Bulls Have Moved On…Again

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Markets gapped down Monday (on fears over the Iran mess), but the bulls would have none of it.  An all-day rally left all the major indices printing very strong Marubozu (shaved head) candles, closing on the highs.  While the SPY, DIA, and QQQ did not print new all-time highs, we are back within spitting distance of those marks.  Markets are also still not over-bought again (at least by the T2122 metric, which rose, but remains below 80).  Oil prices also stabilized, dipping after the true risk of Persian Gulf conflict was reweighed.

A US Marine Brigadier General (William Seely) sent a letter to the Iraqi Ministry of Defense implying that the US would be removing troops from Iraq, starting with the Green Zone.  However, after-hours the US Department of Defense said the letter was a mistake and denied that US troops will be leaving, but are instead just repositioning.  In the meantime, the US deployed the 82nd Airborne Division (about 3,500 men) and a 2,200 man Marine Rapid-Reaction Group back to the region and President Trump said we were not leaving unless Iraq pays us for building an airbase. Finally, the Pentagon rejected President Trump’s list of threatened 52 Iranian targets as many of them are illegal targets under International law (cultural and religious sites).

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In business news, American Airlines (AAL) reached an agreement with Boeing (BA) over the compensation BA will pay over the grounding of the 737Max.  Finally, Pier 1 Imports (PIR) reported it will close 450 stores (nearly half of their current stores).

Tuesday’s major economic news includes Import/Exports (8:30 am), and Nov. Factory Orders and Nov. Non-Mfg. PMI (both at 10 am).  There are no earnings reports Tuesday.

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Overnight, Asian markets were mixed but mostly green.  In Europe, markets are green across the board at this point.  As of 7:45 am, U.S. futures are sitting on either side of flat as the world seems to have now moved past the latest Persian Gulf crisis for the moment. Even oil is down about a percent at this point. 

The bulls great showing Monday tells us who is in-charge of markets. While anything can happen short-term, as we’ve said before, it’s hard to bet against the bulls in the longer-term. As always, keep planning your trades, trading your plans and keep taking profits along the way. Remember it is consistent singles and doubles that win the game…not occasional home runs. However, it may be time to reconsider any short or hedge positions put on due to the US-Iran situation.

Ed

Swing Trade Ideas for your consideration and watchlist: PTCT, CHGG, BLUE, VG, EXAS, TDOC, GGAL, WORK, GPS, M, ATVI, GRUB Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. The stocks/etfs we mention and talk about are not recommendations to buy or sell.

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🎯 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.

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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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 relentless march of the bulls.

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The relentless march of the bulls

Geopolitical fears proved to be no match for the relentless march of the bulls yesterday.  By the close of the day, not only had they rejected the fear of the gap down but left behind bullish engulfing candle patterns that held support and trend.  However, the substantial rise in gold and oil prices seems to be a huge contradiction to this exuberant bull run.  As Iran promises retaliation and the US warns waterway shippers of possible attacks, traders should plan their risk carefully keeping a close on the developments in the middle east.

Overnight Asian markets also set aside retaliation fears closing the day green across the board.  European markets are also rebounding this morning as fears seem to has subsided.  As I write this report US Futures that boldly continued to rally overnight seem a bit more subdued ahead of economic reports on International Trade, Factory Orders and the ISM.   

On the Calendar

On the Tuesday earnings calendar, we have 10 companies reporting with none that particularly notable.

Action Plan

The bulls shook off the fear of potential retaliation from Iran yesterday rejecting the gap down lows of the last two trading days.  To be honest, I’m not sure where the overall confidence is coming from with Iranian generals publicly speaking about retaliation and US warnings; they are concerned about waterway attacks.  Nonetheless, the bulls remain relentlessly in control of the trend that left behind bullish engulfing candle patterns on the DIA, SPY, and QQQ. 

Bullish is a good thing but over-exuberant blind bullishness and become very dangerous so let’s hope it’s not the later.  With the recent pullback, the T2122 indicator has relaxed, allowing more room for the indexes to extend more to the upside.  However, there is a contradiction in the VIX, which shows little to no fear while gold, (GLD) has gone nearly parabolic in its rally over the last few days.  Overnight futures continued to push boldly higher as have oil prices that at one point topped $70 a barrel yesterday.  With little on the earnings calendar, the market will look to the economic reports on International Trade, Factory Orders and ISM numbers for inspiration.  Also, remember geopolitical news could create substantial reversals and price volatility, so plan your risk accordingly.

