The Bulls said “not so fast” to the Bears Friday.  The SPY gapped up 0.46%, DIA gapped up 0.49%, and QQQ gapped up 0.45%.  At that point, all three major index ETFs followed through for 30 minutes, retraced for another 30 minutes, and then the Bulls were in charge the rest of the day.  All three major index ETFs closed very close to their highs for the day.  This action gave us large gap-up, white-bodied candles in the SPY, DIA, and QQQ, breaking out of the recent range with strength.  This took place on slightly lower-than-average volume in all three.

On the day, all 10 sectors were in the green with Technology (+2.30%) way out front (by more than 1%) leading the way higher while Consumer Defensive (+0.11%) lagged behind the other sectors. At the same time, the SPY gained 1.56%, DIA gained 1.16%, and QQQ gained 2.25%.  The VXX plummeted 4.04% to close at 19.93 and T2122 shot back up but remained in the center of the mid-range at 57.80. 10-year bond yields fell slightly to 4.622% and Oil (WTI) jumped up 1.98% to close at $77.25 per barrel. So, Friday was the Bulls’ Day from start to finish.  This gave us the second straight week of gains in quite a while.

The major economic news reported Friday included Michigan Consumer Sentiment, which came in lower than expected at 60.4 (compared to a forecast of 63.7 and a previous reading of 63.8).  At the same time, Michigan Consumer Expectations also came in below what was anticipated at 56.9 (versus the 59.5 forecast and a prior value of 59.3).  However, Michigan 1-year Inflation Expectations were higher than predicted at 4.4% (compared to a forecast of 4.0% and a previous reading of 4.2%).  Finally, the Michigan 5-year Inflation Expectation also came in hot at 3.2% (versus a forecast of 3.0% and a prior value of 3.0%).

In Fed speak news, San Francisco Fed President Daly said Friday that it is still too early to say whether the Fed has done enough hiking.  Daly told CNBC, “(Fed policy) is in a very good place” and “the news on inflation has been fairly good.”  She continued, “all of that said, it is far too early to declare victory.”

In stock news, the US Air Force’s B-21 “Raider” bomber built by NOC took its first flight Friday.  The $750 million per flying wing plane achieved its first unscripted step toward production.  (The USAF plans to buy 100 of the jets.)   Elsewhere, Reuters reported that the US cattle herd is at the lowest level in decades, following years of drought that had burnt off pasture land.  This is causing the need for the US to import a record amount of beef.  The article claimed this shift is causing significant margin pressure on companies like TSN. Later, WYNN reached a tentative deal with the hospitality workers union just hours ahead of the union’s scheduled strike.  (CZR and MGM reached deals with the same union earlier in the week.)  The deal covers 5,000 WYNN employees at Las Vegas properties. At the same time, Reuters reported that Chinese electric vehicle maker NIO is still debating whether it will enter the North American market in 2025.  The company is a leading force in the Chinese EV market, but building cars in China for import into the US amid trade tensions has given the company pause.  HMC raised worker pay by 11% after the UAW deal with the “Big 3” automakers.  Despite this, the UAW has targeted HMC, TM, and TSLA workforces as targets for union organizing.  Meanwhile, MULN announced it has secured a former KHC food manufacturing plant and warehouse for the production of its electric vehicles.  Later, a GM assembly plant in Flint MI, narrowly voted AGAINST ratifying the tentative deal between the UAW and GM.  (51.8% of workers at that plant voted against the deal.)

In stock government, legal, and regulatory news, PXMD announced that it had given the FDA new study data indicating their drug had made significant progress against African Sleeping Sickness.  Later, Reuters reported that three sources tell them that EU countries and the EU Parliament are set to agree on “light touch” rules for ABNB next week.  This less aggressive approach to regulation is a stark contrast to the EU approach to other tech firms.  Elsewhere, BKNG has agreed to pay $100.25 million to settle a tax dispute with Italy.  Later, Reuters reported that LUV now expects FAA certification of BA’s 737 MAX 7 plane by April 2024, which will allow the airline to start flying the planes in October or November of that year.

After the close, STNE reported beats on both the revenue and earnings lines. So far this morning, FTRE reported beats on both the revenue and earnings lines.  At the same time, TSN missed on revenue while beating on earnings.  However, HSIC missed on both the top and bottom lines. It is worth noting that FTRE raised its forward guidance while TSN lowered its guidance.

Overnight, Asian markets were mixed but leaned to the red side.  Hong Kong (+1.30%) and Taiwan (+0.94%) were far out front leading the gainers while Singapore (-0.91%) was by far the biggest of the more plentiful losers.  However, in Europe, with the single exception of Athens (-0.07%), we find green across the board at midday.  The CAC (+0.36%), DAX (+0.25%), and FTSE (+0.63%) lead that region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modest red start to the day.  The DIA implies a -0.10% open, the SPY is implying a -0.20% open, and the QQQ implies a -0.24% open at this hour.  At the same time, 10-year bond yields are up slightly to 4.632% and Oil (WTI) is just on the green side of flat at $77.27 per barrel in early trading.

The major economic news scheduled for Monday is limited to the Federal Budget Balance (2 p.m.).  The major earnings reports scheduled for before the open include FTRE, HSIC, and TSN.  Then, after the close, ACM, LU, and SLF report. 

In economic news later this week, on Tuesday, Oct. Core CPI, Oct. CPI, and API Weekly Crude Oil Stocks are reported.  Then Wednesday we get, Oct. Core PPI, Oct. PPI, Oct. Retail Sales, Sept. Business Inventories, Sept. Retail Inventories, and Weekly EIA Crude Oil Inventories.  On Thursday, Oct. Export Priced Index, Oct. Import Price Index, Weekly Initial Jobless Claims, Philly Fed Mfg. Index, Oct. Industrial Production, and the Fed’s Balance Sheet are reported.  Finally, on Friday we get Oct. Building Permits and Oct. Housing Starts.

In terms of earnings reports later this week, on Tuesday, we hear from ARMK, AZUL, CAE, CSIQ, ENR, HD, IHS, SBH, SE, TME, VIPS, and NU.  Then Wednesday, AAP, CTLT, FI, GFF, JD, TGT, TCEHY, TJX, XPEV, ZIM, SQM, CPA, MMS, PANW, and TTEK report.  On Thursday, we hear from BABA, ARCO, BBWI, BERY, BV, DDL, DOLE, M, NICE, WMT, WSM, QFIN, AMAT, BZH, CPRT, GPS, GLOB, HI, MATW, POST, ROST, UGI, WWD, and ATO. Finally, on Friday we hear from ATKR, BJ, and SPB.

