Pop and Chop

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Pop and Chop

I think the best description for the price action of late is Pop & Chop.  An exciting gap up market open followed by sheer boredom as uncertain bulls and bears milling about waiting for the next tidbit of news hoping for clarity.  The FOMC minutes provided no clarity, and now it looks like the best hope for inspiration is the Powell address at 10:00 AM Eastern from Jackson Hole.  I would not be at all surprised is we see more of the choppy price action today as we wait.

Asian markets closed mixed overnight as manufacturing data showed a decline putting pressure on the Nikkei.  Across the pond European indexes are seeing modest declines across the board in reaction to another US bond yield inversion.  Here in the US, futures also point to modestly bearish open ahead of morning earnings reports and the weekly Jobless Claims. 

On the Calendar

We have more than 50 companies reporting earnings this Thursday.  Among the notable reports are CRM, VMW, GPS, HPQ, INTU, ROST, DKS, FLWS & CM.

Action Plan

After great earnings results from LOW and TGT gaping the market higher at the open the price action once again went flat and chopped sideways the rest of the day.  The FOMC minutes release was a non-event providing no further clarity as to interest rate path forward.  Perhaps, Powell’s address in Jackson Hole Friday morning will provide enough inspiration the shake loose of the summer doldrums. 

Once again the US 10-year bond rates have slightly inverted with the 2-year bond rates, but the market seems to be taking it in stride this morning lifting off the overnight lows slightly while still pointing to a modestly bearish open.  However, that could easily change a earnings result roll in, and we get the latest reading on Jobless Claims.  Overhead resistance of price and moving-averages continues to challenge the index charts clearly defining the battlefield of the bulls and bears.  Although price action has been very challenging, let’s keep in mind the Dow is less than 5% below its record highs in July, which is a pretty mild correction at this point.  Nonetheless its have still been very frustrating, and I would expect more chop today amid so much uncertainty.

Trade Wisely,

Doug

Waiting on News

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Yesterday we sent a text alert for those owning ENPH that we were closing ENPH for a 30% profit because of the risk in the market. We felt 30% was a good base hit. Get for free text alerts

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Candlestick Patterns: To amateurs and unaware young traders, the fact that candlesticks play an essential role within the world of swing trading may seem absurd. How could candlesticks and the stock market possibly be related? However, the key lies within the shape of a candlestick, which resembles an ancient and reliable Japanese method of graphing stocks. Known as Japanese candlestick charts, these graphs are reliable and easy to read. They allow traders to visually detect selling pressure and buying pressure by studying informative candlestick patterns. Click for more Candlestick Information

The market (SPY) seems hesitant to go anywhere right now ahead of any news coming out of the Jackson Hole meeting. The SPY closed with yet another Doji very near the top of the current chart pattern. If the bulls run we will what to watch resistance starting at $295.50 to $295.70. A close below $290.85 could lead to a test of the August lows or the on of out 200 period moving averages.

The I path Series S&P 500 VXX Short Term Futures ETN. The VXX closed down on the 50-SMA period moving average. Below $25.30 sets up a lower move for the VXX and above $25.30 sets up a higher step $26.30 or higher.

😊 Have a great trading day – Rick

✅ Check out our newest YouTube videos👈

Trade-Ideas

✅ For your consideration: Here are a few charts I thought should go on the watch-List, remember to trade your trade. AKAM, NVRO, TRHC, MSI, TSN, TXN, MCD, MSFT, COST, QCOM. Trade smart and wait for the QEP→ (QEP) Quality Entry Patterns). These Trade ideas are not recomendations.

$50.00 discount with code: Privilege

🎯 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

Challenging

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Challenging

August is traditionally a very challenging month for the market, and so far, AUG19 has certainly lived up to its reputation.  Erratic even violent price swings with big overnight gaps have tortured traders trying to make some sense of the uncertainty.  Today, markets are hopeful the FOMC minutes will provide some clues as to the thinking of the committee and their next possible rate decision.  What we know now is there were three dissenting votes for the rate cut we received last month.  The question is, what has changed?  Perhaps, we will not get any clarity until Powell speaks in Jackson Hole Friday morning.

Asian markets were mixed and mostly flat overnight as they also wait for central bank guidance.  European seem much more confident this morning solid bullish price action and green across the board.  US Futures are also pointing to a bullish open in response to strong earnings results from LOW and TGT this morning.  Be careful not to chase the opening gap keeping in mind we could easily slip back into consolidation as we wait for the 2:00 PM minutes release.

