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More Fallout From Soleimani Killing

January 6, 2020 by Ed Carter

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.

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 2^nd. 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.

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.

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

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🎯 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

Saber-rattling.

January 6, 2020 by Doug Campbell

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

January 3, 2020 by Rick Saddler

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.

January 3, 2020 by Doug Campbell

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.

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

January 3, 2020 by Ed Carter

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.

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.

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.

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.

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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

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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Trends remain Bullish

December 30, 2019 by Doug Campbell

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.

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 2^nd 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

Bulls Have the Momentum

December 30, 2019 by Ed Carter

Markets took a rest Friday with gaps higher across the board, met with a fade of the gap selling. The end result was a flat day with the SPY (down 0.02%) and QQQ (down 0.008%) on the red side of flat and the DIA (up 0.09%) just on the green side of flat. However, this still leaves markets right at all-time highs. It’s worth noting that volumes were near average across all indices.

For reference, this was the fifth straight week of gains as Santa Claus continues his rally. Interestingly, the VXX climbed 2% Friday to a still-low 15.23. In addition, T2122 fell out of the overbought territory, down to 73.04.

Over the weekend, there was no major news. North Korea apparently did not follow through on its threatened “Christmas Present for the US.” However, the US did attack apparently Iranian-aligned militias in both Iraq and Syria. Other than that, there was just a now-normal church shooting and knife attack on a Hanukkah celebration. So, just a standard, low-key weekend…nothing to rile markets

Monday’s major economic news includes Trade Balance and Auto Inventories (8:30 am), Dec. Chicago PMI (9:45 am), and Nov. Pending Home Sales (10 am). With another holiday upon us, again this week there are no major earnings reports.

Overnight, Asian markets were mixed. In Europe, markets are all in the red at this point. As of 7:30 am, U.S. futures are flat, sitting on either side of Friday’s closing value.

All-in-all, we are wrapping up another great year for stocks as markets have gained close to 30%, despite trade fears, on the back of three Fed cuts (even with a strong domestic economy). With those gains in their pocket, it is doubtful bulls will be willing to allow any of their profits to evaporate in the last two days of the year. So, the bulls have both the momentum and reason to defend the highs the next couple days.

At this point, it seems over-extension and the unknown are the only things to fear early this week. With that said, remember that volumes will likely continue to be light as many traders take more time off for the holidays. So, continue to plan your trades, and trade your plans. Don’t chase (there will always be another trade, I promise), keep taking profits along the way, move your stops to protect yourself and wait for the trade to come to you.

Swing Trade Ideas for your consideration and watchlist: FTCH, PSX, BX, KO, MA, CPB. 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

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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Strong Retail Numbers Inspire

December 27, 2019 by Doug Campbell

Although Santa has returned to the North Pole and his jolly Ho, Ho, Ho, has faded into memory, the big guys’ influence continues as the strong retail numbers continue to inspire the bulls. Lead by AMZN’s record-breaking sales results, there were new record highs achieved in the DIA, SPY and QQQ on relatively low holiday volume. As we head into the weekend and the New Year, the bulls seem to have plenty of momentum on their side, but be careful not to become too complacent.

Asian markets finished the week mixed but mostly lower. European markets this morning see only green following the optimistic lead of Wall Street. US Futures point to a gap up open on this last Friday of 2019, fulled by momentum with very little on the earnings or economic calendar to provide inspiration.

On the Calendar

On the Earnings Calendar, we have 18 companies reporting but none are particularly notable.

Action Plan

Strong holiday retail sales continued to inspire markets higher yesterday as it seems Santa’s influence remains strong this year. Once again, the DIA, SPY and QQQ reached out for new record highs yesterday on low holiday volume. There is no doubt this has been an amazing quarter to top off a truly remarkable decade for the market. As we slide into the weekend with just three trading days left in 2019, the momentum is certainly with the bulls and there are no indications in the price action they are ready to stop just yet.

However, we all know that what goes up must eventually come down, so we must not get complacent and be ready to act if and when the bears decide to reassert themselves. Futures this morning point currently point to a mixed open with the Dow suggesting a substantial gap up at the open. Gap up opens at new market highs make me watchful of the dreaded pop and drop possibility so be careful not to chase the open, wait to see if there are buyers that follow-through. With such a strong trend and momentum, follow-through may not be much of a wait even though there will be very little inspiration in the earnings and economic calendar today.