In Chinese economic news, that country’s “Singles Day” holiday (invented by BABA) ended at midnight Saturday night.  BABA reported that it made year-over-year growth in sales for the event. Meanwhile, rival platform JD reported record sales volume for that holiday.  Reuters reports that industry analysts found sales increased by 2.08% compared to 2022 up to $156.40 billion.  (For reference, event sales grew 2.9% between 2021 and 2022.)  In other China economic news, Reuters reported Sunday that the most recent data (through September) showed a 38.2% year-on-year increase in loans given to the country’s manufacturing sector.  This compares to a slight -0.2% decrease in loans to the Chinese property sector.  While the slight decline in loans to Real Estate developers might track (given the widely-known troubled nature of that sector), the nearly 40% increase in loans to manufacturing was very surprising. Analysts seem to think this is a strategic top-down decision made by Beijing (building the country’s high-tech manufacturing capacity instead of driving domestic consumption).  For example, forecasts say China will soon be able to meet the entire world’s demand for lithium-ion batteries by itself.  However, this is all complicated by the fact that the demand of the rest of the world cannot absorb this added capacity.  As a result, this Chinese investment choice is (to the extent tariffs and trade agreements allow) likely to be disinflationary for the entire world…at least among high-end manufactured goods.

In miscellaneous news, on Friday, MCO changed its outlook on the US credit rating to “negative” from “stable” while maintaining its credit rating at “Aaa.”  The agency cited deficits, rising interest rates (cost to service debt), a lack of measures to reduce spending or increase revenues, and political brinksmanship as contributing factors to their change in outlook.  (The current budget continuing resolution expires on Friday.)  In a related story, on Saturday, Speaker of the House Johnson unveiled the House GOP plan for a partial CR aimed at making the MAGA extremists happy.  The approach calls for splitting the budget for political purposes.  Johnson’s idea kicks the can on some portions of the budget until Jan. 19, while the rest is kicked down the road until Feb 2.  Paired with this is a “poison pill” that calls for dramatic cuts if either of the deadlines are missed, which is what MAGA extremist wanted in the first place.  (The idea behind this is that it puts the pressure on non-extremist portions of the House, Senate, and the President to agree to MAGA budget demands by the deadlines or the default is that MAGA gets the cuts it wants.)  Obviously, that idea is dead on arrival in the Senate and at the Whitehouse. Then on Sunday, some of the MAGA types decided even that was not enough, telling the political shows they would vote against this plan because it does not give them the up-front budget cuts they want.  For what it is worth, neither the House nor Senate versions of a CR will request funding for Israel, Ukraine, or for increased border protection funding.  So, all sides seem to have agreed those issues will be considered as extraordinary funding and not part of the budget. (Although, I am not sure how you can explain expansions on border patrol manpower and facilities as a one-off rather than a part of normal government operations.) 

With that background, it looks like all three major index ETFs are now looking to open inside the top of Friday’s large white candle. So far, all three are giving us small, white-bodied, indecisive candles (more wick than body) inside of those big Friday candles. The SPY, DIA, and QQQ all remain above their T-line (8ema) and 50smas (although it is also worth noting that DIA printed a “death cross” of the 50sma and 200sma Friday). So, the Bulls still have control of the short-term trend and the bullish breakout of consolidation is still in play. However, keep in mind that all three also remain 3%-4% below their summer highs. So, the Bears remain in control of the longer-term trend. However, those downtrend lines will be tested soon in the large-cap indices and has already been broken in the QQQ. In terms of extension, QQQ is the only major index ETF stretched above its T-line. At the same time, the T2122 indicator is in its mid-range. So, there is some room to run in either direction.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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.

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

On Thursday, markets opened higher with SPY gapping up 0.26%, DIA gapped up 0.26%, and QQQ gapped up 0.20%.  At that point, all three major index ETFs wove their way sideways until 11:55 a.m.  From there, all three headed South with a hard move lower at 1 p.m. (when a poor 30-year bond auction was apparently caused by a hack of a major Chinese bank, which is normally a big bond buyer).  DIA hit its lows at 2:45 p.m. followed by the SPY and QQQ at 3 p.m.  All three then traded in a tight range the rest of the day.  This action gave us large, black-bodied candles in all three.  The SPY and QQQ both printed what could be seen as Evening Star signals while the DIA just gave us a large black candle.  This happened on average volume in the DIA and QQQ while that SPY gave us less-than-average volume.

On the day, nine of the 10 sectors were in the red with Healthcare (-2.26%) out in front leading the way lower while Energy (+0.07%) held up better than the other sectors, barely holding onto green territory.  At the same time, the SPY lost 0.78%, DIA lost 0.59%, and QQQ lost 0.77%.  The VXX gained 3.85% to close at 20.77 and T2122 fell again but remained at the low end of the mid-range at 26.04. 10-year bond yields rose to 4.634% and Oil (WTI) fell slightly to close at $75.54 per barrel. So, Thursday broke the streak of higher closes in the SPY and QQQ, as well as giving us the second straight lower close in the DIA.  

The only major economic news reported Thursday was Weekly Initial Jobless Claims, which came in slightly higher than expected at 217k (compared to a forecast of 215k but still slightly down from the prior week’s 220k).  Then, after the close, the Fed Balance Sheet again came in down just a bit from the previous week at $7.861 trillion (down from $7.867 trillion the prior week).

In Fed speak news, Richmond Fed President Barkin (hawk) and Atlanta Fed President Bostic (dove) both spoke at a New Orleans event.  Both seemed to indicate that the economy has not yet fully absorbed the impacts of the previous FOMC rate hikes.  In his remarks, Bostic again said he believed the Fed policy is already restrictive enough to curb inflation and warned that there could be some “economic instability” ahead as the economy fully feels the previous Fed hikes.  For his part, Barkin predicted a coming economic downturn and said his forecast had not expected the strong Q3 growth.  He argued that an economic slowdown is necessary to stop price-setters from continuing to raise prices.  Later, Fed Chair Powell told an IMF conference in Washington that he and his Fed colleagues are encouraged by the slowing pace of inflation but are still not sure they have done enough to keep that slowing momentum going. He said, (the Fed is committed to a 2% rate of inflation target), but… “we are not confident that we have achieved such a stance.”  Powell went on to say inflation remains “well above” where they would like to see it but also described the Fed policy as “significantly restrictive.”  Above all, Chairman Powell tried to warn investors not to expect rate cuts in 2024 (as many still predict).  Finally, he said, “We will continue to move carefully, however, allowing us to address both the risk of being misled by a few good months of data, and the risk of overtightening.”

