Pop and Drop

September 11, 2018 by Doug Campbell

Pop and Drop

After gaping up nearly 90 points yesterday, the Dow found the only sellers and delivering the classic pop and drop whipsaw. Leaving behind a bearish engulfing candle on the DIA suggest a lower print today but the fact the index continues to hold about a key support continues to give the Bulls a slight edge. On the other hand, the NASDAQ appears to be the most vulnerable as it lingers below a key resistance level.

Yesterday I cautioned about chasing a gap caught up with the fear-of-missing-out. The same caution holds true today. It is just as wrong to chase a gap down as it is to chase a gap up. Fool me once shame on you, fool me twice shame on me! Emotional undisciplined trading is the pitfall for the majority of retail traders. Don’t play that game and watch your account continue to be chopped up. Today after the gap down wait and watch for follow-through because there is just as much chance of whipsaw up near support as there was for the pop and drop yesterday.

On the Calendar

Today’s Economic Calendar kicks off early today, but there is only one potential market-moving report. We begin with the NFIB Small Business Optimism Index @ 6:00 AM then the Redbook at 8:55 AM. The JOLTS report at 10:00 AM expects job openings to increase slightly to 6.670 million in July vs. 6.662 million in June continuing the trend of strong demand for labor. Wholesale Trade is also @ 10:00 AM and we have three Bond Auctions between 11:30 AM and 1:00 PM to finish the Calendar day.

On the Earnings Calendar today we have just ten companies reporting results, and none of them are particularly noteworthy. Make sure to keep checking because being surprised by an earnings report can prove to be a costly mistake!

Action Plan

Yesterday I cautioned about chase the morning gap and getting caught up with the fear of missing out. The DIA found only sellers after gapping up nearly 90 points with the classic pop and drop whipsaw leaving behind a bearish engulfing candle. The SPY and IWM faired better closing down on the day but continued to hold above Friday’s low prints while the QQQ stalled below resistance. Currently, the Dow Futures are suggesting a gap down of equal magnitude of yesterdays gap up.

The good news is that the DIA, SPY, and IWM remain above key supports that could be defended by the bulls. The QQQ’s appear to be the most vulnerable to a bear attack currently under price resistance. If selling pressure continues after the market, open clues to future selling might manifest in the QQQ’s first. Remember the Bulls will not likely give up easily so watch for a potential whipsaw back up at or near support levels. It is just as wrong to get caught up, chasing a gap down as it is to chase a gap up.

Trade Wisley,

Doug

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Finding Balance with Position Trading

September 10, 2018 by Doug Campbell

[img_text_aside style=”1″ image=”http://hitandruncandlesticks.com/wp-content/uploads/2018/09/Position-trading-thumbnail.jpg” image_alignment=”right” headline=”” alignment=”center”]This E-Learning session is all about Position Trading and longer term holds. How to find them, trade them and bring balance to your overall portfolio.

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Cradle Pattern Equals Cup/Handle Pattern YEXT bullish over $27.30 • Stop about $26.40

September 10, 2018 by Rick Saddler

Cradle Pattern Equals Cup/Handle Pattern

YEXT daily chart is presenting us with a Bullish Cradle Pattern which is a Cup and Handle Pattern on a faster time frame. YEXT has been hot and trending in a T-Line Run, then about a week ago the profit takers stepped in and caused an Evening Star that led to a pullback below the T-Line. Price action has was in a state of indecision for four candles, the Buyers came back Friday and tested the Evening star high. And a pattern is formed, it is very important the bulls breakout of the Evening Star high and prove support. Two opposing forces are at play in chart patterns. We are bullish YEXT over $27.30 with a protective stop about $26.40

Past performance is not indicative of future returns

Good Trading, Rick, and Trading Team

Road To Wealth August 2018 statement has bee posted Monthly Trading Results updated the first week of each month.

What’s on Rick’s watchlist today? New brokerage statement says 258% increase.