Trade Wisely,

Doug

10 Trade-Ideas | Starting Week 1/13/2020

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In this video, Rick looks at 10 charts for his watch-list the coming week 1/13/2020 and maybe longer. (SPT) See it – Plan it – Trade it. Past performance is not indicative of future returns. This post is not a recommendation to buy or sell a security. 60-day trial for just $49.

DISCLAIMER: The stocks we talk about are not recommendations to buy or sell. You must evaluate the risks and rewards yourself. 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 financial or trading advice. All information provided is intended for educational purposes only. You are advised to thoroughly test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

More Fallout From Soleimani Killing

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Markets gapped lower Friday on fears and consequences of the US assassination of a top Iranian General (on his way to meet with the Iraqi Prime Minister).  However, the major indices recovered a bit over the session.  At the end of the day, the SPY was down 0.76%, DIA down 0.80% and QQQ down 0.92%.  So, the bulls are not ready to run for cover and we remain near all-time highs.  However, the short-term trend is more sideways than bullish as of the end of the week.

It was a busy weekend of reactions from the US drone strike in Iraq.  Iran says they are no longer bound by the 2015 nuclear deal and are ramping up uranium enrichment.  Rockets were fired into the Green Zone, landing near the US Embassy in Iraq.  The Iraqi government has suspended coalition operations against ISIS.  In addition, the Iraqi Parliament (at the request of the Iraqi PM) has demanded that US troops leave their country and refrain from using Iraqi land, water or air space.  Finally, President Trump is threatening sanctions on Iraq (for kicking us out) and also threatened to strike 52 specific Iranian targets if Iran retaliates…and has deployed thousands more US troops to the area in order to back up that threat. 

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While market impacts over this still-unfolding story are unsure at this point, it would seem likely that oil markets will be unsettled by the threat of war in the Persian Gulf.  (Brent hit $70 today.) Typically, after a middle-eastern crisis, safety plays (Gold and Bonds) tend to fade and stocks gain after an initial reaction.  However, oil prices tend to remain elevated for longer periods.  An interesting non-US fallout is that the Saudi Aramco stock price fell nearly two percent Sunday over fears of Iranian reprisal attacks against Saudi Arabia. 

Monday’s major economic news is limited to Dec. Services PMI (9:45 am).  The only earnings report of note Monday is STT. However, there may be news out of Congress (either over limiting President’s Trumps War Powers toward Iran or on the Impeachment).

In other business news, BA has found another potential design/wiring flaw in their 737Max. Just like the software flaw that caused the crashes, a December audit found that Boeing knew of this problem, but had not reported it to the FAA.

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Overnight, Asian markets were mixed but mostly red on the news out of Iraq.  In Europe, markets are also mixed but mostly red at this point.  As of 7:30 am, U.S. futures are down sharply (greater than 1%) following Thursday’s stellar start to the year.  

The bulls were off to a great start on January 2nd.  However, the killing of Iran’s top general has thrown the world into turmoil again.  It’s hard to bet against the bulls in the longer-term.  However, anything can happen short-term.  So, all we can do is be nimble, add hedges or get flat until things settle.  Continue to plan your trades, and trade your plans.  As always, keep taking profits along the way, move your stops to protect yourself and wait for the trade to come to you. 

Ed

Swing Trade Ideas for your consideration and watchlist: CTST, LB, NIO, NUAN, WDAY, TWLO, GE, ROKU, CGC, SHW, XPO. Trade smart, take profits along the way and trade your plan. Also, do not forget to check for upcoming earnings. Stocks we mention and talk about are not recommendations to buy or sell.

✅ SMS text alerts and reminders?👈

✅ Check out our newest YouTube videos👈

🎯 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.

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

Saber-rattling.

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Saber-rattling

Increased saber-rattling over the weekend as Iran and the US exchange threats and tensions grow between the countries.  Not surprisingly, markets around the world are reacting negatively to the growing uncertainty.  With little on earnings or economic calendar to provide market inspiration, the news spin cycle will affect market sentiment and price action volatility.  Traders will have to stay nimble and focused carefully on price action for clues.  As of the close on Friday, index trends and support held as the bulls stepped up to defend after the morning gap down.  Unfortunately, we face a similar bearish gap this morning.

Don’t forget me, I’m a tough guy too!