In stock news, UNH announced Thursday that it is transitioning eight insulin products to tier 1 status (least expensive).  Those products are made by LLY, NVO, and SNY.  At the same time, TDG announced it is buying a components and subsystem business from private company CPI for $1.39 billion.  Later MGM announced it has reached a tentative deal with the hospitality workers union, less than 24 hours ahead of a strike by 25,470 Las Vegas employees.   (CZR reached a deal earlier and WYNN has not yet reached an agreement.)  Elsewhere in the entertainment industry, the Screen Actors Guild reached a deal with studios such as DIS, PARA, NFLX, WBD, FOX, and AMZN ending the 118-day strike. Later, software company BILL issued a statement seeking to quash the rumors that it is in negotiations to be acquired.  At the same time, FSR revealed is negotiating with five different carmakers in the hope of attaining additional production capacity in the hope of launching two additional models by 2025.  Later, Reuters reported that NVDA plans to release three new chips aimed at the Chinese markets.  Less than a month after US officials tightened rules on export to China, NVDA has reworked the product designs of their AI chips to skirt the restrictions.  At the same time, XOM said it has acquired a floating production and storage facility from SBFFY for $1.26 billion.  Later, UAL announced it is revamping its loyalty program tied to CCF credit cards with changes taking effect on January 1.  Meanwhile, Reuters reports that GS is working on a dozen different projects to incorporate AI into its business practices.  After the close, TKO announced that major shareholder McMahon plans to sell 8.4 million shares in a secondary offering for $713.16 million.  Also after the close, BKNG announced it would begin booking cruises.  In addition, NFLX and WBD announced they are partnering with VZ to offer a $10/month streaming combination (versus the old price of $17/mo.).

In stock government, legal, and regulatory news, early Thursday, the NHTSA said that TSLA is recalling 159 Model S and Model X cars.  At the same time, AAPL suffered a setback related to its $14 billion tax bill in the EU.  An advisor to the EU’s top court said that a lower court had made legal errors when ruling in favor of AAPL and the top court should review the case on whether AAPL owes Ireland $14 billion.  Later, the Bulgarian Parliament approved a $1.5 billion purchase of Stryker fighting vehicles from GD.  At the same time, a US bankruptcy court ruled that Scandinavian airline SAS could receive a $450 million loan from private firm Castlelake.  The funds will be vital to repaying APO, which is the debtor-in-possession of the airline.  After the close, AAPL agreed to pay $25 million to the Dept. of Justice to settle claims that the company has illegally favored lower-wage immigrant workers over US and green-card-holding people.  Of this, $6.75 million are penalties and the $18.25 million will go to an unspecified number of discrimination victims.  After the close, a US judge approved the $290 million JPM settlement with victims of disgraced and deceased financier Epstein.

After the close, DTEGY, HOLX, LNW, LGF.A, NWSA, RBA, STN, TTD, and WYNN all reported beats on both the revenue and earnings lines.  Meanwhile, CANO beat on revenue while missing on earnings.  On the other side, FLO, ILMN, MTD, VYX, and NGL all missed on revenue while beating on earnings.  Unfortunately, CPRI, TPC, and U missed on both the top and bottom lines.  It is worth noting that ILMN lowered its forward guidance.  

Overnight, Asian markets were nearly red across the board.  Only India (+0.15%) held on to green territory while Hong Kong (-1.76%) Thailand (-1.10%), and Singapore (-0.91%) led the region lower.  In Europe, we do see red across the board at midday.  The CAC (-1.11%), DAX (-0.78%), and FTSE (-1.28%) are leading the region lower in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a mixed start to the day.  The DIA implies a +0.16% open, the SPY is implying a +0.05% open, and the QQQ implies a -0.11% open at this hour.  At the same time, 10-year bond yields are back down slightly to 4.606% while Oil (WTI) is up 1.33% to $76.74 per barrel in early trading.

The major economic news scheduled for Friday are limited to Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations (all at 10 a.m.).  However, there were some last-minute Fed speaking engagements including Logan, Bostic, and Daly. The major earnings reports scheduled for before the open are limited to AQN.  Then, after the close, STNE reports. 

So far this morning, TOELY and DWAHY reported beats on both the revenue and earnings lines.  However, AQN missed on revenue while reporting in line with expectations on earnings.

In miscellaneous news, a hacking and ransomware attack on Chinese ICBC bank stopped it and others from participating in the US 30-year bond auction.  In turn, the lack of Chinese buyers caused soft demand and spooked US markets Thursday afternoon.  Back in the US, the Fed’s semiannual supervision report said that it was keeping a close tab on banks (related to rising interest rates and commercial real estate losses).  Despite some concerns, the report said the overall banking system remains sound and most lenders remain well-capitalized.  Unrelated to this, the Bank of England said Friday that the UK’s 50 largest banks will be subjected to a stress test that imagines a scenario worse than 2022’s shock to the gilt market.

With that background, it looks like all three major index ETFs are now looking to open up a bit from the Thursday close. All three are giving us white-bodied, indecisive candles (more wick than body) inside of Thursday’s black candle. The SPY, DIA, and QQQ all remain above their T-line (8ema) and 50smas (although the SPY and DIA are close to retesting those averages). So, the Bulls still have control of the short-term trend, even after pulling back from the recent impressive Bull run. However, keep in mind that all three also remain 4%-5% below their summer highs. So, the Bears remain in control of the longer-term trend. In terms of extension, none of the major index ETFs are stretched from their T-line. At the same time, the T2122 indicator is in its mid-range (the bottom of that range). So, there is some room to run in either direction. Bear in mind that this is Friday. So, pay yourself by taking some profits and prepare your account for the weekend news cycle. This might include, lightening up, buying insurance (puts/calls) on individual positions, or hedging your overall account.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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.

