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Shooting star candle patterns.

October 8, 2019 by Doug Campbell

With the indexes leaving behind shooting star candle patterns at price resistance levels yesterday seems to suggest that trader’s hopes of progress in the coming trade talks have diminished. Reports that Brexit talks could be failing is not helping as currencies fluctuate, and Oct. 31 deadline quickly approaches. Growing unrest between Turkey and Syria due to the Presidents decision to withdraw US Troops and increasing tensions between Iraq and Ecuador rising oil prices, it’s no wonder market prices continue to so volatile and extremely challenging to trade. It’s truly a day-traders market with all the unrest and news sensitivity and changes market direction in half a heartbeat.

Asian market rallied to close green across the board last night as China television banned NBA broadcasts over Hong Kong protest comments. European market are however decidedly bearish this morning as trade hopes sink and a no-deal Brexit grows. US Future points to a substantial gap down this morning as it faces so much uncertainty in the coming days.

On the Calendar

On the Earnings Calendar, we have 11 companies reporting quarterly results today. Notable reports include HELE, LEVI, and DPZ.

Action Plan

Reports this morning suggest Brexit talks are breaking down quickly hit the currency markets as the sterling fell in reaction. The President’s decision to bring US Troops home from Syria has drawn rebuke from his most staunch supports in Congress and increasing the likelihood that Turkey will invade Syria further destabilizing the region. Oil prices are on the rise this morning, with increasing tensions between Iraq and Ecuador escalate. Ahead of trade negotiations, the US dollar is pulling back, and gold is on the rise this morning, and the Chinese media suspends NBA broadcasts over comments supporting Hong Kong protests.

Top off all this unrest with tough talk from China and hopes of a productive outcome of this week’s talks seems to have greatly dimmed this morning. With the index charts testing price resistance levels yesterday and leaving behind bearish shooting star patterns, a pullback to is not a big surprise. However, the futures seem to be painting a grim picture this morning with a substantial gap down expected amidst all the swirling uncertainty. I continue to expect unruly and price action driven by the news reports that can chop a trader’s account to pieces.

Trade Wisely,

Doug

Bull Trap Being Sprung?

October 8, 2019 by Rick Saddler

Markets gapped lower Monday but rallied to close the gap and retest the 50sma and downtrend. The bad news for bulls is that all three major indices failed that test (or at least failed to pass it Monday). This leaves all four (SPY, DIA, QQQ, and IWM) in a potential Dreaded-h pattern in the making. So, the downtrend remains in effect and the key technical indicator for Tuesday. In spite of this, Defensive sectors were out of favor all day. Does this put us in a bull trap in progress?

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Overnight, Asian and European markets were all in the red. This is probably due to the U.S. blacklisting 28 entities in China (prohibiting them from buying anything made in America). This move was ostensibly made over Human Rights violations, but market analysts suspect it has more to do with adding Trade War pressure (or at least believe that is how China will interpret the move). Adding to the market fears are reports that the UK PM had a testy call with German Chancellor Merkel, making any new Brexit deal “overwhelmingly unlikely.” This, of course, raises the risk of a No Deal Brexit. As of 7:30 am, U.S. futures were also pointing to a significant (0.7%) gap down on the overnight news.

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On Tuesday PPI data (8:30 am) may impact markets, as inflation data may help inform FOMC action. Fed Chair Powell will also speak again in the afternoon. It’s worth noting that market expectations of an Oct. Fed rate cut have fallen slightly from >90% last week to 70% Monday.

The bottom line remains to be cautious. It is very hard to swing trade the recent markets successfully until we start getting less “gaps and whiplash” and more “trend and follow-through.” Be careful chasing after 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 – DD, TSN, QSR, LDOS, HEI, FSLR, WES, LSCC, RDUS Long – DOCU, VZ, EQR, PNW, SO, DUK, ES Trade smart, and trade your trade. Stocks we mention and talk about are not recommendations to buy or sell.

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🎯 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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Knocking on the door

October 7, 2019 by Doug Campbell

After a big short squeeze rally in reaction to the jobs number that suggested a 2020 recession is less likely but left the door open for more rate cuts, the US indexes are once again knocking on the door of price resistance. With trade talks set to resume this week and threatened tariff increases scheduled next week, traders should prepare for a news-sensitive market. As protests continue to disrupt Hong Kong and amidst impeachment proceedings, perhaps an interim agreement could be reached to at least delay future tariff increases by both countries, but I wouldn’t hold my breath in anticipation.

Last night Asian markets closed down across the board with all eye on the forthcoming trade talks. European markets are, however, cautiously bullish this morning ahead of trade talks and a rapidly approaching Brexit deadline. US Futures have rallied substantially off of overnight lows but continue to suggest a slightly lower open as uncertainty swirls and with significant technical resistance levels just above. With little on either the earnings and economic calendar for the market to react to, I would not be surprised to see a choppy price action today.

