Some nasty retail earnings and tough talk raise concerns about the so-called Phase 1 trade deal bring a needed pause in the bull run. Even bulls need a little rest from time to time, and this little pullback may prove to be very productive as long as the overall index trends hold. Better earnings results out from TGT and LOW have already recovered some the overnight losses in the futures market now suggesting a modest gap lower at the open.
Overnight Asian markets closed the day bearish across the
board on growing trade tensions. European markets are also reacting lower this morning,
seeing red across the board. US Futures
have lifted overnight lows but continue to point to modest declines ahead of
more impeachment hearings and the FOMC minutes due out at 2 PM Eastern today.
On the Calendar
On the hump day Earnings Calendar, we have more than 50
companies reporting today. Notable
reports include LOW, TGT, JACK, LB, LZB, NTES, and QIWI.
Action Plan
Yesterday’s gap up opens eventually turned into a pop and
drop pattern with the Dow closing the day with a bearish engulfing candle. However, the SPY and QQQ found enough buyers
by the end of the day, and the price action finished the day with just a little
rest from breaking daily records. It
would seem tensions between the US and China have once again flared with new tariffs
threatened as part of the rhetoric. Today
the impeachment show continues on the capital hill while the market waits for
the FOMC minutes at 2 PM Eastern.
Even with the slight bearishness of yesterday index trends
remain intact while the VIX continues to register little to no fear of in the market. Although the futures are under slight
pressure this morning, I see this pullback as nothing more than a rest so
far. Of course, that could quickly
change if the Phase 1 proposal falls apart, but my guess is that’s not likely at
least for now. We needed a little rest,
and as long as the overall trends hold, this pullback may well prove to be nothing
more than a pause in an otherwise very bullish trend. Futures point to modest gap down at the open,
but be very careful chasing the open down as many will see this as an opportunity
to buy. As always, wait for proof of
follow-through!
Markets gapped higher Tuesday (despite HD and KSS both missing and lowering Q4 forecasts). However, after the gap-up, the selling began immediately and took us to red territory across the board. However, a late-morning rebound rally recovered some of the losses. The rest of the day was a range-bound grind sideways that left the DIA (anchored by HD) printing a Bearish Engulfing candle, the SPY barely red and the QQQ printing a new all-time high close that was also a black-body Hanging Man candle. In addition, the rally may be showing more signs of being stretched as T2122 fell again (meaning we are maintaining all-time highs on fewer participating companies).
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It is worth noting that during his Tuesday Cabinet Meeting Photo Op, President Trump again threatened to raise tariffs on China (if they don’t make a deal). That made no impact on markets. This was the first time in a long time, a China Trade headline or rumor had no impact at all on markets. Impeachment Hearings, which dominated news all day, also seemed to have no impact on markets today. However, overnight the Senate passed the Hong Kong Democracy Bill (President Trump is expected to sign), which immediately drew China’s ire and spooked International Markets (on fear this would provoke more escalation in the Trade War).
Wednesday’s major economic news is limited to Oil Inventories (10:30 am) and the release of October FOMC Minutes (2 pm). However, since all Fed votes were made public and most Fed voters have spoken publicly since the FOMC Meeting, this too may be a non-event for markets. Major earnings before the bell today include LOW (which beat earnings, missed on revenue and raised guidance) and TGT (which posted had a huge beat on the top and bottom lines and also raised forecast for Q4.) In addition. Impeachment Hearings resume at 9 am.
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Overnight, Asian markets were flat to green. In Europe, markets are mixed, but mostly green at this point. As of 7:30 am, U.S. futures are pointing toward a gap higher of between 0.2% (DIA and SPY) and 0.4% (QQQ). However, HD also reported a sales miss and lowered its full-year guidance this morning. It may also be worth noting that the Hong Kong siege may be winding down with only 100 people still hold-up inside the surrounded University campus.
Once again, we have no scheduled news, all the important earnings already done before the bell, and Impeachment Hearings will likely control the news cycle during the day. However, since we’re in a Trade War, that front always has the potential for news. Nonetheless, it would not be surprising for markets to gap and then drift the remainder of the day. Unexpected news can always surface. Regardless, the bulls remain very resilient, only willing to hear good news for months now. So, don’t get caught over-reacting to a temporary shock. Continue to be cautious, take profits and move stops. Remember that a Trader’s job is to consistently make gains…not to hit the occasional home run.
