On Thursday, markets gapped higher, opening up 0.57% in the SPY, up 0.59% in the DIA, and up 0.44% in the QQQ.  However, the Bears said “Not so fast” as all three major index ETFs started immediately selling and didn’t stop until 10:25 a.m. The QQQ even recrossed its opening gap during that move.  Still, that was the last we heard from the Bears as the Bulls stepped in to lead a rally that lasted the rest of the day (although to be fair, most of the afternoon was more of a sideways grind).  This action gave us gap-up, white-bodied, Spinning Top candles in all three major index ETFs.  All three are back above their T-line (8ema) and 50sma.  QQQ even retested its T-line from above and passed the test while DIA did the same with its 50sma.

On the day, all 10 sectors were in the green with Basic Materials (+1.89%) out in front, leading the rest of the market higher, while Healthcare (+0.35%) lagged well behind the other sectors.  At the same time, the SPY gained 0.86%, DIA gained 1.00%, and QQQ gained 0.82%. This all happened on just below-average volume in all three major index ETFs. (A bit better volume than we saw the three earlier days this week.) VXX dropped 2.93% to close at 19.91 and T2122 shot back up to just outside of overbought territory at 79.90. 10-year bond yields rose to close at 4.288% while Oil (WTI) spiked to end the day at $90.53 per barrel.  So, with the exception of some “fade the gap” sentiment just after the open, it was the Bulls’ day and a pretty steady and boring one at that. Still, we closed just below potential resistance levels and that should not be ignored.

The major economic news reported Thursday included August Core PPI (month-on-month), which came in just as expected at +0.2% (right on the forecast but well down from the July +0.4% reading).  However, August PPI (overall, not just core, month-on-month) came in hot at +0.7% (versus a forecast and July value of +0.4%).  At the same time, August Core Retail Sales also came in above the predicted level at +0.6% (compared to a forecast of +0.4% but down from the July reading of +0.7%).  Overall August Retail Sales (month-on-month) also came in well above anticipated at +0.6% (versus a forecast of +0.2% and even above the July +0.5% value).  Later, July Retail Inventories were reported to have fallen, reported at flat +0.0% compared to the June +0.1% reading.  At the same time, July Business Inventories also came in flat at +0.0% (below the forecast of +0.1% but up from the June -0.1% value).  Finally, after the close, the Fed Balance Sheet Weekly report showed a continued decline but a much smaller one this week.  This week it fell just $2 billion from $8.101 trillion to $8.099 trillion.  This was the smallest decrease since March.

In new issue news, the much-hyped ARM IPO went live Thursday, opening at $56.21 after the stock had priced at $51.  It traded as high as $66.25, as low as $55.55, and closed at $63.59.  Elsewhere, a new ETF (QQQY) began trading Thursday that is aimed at taking advantage of the craze of zero and short-dated equity options.  The new ETF aims to achieve a monthly yield for investors by selling 0DTE put options on the Nasdaq-100 index (hoping to capture the premium) in combination with buying Treasuries.

In stock news, UP appointed a member of the DAL board (George Mattson) as its new CEO. This came weeks after UP received a $500 million lifeline loan from a consortium of airlines (including DAL).  Later, NVO announced it still intends to split its stock (ADR) 2-for-1 on September 20, despite its 23% surge since August 4 and 41% gain this year.  Elsewhere, Reuters reported unnamed sources tell it that TSLA is very close to announcing new manufacturing technology that will allow the company to die-cast the entire underbody of its cars.  (As opposed to making or buying and then assembling 400 underbody components now.)  If/when implemented, a large amount of labor and cost would be removed from each car, allowing TSLA to achieve lower prices, higher margins, or more likely both.  The technology would also allow TSLA to launch a new vehicle designed from the ground up in 18-24 months versus the current 3–4-year timeline.  At the same time, TSM announced that it has acquired a 10% stake in the INTC Nanofabrication business unit for $430 million.  This comes after INTC sold a 20% stake in the unit to Bain Capital.  By midday, CZR disclosed that it had also suffered a cyber attack (and paid a $15 million ransom to the attackers) before MGM suffered a very similar attack Sunday.  At the same time, the CFO of T said the company is optimistic it will reach its full-year free cash flow forecast of $16 billion.  After the close, Reuters reported the new CEO of BAYRY plans to cut management jobs as a first step in his plan to overhaul the German industrial/chemical giant.  (No number of jobs or timetable was provided.)  Also after the close, Reuters reported that DIS has had preliminary talks with NXST over the sale of DIS subsidiary ABC.  (NXST operates a regional network of TV stations.) 