On the Calendar

On the Earnings Calendar we have just eight companies expected to report today, but none of them are particularly notable.

Action Plan

The Employment Situation report Friday was strong enough to ease concerns of a US recession in 2020 but not so strong that the market still believes in another rate cut is on the way. Combine that with a short-term oversold condition, and short squeeze trigger huge rally right back into price resistance levels. As the US and China prepare to resume trade talks this week, the news spin cycle it running at full speed likely to create will price swings as they speculate on the outcome. Many are hoping for at least an interim agreement to stop that would stop the possible tariff increases set to increase next week.

With the ongoing Hong Kong protests and impeachment proceedings, both countries have good reason to get this frustration behind them, but I would not expect either side to give in easily. Futures have rallied this morning off the overnight lows that had suggested a substantial gap down. With no notable earnings to react to and a very light economic calendar, expect the market to be very new sensitive with choppy price action. The indexes have substantial price resistance levels above to deal with, and after a 2-day rally of more than 800 Dow points, a little rest or consolidation would not be a big surprise as we wait for trade talks to resume.

Trade Wisley,

Doug.

Rebound Whipsaw

October 7, 2019 by Rick Saddler

On Friday, the bulls managed to put together the first consecutive up days of the prior two weeks. It was a strong effort with a gap up and morning follow-through. However, mid-day the market went dead for 2.5 hours before bulls stepped back in and rallied the market steadily right into the close. During the process, the SPY, DIA and QQQ all pushed through and closed just above their 50-sma. Of course, the IWM continues to lag and the downtrend of the last couple weeks remains intact across all major indices.

In news over the weekend, the impeachment story continues to dominate US news and violence flaring up at Hong Kong protests dominates the International news. On the calendar, Chair Powell speaks again Monday afternoon. However, Inflation data (Tues. and Thur.), JOLTS (unfilled jobs – Wed.) and the release of Sept. FOMC Minutes (Wed.) may be the key economic drivers of the week. That said, the most important event for the economy itself might be the resumption of US-China Trade talks on Thursday. There are very few major earnings announcements this week as earnings season really kicks off next week.

Overnight, Asian and European markets were in the green. As of 7:30 am, U.S. futures were pointing to a lower open, back down to retest the 50sma.

Friday’s chart action gives a probability of a higher high today. Yet, with a small gap down at the open, the bulls will have to retest the 50sma before they can rally. So, don’t get too bullish too early. Remember the bulls still have a lot of resistance levels to work through and the downtrend (which runs back to mid-September) is still the current market trend.

The bottom line remains to be cautious. It is very hard to swing trade the recent markets successfully until we start getting less “gaps and whiplash” and more “trend and follow-through.” So be careful chasing after one nice (or ugly) candle.

For Your Consideration: Here are a few tickers we will be adding to our swing trade watch-list. Short– TSN, HEI, BLL Long- PHM, AIZ, DUK, ETR, PG, PEP, STX. 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

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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The World is Watching!

October 4, 2019 by Doug Campbell

With the world is watching and inquiring minds wait in anticipation for the release of the Employment Situation number and how it will impact today’s open. Can it provide the bullish inspiration needed to follow-though on the hopeful bullish hammer patterns left behind yesterday, or will is disappoint adding fuel to the fire of a slowing US economy? How we end this trading week will greatly depend on this key metric and will shape how the market opens today.

Asian markets were mixed overnight as Hong Kong imposes emergency law as anti-China protests continue to disrupt the city. As of the writing of this report, European markets are mixed but mostly higher, but expect that also greatly fluctuate depending on the result of the US Employment numbers this morning. US Futures are currently pointing to a lower open, but that’s likely to change significantly after the 8:30 AM release of the Employment number. Buckle up; it could be a volatile end to a week of technically damaging and tumultuous price action.

On the Calendar

On Friday’s Earnings Calendar, we have just five companies reporting results today with none that would say are market-moving or particularly notable.

Action Plan

Our last notable earnings report for the week, COST, slightly beat on estimates but seems to have disappointed investors that were hoping for a strong showing for the quarter. Interestingly that single report seemed to influence the trading of the overnight futures. Protests continue to have damaging impacts on Hong Kong after the city declared emergency law last night. This morning’s total focus of the market focus on the Employment Situation number that comes out an hour before the market open. The consensus is expecting 145K jobs with a low range of 120k and upper range of 179k. Of course a surprise beat or miss of the key metric could have a profound impact on how the market opens today.

