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Hoping for a Trade Deal

October 11, 2019 by Rick Saddler

Markets had a strong day Thursday, almost exclusively on “hope” of a partial trade deal between the US and China. The indices closed up two-thirds of a percent, right at the 50sma in the SPY and DIA. Still, both the SPY and IWM both failed the downtrend line and that trend remains intact in all (arguably) indices except the QQQ (which broke through on Thursday).

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Friday’s economic calendar includes the Michigan Consumer Sentiment survey at 10 am. However, given all the focus for months on the Trade War, the big market mover will be the rumors, announcements, and spin placed on the meeting between President Trump and the Chinese Vice Premier. Also keep an eye on Oil markets as Iran claims one of their tankers in the Red Sea was struck by 2 missles last night. The only earnings of note is for FAST before the bell.

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Overnight, Asian and European markets were up strongly (apparently also on Trump’s tweet that trade negotiations were going “very, very well”). And as of 7:30 am, U.S. futures are all pointing to a large gap higher (about 1.25% across the board) on that optimism for a Friday trade deal.

The bottom line remains that it is very hard to swing trade in the recent markets successfully. Day or Position trading look much better in this sort of volatile and choppy market. Until we start getting less “gaps and whiplash” and more “trend and follow-through” be very cautious. Do not confuse one candle as trading wisdom…or a new trend. That all said, downtrend remains in control for now.

For Your Consideration: No trade ideas for Friday. Remember to lock-in profits while you can, and hedge your risks for the weekend when you can’t react to news and rumors. Trade smart, and trade your trade. 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

🎯 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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Trading EMAs

October 10, 2019 by Ed Carter

Emotionally Charged

October 10, 2019 by Doug Campbell

During the evening and night, we saw just how sensitive to news reports and how emotionally charged the market has become over China’s trade developments. While the markets seem to hold on the notion of a partial deal coming together in the high-level talks, reports suggest the 2-day meeting may have shortened to just today. Stay tuned, stay focused, and stay very directionally flexible as each new report could substantially move the market violently. Plan your risk carefully.

Asian markets recovered early losses by the close of the day on conflicting reports regarding trade. European markets are trade cautiously mixed as negotiations resume in Washington DC. US Futures recovered from steep losses during the evening and indicated just how quickly market sentiment could shift as news on progress or non-progress of the negotiations rolls out. Remember, an October tariff increase to 30% will happen unless something changes with the US/China relationship.

On the Calendar

On the Thursday Earnings Calendar, we have our biggest day of reports this week, with 25 companies fessing up to results. However, there is only one DAL, which is reporting before the opening bell that’s notable.

Action Plan

Conflicting news reports created a wild night of price action that saw futures collapse more than 200 points but recovered to near falt this morning. That’s a clue to just how emotionally charged and sensitive the market has become over any news on the high-level talks today. It sounds as if the China negotiations may start and end today rather than the planned 2-day schedule. What we know as of now is that tariffs on 250 billion dollars of Chinese products will increase from 25% to 30% on October 15^th.

Traders should prepare for the possibility of very violent price moves as news comes out concerning the progress of the talks. Technically, speaking the indexes are at a critical crossroads, with prices hanging just below declining 50-day moving averages and substantial price resistance just above. With such unstable price moves, this can become a day-traders market due to will price action fluctuation and the overnight reversal risks. Carefully plan your risk and remain very directionally flexible as we wait for news on trade negotiation developments throughout the day.

Trade Wisely,

Doug

Waiting on an Elusive Deal

October 10, 2019 by Rick Saddler

Markets gapped higher Wednesday on anonymous reports the Chinese are open to a partial trade deal – grain purchases for tariff suspension. While the gap was impressive, the day ended as nothing but a Doji (indecisive), if up almost 1% on the S&P and QQQ. So, the downtrend remains in place and taken together, the last two days are just more of the sideways chop at the level of the large gap down Open Tuesday.

On today’s economic calendar we see Consumer Inflation at 8:30am. However, the big news is the resumption of US-China Trade talks. Unfortunately, overnight the Chinese media was reporting “trade talks have made no progress” and “high-level talks will only last one day” (instead of two as was planned).

