MSFT rose to the top, becoming the biggest company by valuation in the world pushing the chart into the parabolic territory. 

Along with a big day earnings report, we have several Fed speakers, including comments from Jerome Powell at 10:00 AM Eastern.  Although we are unlikely to learn anything new for the chairman, any inclination of dovishness or hawkishness can move the market so stay focused on price action for clues.  On the campaign front, the Democrats are hoping to shake off the Iowa debacle, gain some momentum in the New Hampshire caucus today.  So far, the field remains split and there is no clear front runner as voting begins.  The results of the contest could have market impacts for traders to consider on Wednesday morning.  Futures indicate yet another gap up open to record highs.  How long this continues is anyone’s guess, but be very careful not to chase or become complacent.

Trade Wisely,

Doug

Bulls Liking the Blue Sky

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Markets ran down at the open Monday, but almost immediately the bulls stepped in.  After that rebound and run up into the highs at 10:45am, there was a sideways grind in a tight range until 3pm.  At that point, the bulls stepped back in again to drive higher right into the close.  It seemed to be the big tech names that led the market higher, with beautiful candles from AMZN, MSFT, AMD, NVDA, and GOOG. For the day, the SPY was up 0.75%, the DIA up 0.60%, and the QQQ up 1.21%.  Of these, both the SPY and QQQ gave us new all-time high closes.  All three printed Bullish Engulfing signals.  This all implies new higher-highs Tuesday.

On a light news and earnings day, the coronavirus continued to be the top story.  The death toll has now exceeded 1,000 with 43,000 confirmed cases.  In terms of impact, CNBC reported that their survey of economists is indicating that the US GDP for the first quarter will likely be reduced to 1.2% due to the impacts of this virus.  (That’s down almost an entire percent from Q4.)

It is of note that the number of new cases reported Tuesday in Hubei Province has held relatively stable at about 2,500.  This may indicate the spread is slowing, which would be great news.  However, both the W.H.O. and the Chinese government are cautious not to show optimism. They say that they are looking for stabilization outside the quarantine regions of China within a few weeks, but inside the quarantine zone, they expect the outbreak may take longer to subside.

In related news, some Chinese plants reopened for the first time in weeks on Tuesday.  This was a relief for global supply chains in industries like auto and electronics.  Still, the ramp-up time for individual plants or even regions is unknown.  Obviously that time will depend on how many employees return and whether virus preventative measures might hinder productivity.  Typical ramp-up takes 1.5 weeks to get back to normal productivity.  As a possible indication for this instance, Bloomberg reported sources at the Foxconn iPhone plant in Zhengzhou said that only 10% of the workforce returned on their first day back open. 

In other news, details from President Trump’s proposed 2021 budget filled the news void.  His $4.8 Trillion plan lines up with his campaign priorities but also abandons the pledge to eliminate budget deficits in 10 years.  I will skip the details because as is typical of budgets, particularly in election years, this one has no chance of passing the House, who has the final say, as is.  This is more of a set of campaign bullet points and negotiation tactics, as will be the responses.   

$50.00 discount with code: Privilege

It is also worth noting that S shot higher in after-hours trading last night on rumors that a Federal Court has approved the T-MUS merger.

Overnight, Asian markets were in the green.  Europe has followed Asia so far today as we see green across the board.  As of 7:30 am, U.S. futures are pointing to another gap higher of between three-tenths and half a percent.

On Tuesday, Fed Chair Powell begins two days of Congressional testimony at the same time as the JOLTS report (10 am).  In the afternoon there will be a trio of other Fed speakers. On the earnings front, D, EXC, HAS, HLT, MLM, MAS, OMC, UA, and UAA all report before the open.  After the close, AKAM, AMCR, AIZ, PEAK, UDR, and WU will report.