In stock government, legal, and regulatory news, the Indian state of Goa told ABT that it plans to suspend the company’s antacid manufacturing license.  This comes after Goa authorities found contamination risks and sanitation issues in the plant.  (ABT has a 7% share of the Indian market in that segment with annual sales of about $11 million.) Later, a day after France halted the sale, Belgium said Thursday it is reviewing the potential health risks of AAPL iPhone 12 models.  However, there does not appear to be an EU-wide ban movement underway yet as the European Commission is waiting on feedback from its member countries before deciding on what, if any, action to take on the matter.  By midday, the US Supreme Court froze an order by a lower court that had curbed the Biden Administration’s ability to engage with social media companies like META, GOOGL, and X (Twitter) in an effort to get them to remove misleading, false, or dangerous content.  In stock legal news, GOOGL hinted at part of its antitrust defense.  The search giant shared data it says shows that users are “happy to stick with Google search when pre-installed on their devices and quickly switch when competing search engines are pre-installed.”  On the other side, the government introduced evidence showing that GOOGL spends $10 billion each year to keep Google as the default search engine in phones, tablets, and browsers.  In the afternoon, a proposed class action lawsuit was filed against several companies, including JNJ, PG, WBA, GSK, and KVUE alleging these companies deceived consumers in advertising of over-the-counter cold medicines that contain an ingredient an FDA panel just recently unanimously ruled was ineffective (no more effective than placebo).  No damage information is available yet, but that segment of products generates about $1.76 billion in annual sales in the US.  After the close, GOOGL agreed to pay the state of CA $93 million to resolve a lawsuit claiming the company’s search engine misled consumers about its location tracking practices.  (GOOGL continues to track and use people’s location data for advertising even after they have turned off the “Location History” setting.)  Also after the close, UBER said it would appeal a $205 million fine from a Brazilian court over a ruling that the company used “irregular labor relations” for treating drivers as contractors and not as employees.

After the close, ADBE, CPRT, and LEN all reported beats on both the revenue and the earnings lines.  (ADBE and CPRT both had actual quarter-on-quarter earnings growth while LEN beat a reduced number.)  It is worth noting that both ADBE and LEN raised their forward guidance. 

Overnight, Asian markets were mostly green again.  Only Shenzhen (-0.52%), Shanghai (-0.28%), and Thailand (-0.20%) were in the red.  The other nine Asian exchanges were led higher by Australia (+1.29%), Japan (+1.10%), and South Korea (+1.10%).  In Europe, with the sole exception of Russia (-0.08%), the bourses are green across the board at midday.  The CAC (+1.66%), DAX (+1.07%), and FTSE (+0.83%) are leading a broad and strong move higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a mixed and modest start to the day.  The DIA implies a +0.22% open, the SPY is implying a +0.09% open, and the QQQ implies a -0.08% open at this hour.  At the same time, 10-year bond yields are popping higher at 4.324% and Oil (WTI) is up slightly to $90.66 per barrel in early trading.

The major economic news scheduled for Friday includes August Export Price Index, August Import Price Index, and NY Empire State Mfg. Index (all at 8:30 a.m.), August Year-on-Year Industrial Production and August Month-on-Month Industrial Production (both at 9:15 a.m.), Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan Consumer 12-month Inflation Expectation, and Michigan Consumer 5-Year Inflation Expectations (all at 10 a.m.).  There are no major earnings reports scheduled for either before the open or after the close. 

In Autoworker contract talks or strike news, GM sweetened its offer to include a 20% pay increase over 4 years as well as an unclear inflation-protection mechanism, and an increase to 5 weeks of vacation.  For their part, F CEO Farley made no new offer but told reporters that the UAW’s 40% wage hike demand would put the company out of business (in bankruptcy).  In addition, Farley said he has not received a counter-offer to the company’s 20% wage increase proposal.  (To be fair, the union did lower its demand to a 36% increase over the new contract.)  With just eight hours left until the current contract expired, the AP reported the sides remained far apart and the union’s targeted individual-plant strikes looked unavoidable.  In the end, no deal was reached and at midnight, autoworkers went on strike at three key plants.  The GM truck and van plant in MO, the F Ranger and Bronco pickup plant in MI, and the STLA Jeep plant in OH are the first plants to see pickets.  The UAW says the 3 strikes so far cover just 12,700 union members (over more than 146,000).  The three plants selected produce high-profit vehicles for the automakers.  (UAW President Fain had previously announced that the strikes will rotate, move to different plants, and increase in number to cause maximum uncertainty and disruption if the strike continues.  The idea is to force the Big 3 to live with the chaos of unpredictable operations and shortages, even as most union workers continue to draw normal paychecks. However, the Big 3 also have the option of locking all union employees out by closing all their plants.  Neither option is good for the three largest automakers.)