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

Wednesday was another indecisive day in the Market.  SPY gapped up 0.14%, DIA gapped up 0.15%, and QQQ gapped up 0.11%.  From that point, all three major index ETFs put in a gradual morning selloff, reaching the low of the day at noon, followed by a gradual afternoon rally.  This action gave us indecisive candles in all three.  The SPY and QQQ both printed Doji candles while the DIA printed a black-bodied Spinning Top.  All three remain above their T-line (8ema) as well as their 50sma.  This came on well below-average volume in the SPY, DIA, and QQQ.

On the day, eight of the 10 sectors were in the red with Energy (-1.44%) again out front leading the way lower while Technology (+0.28%) was again trying to pull the rest of the market higher by holding up best.  At the same time, the SPY gained 0.07%, DIA lost 0.12%, and QQQ gained 0.06%.  The VXX fell another 1.9% to close at 20.00 and T2122 fell again but remained in the middle of its mid-range at 41.67.  10-year bond yields fell again to 4.492% and Oil (WTI) plummeted another 2.25% to close at $75.63 per barrel.  So, Wednesday gave us a ninth-straight day of gains in the QQQ, eighth-straight in the SPY, and the first lower close in nine days in the DIA.  However, again this was another low-volume and indecisive day as the rally seems to be losing steam (particularly in the large-cap index ETFs).

The only major economic news reported Wednesday was a change in forecast by the EIA.  The agency now forecasts a 300k barrel-per-day decrease in total petroleum consumption in the US by year-end.  Previously, the EIA had forecast a 100k barrel-per-day increase in petrol consumption by the US by year-end.

In Fed speak news, FOMC Chair Powell spoke at a Fed Research and Statistics Div. 100-year anniversary celebration Wednesday.  In his remarks, Powell emphasized the need for economic forecasting and models to be agile given unpredictable global events.  Reuters also reported that NY Fed President Williams spoke at the same celebration as Powell.  Williams lauded recent research and statistics improvements by the Fed, which he said three decades ago was all about the “here and now” (tactical view), but after a large transformation now allows the FOMC to make longer-term and more strategic decisions.  Later Reuters reported that the Cleveland Fed has officially begun the search for a successor to current branch President Mester who retires next June.  (Mester has held the Cleveland Fed Presidency since 2014.)   After the close, Fed Vice-Chair Jefferson indicated to a gathering that he favors erring on the side of doing too much (on inflation) versus not doing enough.  In prepared remarks, Jefferson said, “If (inflation) expectations were to begin to drift, the reality or expectation of a weak monetary policy response would exacerbate the problem.”

In stock news, the CEO of STLA said Wednesday that the next new model from Chrysler will be an electric crossover vehicle.  Elsewhere, FTS announced Wednesday that it has completed a $500 million private placement of senior unsecured notes.  Later, CZR announced it had reached a tentative 5-year deal with the Culinary Worker Union, averting a potential strike by 10,000 employees at its nine Las Vegas locations.  However, potential strikes are still pending against MGM and WYNN properties in Las Vegas.  Later, SPR announced plans to raise $200 million by issuing more class A common stock.  At the same time, AMZN announced it has begun cutting jobs in its Music division.  However, AMZN would not confirm the number of layoffs.  Later, NVO announced it would discontinue its long-lasting insulin Levemir.  The discontinuation will be phased, beginning in January and lasting through 2024.  The company cites other alternative insulins available and manufacturing constraints as the reason.  (NVO also offers other basal insulin drugs such as Tresiba.)  At the same time, LMND announced it has reached the two million customer milestone (after achieving 1 million in late 2020).  Later, META announced it would require advertisers to disclose when AI is used to create or alter political, social, or election-related ads on Facebook and Instagram. 

In stock government, legal, and regulatory news, Reuters reported Wednesday that C has agreed to pay $25.9 million to settle charges from the CFPB related to allegations of discrimination against Armenian-Americans on credit card applications based solely on the applicant’s last name.  Later, the NHTSA announced that GM is recalling nearly 1,000 Cruise driverless robotaxis after one of the vehicles dragged a pedestrian during an accident in October.  At the same time, TGT asked an FL judge to dismiss a shareholder lawsuit that alleged the company had ignored potential risks of offering LGBTQ merchandise during Pride Month.  The company claims the allegations are completely without merit and have nothing to do with the stock, but are instead just the expression of the plaintiff’s disagreement with the company decision.  (The plaintiff is a front for a nonprofit run by long-time anti-progressive activist and former advisor to the ex-President, Stephen Miller.)  Later, KO announced Wednesday it is withdrawing two soft drinks in Croatia in response to Croatian state inspection authorities’ orders after batches of the products were suspected of causing illnesses.  Meanwhile, Reuters reports that GOOGL will be asked to explain measures taken to protect children in line with EU rules.  (This is related to YouTube and the report says TikTok faces the same inquiries.)  Later, LLY received both US and UK approval for its Zepbound weight-loss drug.  The drug will compete with wildly successful Wegovy from NVO.  (Analysts expect that niche to be a $100 billion annual market by the end of the decade.)

After the close, ALTG, AMC, APP, CENX, DIT, GNW, HUBS, JXN, KGC, MFC, MGM, SPNT, TTEC, TWLO, VSAT, and DIS all reported beats on both the revenue and earnings lines.  Meanwhile, ATO, BGS, CTVA, ENS, G, MATV, SU, and MODG all missed on revenue while beating on earnings.  On the other side, AE, AFRM, JAZZ, TTWO, and LYFT all beat on revenue while missing on earnings.  Unfortunately, ASH, FLT, HP, and UHAL missed on both the top and bottom lines.  It is worth noting that ALTG, APP, HUBS, LYFT, and TWLO raised their forward guidance.  However, MODG and TTEC both lowered their guidance.

Overnight, Asian markets were mixed again with Japan (+1.49%) by far (by more than 1%) the biggest mover.  On the downside, Thailand (-0.48%) paced the losses followed by Malaysia (-0.37%).  Meanwhile, in Europe, the bourses lean heavily to the green side with only three of 15 exchanges in red at midday.  The CAC (+0.76%), DAX (+0.44%), and FTSE (+0.45%) lead that region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a mixed and flat start to the day.  The DIA implies a +0.13% open, the SPY is implying a +0.10% open, and the QQQ implies a -0.06% open at this hour.  At the same time, 10-year bond yields have rebounded to 4.543% and Oil is up 0.45% to $75.67 per barrel in early trading.

