Bullish Breakout
Last week BAC produced and very nice bullish breakout showing significant strength. BAC has now pulled back leaving a hammer pattern at price support. Should price follow-though showing buyers stepping in at support BAC would be a buying opportunity.
Banks typically do well in a rising interest rate environment. Next week is the FOMC meeting and the market believe there is more than a 90% chance they will raise the rate. The overall market is trending up is currently looking a bit stretched so consider that if you decide to act on this trade idea.
Consider the BAC JAN 28 Calls. Consider scaling out with first target area between $29 an $30. Plan your trade carefully as there will not be follow up management instructions on this free trade idea.
Recently Closed Trades
CSCO 17% • BAC 31% • CREE 48% • WMT 245% • NFLX -40% • STX 42% • 2nd CSCO Trade 30%
Today’s Market Prep Note
With the futures pointing to a 200 point gap up in the Dow on the back of the Tax Reform bill passage, it would seem the market is bulletproof. Even the threat of nuclear war seem to be nothing more than an annoying mosquito easily shooed away. Now the Dow has 25,000 in its cross-hairs and seems to have all the money and energy necessary to drive for that goal. However, I doubt the ascension to this plateau will be a smooth one. Friday’s full reversal intra-day whipsaw may be a clue to fast and whippy price action ahead. Big price action swings could be possible as we move forward making it very challenging for swing traders. The bulls are obviously in control, but Friday’s price actions should serve as a reminder that the bears are still here and they have been waiting to eat for a long time. Plan your risk carefully.
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Investing and Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc. is financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.
Doug Campbell is not a licensed financial adviser, nor does he offer trade recommendations or advice to anyone except for the trading desk of Right Way Options Inc.
PBO Flag Found A New Friend
CYCC – The Rounded Bottom and the PBO Flag found a new friend, “the Morning Star.” Excellent support with price, the big three moving averages and price support. A little volume kicked in Friday, and after $2.25 there’s a nice little gap that could reward in a good way.
Good Trading – Hit and Run Candlesticks
► Must Read Trade Update (NTNX)
On October 16 we shared and covered in detail the technical properties of NTNX in the Trading Room, Friday the profits were about 35.5% or $945.00, with 100 shares. NTNX has been a T-Line run and continued to make higher highs and higher lows.
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► Eyes On The Market
Can you believe this marker? I saw the DOW up over 200 points. At the close Friday the Bulls had come back strong, and with the TAX Bill this weekend the Bulls must be throwing a party. Today and this week it will be more important than ever to keep an eye on price. We don’t want the price to sneak across some line we don’t want it to. The trend is you, friend; friends do turn on each other on the playground.
Rick’s trade ideas for the day – MEMBERS ONLY
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Investing and Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc. is financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.
Rick Saddler is not a licensed financial adviser nor does he offer trade recommendations or advice to anyone except for the trading desk of Hit and Run Candlesticks Inc.
Bulletproof?
With the futures pointing to a 200 point gap up in the Dow on the back of the Tax Reform bill passage, it would seem the market is bulletproof. Even the threat of nuclear war seem to be nothing more than an annoying mosquito easily shooed away. Now the Dow has 25,000 in its cross-hairs and seems to have all the money and energy necessary to drive for that goal. However, I doubt the ascension to this plateau will be a smooth one. Friday’s full reversal intraday whipsaw may be a clue to fast and whippy price action ahead. Big price action swings could be possible as we move forward making it very challenging for swing traders. The bulls are obviously in control, but Friday’s price actions should serve as a reminder that the bears are still here and they have been waiting to eat for a long time. Plan your risk carefully.
On the Calendar
On the First Monday of December, the Economic Calendar has a light day. At 10:00 AM we get the Factory Orders report which will likely show strength and confirm expectations for fourth-quarter manufacturing strength. After that just a few bound auctions and a nonmarket moving TD Ameritrade report.
On the earnings calendar, we have 14 companies reporting today. A quick scan of the list and I don’t see any that are particularly noteworthy unless of course, you happen to own one of them. Make sure to keep checking and remember you’re the boss. Expect the best from yourself.
Action Plan
Last Friday I suggested that the market was going to be very sensitive to the news and to prepare yourself for possible violent price moves. During the Flynn testimony, we go just that! A very fast and nasty whipsaw that looked like it had completely reversed in just 20 minutes of trading. The promise of the tax reform bill likely to pass in the Senate revered it once again as the bulls regained control.
Now that the bill has passed the bulls are running hard this morning. The Dow Futures are pointing to a gap up around 200 points and sending the charts into a parabolic territory. One would think a huge selloff should be just around the corner, but I sure would not want to be betting against the strength of this bull run. In fact, with Dow 25,000 in sight, it’s likely to attract the bulls like a moth to a flame. Continue to trade with the trend but plan carefully and avoid chasing. Expect elevated volatility with triple-digit gaps and whipsaws possible in the days ahead.
Trade Wisely,
Doug
[button_2 color=”green” align=”center” href=”https://youtu.be/Ie3ZCLlhXOo”]Morning Market Prep[/button_2]
Consistency is Key
No matter if the market up-trending, down-trending or moving sideways to achieve lasting success consistency is key. I trade stock options because no matter the condition of the market there is opportunity to make a profit. Most options services like to hype the big percentage returns that options can provide but I prefer to focus on the consistency of my win/loss ratio. To prove that point Right Way Options has traded an account “live” in full view of the membership. Starting with $10,000 on Jan. 1, 2017 and trading small one, two or three contract positions. The win/loss ratio ranged between 65% and 75% winners holding only 5 to 7 trades at a time. Focus on consistency and money will take care of itself. Currently up more than 90% this year.