In miscellaneous news, China struck back (rhetorically) at the EU Thursday after European Commission President von der Leyen had announced an investigation into China over electric vehicle subsidies that allowed Chinese carmakers to flood the world (Europe) with EVs at artificially low prices.  China, predictably, blasted the European Commission move as protectionist, and anti-competitive and said it would harm economic relations.  This last part caused concern among the German car industry which sells a lot of cars in China.  Meanwhile, in the US, frustrated GOP House Speaker McCarthy provoked and taunted right-wing members of his caucus over their threats and pseudo-extortion.  (The most extreme members of the small right-wing “Freedom Caucus” have publicly threatened to force McCarthy out of his Speakership unless their list of demands is met in recent days.)  McCarthy told Republican Congressmen that if they wanted to remove him, they should file the…motion, but they should get out of the way of “everybody’s work.”  Specifically, he told them nobody wins a government shutdown and he is set on not having that happen.  However, there are only 9 “working days” (16 calendar days) left before a shutdown is forced by the House’s failure to pass the 12 different required appropriation bills.  Elsewhere, China cut the reserve requirements for banks for the second time this year.  However, this intended stimulus was minor to say the least, reducing the cash reserves requirement by a quarter percent to 7.4%.  Still, the move is expected to free up just under $69 billion for loaning and investment into medium and long-term projects.

With that background, it looks like markets are undecided this morning. The three major index ETFs are little moved from the Thursday close and are printing small candles in the premarket session. All three remain above their T-line (8ema) but they are also close to that average and could easily recross it if the Bears find some strength. The SPY, DIA, and QQQ are all also above their 50sma again this morning. So, for now, they market remains in a bullish trend. However, we should also note that there is an obvious potential resistance level just above the SPY, QQQ, and DIA. The short, mid, and long-term trends remain bullish, but action has been choppy within those trends recently. In terms of extension, as mentioned, none of the major index ETFs are far from their T-line and the T2122 indicator is now at the top of its mid-range. So, there is plenty of slack for either the Bulls or the Bears to make a move. Finally, this is Friday. So, pay yourself and prepare your account for the weekend with whatever hedging or lightening up is appropriate for your risk tolerance.

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 opened flat on Wednesday with “gapping” up 0.04%, DIA gapping up 0.08%, and QQQ gapping up 0.04%.  At that point, the two large-cap index ETFs traded dead sideways while the QQQ made a small rally and then sold off in the first 30 minutes.  All three then sold off until 10:20 a.m., before rallying back up until 11 a.m.  After that, the SPY, DIA, and QQ all traded sideways in a very tight range until 2 p.m.  This led to a selloff that lasted until 3:15 p.m. before the day ended on a modest 45-minute rally.  This led to indecisive Spinning Top candles in all three major index ETFs, white-bodied in the SPY and QQQ as well as a black-bodied on in the DIA.  SPY and DIA both failed a retest and closed tight below their T-line (8ema) and 50sma while QQQ closed tight above its own T-line and 50sma.  This all happened on well-below-average volume in all three major index ETFs. 

On the day, seven of the 10 sectors were in the red with Utilities (+1.02%) way out in front leading the rest of the market higher, while Energy (-0.71%) was by far the biggest laggard sector.  At the same time, the SPY gained 0.12%, DIA lost just 0.19%, and QQQ gained 0.38%.  VXX fell just over two percent to close at 20.51 and T2122 dropped back down to just inside the oversold territory at 19.51.  10-year bond yields fell to close at 4.254% while Oil (WTI) ended the day flat at $88.85 per barrel.  So, on the whole, it was a very indecisive and volatile day (at least within a small range).  