Asian markets closed in the red across the board as oil prices jumped more than 2%.  European indexes are also trading negatively this morning as they monitor the growing tensions between Iran and the US.  Futures this morning here in the US point to a substantial gap down open this morning to begin our first full trading week this year.  Geopolitical events can create extreme shifts in sentiment as news comes out.  Plan your risk accordingly.

On the Calendar

On the Monday earnings calendar, we have just 4 companies reporting, but none are notable and unlikely to any overall market effect. 

Action Plan

With little on the economic and earnings calendar today, the market will likely focus on the Iranian tensions and any news developments on the subject.  Over the weekend, Iran voted to expel the US from the country and threats were made against the US troops to be removed by force.  The President responded, saying the troops would remain right where they are unless Iran pays back the American people for the expensive and newly created base.  He also threatened sanctions like the country had never seen before. 

In response to the Iranian threat of retaliation, the President said the US has picked out 52 targets if they do.  Now the House, which is upset they were not briefed on the Iranian airstrike, are trying to move forward a bill this week that would attempt to limit Presidental powers.  As you might imagine, markets around the world continue to react negatively to the saber-rattling and the uncertainty it creates.   As of the close on Friday, the bullish trend remained in tack and bulls had successfully defended price support levels.  Futures this morning reflect the worry of the market pointing to a substantial gap down at the open to begin our first full week of trading in 2020. 

Trade Wisely,

Doug

GE | Chart of the Day

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We bought GE calls on Friday, January 3, 2020

Let’s look at GE found on the LTA scanner. We’ll discuss what I like about it, what potential I see and how I might trade it. If you aren’t already in the room, you might think about taking a 60-day trial for just $49.

DISCLAIMER: The stocks we talk about are not recommendations to buy or sell. You must evaluate the risks and rewards yourself. 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 financial or trading advice. All information provided is intended for educational purposes only. You are advised to thoroughly test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

What a difference a day makes.

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After a very exuberant Thursday rally, a US airstrike in retaliation for the embassy attack is sending shock waves through the world markets this morning.  What a difference a day makes as uncertainty once again raises its ugly head as we move toward the weekend.  As traders face an uncertain weekend, it could easily trigger some profit-taking and increase the overall price action volatility.  Watch closely if index price supports can stave off this initial knee-jerk reaction.  If they begin to fail, profit-taking could quickly increase.

Asian markets closed the day lower across the board but rather subdued overall.  European markets are all in the red this morning in reaction to the Iranian tensions.  US Futures point to a sharply lower open this morning with the Dow indicating a gap down of more than 250.  Buckle up; it could be a bumpy ride.

On the Calendar

On the Friday Earnings Calendar, we have 18 companies listed as reporting, but just one confirmed report from LW and it happens to be the only one that’s noteworthy on the day.

Action Plan

A day after an exuberant rally that set new records, the market has a very different attitude this morning.  During the evening in response to the invasion of the US Embassy in Iran, a strategic killed one of Iran’s top generals sending shock waves throughout the middle east and possibly escalating the conflict.  Qasem Soleimani is tied directly to the deaths of over 600 Americans and was a very popular military leader in Iran.  What comes next is anyone’s guess, and that uncertainty is evident with a quick look at the futures market.

Lettering design poster, banner.

The strong bullish trend over the last three months may still hold after this morning’s knee jerk reaction, but overall, the market hates uncertainty, and we can expect the VIX will respond to show some fear.  Keep a close eye on price supports within the index trends.  Failure of supports heading into an uncertain weekend could set off a wave of profit-taking.  Remember, we have the ISM, Petroleum Status and the FOMC minutes on the economic calendar along with a parade of Fed speakers.

Trade Wisely,

Doug

US vs. Iran Takes Center Stage

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In economic news Thursday, the biggest story of the day came prior to the US market open.  The Chinese Central Bank lowered the amount of capital Chinese Banks must hold.  This move will inject between $800 billion and $1 trillion into the Chinese economy, with world markets hoping that stimulus will cause a world-wide rebound.  Thus we got a gap up.

So, Markets gapped higher to start the new year.  This was met with sideways grind until the bulls kicked it into gear again after 2 pm.  There were significant surges about 2:30 pm and again at 3:50 pm.  The net result was that the SPY closed up 0.94%, DIA up 1.23% and QQQ up 1.67%…all closing at new all-time high closes.  This happened on above-average volume.  As you’d expect, the VXX fell dramatically as well, down to 14.51.  There simply is no fear in this market.