On the Calendar


On the Wednesday Earnings Calendar, we have just short of 40 companies reporting.  Notable reports include LOW, TGT, JWM, SMAR, SNPS & ADI.

Action Plan

After two days of very choppy price action, the market today is hopeful it can find some clarity as to the thinking fo the FOMC with the release of last months minutes at 2:00 PM Eastern today.  Positive early morning earnings result from LOW, and TGT has the early morning futures pushing higher to once again challenge price resistance in the index charts.  President Trump is discussing payroll tax reductions and is pushing with all his might attempting to pressure the FOMC into a 100 basis point rate cut this month to avoid recession fears.

We will also have to keep an eye on the Existing Home Sales number at 10:00 AM Eastern this morning.  The consensus expects housing sales to increase, but this is a potential market-moving report, particularly if the actual results miss estimates.  After the morning rush gap, I would not be at all surprised to see the market slip back into consolidation as we wait for the 2:00 PM minutes release.  After the release expect an explosion of volatility so be prepared for about anything to occur.

Trade Wisely,

Doug

Candlestick Trading Signals Builds a Path

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Picture a candlestick: the solid body of the candle, the thin wick above, the shadow below, and (of course) the lovely and fragrant ambiance it creates. From this image, swing traders have created a technique known as Japanese candlesticks.

As you might have guessed, this charting method originated in Japan. The body (also called “the real body”) of the metaphorical candle represents the open and close range, and the body is either filled black (for a close under the open) or left hollow and white (for a close over the open). The thin lines protruding from the top and bottom of the body are known as shadows (or sometimes, “wicks” and “tails”). The top shadow represents the session high, and the bottom shadow represents the session low. To continue reading more on Candlestick Signals please click here

After Monday’s Doji at the 34-EMA and near the 50-SMA yesterday the sellers felt they could push the SPY down, and they did, this morning the futures are up, and the buyers are trying to regain the 34-EMA and 50-SMA ( the battle is on) looking at the SPY between the 50-SMA, and the 200-SMA is a slugfest between traders and the buyers and sellers. A breakout in the next few days above the 50-SMA would give us a bullish “W” pattern. A close below the Dotted deuce would be a failed attempt of breaking out of the 50-SMA, and the August lows may get tested. To continue reading more on Candlestick Signals please click here

The I path Series B S&P 500 VXX Short Term Futures ETN.  Closed with a little Doji on the 34-EMA and what seems to be a little support. A close over $27.00 would spice up a VXX trade and cause the market to give way to a few sellers. Continued weakness on the VXX would suggest the Buyers are getting ready to challenge the 50-SMA.

😊 Have a great trading day – Rick

✅ Check out our newest YouTube videos👈

Trade-Ideas

✅ For your consideration: Here are a few charts I thought should go on the watch-List, remember to trade your trade. GTHX, SHOP, NVRO, TWTR, NWL, TTWO, TSN, TRHC, MCD, STMP, . Trade smart and wait for the QEP→ (QEP) Quality Entry Patterns). We are currently long, CVS, and WDC. These Trtrade ideas are not recomendations.

$50.00 discount with code: Privilege

🎯 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

Searching for Clarity

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Searching for Clarity

Yesterday’s huge morning gap failed to find follow-through buyers as volatility weary traders choose to sit on their hands searching for clarity to the big issues clouding the path forward.  While we could hear of new developments in the trade war at anytime resolution of its uncertainty is likely weeks if months away.  Fed Chairman Powell may provide some clarity on the FOMC’s thoughts on interest rates when he speaks on Friday, but until then the market will stay focused on fluctuating bond rates, earnings, and economic reports to try and find inspiration.

Asian markets traded flat but mostly lower as China set new loan prime rates in an attempt to stimulate economic growth.  This morning European markets are trading cautiously and mostly flat as recession fears continue to linger.  US Futures also point to a flat but slightly lower open this morning as we wait and search for clarity.  What comes next is anyone’s guess.

On the Calendar

On the Tuesday Earnings Calendar, we have less than 50 companies reporting today.  Notable reports include CREE, TOL, URBN, HD, KSS, MDT, and TJX. 