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SPY

The weekend is over without major political jiber Jaber, and this morning the buyers are trying to sneak through the T-Line (8-EMA Moving average) 7:15 AM on the daily chart. Friday gave us six days with lower highs and lower lows and an Inverted Hammer on the 20-SMA. The Inverted Hamer indicates the sellers hit the road running right out of the gate; then the buyers fought back closing off the lows. I have found the Inverted Hammer after a trend down suggest the buyers are fighting back and trying to turn the trend around. It is very important that confirmation is visible in the next few days. Price action on the 3-day chart shows that the T-Line (8-EMA) has caught a 3-day low and has held price within the breakout candle four candles ago.

****VXX – The VXX chart was pretty active last week running up to the 50-SMA but closing under keeping the trend reversal at bay. The bullish construction of VXX is still troublesome and needs to be watched.

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This is not your usual service that sends out a ton of stock recommendations, and then cherry picks the winners to show you how great they are. Hit and Run Candlesticks and Right Way Options are truly educational services. They taught me how to trade not what to trade. The entire team: Rick, Doug, Steve, and Ed are there to help and answer your questions. They are awesome. They cut years off my learning curve. And it’s a team effort. Everyone in the room (all the members) are there to help with invaluable insights and advice. The only service you will ever need. Thanks to all the team for how you have helped me and for all you do. –Jonathan Bolnick

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Past performance is not indicative of future returns

Investing and Trading involve significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, Right Way Option, Trader Vision 2020, Top Gun Futures or Rick Saddler, Doug Campbell, Ed Carter, Steve Risner is to be considered financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.

Rick Saddler, Doug Campbell, Ed Carter, Steve Risner is not a licensed financial adviser nor do they offer trade recommendations or advice to anyone.

No Fear

September 10, 2018 by Doug Campbell

No Fear

Even in the face of 276 billion in possible China tariffs, the Bulls are showing no fear this morning with the Futures suggesting a substantial gap up at the open. The DIA, SPY, and IWM having held key levels of price support last week look ready to for another leg higher. The QQQ’s still has some work to do to reclaim a key support but the current bullish would suggest that is certainly possible.

Although the market is putting on a brave face this morning, keep in mind that the bullish sentiment could quickly shift if the tariffs become a reality. If the market doesn’t care then why wouldn’t the president move forward with them? Plan your risk accordingly. Keep in mind whipsaw price action is possible near market highs so be careful not to chase with the fear of missing out. Remember low-risk entries occur at or near price support not at or near price resistance.

On the Calendar

We begin this week with an Economic Calendar without an expected market-moving report the entire day. We have a Bond Announcement @ 11:00 AM, a Fed Speaker @ 11:30 AM, 2-Bond Auctions @ 11:30 AM, TD Ameritrade IMX @ 12:30 and Consumer Credit @ 3:00 PM to close the day.

Of the 24 companies reporting on the Earnings Calendar this Monday, I don’t see anything particularly notable or market-moving. However, it’s still extremely important that you are checking reporting dates against your current holdings. Doing so is a simple practice that is important for all traders.

Action Plan

It would appear that the threat of new tariffs is not enough to deter the Bulls from pushing the market higher. Asian markets were mixed but mostly lower overnight however European markets are currently showing modest gains across the board this morning. There is still a significant amount of time before the open, but currently, the Dow Futures are suggesting a gap up of nearly 100 points.

Friday’s sudden attack lower was defended by Bulls holding key support levels in the DIA, SPY, and IWM. The QQQ remained below an important resistance level but this mornings bullishness looks as if regaining this level as support is possible. All-in-all the bullishness this morning looks good for a new leg higher in the market. Remember too we watchful of whipsaws at or near market highs. Also, remember the Fear-Of-Missing-Out is a powerful emotion so be careful not to over-trade or chase gapping stocks near resistance. Ignoring the possible tariff now could still create a quick change in market sentiment if levied, so plan according.

Trade Wisely,

Doug

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YEXT Setup and Trade Plan

September 10, 2018 by Ed Carter

Today’s Featured Trade Idea is YEXT.