The bulls continue to see only the bright side.  While the DIA sits at potential resistance, the other two major indices are in “blue sky.”  The trend remains clearly bullish, but we remain extended, especially in the QQQ.  As always, stick with the trend and remember that Mr. Market can stay too far on any one side longer than we can be right while early.  Just don’t let profitable positions go South on you.  Keep taking profits, using prudent hedges, and reducing risk. 

Ed

Swing Trade Ideas for your consideration and watchlist: TDOC, ZBH, ERI, AAXN, ZEN, LITE, JNJ, SPLK, PEN. 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.

🎯 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

|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.

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

Bearish Candle Patterns

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Bearish Candle Patterns

In reaction to weekend uncertainty, profit-takers dominated the price action leaving behind some potentially bearish candle patterns on the DIA, SPY, and IWM.  The QQQ held up as the strongest index, while the poor under-loved IWM proved the weakest printing a lower high.  As concerns, economic impacts, and supply chain issues begin to weigh on the market; we have a very big week of earnings reports that continue to provide short-term inspiration to the bulls.  Expect the volatile price action to continues and remain flexible as anything is possible as we sort through the uncertainty.

Asian market closed mixed with China finding the inspiration to rally with the government fronting 10 billion to help virus victims with medical costs.  European markets are modestly lower across the board as the outbreak continues to expand, and the UK reports four new cases.  US futures are trying to put on a brave face but as I write this report, the open appears relatively flat.

On the Calendar

On the Monday earnings calendar, we have just over 100 companies fessing up to results today.  Notable reports include AGN, BIP, ELY, DVA, RE, FRT, JCOM, L, MELI, OMF, PSEC, QSR, STE, & VOYA.

Action Plan

Friday saw a pullback on weekend worries printing evening star patterns no the DIA, & SPY.  The QQQ holds up as the strongest index with help from some big techs like MSFT and AMZN while IWM continues to prove the weakest index leaving behind a lower high on Friday.  Over the weekend, the outbreak death toll rose to 908, with more than 40,000 confirmed cases.  Some businesses will resume work today, but many have extended closures until March 1st raising serious supply chain concerns for may US Business.  However, the market may once again choose to ignore that as traders react to more than 500 earnings reports scheduled for this week.  Tuesday and Wednesday at 10 AM Eastern Jerome Powell speak and of course, could move markets if there is anything new gleaned from his comments.

Instead of the wild futures driven gaps we witnessed last week, the pre-market activity is taking a much more subdued approach this morning as concerns of economic impacts from the outbreak grow.  Technically speaking, there is a reason for traders to be a bit pensive with possible bearish patterns printed on the index charts at or very near price resistance highs.  What comes next is anyone’s guess!  Will we take our queues from the big week of earnings events or will the virus impacts take center stage.  One thing for sure traders should plan for more volatility, remain flexible, and guard against over-trading. 

Trade Wisely,

Doug

Bear Signals and Virus Fear

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Markets took some profits on Friday as the US followed the pattern of Asia and Europe for the day.  The QQQ and SPY ended the day as Doji candles after some volatility, but the DIA printed a large-body black candle to print an Evening Star signal.  The SPY was down 0.53%, the DOA down 0.87%, and the QQQ down 0.43%.  As a result, the VXX climbed slightly to 14.38 while the T2122 fell again to 33.94 (still not oversold).

The big story on the day seemed to be a complete reversal by the Fed from what was told to the financial press just two days earlier.  On Friday, the Fed reported to Congress that the coronavirus presents a new risk to the US economic outlook and they warned of disruptions to global markets.  Specifically, the Fed reported, “Because of the size of the Chinese economy, significant distress in China could spill over to U.S. and global markets through a retrenchment of risk appetite, U.S. dollar appreciation, and declines in trade and commodity prices.” 

On Tuesday and Wednesday, both Fed speakers and the President’s Chief Economic Advisor Larry Kudlow had said the virus would not have a significant impact on the US economy.  This reversal may help explain the profit-taking on Friday.