The major economic news scheduled for Thursday includes Weekly Initial Jobless Claims (8:30 a.m.), WASDE Ag Report (noon), and Fed Chair Powell speaks again at 2 p.m.  The major earnings reports scheduled for before the open include AEE, MT, BDX, CLMT, TAST, COMM, DBD, EPC, GLP, GRAB, HBI, HE, HBM, IHRT, KELYA, LI, EYE, NOMD, ACDC, RCI, SN, SCSC, SONY, SLVM, TPR, TDG, USFD, WRK, WWW, and YPF.  Then, after the close, CANO, CPRI, FLO, HOLX, ILMN, LNW, MTD, NWSA, NGL, PBR, RBA, STN, TTD, TPC, U, and WYNN report. 

In economic news later this week, on Friday, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Friday, AQN, AU, and STNE report.

Ping An Insurance Group to take over China’s largest private property developer Country Garden.  The Chinese State Council instructed provincial governments to arrange the rescue of Country Garden by Ping An.  However, Reuters also reported that Ping An spokesman categorically denied it has been asked to do so.  Elsewhere, NERC said that more than half of the people in North America (180 million) could face electricity shortages this coming winter during extreme cold periods due to a lack of natural gas infrastructure.  In somewhat related news, TX passed a state constitutional amendment to create a $10 billion fund to improve the reliability of the state’s energy-generating infrastructure.  (However, this will have no impact this coming winter.)

So far this morning, MT, BDX, TAST, CTTAY, CRARY, EPC, GRAB, LI, EYE, NOMD, RCI, SN, TDG, and WWW all reported beats on both the revenue and earnings lines.  At the same time, AZN, DDS, SLVM, TPR, USFD, WB, and WRK reported revenue misses while beating on earnings.  On the other side, AVAH and BAK reported beats on the revenue line while missing on earnings.  Unfortunately, COMM, GLP, HBI, and SONY missed on both the top and bottom lines.  It is worth noting that HBI lowered its forward guidance while LI, EYE, and NOMD raised their own guidance.

With that background, it looks like more indecision this morning as the premarket opened not far from the prior close and have printed small candles with mostly wicks so far in the early session. All three major index ETFs remain well above their T-line (8ema) and 50smas. So, the Bulls still have control of the short-term trend, even though we are consolidating. Keep in mind that all three still remain 4%-5% below their summer highs. So, the Bears remain in control of the longer-term trend. In terms of extension, the T-line is catching up to the DIA and even the SPY. However, the QQQ remains a bit stretched above its T-line. At the same time, the T2122 indicator is back in its mid-range. So, there is some room to run in either direction. Be aware of potential volatility from the Jobless Claims before the open and Chair Powell’s speech in the afternoon.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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.

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

Tuesday was another bullish day in the market.  The SPY opened flat, DIA “gapped” down 0.09%, and QQQ gapped up 0.25% at the open.  At that point, all three major index ETFs made a morning rally, with QQQ by far the strongest.  Then after 11 a.m., all three meandered sideways in a fairly tight range the rest of the day, all of the ending on a down wave.  This action gave us white-bodied candles in the SPY, DIA, and QQQ with SPY and DIA printing a Spinning Top and QQQ printing a larger-body candle.  It is worth noting all three are at or have just broken through a potential resistance level.  All three also remain well above their T-line (8ema) although the consolidation in DIA is helping alleviate extension a bit.  This all happened on well-below-average volume in the SPY, DIA, and QQQ.

On the day, six of the 10 sectors were in the red with Energy (-2.36%) leading the way lower while Technology (+1.06%) pulling the rest of the market higher.  At the same time, the SPY gained 0.28%, DIA gained 0.95%, and QQQ gained 0.15%.  The VXX fell another 0.41% to close at 20.39 and T2122 fell again but remained in the middle of its mid-range at 48.88.  10-year bond yields fell to 4.571% and Oil (WTI) plummeted 4.19% to close at $77.45 per barrel.  So, Tuesday gave us a seventh-straight day of gains in the SPY and DIA and the eighth day of gains in the QQQ.  However, again this was another low-volume and indecisive day in the large-caps while things were more bullish in the QQQ. 

The major economic news reported Tuesday included September Exports, which came in higher than August at $261.10 billion (compared to an August value of $255.40 billion).  At the same time, September Imports were also up at $322.70 billion (versus the August value of $314.10 billion).  Together, these gave us a Sept. Trade Balance that came in higher than expected at -$61.50 billion (compared to a forecast of -$59.90 billion and an August reading of -$58.70 billion).

In Fed speak news, Minneapolis Fed President Kashkari again said the Fed may need to do more in a Bloomberg interview Tuesday morning.  Kashkari said, “When activity continues to run this hot, that makes me question if policy is as tight as we assume it currently is.”  He continued, “So if you saw inflation tick back up and you saw continued very strong economic activity in the real side of the economy that would tell me we might need to do more.”  However, shortly afterward, Chicago Fed President Goolsbee told CNBC that the Fed is making progress and reiterated that he continues to see the US as being on a “golden path” where inflation comes down without a recession or much of a slowing.  Goolsbee said, “Over the next couple of months, we might equal the fastest drop in inflation in the last century.”  Goolsbee continued, “So we’re making progress on the inflation rate … and as long as we’re making progress, as I’ve been saying for a while, the moment of arguing how high should the (policy) rate go is going to fade to how long should we keep rates at this level as inflation is coming down.” Later, Fed Governor Waller told a St. Louis Fed seminar (talking about the Q3 GDP data), “This was an outstanding quarter…this big blowout number.”  He continued, “Everything was booming.  So, this is something we are keeping a very close eye on when we think about policy going forward.”

In stock news, on Tuesday TM informed its dealers that it is reducing production at its joint venture plants in China.  Originally, TM had planned to reduce production in Oct. and Nov.  However, the announcement said production will now be reduced through February as the company tries to reduce an inventory glut.  Later, UAW members working for GD voted to approve the tentative contract agreement reached in October. At the same time, CNHI announced plans to delist in Italy and maintain a single listing on the NYSE as of Jan. 2, 2024.  In addition, CNHI announced a new $1 billion share buyback plan.  Later, Reuters reported that NFE had terminated a joint project with Mexican energy company Pemex to develop a deep-water LNG project in the Gulf of Mexico.  (The same project was canceled in 2016 as being too expensive before being revived in 2019.)  Elsewhere, STLA announced plans to retire its V-8 Hemi engine in Ram pickup trucks starting in 2025 as it moves toward hybrid and electric versions of the truck.  Later, TSLA reported a “notable increase” in new car registrations in China.  The report showed 14,000 insurance registrations of TSLA cars in China for the week ending Nov. 5 versus 10,800 the prior week.  After the close, Reuters reported that sources tell it that GS intends to “offload” the GM credit card business.  Also after the close, Bloomberg reported that AAPL has halted development of software for iPhones, iPads, Macs, and other devices so that developers can focus on finding glitches and bugs in the existing code.  This rare move came after a proliferation of bugs have been reported in recent months.