Members can join us in Trading Room #1 as Rick reviews the YEXT setup and other Trade-Ideas at 9:10am Eastern. For now, here are my own analysis and a potential trade plan made using our Trader Vision 20/20 software.

YEXT has been trending Bullish since April or May, with the last leg higher lasting a month before it did a little profit-taking pullback last week. After bottoming out and showing a lack of conviction in the selling, on Friday it printed a Trader’s Best Friend signal to test the b/o level of it’s J-hook pattern. I will look for a b/o Entry with a tight Stop below and Fibonacci Extension Target prices. I don’t feel pressure to chase the trade as any breakout is likely to retest the $27.20 area as Support after b/o.

Trader Vision shows us that earnings should be out of the way for a couple months. It also tells us we have 4 Bullish Conditions and 2 Bearish Conditions (the short-term pullback in overall markets and the profit-taking in YEXT itself).

TV20/20 also tells us that this Trade Plan offers very limited risk ($135) to the Stop on a b/o buy. In addition, it shows us that we can reach our Trade Goal just above the 1st Target. However, if we can sell half at Target #1 and hold the remainder until the 2nd Target, this plan offers us 3.28:1 Reward/Risk with a $442.50 profit.

Having this knowledge before a trade is even entered makes it much easier to control emotions and maintain discipline.

Below is my markup of the chart and the trade plan as laid out by Trader Vision 20/20. As a bonus, if you click the green button below, you’ll be able to watch a video of the chart markup and trade planning process.

The YEXT Trade Setup – As of 9-7-18

The Trade Plan

Note how Trader Vision 20/20 does so much of the work for you. Knowing the ratio of Bullish Conditions to Bearish ones as well as the overall risk of the position size, risk to Stop out and the Reward possible at each Target price can help a great deal with controlling our emotions. Knowing the dollar impact of every scenario ahead of time, allows us to make calm decisions during the trade. It really takes the pressure off. No guesswork. No surprises. No emotional roller coaster.

To see a short video of this trade’s chart markup and trade planning, click the button below.

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Trader Vision immediately simplified the process…immediately it provided that information and guidance to me. I knew what I would risk for how much reward, I began taking trades off at the 1st target, 2nd target, I was no longer holding all my trades for the homerun. I also began implementing the stop losses if and when they were reached, not just hoping the stock would recover. It then became easier to see what patterns were working for me and which were not. It provided a much more relaxed and stress-free environment. –Joan G

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Investing and Trading involve significant financial risk and are not suitable for everyone. Ed Carter is not a licensed financial adviser nor does he offer trade recommendations or investment advice to anyone. No communication from Hit and Run Candlesticks Inc. is to be considered financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.

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SPY Five Lower Lows Education is shark repelent

September 7, 2018 by Rick Saddler

SPY Five Lower Lows

With five lower lows in the SPY, this week has been controlled by the sellers, or maybe the buyers just needed a rest? Yesterdays low in the SPY came within pennies of the 20-SMA which in my book is still an acceptable pullback.

The DIA’s have fared much better closing above the T-Line, and two higher lows are trying to paint a bullish continuation pattern, go blue chips! The QQQ’s have been the poor sport, but when you look at the overall trend, the QQQ’s are still trending above the 34-EMA. If we start to breach the 34-EMA on the SPY, DIA, IWM, or QQQ’s that’s when I will become very concerned about the weakness in the market. Right now stong trading rules are needed to navigate through the rough market.

Keep in mind we believe flexibility, base hits, selling into strength and if you’re wrong about the trade simple close the trade out and own it. And a trading plan that at the very least uses a stop, entry, and a profit plan.

A good rule of thumb is if you have three losing trades in a row you might want to read up on how to handle sharks in the water.

Education Plan #1

Buy and sell stocks without a good understanding of what’s going on in a chart or the market. Buy and Sell on faith, hope, and tips you pick up. Thinking that you can learn everything you need to know before your capital burns up.