Action Plan

With markets responding to improving bond rates, the market gapped strongly higher yesterday but failed to find follow-through buyers as the market chopped sideways the rest of the day.  Traders are finding it difficult to trust the recent price action with so much uncertainty clouding the path forward.  Perhaps yesterday’s price action was a prelude to a resting consolidation relieving some of the intense volatility of late as we wait for clarity.

Technically the indexes remain in a downtrend with price challenged by overhead resistance as well as moving average resistance.  Unfortunately, we are unlikely to get much clarity this week in the trade war, but perhaps the Fed Chairman will help clarify the FOMC’s next move when he speaks on Friday.  With earnings season winding down the market will turn to economic reports to try and find inspiration and will likely continue to be very sensitive to the political spin as it searches for answers.  Choppy consolidating price action, though very boring, maybe just what we need calm the nerves of traders after a will couple weeks of trading.

Trade Wisley,

Doug

SPY Found Resistance With A Doji

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FOCUS: Stocks/Options Monday 8/20/19; Although we’ve discussed Dragonfly and Gravestone doji in the past, we never got around to explaining the simplest of all candlestick patterns: the basic doji, sometimes referred to as a “Doji Star.” Resembling a plus sign or a cross, the doji candlestick pattern is formed of just one candlestick, and it is incredibly common. Although there are several different types of doji (such as the Gravestone, the Dragonfly, and the Long-Legged), which we will describe briefly, today we’re focusing on the classic, original doji. To learn how to identify this informative candlestick pattern and interpret its presence, to read more on the Doji Click Here

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The SPY gapped yesterday found resistance at the 34-EMA and just under then 50-SMA closing with a Doji very near the bearish downtrend line. A bullish breakout in the next few days would give us a bullish “W” pattern. A close below the Dotted deuce would be a failed attempt of breaking out of the 50-SMA, and the August lows may get tested. We saw a ton of profits pulled out yesterday from the members of Hit and Run Candlesticks, WTG!!!!.

The I path Series B S&P 500 VXX Short Term Futures ETN  saw weakness yesterday closing on the 34-EMA and near the 5-SMA. Pre-market the VXX is up, a run and a close above $26.35 would be trouble for the market, and a race to the $27.45 area would put a great deal of pressure on the market.

😊 Have a great trading day – Rick

✅ Check out our newest YouTube videos👈

Trade-Ideas

✅ For your consideration: Here are a few charts I thought should go on the watch-List, remember to trade your trade. WDC, AGO, TWTR, AJRD, CVS, KR, AGI, AEM. Trade smart and wait for the QEP→ (QEP) Quality Entry Patterns). We are currently long, CVS, and WDC. These Trtrade ideas are not recomendations.

$50.00 discount with code: Privilege

🎯 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

Difficult Decisions

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Difficult Decisions

With bond yields bouncing and the market suggesting a huge gap up, open traders face difficult decisions this morning.  If the current futures bullishness holds the DIA, SPY, QQQ, and IWM will gap directly into the price and moving average resistance.  Do you trust price action enough to risk your capital and hoping for follow-through buying or even a short squeeze to be triggered?  Do you wait to see if this is a bull trap with the bears ready to defend resistance creating pop and drop pattern?  Or could the morning gap get no follow-through commitment from the bulls or bears and we to consolidate the big gap the rest of the day?

Whatever you decide given the wild volatility we have experienced the last couple of weeks, it will require considerable skills to navigate the price action successfully.  Before leaping ask yourself these questions.  Are you following your rules? What is your plan if your wrong? Do you have and edge or are you just gambling your hard-earned money?  Do your skills match the current market condition?  There are no easy answers in a market full of news-driven uncertainty and emotion.  There are only difficult decisions to make with such high volatility.  What will you decide? 

On the Calendar

On the Earnings Calendar, we have nearly 60 companies reporting on Monday.  Notable earnings include WB, EL, & BIDU.

Action Plan

The relief rally that began last Thursday afternoon is betting a big boost of energy this morning as bond yields bounce and inversion fears subside.  Unfortunately, with the Dow currently pointing to a gap of more than 200 points, retail traders have a tough decision to make.  A big pop like this can certainly trigger a short squeeze, but it can also create a nasty pop and drop if it finds no followthrough buyers.  Indeed a difficult decision with such high price volatility that has proven to punish both bulls and bears with news-driven reversals.