Ed
Swing Trade Ideas for your watchlist and consideration. Long – DT, ALLE, ARNC, MGM, IPG, FEYE, PKG, GE, FITB, INTC, WFC, GS. Short – MYL, NI, FE, FANG, OXY, MCD, DG, CCEP. 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.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
While the bulls seemed to struggle to find inspiration in
the morning session, there was a constant and persistent push in the Dow futures,
which led the indexes throughout the entire day, ultimately setting new record
highs. Oddly, even so-called safe-haven sectors
are being swept up in this relentless bull run.
A rare thing to see, so enjoy it.
How long this can last is anyone’s guess, so don’t get caught up in the
emotion of will bullishness stay focused on price action, plan carefully, and
remember to take profits along the way!
While trouble in Hong Kong continues to get more violent
Asian markets managed to close mostly higher though China said yesterday they
were pessimistic about a trade deal. European
stocks joined the US markets in bullishness setting 4-year highs and are green
across the board this morning. US
futures pared gains slightly after HD missed on sales expectations but still
point to new record highs ahead of the Housing Starts number at 8:30 AM
Eastern.
On the Calendar
On today’s Earnings Calendar we have just over 60 companies
reporting. Notable reports include HD,
JKS, KSS, MDT, TJX, and URBN.
Action Plan
Pimco predicts the US and China will sign a Phase 1 trade
deal before Christmas causes the futures to leap higher. However, after HD missed on sales expectations,
futures have softened but continue to point to another record high open. Impeachment hearings resume this morning, and
according to reports, the President is considering the idea of testifying in
his own defense. Expect the political
drama to attract a good deal of attention, but it’s unclear if the bulls will waver
in their march higher even if the news is bad.
Although the markets seemed to lack momentum yesterday, the
constant push in the futures market finally broke the log jam setting new
record highs for the day. It’s
interesting to note value stocks and consumer defensive stocks are moving up in
concert with growth and high beta stocks, which is quite odd. Relentless bullishness seems to be the best
description of the current market, and it doesn’t seem to matter what their
buying just buy something. How long this
can last is anyone’s guess, but enjoy it because it’s not often such an event
occurs. As always keep your emotions in check,
stay focused on price remembering how quickly sentiment can shift.
The markets waffled and then drifted higher Monday on a lull in news. A late-day push by the bears was unable to stave off another all-time high close on the SPY, DIA, and QQQ…but barely. More troublingly, breadth dwindled again as T2122 fell back into the 50s while we printed those new all-time highs. This means fewer companies are participating in the rally. As we said in the room today, the rubber band is getting pretty stretched.
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The only “in day” news Monday was a meeting between President Trump and Fed Chair Powell. While such meetings have happened often in the past, never has a President continually belittled and berated the Fed before and certainly never calling the Fed Chair (he appointed) an “enemy of America.” The White House says the President made a case for negative rates, while Powell explained the current Fed policy. Regardless of the President’s temperament, both sides reported the meeting was cordial. Neither side claimed any changes were decided.
Tuesday’s major economic news is limited to Building Permits (8:30 am). However, there will be a Fed speaker at 9 am. Major earnings include HD (see below), KSS, MDT, TJX, and TDG all before the Open. In addition, Impeachment Hearings resume Tuesday with several people scheduled to testify.
Favorite Charting Software
Overnight, Asian markets were flat to green. In Europe, markets are mixed, but mostly green at this point. As of 7:30 am, U.S. futures are pointing toward a gap higher of between 0.2% (DIA and SPY) and 0.4% (QQQ). However, HD also reported a sales miss and lowered its full-year guidance this morning. It may also be worth noting that the Hong Kong siege may be winding down with only 100 people still hold-up inside the surrounded University campus.
With all the important earnings coming before the bell and Impeachment Hearings likely controlling the news cycle during the day, it would not be surprising for markets to gap and drift Tuesday. However, unexpected news (diversion?) from the Trade War with China can always surface. Either way, the bulls have really only wanted to hear good news for months now. So, don’t get caught over-reacting to a temporary shock. Continue to be cautious, take profits and move stops. Remember that a Trader’s job is to consistently make gains…not to hit the occasional home run.