In stock government, legal, and regulatory news, JNJ announced Tuesday that it will seek FDA clearance for its Ottava robotic surgery system in 2024.  This comes after delays caused by technical issues and COVID-19 disruptions.  (If approved, JNJ’s system will compete with the ISRG and MDT robotic surgery systems.)  Across the pond, the UK government revealed upcoming legislation that will make automakers (not individual vehicle owners) liable for any accidents that happen when self-driving is engaged.  This came at the urging of the insurance industry and may auger events to come in the US.  Back in the US, the CFPB proposed a new rule Tuesday that could extend the agency’s reach to cover nonbank digital wallet providers such as AAPL, GOOGL, and PYPL.  At the same time, GE did settle with the Dept. of Justice for $9.4 million over allegations of selling uninspected and out-of-spec parts to the US Army and Navy.  Elsewhere, by a 2-1 vote, the 9^th Circuit Court of Appeals upheld an injunction on the state of CA, preventing them from requiring businesses to warn consumers that the active ingredient in MON’s Roundup weedkiller causes cancer.  Later the FTC sent a letter to ABBV, AZN, and TEVA saying the agency will dispute 110 patents the companies have filed with the FDA to prevent competitors from selling similar products. 

After the close, AKAM, DVA, DVN, EC, GILD, IAC, JHX, JKHY, KD, MBC, OXY, PRI, PRIM, RXT, and TOST all reported beats on both the revenue and earnings lines.  At the same time, AMRK, CIVI, COTY, CPNG, EBAY, PLUS, EXR, MOS, PR, RIVN, and STE beat on revenue while missing on earnings.  On the other side, AEL, BHF, CAPL, FG, FNF, GO, GXO, IOSP, MASI, HOOD, MRC, TKO, and VTRS missed on revenue while beating on earnings.  Unfortunately, ANDE, DAR, DOOR, OVV, PAAS, and SNBR missed on both the top and bottom lines.  It is worth noting that DVA, EBAY, and JKHY raised their forward guidance.  However, GO, MASI, and SNBR lowered their forward guidance.

Overnight, Asian markets were mixed with Singapore (-1.39%) and South Korea (-0.91%) pacing the seven losing exchanges while Taiwan (+0.33%), Australia (+0.26%), and Thailand (+0.25%) lead the five gaining exchanges.  Meanwhile, in Europe, we see a similar mixed picture at midday.  The CAC (+0.13%), DAX (-0.09%), and FTSE (unch) are typical of the region in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a similar flat and mixed start to the day.  The DIA implies a +0.01% open, the SPY is implying a -0.03% open, and the QQQ implies a -0.11% open at this hour.  At the same time, 10-year bond yields are up slightly to 4.587% and Oil (WTI) is down another nine-tenths of a percent to $76.69 per barrel in early trading.

The major economic news scheduled for Wednesday are limited to EIA Crude Oil Inventories (10:30 a.m.).  We also hear from Fed Chair Powell (9:15 a.m.) as well as Fed member Williams (1:40 p.m.).  The major earnings reports scheduled for before the open include ADNT, BIIB, GIB, CRL, CCO, SID, EDR, GTN, IBP, BEKE, K, MIDD, NFE, NYT, NXST, ODP, PTEN, PFGC, PLTK, PSNY, RL, RPRX, REYN, RBLX, SEAS, FOUR, SWX, SPTN, STWD, SHOO, TRP, TEVA, UAA, UWMC, VSH, WBD, and KLG.  Then, after the close, AE, AFRM, ALTG, AMC, APP, ASH, ATO, GBS, ATG, CENX, CTVA, ENS, FLT, G, HP, HUBS, JXN, JAZZ, KGC, LYFT, MFC, MATV, MGM, SU, TTWO, MODG, TTEC, TWLO, UHAL, VSAT, and DIS report. 

In economic news later this week, on Thursday, we have the Weekly Initial Jobless Claims, WASDE Ag Report, and Fed Chair Powell speaks again.  Finally, on Friday, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Thursday AEE, MT, BDX, CLMT, TAST, COMM, DBD, EPC, GLP, GRAB, HBI, HE, HBM, IHRT, KELYA, LI, EYE, NOMD, ACDC, RCI, SN, SCSC, SONY, SLVM, TPR, TDG, USFD, WRK, WWW, YPF, CANO, CPRI, FLO, HOLX, ILMN, LNW, MTD, NWSA, NGL, PBR, RBA, STN, TTD, TPC, U, and WYNN report.  Finally, on Friday, AQN, AU, and STNE report.

In miscellaneous news, the NY Fed reported Tuesday that US credit card debt has now topped $1 trillion to reach a record $1.08 trillion at the end of Q3.  That amounted to a $154 billion increase year-over-year.  It is worth noting that the average annual rate for US credit cards is not over 20% (also an all-time high).  Elsewhere, the Mortgage Brokers Assn. reported that the rate of the average US mortgage plunged by a quarter of a percent last week from 7.86% to 7.61%.  As a result, mortgage demand picked up with refinance loan applications rising 2% for the week and new home purchase loan applications increasing 3% versus the prior week.  Overall loan applications were up 2.5% on the week.

So far this morning, ADDYY, BIIB, EDR, GIB, CRL, CRZBY, FOUR, EONGY, ICL, BEKE, KNBWY, ADRNY, NYT, REYN, TEVA, and SHOO all reported beats on both the revenue and earnings lines.  Meanwhile, GTN, NFE, and PTEN all beat on revenue while missing on earnings.  On the other side, MIDD, ODP, PFGC, SEAS, STWD, and UAA missed on revenue while beating on earnings.  Unfortunately, ADNT, CCO, PLTK, RPRX, and SPTN missed on both the top and bottom lines.

