Heiken-Ashi Trap in LTA
Price Supports Hold
Although it was disappointing to see the bearish price action yesterday, the end of day rally indicated the bulls are still in control as price supports proved strong. Of course earnings will play a big role this morning; the majority of the attention of the market will likely turn to the big economic reports to find inspiration. We have had a very event-driven but with more than 1600 companies expected to report next week there will no time to take a break. Plan your risk into the weekend accordingly.
During the night, Asian markets close their trading week mixed but mostly higher after their government expressed long-term trade concerns. However, European markets see modest gains across the board this morning. US Futures are also showing bullishness this morning, pointing to a modest gap up ahead of the Employment Situation number and earnings results. Keep a close eye on the ISM Mfg. number at 10 AM Eastern as it may prove to be the biggest market-moving report of the day.
On the Calendar
We get a little break on the Friday Earnings Calendar with just over 100 companies reporting. Notable reports include ABBV, BABA, LNG, CVX, D, XOM, LYB, NWL, STX, X, and WPC.
Action Plan
Yesterday’s price action was disappointing after China’s unfavorable comments regarding trade. However, a late-day rally saved the index charts from technical damage, and the bulls remain in control. Although we have a significant day of earnings, the major focus will be in the Employment Situation report and the ISM MFG number that may prove to be the biggest market-moving numbers of the day.
As we head into the uncertainty of another weekend, remember to take some profits. Although we seem to have kicked the Phase 1 trade deal and Brexit down the road and have the FOMC behind us, we can’t become complacent in this very news-driven market. With all the major indexes holding support and well above their 50-day averages, I remain bullish though somewhat cautious as prices work to prove support. Remember, we have a very big week of earnings, with more than 1600 companies expected to report, so rest up this weekend the coming week will require us to be at our best.
Trade Wisely,
Doug
Jobs, Earnings and China
Despite strong earnings Wednesday night and premarket on Thursday, markets could not overcome bad news out of the Trade War. Reports out of China say they won’t budge on the major issues (subsidies to companies, industrial policy and Intel. Property), don’t trust President Trump to keep any deal and doubt any long-term agreement can be done while he is in office. Meanwhile, the White House says they still expect to sign the phase one agreement (just to not make things worse) on the same schedule as before the Chile Conference was canceled.
The net result was that the bears had control of the markets all day on Thursday. The four major indices ended up printing Hanging Man type candles. The good news is that all four also managed to climb back above Support by day end. Also, after the close Thursday, ANET, FTNT, QRVO, and WU all reported beats.
Friday’s economic calendar includes Oct. Nonfarm Payrolls (8:30 am) and ISM Mfg. PMI (10 am). There will also be several FOMC speakers in the afternoon (which will probably have no impact this quickly after the Fed Statment). However, earnings are still likely to be the driver with AIG, ABBV, BRKB, CBOE, CL, D, XOM, LYB, NWL, PCG, STX, SRE and CVX all among those reporting before the bell today.
Overnight, Asian markets were mixed. In Europe, markets are also mixed, but mostly green at this point. As of 7:30 am, U.S. futures were green, looking for about a one-third of a percent gap up.
China Trade fears remain front and center as of Thursday. However, earnings remain generally strong, with a few exceptions. Remember this is Friday (payday). So take some off the table where you can. Be cautious as there are many earnings still to go, likely more twists in the Trade War saga and two days ahead when you can do nothing about a report (or tweet) if you are long or short.
Ed
Normally, we have no trade ideas for Fridays. However, in honor of the Open House, here are some Swing-Trade Trade ideas for your consideration. Long – PM, PCAR, PNR, PKG, NEE, INTC, APH, INFO, TSM, PPG, BF.B, DE. Short – MLM, BA, IBM, DRI. 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?👈
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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.
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
Trading Economic Reports
Support and Resistance
Lower rates inspire the bulls.
Lower rates and strong earnings reports inspire the bulls to reach out to new record highs in the SPY. Not only that, but both the SPY and QQQ successfully tested and held the support level of the recent breakout. Well done, bulls! Unfortunately, trade war uncertainty once again raised its ugly head during the night, tempering the bullish sentiment as we head toward today’s open that chalked full of enough earnings and economic calendar events to keep everyone guessing, what comes next?
Asian markets closed mixed but mostly higher after reporting their 6th straight manufacturing decline. European markets see only red this morning with rising doubts about the trade war deal. US Futures have slightly improved this morning from overnight lows but continue to point to a modestly bearish open due to trade war concerns. With the Employment Situation and ISM number on Friday, we should not be surprised to see a choppy day of price action as we wait.
On the Calendar
The Thursday earnings calendar is a busy one, with nearly 340 companies expected to report results. Notable reports include MO, AMCX, AMT, ADM, CAR, AVP, BLL, APRN, BMY, CHD, CI, CLX, COR, DNKN, DD, EL, EXC, FCAU, FTNT, GLPI, HFC, IP, IRM, KHC, MELI, NNN, RMAX, SNY, SIRI, STOR, TRI, W, WU, WWE, XYL, and YETI.
Action Plan
We have and interesting set of circumstances facing the market this morning. A rate cut that the market wanted, good earnings reports yesterday, and another big day of them today, but the futures are reacting negatively to downbeat comments on trade from China. China was in the news for a second time last night, stating their manufacturing activity shrank for the 6th straight month due to trade war pressures. Congress is expected to vote today on the rules they will follow in the impeachment process, which is likely to be a distracting and firey side show of political gamesmanship.