Ed
Swing Trade Ideas for your watchlist and consideration. Long – ALLE, PSX, IFF, IPG, MGM, ITW, PCAR, PKG, LEG, GE, VLO, INTC, APH, NTRS, UTX, WFC, KSU, STI, MS, KR. Short – MCD, FE, CCEP, NI, MYL. 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.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
In a last-minute surge of bullishness, the Dow close 4 points over 28000 as new records in three of the four major indexes created history. The poor small-cap Russell continues to lag way behind, under-loved, and struggling with resistance. Positive news on the Phase 1 trade deal negotiations has the market once again gaping higher as the bulls continue to show no fear of heights. With Fed signaling a rate-cutting pause and earnings season, winding down the market may become more sensitive to trade developments and news out the impeachment hearings. Remember, big round numbers such as 28,000 will likely see a test as support in the not to distant future, so remain flexible and focused on price action.
Overnight Asian markets closed green across the board despite the increasingly violent protests in Hong Kong choosing to focus on US/China trade hopes. European markets are mostly flat and mostly lower this morning, taking a much more cautious approach to trade news. However, US Futures are tossing caution to the wind looking to extend Friday’s record-breaking rally with a Dow gap up open of more than 75 points. The possibility of a pop and drop exists, so consider your risk carefully if you chase the open.
On the Calendar
On the Monday Earnings Calendar, we just over 50 companies reporting results. Of the companies reporting, MANU is the only one that I see as particularly notable.
Action Plan
The big move Friday looks to have additional inspiration this morning after a report of a productive meeting on the Phase 1 trade deal. With the majority of earnings reports now behind us, we still have about 200 companies reporting this week. The majority of the notable reports will be in the retail sector, with HD kicking it off tomorrow morning. As Impeachment hearings enter their second-week traders will have to keep on eye on the news for possible market-moving reports spun-out of by the political drama.
On Friday, the Dow closed above 28,000 for the first time while the DIA lagged slightly behind at 279.84. Big round numbers can sometimes be a stumbling block for the market, but the SP-500 cut through 3100 like warm butter and the Nasdaq lept right though 8500 like it wasn’t even there. That in mind, be careful chasing the morning opening gap. Testing these big round numbers as support is not out of the question in the near future, so as always remain focused on price action for clues. With earnings winding down and the rate-cutting, Fed pausing inspiration may turn to the Phase 1 trade deal hopes and making the market very news sensitive.
The bulls ran roughshod Friday from a gap higher (on a Larry Kudlow report of a phase-one deal with China being nearly complete) to a push most of the day. During the late afternoon, President Trump announced Executive Orders forcing transparency in drug expenses. With bulls only wanting to hear good news, this was read as very bullish by insurers, hospitals and even drug makers (no downside was going to be recognized for anyone). So, at the end of the day the SPY, DIA, and QQQ had all achieved new all-time high closes.
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Monday has no major economic news. There will also be another break in Impeachment Hearings. In addition, there are also no major earnings reports. However, there were more violent clashes in Hong Kong with Police forcing entry into a University and being met by Molotov Cocktails and homemade arrows.
Overnight, Asian markets were mixed. In Europe, markets are also mixed with the FTSE and a couple of smaller burses in the green, while the DAX, CAC and most others are in the red at this point. As of 7:30 am, U.S. futures are pointing toward a gap higher of between 0.1% (SPY) and 0.3% (QQQ).
Favorite Charting Software
With no major news planned for the day, it is quite possible that the lull gives bulls the chance to push even higher. However, unexpected news from the Impeachment or Trade War with China front can always throw things one way or the there. Either way, the bulls have really only wanted to hear good news for months now. So, don’t get caught over-reacting to a temporary shock. Follow the trend, wait for an entry signal and above all, obey your rules! Be cautious and continue to take profits and move stops. Remember that a Trader’s job is to consistently make gains…not to hit the occasional home run.
Ed
Swing Trade Ideas for your consideration. Long – BHC, CXO, IPG, CDW, CAH, PM, K, PNR, PCAR, DOV, GE, AMP, CTXS, UTX, WFC, MS. Short – MOS, OHI, CINF, CHD, MCD, CTAS. 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.
🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.
🎯 DickCarp: the scanner paid for the year with HES-thank you
🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.
🎯 Bob S: LTA is incredible…. I use it … would not trade without it
🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade: PYPL, TGT, and ZS. Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.
🎯 Friday 6/21/19 (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.
Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.
DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it. Past performance does not guarantee future results. Terms of Service