With that background, it looks like yet again Mr. Market is undecided early in the day. The Premarket started flat and mixed in all three major index ETFs. From that point, all three have printed small, indecisive, and mixed-color candles during the early session. All three remain well above their T-line (8ema) and 50smas. So, the Bulls still have control of the short-term trend. Keep in mind that all three remain 4%-5% below their summer highs. So, the Bears remain in control of the longer-term trend. In terms of extension, all three remain a bit stretched from their T-line but the T2122 indicator has dropped back into its mid-range. So, while there is some room to run in either direction, the market remains in need of a pause or pullback to relieve extension. Remember that we’ve had quite a string of gains in a row. So we’re stretched to the upside. (However, also remember that the market can stay stretched longer than we can stay afloat knowing it has to turn soon.) So, be aware of that potential volatility.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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.

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

Markets were basically undecided on Monday.  SPY gapped up 0.18%, QQQ gapped up 0.22%, and DIA opened up just 0.06% higher.  At that point, all three major index ETFs wobbled around on that opening level.  Then starting at about 11:15 a.m., the SPY and QQQ began (followed at noon by the DIA) a steady selloff that lasted until 2:15 p.m.  From there, all three rallied to recross the morning gap and end in bullish territory.  This action gave us white-bodied, indecisive candles in all three of the index ETFs.  The SPY and DIA printed Doji-type candles while the QQQ printed a Spinning Top candle.  All three major index ETFs remain stretched above their T-line (8ema) and stayed above their 50sma (in the DIA also above the 200sma which is just below its 50sma).  This happened on far-below-average volume in all three of those ETFs.

On the day, eight of the 10 sectors were again in the red with Energy (-1.13%) leading the way lower while only Consumer Defensive (+0.11%) and Technology (+0.02%) were able to hang on to green territory (barely at that).  At the same time, the SPY gained 0.22%, DIA gained 0.12%, and QQQ gained 0.41%.  The VXX fell another 3.31% to close at 20.48 and T2122 dropped out of the over-bought territory and back into the mid-range at 67.37.  10-year bond yields climbed to 4.659% and Oil (WTI) gained slightly to close at $80.88 per barrel.  So, Monday gave us a sixth-straight day of gain in the SPY and DIA and the seventh in the QQQ.  However, this happened on very indecisive candles and all three of the major index ETFs remain very stretched.

There was no major economic news reported Monday.  However, there were some Fed speakers.  Fed Governor Cook told a Duke University event the rising short-term bond yields are not tied to the Fed’s policy plans.  She also said, “I would say that an expectation of higher near-term policy rates does not appear to be causing the increase in longer-term rates.”  She went on to imply that she is in the “no more hikes” camp by saying “we hope that this will be restrictive enough such that we can return to our 2% target over time.”  However, on the other side, the Wall Street Journal reported Monday that Minneapolis Fed President Kashkari said he would prefer to err on the side of tightening too much rather than not enough.  Kashkari said, “Undertightening will not get us back to 2% in a reasonable time.”  The interview quoted him as going on to say “I am not ready to say we are in a good place (yet)” (in terms of having a high enough Fed Funds rate).  Elsewhere, a Fed report released Monday said bank loan officers are reporting a slowing of the tightening of credit requirements as well as (or maybe due to) a weaker loan demand.  The report said 60% of banks cite moderately to substantially weaker loan demand in Q3 (up from 43% in Q2).

In stock news, on Monday, C announced that they are aiming for at least a 10% cut to its workforce as part of CEO Frasier’s restructuring.  (For reference, C has 240,000 employees at this point.  So, we are talking about something like 24,000 layoffs.)  Later, CHE announced its board had approved a $300 million increase in its share buyback plan.  At the same time, the CEO of EQT said the US is facing an imminent energy crisis solely due to public resistance to building new pipeline capacity.  He went on to say that natural gas pipeline construction fell to a record low in 2022 and capacity is down almost 900 million cubic feet per day versus the 28 billion cu.ft./day in 2017.  Later, HGV announced that it had acquired BVH for $1.5 billion (including debt).  BVH shares shot almost 107% higher on the news.  Elsewhere, AIG announced it will raise funds by issuing a 50-million share secondary offering of CRBG.  (The underwriters of the secondary, GS, and JPM will have the option to buy an additional 7.5 million shares on top of the 50 million.)  In related news, AIG also initiated a tender offer to rebuy $1 billion worth of its outstanding debt securities.  At the same time, GM announced (that strikes) it had reversed a previous decision and rehired the 1,245 Brazilian employees it had laid off at the Sao Paulo S-10 pickup and Trailblazer engine plant.  Later, BCSF announced it was buying consulting firm Guidehouse from private Veritas Capital for $5.3 billion.  Meanwhile, WELL announced plans to offer $3 billion worth of common stock to fund property acquisitions.  At the same time, CPG announced plans to acquire HHRS for $15.33 per share.  Finally, on Monday night CNBC reported that the GM Cruise robotaxis requires human assistance every four to five miles.  The report said GM maintains one “driver assistant” for every 15-20 robotaxis to get the car past any tricky driving.  The report said assistants provide “wayfinding data” to the onboard computer and do not take over to remotely drive the vehicle.

In stock government, legal, and regulatory news, a lawsuit against WFC and Navy Federal Credit Union has moved to federal mediation.  The lawsuit alleges the financial institutions should have prevented the customer from transferring $3.6 million from his savings to a foreign entity (scam) because the customer had suffered a stroke and was diminished enough that his account had been flagged by Adult Protective Services. Later, MULN announced that it had been given EPA certification for its Class 1 EV cargo vans.  Elsewhere, the US Dept. of Ag reported that TSN is recalling 30,000 pounds of fully cooked dinosaur-shaped chicken nuggets after USDA inspectors found small pieces of metal in samples of the product.  Later, the FAA announced it would hold an additional round of runway safety meetings at 16 more airports in the coming weeks after recent troubling close-call incidents.  (LUV, FDX, and most of the major airlines as well as airport officials are required to attend.)  At the same time, TM confirmed the NHTSA report that it is recalling 1.9 million RAV4 SUVs over a defect that could cause a fire.  Later, NKE filed suit against SKX and private New Balance over alleged patent infringement.  Then after the close, GE agreed to pay $9.4 million to settle US federal claims that it sold “uninspected” and “out of spec” parts to the US Army and Navy.  At the same time, GOOGL was hit with a second major antitrust case, this one filed by Epic Games and related to Google Play Store monopoly over Android app distribution.  After the close, a federal judge pared back a US government lawsuit against drug distributor COR (formerly ABC) for its part in the opioid epidemic.  (The Dept. of Justice alleges COR changed its order monitoring policies, dramatically reducing oversight of opioid orders.)  Finally, the FTC has sent requests to TPR and CPRI for more information about the planned $8.5 billion purchase of CPRI by TPR.