Overnight last night, the potentially most significant story of the day came out of Iraq.  President Trump apparently ordered the targeted killing of Iran’s top military General, while he was in Iraq.  (Akin to some other country killing the Chairman of the US Joint Chiefs of Staff.)  This is the second US airstrike in Iraq targeting Iran or Iranian allies in the last couple of days.  Iran is vowing revenge, the US State Department has ordered Americans out of Iraq and Iraqis are, understandably, not pleased with US actions or the prospect of another war. 

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This action may betray US administration policy.  Obviously it has the potential to spiral into another middle eastern War for the US. (This is conjecture, but based on forward-positioning of tens of thousands of US Troops into Saudi Arabia in recent months, Administration actions against Iran since Trump took office, and the fact that no sitting US President has lost an election during wartime…it seems plausible.)  In any event, Dow futures dropped 350 points on this news overnight.  Oil prices also spiked four percent.

Friday’s major economic news includes Dev. ISM Mfg. PMI (10 am), Crude Oil Inventories (11 am), and a couple of Fed speakers in the afternoon.  The only earnings report of note is LW.

Overnight, Asian markets were mixed but mostly red on the news out of Iraq.  In Europe, markets are also mixed but mostly red at this point.  As of 7:30 am, U.S. futures are down sharply (greater than 1%) following Thursday’s stellar start to the year.  

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The year was off to a great start and the bulls seem to be focusing on optimism over a trade deal with China and potential for some recovery based on Chinese economic stimulus.  However, this military situation with Iran now takes center stage and will bring fear and uncertainty back into markets.  I had intended to say that over-extension and the unknown are the only things to fear early this year.  However, at least one of those unknowns now has a name…Iran.

With that said, we cannot predict geopolitics, US politics or market reactions.  All we can do is add hedges or get flat until things settle.  So, continue to plan your trades, and trade your plans.  Don’t chase the new year rally.  Trade charts you have analyzed and chosen to meet your criteria.  As always, keep taking profits along the way, move your stops to protect yourself and wait for the trade to come to you. 

Ed

Swing Trade Ideas for your consideration and watchlist: AMD, GE, TWLO, IEF, MPLX, INTC, CSCO, NKE, INFO, CGC, VXX. Trade smart, take profits along the way and trade your plan. Also, do not forget to check for upcoming earnings. Stocks we mention and talk about are not recommendations to buy or sell.

✅ SMS text alerts and reminders?👈

✅ Check out our newest YouTube videos👈

🎯 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.

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

Trends remain Bullish

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Trends remain Bullish

Friday’s close saw a little selling coming into the market with the VIX bouncing up 6% by the close, but overall, the index trends remain bullish.  Heading into another mid-week holiday with a nasty winter storm spreading across the east coast low volume algo-driven chop could be the bulk of price action after the opening rush.  Trade and Housing numbers could provide some short-lived inspiration, but our time may be better spent reviewing this year’s results and preparing goals & plans for 2020.

Happy New Year

Asian markets closed the day mixed but mostly higher waiting on November Hong Kong data.  European markets this morning are trading lower across the board but on light holiday volumes.  US Futures suggest a flat to ever so slightly bullish open ahead of the International Trade in Goods and Pending Home Sales November results. 

On the Calendar

On the 2nd to last trading day of 2019, the Earnings Calendar indicates there are just eight companies reporting today but seven of the report are unconfirmed and I don’t see a single notable report among them.

Action Plan

A New Beginning with Right Way Options in 2020

With a nasty winter storm spreading across the east coast and another mid-week holiday facing the market trading volume is likely to diminish quickly after the morning rush.  We have little to nothing on the earnings calendar for the market to react to, so it will likely look to the economic calendar for some inspiration.  Consensus expects a widening of the gap in November’s reading on International Trade in Goods number at 8:30 AM Eastern and an increase in the 10:00 AM Pending Home Sales report.  Of course, news events could temporarily fire up some price action, but most likely, the next couple of days will see a lot of algo-driven chop.

There is always the possibility of a little end of month window dressing but there is also the chance we could see some end of year profit-taking.  Last Friday saw a slight increase in the VIX, but so far this morning the US Futures are suggesting a flat to ever so slightly bullish open.  Rather than trading, the next few days may be better spent reviewing this year’s results looking for improvements to trading rules and plans.  Perhaps, start by setting goals for 2020 and building watchlists so that you can jump-start the New Year as a better, more prepared trader.

Trade Wisely,

Doug