The major economic news reported Wednesday included August Core CPI (month-on-month) which came in a bit hot at +0.3%, compared to a forecast of +0.2% which was also the July value.  However, the August Core CPI (year-on-year) was in line with what was expected at +4.3% (versus a +4.3% forecast and down from the July reading of +4.7%). Meanwhile, the August CPI month-on-month came in as predicted at +0.6% (compared to a +0.6% forecast but far above the July value of +0.2%).  At the same time, August CPI year-on-year was higher than anticipated at +3.7% (versus a forecast of +3.6% and the July reading of +3.2%).  Later the EIA Weekly Crude Oil Inventories showed a significant unexpected build of 3.954 million barrels (compared to a forecast calling for a drawdown of 1.912 million barrels and far above the prior week’s 6.307-million-barrel drawdown). Finally, at 2 p.m., the Federal Budget Balance was massively better than expected at +89.3 billion, yes it was a surplus, (versus a forecasted -$240 billion and the August deficit of $221 billion).  In light of the CPI data, it is worth noting that Wednesday night the CME Fedwatch Tool still shows that markets have priced in a 97% chance that the Fed will leave rates unchanged next week.

In stock news, German jet engine provider MTUAY said Wednesday that it will begin talks with RTX over the $751 million hit MTUAY will suffer due to problems with RTX’s Pratt & Whitney engines.  Elsewhere, DAL is facing a proposed class-action suit in Los Angeles over “Greenwashing” for allegedly false advertising in which DAL claimed to be “carbon-neutral” based on carbon offsets the company had purchased.  Later, XOM disclosed that it’s invested $30 billion into various projects in the Qatar LNG industry.  At the same time, USB was down hard after its three top officers made comments at an industry conference stating that slow loan growth would be a drag in its Q3 performance.  The CEO also said he expected “a little bit more of the effect in Q4.”  In other banking news, C announced a major reorganization Wednesday, cutting entire layers out of the management hierarchy and giving the CEO direct oversight of the five core business units.  Interestingly, while “job cuts” were part of the announcement, no numbers, timing, or specific senior manager exits were mentioned.  Later, EPOW shares jumped after it announced it had received interest from TSLA over its battery component products.  In less promising news, MMM warned that it foresees a “slow growth environment” in 2024, particularly mentioning projected weakness in electronics and consumer segments.  Later SGML announced it is “exploring strategic options” for the whole company after it has received multiple proposals for its Brazilian unit.  After the close, Reuters reported that GS has fired “several” executives in its transaction banking unit after they violated company communications policies (using banned apps like WhatsApp for secret interactions).  Also after the close, SBUX announced that founder and former three-time CEO Schultz will retire from the company board on September 30.  Wednesday evening, the head of US operations for TD said that the US Justice Dept. probe into the bank’s money laundering compliance is “manageable.”  However, he said he expects fines and non-monetary penalties.  Wednesday night, BRKB announced it sold 5.5 million shares of HPQ this week, unraveling a small portion of its $3.27 billion position in the stock.  Finally, The long-anticipated ARM IPO goes live today, after the Wall Street Journal reported Wednesday that it will be priced at $52 per share (top end of its earlier-announced range).

In stock government, and regulatory news, the NASDAQ has formally submitted an application to the SEC, seeking approval to list an ETF the combines the spot and futures contract prices of Ethereum cryptocurrency. The fund, Hashex Nasdaq Ethereum ETF, would be offered by a Brazilian asset management company managed by Toroso Investments.  Elsewhere, the NHTSA announced that TM has issued recalls for nearly 22k 2023 Tundra and Tundra Hybrid vehicles (due to load carrying labeling that can encourage usage at unsafe load capacities).  Overseas, China said that it “has not banned the purchase or use of foreign phones (AAPL).  However, at the same time, the spokesman said they had noticed a lot of recent media exposure over security incidents related to AAPL phones and the Chinese government placed great importance on information security…and will monitor things closely.  (Great house you have there.  It would be a shame is it burned down.  AAPL gets 20% of its revenue from China.)  At the same time, the FBI announced it was investigating the cyber attack at MGM that has kept the hotel and casino operator’s systems paralyzed for three days now.  Meanwhile, AAPL defended its iPhone 12 model after a French watchdog agency halted the sale of that model, claiming the phone breaches EU radiation exposure limits.  AAPL claims the 12 model (2020) phone meets international standards for radiation, but French tests have now found otherwise.  This raises the possibility of European-wide bans on the sale of model 12 iPhones.  After the close, the EEOC filed suit in AR against WMT over allegations it fired hourly workers with disabilities who could not pass a computer-based test which had no relation to their jobs.  (WMT has since discontinued the tests but did not offer to rehire those workers it fired.)  Also after the close, Elon Musk told reporters that while he can’t read lawmaker’s minds, the majority did raise their hand when asked if they felt there was a need from more AI regulation.  (The day-long closed-door session was meant to be a primer for lawmakers on AI technology and issues with speakers including the CEOs from GOOGL, META, NVDA, MSFT, IBM, and TSLA as well as former MSFT CEO Bill Gates.)