Over the weekend, the virus has continued to spread and has surpassed the SARS outbreak of 2003 in terms of impact.  The number of confirmed cases has now reached over 40,000 and deaths now exceed 900.  One of those deaths was in the US.  In terms of impacts, there is serious scrambling going on throughout the Auto and Electronics industries as the vast majority of those supply chains run through China.  In other words, you can’t make a car in Detroit, Berlin, Japan or Mexico if the parts have not arrived from China.

Overnight, Asian markets were in the red.  Europe is mixed at this point, but most of the major bourses are red…the FTSE being the striking exception.  As of 7:45 am, U.S. futures are flat, sitting on either side of the break-even line.

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There is no major economic news for Monday.  However, there are a couple of Fed speakers during the day.  Earnings are also light for the day, but AGN, QSR, L, DO, IVC, and AVYA report before the Open.  After Monday’s close, CHGG, MELI, RNG, XPO, APPS, ELY, MESA, MOH, IIVI, JCOM, RE, RPD, VRNS, DVA, BLKB, VOYA, FLDM, FRT, ICMB, and PYX all report.

Markets took some profits Friday, but the bulls have been resilient and relentless for a long time now.  The trend remains clearly bullish, but we are still a bit extended and there is no new impetus with light earnings and no planned economic news Monday.  Perhaps the rumors of President Trump’s election-year budget (apparently going to expand tax cuts) will be the driver today. 

Again, the bias is on the long side, but the candle patterns are on the bearish side. I think we need to remain cautious.  At the very least take a look at bearish setups or hedges. I know I sound like a broken record on the topic, but nobody ever went broke taking profits and reducing risk.  Plan the trade, make the trade come to you and then trade the plan.

Ed

Swing Trade Ideas for your consideration and watchlist: PLCE, FTK, SLCA, SLM, KSU,DKS, CROX, KLAC, SWKS, QRVO, ZM. 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.

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Wild Ride

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Wild Ride

What a wild ride the market has delivered this week, recovering to new record highs amid a mixture of earnings results, the Presidents acquittal, and a virus outbreak that continues to expand.  After such a strong rally, we should not be surprised to see some profit-taking as we head into the uncertainty of the weekend.  Let’s hope the very big gaps left behind can hold as support if tested by the bears.  It could make for a very volatile pullback should those gaps start to fill.  If your currently holding gains, it may not be a bad idea to capture at least some of them before the weekend.

Asian markets closed mixed overnight as China’s trade data was delayed, and the outbreak expanded to more than 31,000 confirmed cases.   European are seeing only red this morning but so far, losses are rather moderate.  US Futures currently point to a gap down of nearly 100 points ahead of the Employment Situation number and a lighter day of earnings reports.  Although the bears are indicating some pressure this morning, I would not expect the bulls to give up easily.

On the Calendar

On the Friday earnings calendar, we get a nice break with just over 40 companies reporting results.  Notable reports included ABBV, AVTR, FE, HMC, & MSG.

Action Plan

After the wild week of bullishness, I was expecting to see the Friday morning futures pushing to extend higher to finish the week strong.  However, the delay in China’s trade data seemed to bring some attention back to issues surrounding the outbreak.  Death numbers rose to 636, and confirmed cases grew over 31,000.  Confirmed cases on the quartered cruise ship are now over 40 as testing continues.  I have to image news like this will continue to affect all travel-related stocks negatively.  As of right now, business is scheduled to resume in China on Feb. 10th, but with the outbreak continuing to expand, could we see another extension by the government this weekend?

The sharp recovery rally this week set new record highs in the DIA, SPY, and QQQ, but also left behind some very big gaps which provide weak levels of price support.  If a pullback begins, that could cause some considerable volatility if price slips into the gaps.  With the uncertainty of the weekend ahead, a little selling pressure could quickly bring out profit-takers.  Plan your risk carefully into the weekend, and remember never to allow greed to prevent you from taking a profit.  Have a great weekend, everyone!

Trade Wisely,

Doug