Even with the big gap up this morning the DIA, SPY, QQQ & IWM will still be under the Price resistance of the last high and their respective 50-day moving averages.  If the big morning gap holds throughout the morning, the T2122 will likely signal a short-term overbought condition at the open.  Make no mistake that does not mean immediate bearishness will resume, but it does suggest caution and that we should avoid chasing with the fear of missing out.  Buyers could follow-through to squeezing out short traders, bears could be ready to defend the resistance levels creating a pop and drop pattern, or we might gap with no commitment from bulls or bears consolidating the rest of the day.  Your difficult decision awaits.

Trade Wisely,

Doug

Friday’s Morning Star

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FOCUS: Stocks/Options Monday 8/16/19,19; If you’ve ever wished upon a star, I hope that that star was a Morning Star candlestick pattern. Unlike the Evening Star, an omen that hints at bad things to come (i.e., low stock prices), the Morning Star is a sign of good fortune. If you spot this bullish reversal signal, which is composed of three candles, you can expect stock prices to increase. Although the bears have been in control, the bulls are ready and able to take over. To learn how to spot the Morning Star signal, how to decipher its characteristics, and how to interpret its meaning, Click to read more

✅ SMS text alerts and reminders?👈

The SPY, DIA, IWM are all set to open higher, follow-through is required for a successful bullish close. Friday’s Bullish morning Star is seeing follow-through at the open this morning also after Thursdays double bottom. The bulls need to challenge and win ($294.10), Above ($294.10) would set up a bullish “W” pattern and likely start a challenge of the August highs. A close below ($282.40) would probably see a June low test.

The VIX-X CBOE Market Volatility Index needs to be below ($21.25) for the SPY or market to rally. Yesterday’s long wick Shooting Star type candle might get us to ($20.00). Overall the VIX charts are bullish, maintain a cautious stance on the market.

😊 Have a great trading day – Rick

✅ Check out our newest YouTube videos👈

Trade-Ideas

✅ For your consideration: Here are a few charts I thought should go on the watch-List, remember to trade your trade. CBB, STMP, ENPH, COOP, NVCR, CORT, CVS, SHOP, T, SBUX, MCD.Trade smart and wait for the QEP→ (QEP) Quality Entry Patterns). We are currently long, CVS, and SBUX. These Trtrade ideas are not recomendations.

$50.00 discount with code: Privilege

🎯 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

Very few answers.

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Very few answers

Lots of questions with very few answers created a very frustrating day of price action on Thursday.  As bond yields finally began to moderate late afternoon, the market picked a direction and provided a least a modest relief rally into the close.  A good round of earnings reports after the bell and a bit of bond market stabilization during the night lifted spirits around the world.  The big question for traders this morning, can we trust this mornings bullishness amidst all the volatility enough to add risk heading into the weekend still full of uncertainty?

Overnight Asian market closed modestly bullish across the board as bond yield slightly improved.  European markets are moving higher this morning after a technical issue delayed the open in the UK.  US Futures are solidly bullish this morning with the Dow pointing to a gap up of more than 200 points.  Be careful not to chase the open in-case this wildly volatile decides to pop and drop.  Also, consider carefully the amount of risk your willing to carry into the weekend.

On the Calendar

We get a little break on the Friday Earnings Calendar with just 68 companies reporting earnings today with DE as the most notable.

Action Plan

Will, there be real progress on trade negotiations or not?  Will the FOMC reduce the rates or not?  Will, the Bond Rates, invert and remain inverted or not?   Will China send troops into Hong Kong to put down the protests or not?  Will the global economic slow down effect the US economy or not?  That uncertainty created another very volatile session on Thursday, and until we get some clarity is likely to continue to create very difficult price action for traders to navigate.

Yesterday T2122 signaled an oversold condition, but with so much uncertainty the market struggled until late afternoon when it finally managed to put together a little relief rally.  A round of good earnings reports after the bell also lifted spirits, and treasury yields somewhat stabilizing during the night has futures pointing to a significant gap up this Friday morning.  The question is, can we trust it, or could it produce a pop and drop pattern or even worse another lower high within the downtrend? Secondly, how much risk will traders be willing to hold into an uncertain weekend?  Nonetheless, any relief rally is a welcome sight after a week of heavy selling. 

Trade Wisely,

Doug