Education Plan #2

Set aside time to study, take advantage of the material available to you. There are several courses that we have available that with help with the understanding of a Trend, Price Action, Chart Patterns, Stochastics and the use of FIB Lines. Having a strong understanding of charts and management of your business greatly increases the probability of your trading success.

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Did you Know? The best time to study is when the market is closed, this way you are less likely to feel pressured to look for the next great trade.

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Past Performance Is No Guarantee of Future Results

Investing and Trading involve significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, Right Way Option, Trader Vision 2020 or Rick Saddler, Doug Campbell, Ed Carter, Steve Risner is to be considered financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.

Rick Saddler, Doug Campbell, Ed Carter, Steve Risner is not a licensed financial adviser nor does he offer trade recommendations or advice to anyone.

Focused and Flexible

September 7, 2018 by Doug Campbell

Focused and Flexible

As we head into the weekend with a strong Employment Situation report expected and the looming threat of 200 billion in tariffs, traders will need to stay very focused and flexible. The DIA, SPY, and IWM are all holding just above key support levels. Unfortunately, the QQQ’s failed its key support yesterday, but that can recover quickly if the bulls find something to inspire them. However, if the bears happen to find inspiration to attack we could see some nasty price action should support fail in the other indexes.

Stay focused on price action watching for head fakes and whipsaws. I also think it’s important to set aside your bias and remain flexible and prepared. The market is at a critical decision point, and though I’m cheering for the bulls, it’s unwise to underestimate the bears. Carefully plan the risk you carry into the weekend.

On the Calendar

The Friday Economic Calendar has only one market-moving report today, but they don’t get much more important than the 8:30 AM Eastern Employment Situation report. The consensus is expecting a strong August with job creation rising to 195,000 and the unemployment rate falling to 3.8 percent. Monthly hourly earnings are also expected to increase by 0.3 percent with the year-on-year rate rising to 2.8 percent. Manufacturing is expected to show a very solid increase of 21,000 and private payrolls rising 190,000. We have Fed speakers at 8:30, 9:00 & 10:45 AM with the Quarterly Services Survey @ 10:00 AM, the Baker-Hughes Rig Count @ 1:00 PM and Treasury STRIPS closing out the week at 3:00 PM.

On the Earnings Calendar, we have a light day with only 13 companies reporting. Before the bell, HURC & GCO are among those reporting with MSB and UBA among those reporting after the close.

Action Plan

Yesterday was an interesting day with 3 of the indexes turning lower while the bulls focused their attention on the Dow. While there were several bear attacks in the Dow creating interday whipsaws, the Bulls found a way to push right back. Overnight Asian markets were mixed but mostly lower and European markets are currently lower across the board. Consequently, current US Futures are pointing to a lower open but with a strong Employment Situation report expected an hour before the open that could quickly change the open expectation.

The QQQ’s failed at support yesterday, but the DIA, SPY, and IWM managed to hold just above key levels. With the Employment Situation report and the threat of 200 billion in new tariffs leveled against China, we will have to flexible and focused. As normal I will be looking to take some profits and reduce risk heading into the weekend.

Trade Wisely,

Doug

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No Setup and Trade Plan Market Uncertainty

September 7, 2018 by Ed Carter

There will be no Featured Trade Idea today. It’s Friday (Pay Day) anyway…when traders should be looking to book profits and take off risk ahead of the weekend. Couple this with current political turmoil (normal political discord, Kavanaugh Nomination Hearings, the Woodward book, talk of the 25th Amendment…AND the possibility of the President unilaterally implementing another $200 Billion in Tariffs on China. Then top it all off with the Indicies being in a short-term pullback, but sitting at potential Support. This all adds up to there being no good reason to chase any more trades going into the weekend. So I will be managing current positions and looking to take profits or reduce risk exposure where I can today.

Members can join us in Trading Room #1 as Rick reviews the markets and any of your charts at 9:10am Eastern.

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