Trade Wisley,

Doug

Exceptional Santa Claus

December 23, 2019 by Doug Campbell

Santa always seems to have some influence over the market during this time of year but this year we have experienced an exceptional Santa Claus rally. A better than expected quarter of earnings, a dovish FOMC, strong employment, and the Phase One tariff relief has made it pretty easy for the jolly old man and reindeer to pull out record highs day after day. With China now in the news following through on tariffs cuts, the bullish trend shows no clues of stopping just yet.

**An RWO Membership is a great last minute Gift!**

Asian markets closed mixed but with very modest gains and losses overall. European markets are trading mixed and mostly flat as traders seem to be taking profits and cutting risks heading into the holiday. US Futures point to modest gains this morning ahead of Durable Goods and New Home Sales numbers. After the morning rush, it would not be a surprise to light and choppy price action as traders head out for holiday plans. I would not rule out the possibility of some profit-taking at some point in the day.

On the Calendar

On the Earnings Calendar, we have just 13 companies reporting on Monday. Ten scheduled on Tuesday and with the market closed for Christmas on Wednesday, there will be no earnings reports. Of the companies reporting, their none that are particularly notable the entire week!

Action Plan

With Santa’s reindeer pulling hard, the markets continue to rally setting new records nearly every day. News that China is cutting tariffs as part of the Phase One trade deal may allow this Santa rally to continue on this eve of Christmas Eve. Today may be the best day of volume this week, but traders should carefully consider the risks of the typical very low volume that could easily continue right into the New Year. I would not be too surprised to see volumes drop quickly after the morning rush of activity as traders head for their holiday plans.

With nothing much to react to the earnings calendar, the market will likely turn to the economic reports to find some inspiration. Keep an and eye on the Durable Goods report at 8:30 AM Eastern and the New Home Sales numbers at 10:00 AM. As a reminder, Right Way Options trading room will be open Tuesday and Thursday for chat only; there will not be a moderator. Of course, on Christmas day, the room is closed. As a result, there will be no morning blog post or Morning Market Prep Video until Friday. I wish you and your family a very Merry Christmas!

Trade Wisely,

Doug

China Trying to Help Santa

December 23, 2019 by Ed Carter

Friday was an indecisive day at the highs as the SPY closed just on the red side of flat, the DIA dead flat, and the QQQ posted a 0.40% gain. This gave the QQQ another new all-time high close on the strength of its gap higher at the open. Beyond the open, all three major indices printed Doji-type candles on the day. The VXX did gain 1.21% but remains at historical lows as fear does not seem to exist in markets now.

In US news this weekend Congress approved and President Trump signed the new spending bill to prevent a government shutdown. This bill raised spending to $1.4 Trillion and in the process eliminated taxes used to pay for some of the ACA (Obamacare) programs. It also avoids the possibility of another government shutdown until at least Sept. 30 2020. (However, it’s hard to imagine anyone allowing a government shutdown a week before any election, let alone a Presidential election.)

In International news, China announced that next year it will reduce its tariffs on 144 new products (706 products were already in this program in 2019). This means a total of 850 products will be charged import tariffs below the WTO “most-favored-nation” tariff rates. Crucial to President Trump this will include Frozen Pork. However, it should be noted that we are talking only a 4% cut (from 12% to 8%). So, the impact on demand is unknown. However, it is another trade olive branch.

Monday’s major economic news is limited to Nov. Core Durable Goods (7:30 am) and Nov. New Home Sales (10 am). There are no significant earnings reports slated for the entire week.

Overnight, Asian markets were mixed but mostly green. In Europe, markets are also mixed at this point. As of 7:30 am, U.S. futures are pointing toward a quarter-percent gap higher at the open.

The bulls seem to have cleared a path for Santa to continue his rally into year-end. The Fed continues to quietly pump tens of billions of dollars of liquidity into markets daily through QE. Meanwhile, a Phase-one Trade Deal seems done, earnings are out of the way and markets are ignoring impeachment. So, at this point, it seems over-extension and the unknown are the only things to fear.

With that said, remember that volumes will be light this week as most traders take time off for the holidays. Continue to plan your trades, and trade your plans. Don’t chase (there will be another trade, I promise), keep taking profits along the way, move your stops to protect yourself and wait for the trade to come to you.

Sorry, but no Swing Trade Ideas this week. 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

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