Technically speaking, yesterdays price action turned out to be very bullish with the SPY and QQQ testing and proving to hold breakout support. Although the DIA still has a lot of work to do before it reaches new record highs, the bulls showed strength holding the downtrend breakout as support after a quick test. Trade war worries add another wrinkle in an already busy day full of earnings events and possible market-moving economic reports. If that’s not enough to keep the market guessing, remember, we still have the Employment Situation, and the ISM reports on Friday morning. Waiting on those could produce some choppy price action after the morning rush as we wait.
Trade Wisley,
Doug
Fed Gains, China Worries
Wednesday saw a Q3 GDP beat (1.9% vs 1.6% expected) and the Fed cutting rates a third time on the year, by a quarter percent (just as expected). Chairman Powell did indicate a “pause in easing” lay ahead but went on to say the FOMC would need to see “really significant” inflation indications to raise rates anytime in the foreseeable future. (Two Fed voters did dissent, believing rates should have been left unchanged.)
After a flat to mildly down morning, the Fed decision resulted in a rally. This left the SPY and DIA up about 0.3% and the QQQ up about half a percent on the day. All three indices managed to bounce up off support during the day. The QQQ printed a Bullish Harami, while the IWM printed what could be a Bearish Hanging Man signal. The SPY and DIA did not print a signal on Thursday.
On the downside, Chile canceled the APEC meeting where President Trump was to meet President Xi. As of now, there is no announced backup plan for signing the partial Trade Deal with China. Worse than that, Bloomberg reports this morning that “Chinese officials” have told Western visitors they will never budge on the major issues and they doubt any Long-Term Trade Deal is even possible with President Trump in place. Further, they urged Westerners to take word back to the U.S. that without additional tariff rollbacks by the US, more substantial negotiations beyond the partial “resuming 2017 grain purchase levels in return for no new tariffs” deal are not going to result in anything.
After the close, both AAPL, FB and KLAC all reported significant beats and saw corresponding rallies in post-market trading Wednesday. Meanwhile APA, CF and LNC all reported misses. It is also worth noting that TWTR announced it will no longer accept political ads, which may (or not) be a drag on their revenue since we are going into an election year. This is in direct contrast to FB’s announcement from earlier this week.
Overnight, Asian markets were mixed. In Europe, markets are red across the board with the exception of the FTSE (which is soaring on the hope of the UK Election changing the Brexit deadlock). As of 7:30 am, U.S. futures were mixed but flat.
The Thursday economic calendar is limited to lesser inflation reports and Jobless Claims (both at 8:30 am). However, earnings are still going full speed with MO, AMT, ADM, BWA, BMY, CHD, CI, CLX, DD, EL, EXC, HBI, HFC, IP, KHC, MAC, MPC, PH, and WAB among those reporting before the bell today.
Earnings remain generally strong, with a few notable exceptions. Between this, the happiness with the Fed action, and the current trend, the bulls definitely have the upper hand. However, be cautious as there are many earnings still to go and likely more twists and turns in the Trade War saga.
Ed
Swing-Trade Trade ideas for your consideration. Long – PM, PNR, PCAR, ARE, TSCO, NEE, INTC, APH, INFO, TSM, PPG, KHC. 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
Trading FOMC Events
Post-Trade Analysis
Deluge of Events
Today the market faces a literal deluge of events. Nearly 380 companies report earnings, including big tech market-movers like AAPL & FB after the bell today. At 8:30 AM Eastern, we get the latest reading on the GDP that the consensus estimate suggests will come in below 2 percent. Then at 2:00 PM, the FOMC rate decision that may excite or disappoint the market, creating significant price volatility. Swing and position traders will have tough decisions to make while quick and experienced day traders will likely have the upper hand. Anything is possible, so think carefully about how you approach the day.
Asian markets, with the uncertainty of the Fed rate decision, looming closed the day down across the board. European markets trade cautiously mixed but mostly lower this morning ahead of the big data dump. US Futures that were down most the night are now hovering near the flat line ahead of the deluge of events. There could be some excitement during the morning rush but don’t be surprised if the market action becomes light and choppy waiting on the FOMC decision. After that, it’s anyone guess!
On the Calendar
Today we have the biggest round of earnings reports so far this season with nearly 380 companies fessing up to their results. Notable earnings include AAPL, FB, AKS, AWK, APA, ARCC, ADP, BKR, EAT, BG, CME, CTCH, CROX, DIN, ETR, EWIX, ETSY, GRMN, GE, HCP, HES, H, LM, TREE, LYFT, MANT, MCK, MET, MGM, TAP, MYL, RCL, SPG, SNE, SO, S, SFM, STAG, SBUX, SU, SPWR, SKT, TDOC, TUP, TWLO, VIAV, WDC, WMB, WING, YUM, & ZNGA.
Action Plan
It’s always tough to know with to do on a day so chalked full of potentially market-moving events. First, we have our biggest day of earnings reports so far this quarter with just short of 380 reports. Both AAPL and FB report after the bell today, which means anything is possible Thursday morning, making it a difficult decision on the risk held overnight. Secondly, with a very big day on the economic calendar beginning with ADP numbers, the GDP report, Petroleum Status report, and then at 2:00 PM Eastern the FOMC decision on interest rates followed directly by the Chairman’s press conference.
Fed fund futures suggest a very high likelihood of a rate cut today, which of course, the market always loves. The big question to be answered is will the FOMC hint of more possible cuts in the future or disappoint the market, suggesting they finished. If so, might the market react negatively? It’s anybody’s guess! I would expect some volatility early in the morning session, but would not be at all surprised to see the market become very slow and choppy as we wait for the interest rate decision. Futures were slightly bearish overnight but have recovered to suggest a flat open at the time of writing this report. However, with so much data for the market to digest before the open, anything is possible, and we will have to stay on our toes and remain flexible.
Trade Wisely,
Doug