Yesterday the Dow briefly dipped below it’s 200-day moving average while the SPY and QQQ managed to bounce before reaching this key support. Unfortunately, the IWM is well below the 200-day average and will soon display the death-cross with the 50-day dipping below its 200-day. All the indexes experienced a nice bounce rally yesterday leaving behind hammer candle patterns seen as potential bullish. However, if price action is unable to follow through to the upside today the significance and hopefulness of the hammer pattern diminishes dramatically. Thus, there is a lot at stake for the Employment Situation report, and the world is watching.

Trade Wisely,

Doug

Rebound Whipsaw

October 4, 2019 by Rick Saddler

Yesterday saw some serious whipsaw, with a 10am free-fall on the extremely poor Non-Mfg. ISM number, followed by an immediate bounce-back. This rebound seems to be built on markets pricing in a 90% chance of further Fed rate cuts in the Oct. FOMC meeting. With that said, the bulls found their footing again late in the day and drove a rally right into the Close. In the process, the SPY and DIA both climbed back above the uptrend (of Lows) line running back into June.

This chart action gives us a high probability of a higher high on Friday. Markets may even try to fill the Thursday Open gap. However, nothing is guaranteed with markets unable to string together two consecutive up days for several weeks now. Needless to say, if we are going higher off yesterday’s strong recovery, the bulls still have A TON of work to do (and levels to work through) to even break the downtrend (of Highs, which runs back to mid-September).

Overnight Asian markets were mixed and European markets are mostly in the green so far. As of 7:30 am, US futures are pointing to a one to two- tenths gap lower.

Today’s economic news includes Durable Goods Orders and Nonfarm Payrolls and Unemployment before the open. These could very well be market-movers as a follow-up to the bad ISM data this week. (Of course, we don’t know if the market will be in a “bad news is bad news” or a “bad news means more helicopter money” mood. This will all be followed by half a dozen Fed speakers (including Chair Powell) during the day. On other fronts, Impeachment, Brexit and the Hong Kong protests (or counter-reaction) will undoubtedly dominate the news.

The bottom line is that it is very hard to swing trade these markets until we start getting less “gaps and whiplash” and more “trend and follow-through.” So be careful chasing after one nice (or ugly) candle. Remember that Friday is payday. So, be sure to book some profits in front of an unpredictable weekend of news.

Sorry there are no trade ideas today. We wish you a fantastic weekend.

✅ SMS text alerts and reminders?👈

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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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Punishing Selloff

October 3, 2019 by Doug Campbell

After a punishing selloff, the market will face an expected decline in Factory Orders and the ISM Services Sector report this morning the worry that the global slowdown has expanded into the US economy. Following a win where the WTO agreed with the Whitehouse, the President has scheduled 7.5 billion in European new tariffs on OCT. 18^th, opening a new front on the trade war and raising concerns of recession.

Asian markets closed mixed but mostly lower on the ramp-up of trade tensions in Europe. Across the pond, European markets also trade mixed as concerns about how the new tariffs will affect there already weakening economy. Currently, US Futures point to a modestly bullish open ahead of economic reports. Remember we have the Employment Situation report before the open Friday, so plan your risk carefully and don’t be surprised if the price action becomes stale and choppy as we wait.

On the Calendar

On the Thursday Earnings Calendar, we have 12 companies reporting results. Notable reports include STZ, COST, and ISCA.

Action Plan

Following an ugly 2-day selloff after a disappointing ISM Manufacturing report, we will get a reading on the service sector with the ISM Non-Mfg report at 10:00 AM eastern along with Factory Orders. The consensus is expecting only a small decline in the services number and an expectation that orders will slip negative that could raise fears of a spreading global slow down. After the World Trade Organization ruled that European government subsidies on aircraft is an unfair trade practice; they cleared the way for the US to impose new tariffs. The President has scheduled 7.5 billion in tariffs to increase on OCT 18^th widening the trade tensions and raising concerns of a US recession.

Technically speaking T2122 suggests a short-term oversold condition, but it will be interesting how the market responds to the opening of another trade war front in Europe. After two strong days of selling the Dow continues to hover above its 200-day average as does the QQQ and SPY. Unfortunately, any market relief rally must come under scrutiny as a possible lower high that may confirm the beginning of a market downtrend. Of course, with the Employment Situation number on Friday, 4^th quarter earnings just around the corner, and trade talks with China to resume soon traders will have to prepare for just about anything.