I’m not telling you its easy. Trading consistently requires hard work, determination, planning and discipline. The good news is that anyone can learn trade consistently. Trust me if an old carpenter can support his family for more than 12 years from trading profits, any one can!
Recently Closed Trades
CSCO 17% • BAC 31% • CREE 48% • WMT 245% • NFLX -40% • STX 42% • 2nd CSCO Trade 30%
Today’s Market Prep Note
Yesterday the Tax Reform bill appeared to be a slam dunk and a vote to was expected to happen at any time. I mentioned yesterday the next couple weeks could be bumpy as all the political drama unfolds. Last night’s delay has the Washington spin machine at high speed with both sides churning out more and more dramatic rhetoric. Listen closely, and you can hear the dramatic music reaching a crescendo. One side vows to save the day while the other promises to fight to the death because of horror this bill will bring. Blah, Blah Blah! Unfortunately, the stock market is directly in the line of fire. Traders should be very cautious. Violent price shifts are possible in either direction so plan your risk accordingly.
Become a Member Today!
30 Day Trial Monthly Semi-Annual Annual
Investing and Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc. is financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.
Doug Campbell is not a licensed financial adviser, nor does he offer trade recommendations or advice to anyone except for the trading desk of Right Way Options Inc.
Political Drama
Yesterday the Tax Reform bill appeared to be a slam dunk and a vote to was expected to happen at any time. I mentioned yesterday the next couple weeks could be bumpy as all the political drama unfolds. Last nights delay has the Washington spin machine at high speed with both sides churning out more and more dramatic rhetoric. Listen closely, and you can hear the dramatic music reaching a crescendo. One side vows to save the day while the other promises to fight to the death because of horror this bill will bring. Blah, Blah Blah! Unfortunately, the stock market is directly in the line of fire. Traders should be very cautious. Violent price shifts are possible in either direction so plan your risk accordingly.
On the Calendar
Friday’s Economic Calendar has several important reports this morning, but before that happens, we will hear from two Fed Speakers. Bullard speaks at 9:05 AM and Kaplin at 9:30. The PMI Manufacturing Index is at 9:45 AM and forecasters expect a very strong 54.5 print today. At 10:00 AM the IWM Mfg. Index has topped consensus several weeks in a row. However, the forecasters today call for a slight pullback to 58.4 vs. 58.7 last month. Construction Spending is also at 10:00 with the October’s consensus increase at 0.5% due to strength in single-family home building. And then who would have guessed we will hear from yet another Fed speaker at 10:15 AM.
On the Earnings Calendar, we only have 18 companies reporting today none of which are particularly notable.
Action Plan
The promise of Tax Reform spurred the bulls into a full-on stampede yesterday as traders seemed to buy stocks with both hands. The Dow smash through 24,000 finally coming to rest up a whopping 331 points on massive volume. It’s also interesting to note that the VIX also rallied suggesting fear at this evaluation is growing. OPEC’s decision to extend their production reduction program also played a part in pushing the market higher. Oil companies surged higher on the news.
This morning futures are looking lower because the Tax Reform bill suddenly seems to have lost votes. The Senate now says the vote could happen today, but they are scrambling to rewrite provisions of the bill on the fly. I repeated over and over yesterday in the trading room a warning to not chase this rally. Those that did could have a tough lesson learned today. If by chance they fail to get this bill passed we could experience a very dark in the market.
Trade wisely,
Doug
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Charts Have Been Mean And Green
Wow, what a great week this has been, the charts have been mean and GREEN, and we love GREEN. Hey, thanks to all the members for posting and sharing the great charts. I see the morning futures are a looking a bit weak this morning, let’s keep our eye on the ball and the trend, using a couple of support and resistant lines can make all the difference in the world.
The DC politics is something I dislike, but we have to keep our eyes and ears open on whats going on and trade the charts based on the charts, not hopes and dreams.
►NewsFrom Our Team
Trader Vission 2020.2 is nearly ready to be launched; the testers have been testing it for about two months now. We are extremely confident that Trader Vission is a must-have tool for the trader that wants the next level of success.
How to save your membership cost – This project will be ready before Christmass, and one of the benefits is it will pay for all your membership cost or at least the largest portion. It is very important to the HRC/RWO team that you receive quality at the very best possible price.
►Sample • Members Recent Big Winners
EGLT 16.8% • WIN 28.9% • HOV 24.45% • ZUMZ 30% • URBN 21.20% • ARNA 21.5
► Eyes On The Market
In the past 11 bars, the SPY has gone from below the Lower T-Line and with a Bullish Morning Star price ran nearly 3.8%. All of our moving trend lines are still bullish. Price has gotten a bit overzealous and extended. I believe we are very close to seeing a little correction or at least price needs to be taken down a notch or two.
Rick’s trade ideas for the day – MEMBERS ONLY
30-Day Trial • Monthly • Quarterly • Semi-Annual • Annual
Investing and Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc. is financial or trading advice. All information is intended for Educational Purposes Only. Terms of Service.
Rick Saddler is not a licensed financial adviser nor does he offer trade recommendations or advice to anyone except for the trading desk of Hit and Run Candlesticks Inc.