Overnight, Asian and European markets were all mixed (on dueling rumors and expectations about the now-shortened trade meeting). And as of 7:30 am, U.S. futures were all pointing to a small open lower (about 0.2 – 0.3%) on the overnight news of trade deal failings.

For Your Consideration: Here are a few tickers we will be adding to our swing trade watch-list. Short – FSLR, WES, LSCC, LDOS, RDUS, KLAC, EL Long – DOCU, CX, EQR, SYY, AMH, ES, COST, CYH Trade smart, and trade your trade. 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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Single Candle Signals

October 9, 2019 by Ed Carter

Tough Talk

October 9, 2019 by Doug Campbell

The markets gap down and run south as tough talk between US and China dims the chances of a trade deal Tuesday. However, Wednesday morning, an unnamed official says China is willing to make a partial deal, but unwilling budge on any of the core issues and, the market gaps up as this ridiculous price whip continues to chop trader’s account to pieces. Before you jump into this morning’s gap keep in mind the indexes continue to show current downtrend with 50-day averages in decline. Fool me twice, shame on me!

Asian markets closed mixed and mostly lower on the uncertainty of trade talks that begin on Thursday. Responding to the Bloomberg report and hopefulness of a partial trade deal European markets are higher across the board this morning. US Futures rose sharply after the 6 AM news story and indicate the Dow will gap up between 150 and 200 points at the open as we wait for the release of the FOMC minutes later today.

On the Calendar

On the hump day Earnings Calendar, we have just eight companies reporting their results today, but none are market-moving or particularly notable.

Action Plan

At 6 AM, Bloomberg reported that an unnamed official close to trade negotiations that China is willing to make a partial deal. The news quickly spiked the Dow Futures higher at one point, suggesting a 200 point gain at the open. Apparently, China is willing to commit to purchasing of farm products if the US stops tariff increases. However, they are unwilling to budge on any of the major sticking points. The President, in the past, said tariffs are to increase on OCT.15^th if no progress is made on a bilateral deal. I guess the good news is that at least today’s gap is to the upside! Trade negotiations begin this Thursday, stay tuned for future gaps and whips in price.

According to reports, Turkey is about ready to invade Syria, as US troops pull back as the President attempts to fulfill a campaign promise to bring our troops home. The UN has reported they are in a desperate financial situation and may not be able to pay staff by November because so many countries have failed to pay their dues, making their peacekeeping operations impossible. Technically, speaking the indexes are in a current downtrend with declining 50-day averages amidst so much swirling uncertainty. Be careful not to chase this morning’s gap, and remember we have the FOMC minutes release at 2:00 PM Eastern this afternoon.

Trade Wisely,

Doug

Dueling Rumors and Spin

October 9, 2019 by Rick Saddler

Markets gapped lower again Tuesday, attempted to rally again (on Fed Chair Powell’s afternoon statement that he sees the Fed balance sheet expanding again soon), but then sold off hard the last hour of the day, closing near the lows. So, the Dreaded-h pattern is now near breakout in all major indices.

Overnight, Asian markets were on the red side of flat, but European markets are all strongly in the green. As of 7:30 am, U.S. futures were pointing to a large gap up (about 1%) on overnight reports that China is open to a partial trade deal. (Just bear in mind the market whip on these same rumors the last few days that were always countered with a rumor in the opposite direction…and China has promised a counter move to the most recent U.S. blacklist / Visa sanctions.)

On today’s economic calendar we see JOLTS at 10am, Oil Inventories at 10:30, Chair Powell speaks again at 11am and the Sept. FOMC minutes come out at 2pm. Also, the Impeachment news cycle will surely keep churning and beware of that Chinese retaliation for the blacklist and putting restrictions on Chinese officials and executive’s travel visas. Finally, Turkey continues to move troops right to the border of Syria. So, news of that situation may also drive markets.

The bottom line remains to be cautious, very quick in your trading time horizon or both. Gaps and whiplash are not good conditions for swing trading. So, be careful chasing one nice (or ugly) candle. However, the downtrend remains in control for now.

For Your Consideration: Here are a few tickers we will be adding to our swing trade watch-list. Short – TSN, LSCC, SYF, LDOS, KLAC, MDT, EL Long – DOCU, UDR, EQR, CYH, KBH, AMH, CX, DHI Trade smart, and trade your trade. 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.