Trade Wisely,

Doug

Below Significant Support

October 3, 2019 by Rick Saddler

The market (SPY), Yesterday October 2^nd the sellers were able to bring the SPY down through significant support closing below our Dotted Duece (200FWL). The 200-FWL is where the SPY found support (buyers) rallied back in August 6.6% to challenge the July top. If tomorrow’s unemployment numbers are reasonable, we could see money flowing again in the marker. As for yesterday’s candle, we may see an oversold bounce, but ultimately the 200-SMA on the daily chart is the next target which will be the August lows. More weakness from the 200-SMA the sellers would have their eyes on the January lows or about $273.50

T-Line and T-Line Channels, The weekly chart price action has now brokedown through all the of the bullish trending T-Line Bands, more weakness below the Bands would require a more powerful reversal signal/pattern to be an essential reason for an optimistic outlook. On a side note, the T2122 chart has the T-Line deep into the oversold area on both the daily and weekly charts. The VXX chart is turning quite bullish after the consolidation on and above the T-Line Bands. Yesterday’s gap woke a ton of traders up! Take a look at you 4-hour chart with the bands…they have reversed to point upward. Be ready for anything.

The bottom line, With the market trending down and getting near the daily 200-SMA, we want to protect our short trades with stops or even taking a few profits. At the same time, we want to start building a bullish watchlist in case the bulls begin to get perky. If you did not catch the recent bearish run be careful not to chase do to ”FOMO” (Fear of missing out), you will get another chance.

Rick

Sorry there are no trade ideas today. We wish you a fantastic weekend.

✅ SMS text alerts and reminders?👈

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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.

Free YouTube Education • Subscription Plans • Private 2-Hour Coaching

A Nasty Whipsaw

October 2, 2019 by Doug Campbell

An unexpectedly poor manufacturing number quickly reversed early bullishness yesterday creating a nasty whipsaw and leaving behind some worrisome price patterns. The major indexes all dipped below their 50-day averages by the close as they each left behind bearish engulfing patterns in the process. Most troubling was the notable reversals in the financial, transport, and technical sectors. Technical failures in an already uncertain market will likely spark some fear in the market so prepare for higher volatility in the days ahead.

Overnight Asian markets closed in the red across the board in reaction to global slowdown fears. Market in Europe is also looking lower this morning as they wait for the Prime Minister to unveil a revised Brexit proposal for the UK. US Futures have bounced off of overnight lows but still point to substantial gap down this morning and a possible short-term oversold condition according to the T2122 indicator. Expect price action to be volatile, news sensitive and, challenging even for very experienced traders.

On the Calendar

On the Wednesday Earnings Calendar, we just 12 companies fessing up to quarterly results. Among the notable reports, today are BBBY, LEN, AYI, LW, and PAYX.

Action Plan

On the day after JNJ pays a large fine to settle their roll in the opioid crisis, traders might be looking for something to relieve the pain of yesterday’s selloff and the substantial gap down setting up this morning. By the close on Tuesday all the major indexes slipped below their 50-day moving averages leaving behind some worrisome technical damage in the charts. A surprisingly disappointing manufacturing number created an ugly whipsaw that left bearish engulfing candles all over the place yesterday.

Notable reversals in the financial sector and transports and the technical damage in the tech sector are particularly troubling. At the time of writing this report, US Futures have bounced off of their overnight lows but still suggest a gap down of nearly 150 Dow points at the open. According to the T2122 indicator this will create a short-term oversold condition so be careful not to chase bearish positions already well into their move lower. Remember this is a very emotional news-driven market, so plan your risk carefully and be willing to take profits quickly as they can be very fleeting in this environment.

Trade Wisely,

Doug

Bearish Oreo Cookie

October 2, 2019 by Rick Saddler

The market (SPY), Another lower low, Bearish Engulf, and a Bearish Oreo Cookie pattern. Yesterday was a particularly bad day for the market. The pre-market futures this morning don’t seem to be finished pushing the market either. As we have been posting, below $297.95 was the line that the bulls needed to capture, below $297.95 was chop and dangerous place to be buying to my longs, and closing below $293. 70 was going to bring in a bear storm. Right now I don’t see too much from stopping the bears sell us off to the $ 290.00, $288.80 area. We had bought some VXX yesterday with a possible move offer the $25.00 Line (so far so good. Over the $25,00 line, we possibly could see $26.40, which would be a SWEET PROFIT. And possible challenge the $28.00 range.

T-Line and T-Line Channels, Another day below the T-Line Bands (Channels), and a lower low. The August price action makes for a smooth trend line drawn. Looking at the premarket action price is already below the line, the bears (sellers) are a bit hangry. The VXX chart us pushing up through the T-Line Bands like butter and now have established a little support over the bands.

The bottom line, We should never rule out a monster bullish reversal on any given day, but until it happens the closing candle today and the recent candles (price action) can lead us to $288.80 then possibly the August lows. Managing your portfolio is far more critical than finding new hot trades to trade. Here is a good quote I heard years ago…”Don’t eat like a bird and poop like an elephant.

Rick

For Your Consideration: Here are a few tickers we will be adding to our swing trade watch-list. Short– TSN, RPM, COST Long- SBH, FIT, HOME- 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.

Free YouTube Education • Subscription Plans • Private 2-Hour Coaching