After the close Monday, ARKO, CNO, COHR, CXW, FANG, FN, FSK, IFF, JELD, NXPI, PARR, O, RNG, SVC, TRIP, UIS, and WMK all reported beats on both the revenue and earnings lines.  Meanwhile, BKD and TDC beat on revenue while missing on earnings.  On the other side, CBT, CE, CLOV, CTRA, GT, ICUI, RHP, STRL, and VRTX missed on revenue while beating on earnings.  However, ATSG, COMP, CRGY, and SANM missed on both the top and bottom lines.  It is worth noting that CE and SANM both lowered their forward guidance.  At the same time, CXW, FN, RNG, and STRL raised their guidance.

Overnight, Asian markets were nearly green across the board with only Thailand (-0.18%) in the red.  Meanwhile, South Korea (+5.66% not a typo, huge rally after a ban on short-selling), Japan (+2.37%), Shenzhen (+2.21%), and Hong Kong (+1.71%) led a huge rally.  In Europe, bourses are more mixed with an even split of green and red at midday.  With that said, the big boys of Europe are red with the CAC (-0.36%), DAX (-0.21%), and FTSE (-0.05%) leading the region lower in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modest green start to the day.  The DIA implies a +0.06% open, the SPY is implying a +0.13% open, and the QQQ implies a +0.18% open at this hour.  At the same time, 10-year bond yields are up slightly to 4.595% and Oil (WTI) is up 1.42% to $81.65 per barrel in early trading.

The major economic news scheduled for Tuesday includes September Imports, Sept. Exports, and Sept. Trade Balance (all three at 8:30 a.m.), EIA Short-Term Energy Outlook (noon), and Weekly API Crude Oil Stocks (4:30 p.m.).  We also hear from Fed members Waller (10 a.m.) and Williams (noon).  The major earnings reports scheduled for before the open include AHCO, ADV, APD, GBTG, AMRX, BCO, CG, CLVT, CNHI, DHI, DDOG, DK, ELAN, EMR, EVRG, FIS, GEN, GEO, GFS, INGR, KKR, LCII, MLCO, PRGO, RXO, TAC, UBER, VTNR, VST, WAT, and ZBH.  Then, after the close, AMRK, AKAM, AEL, ANDE, BHF, CIVI, COTY, CPNG, CAPL, DAR, DVA, DVN, EBAY, EC, PLUS, EXR, FNF, GILD, GO, GXO, IAC, IOSP, JKHY, JHX, KD, MASI, DOOR, MOS, MRC, OXY, OVV, PAAS, PR, PRI, PRIM, RXT, RIVN, HOOD, SNBR, STE, TKO, TOST, and VTRS report. 

In economic news later this week, on Wednesday, we get EIA Crude Oil Inventories and hear from Fed Chair Powell as well as Fed member Williams again.  On Thursday, we have the Weekly Initial Jobless Claims, WASDE Ag Report, and Fed Chair Powell speaks again.  Finally, on Friday, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Wednesday, we hear from ADNT, BIIB, GIB, CRL, CCO, SID, EDR, GTN, IBP, BEKE, K, MIDD, NFE, NYT, NXST, ODP, PTEN, PFGC, PLTK, PSNY, RL, RPRX, REYN, RBLX, SEAS, FOUR, SWX, SPTN, STWD, SHOO, TRP, TEVA, UAA, UWMC, VSH, WBD, KLG, AE, AFRM, ALTG, AMC, APP, ASH, ATO, GBS, ATG, CENX, CTVA, ENS, FLT, G, HP, HUBS, JXN, JAZZ, KGC, LYFT, MFC, MATV, MGM, SU, TTWO, MODG, TTEC, TWLO, UHAL, VSAT, and DIS.  On Thursday, AEE, MT, BDX, CLMT, TAST, COMM, DBD, EPC, GLP, GRAB, HBI, HE, HBM, IHRT, KELYA, LI, EYE, NOMD, ACDC, RCI, SN, SCSC, SONY, SLVM, TPR, TDG, USFD, WRK, WWW, YPF, CANO, CPRI, FLO, HOLX, ILMN, LNW, MTD, NWSA, NGL, PBR, RBA, STN, TTD, TPC, U, and WYNN report.  Finally, on Friday, AQN, AU, and STNE report.

In miscellaneous news, GS said Monday that, in their estimation, the current high yield of Treasury bonds is the equivalent of four quarter-point Fed rate hikes.  This reduces the need for additional FOMC rate hikes (again, by their estimate).  Elsewhere, OpenAI announced the next version of its ChatGPT AI app. At the same time, Natural Gas prices fell 7% Monday after the EIA reported record output and updated its Winter forecast to be milder. Finally, in late-breaking news, WE filed for bankruptcy as had been expected for some time.

So far this morning, AHCO, AMRX, BCO, CLVT, DHI, DDOG, DK, ELAN, FOR, GBTG, GEO, GFS, KKR, RXO, SGRY, TAC, VTNR, AND ZBH all reported beats on both the revenue and earnings lines.  At the same time, APD, CG, EVRG, INGR, PRGO, AND WAT missed on revenue while beating on earnings.  On the other side, UBER beat on revenue while missing on the earnings lines.  Unfortunately, ADV, CNHI, EMR, LCII, VST, and FIS missed on both the top and bottom lines.  It is worth noting that CNHI and SGRY lowered their forward guidance.  However, DDOG, EMR, and VST raised their forward guidance.

With that background, it looks like Mr. Market is again undecided early in the day. The Premarket started lower in all three major index ETFs. From that point, all three that printed small, indecisive, and mixed-color dandles during the early session. All three remain well above their T-line (8ema) and 50smas. So, the Bulls still have the control of the short-term trend. Keep in mind that all three remain 4%-5% below their summer highs. So, the Bears remain in control of the longer-term trend. In terms of extension, all three remain a bit stretched from their T-line but the T2122 indicator has dropped back into its mid-range. So, while there is some room to run in either direction, the market remains in need of a pause or pullback to relieve extension. (However, as always, remember that the market can stay stretched longer than we can stay afloat knowing it has to turn soon.) So, be aware of that potential volatility.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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.

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