In stock legal news, a federal judge in Washington DC ruled that DAL and UAL must face a consumer antitrust class action case that accuses the airlines of conspiring to drive up domestic airfares by reducing the number of seats available.  (AAL and LUV have already settled for $45 million and $15 million respectively over this same claim.)  Elsewhere, in the GOOG antitrust case, Wednesday, a former GOOG executive testified that the company aggressively sought “exclusive” deals with mobile carriers for use of its search engine.  Later, a US Appeals Court questioned why a shareholder lawsuit against PCG officers and directors had been halted since September 2022.  A lower court judge halted the case at company request as PCG pursued bankruptcy.  The three-judge panel called the delay puzzling and questioned what efficiency was being gained by the delay. 

Overnight, Asian markets were mostly in the green.  South Korea (+1.51%), Japan (+1.41%), and Taiwan (+1.36%) paced the gainers while the only three red exchanges were Shenzhen (-0.57%), New Zealand (-0.38%), and Malaysia (-0.27%).  In Europe, the only red at midday comes from Russia (-1.24%).  Meanwhile, The FTSE (+1.24%), CAC (+0.41%), and DAX (+0.24%) lead the region higher.  In the US, as of 7:30 a.m., Futures are pointing toward a higher open.  The DIA implies a +0.30% open, the SPY is implying a +0.44% open, and the QQQ implies a +0.45% open at this hour.  At the same time, 10-year bond yields are up a bit once again to 4.262% and Oil (WTI) is up 1.32% to $89.69 per barrel in early trading.

The major economic news scheduled for Thursday includes August Month-on-Month PPI, Weekly Initial Jobless Claims, and August Retail Sales (all at 8:30 a.m.), July Business Inventories and July Retail Inventories (both at 10 a.m.), and the Fed Balance Sheet (4:30 p.m.).  There are no major earnings reports before the open.  However, after the close, ADBE, CPRT, and LEN report. 

In economic news later this week, on Friday, the August Export Price Index, August Import Price Index, NY Empire State Mfg. Index, August Year-on-Year Industrial Production, August Month-on-Month Industrial Production, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan Consumer 12-month Inflation Expectation, and Michigan Consumer 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Friday, there are no major earnings reports scheduled again.

In miscellaneous news, Bloomberg reported Wednesday that global central banks are not as down on US Treasuries as the media might have you believe.  In fact, demand is consistent and bond buying is on pace to top last year’s $183 billion as central banks are trying to scoop up beaten-down US bonds.  The article pointed out that currency exchange rate differences accounted for all of the changes in the value of bond sales (not the quantity).  Elsewhere, the EPA issued a surprising report that claimed the US is on track to reduce carbon emissions between 35% and 43% by 2030 (compared to 2005 levels). The agency attributed this to Inflation Reduction Act programs. However, Republicans want to kill those programs in support of industry and would likely dispute those findings as “just made up to take credit.” Meanwhile, on the other side, Environmentalists would likely dispute the findings as pollyannish and overly optimistic, especially given continuing industry pushback and the 6.25 years left between now and 2030.   In other Congressional news, GOP House Majority Whip Emmer introduced a bill aimed at preventing the Fed from creating a Central Bank Digital Currency.  While he claimed this was needed because President Biden “is willing to compromise American’s right to privacy,” he did not mention the idea was first proposed (and studies of the idea began during) the Trump Administration and that the Fed is not actually part of any branch of government.  Meanwhile, on a similar topic, the fifth-largest Australian bank (Macquarie) announced it will begin phasing out cash, check, and phone operations in favor of digital-only transactions.  Finally, the London Metal Exchange reported that Copper stockpiles have reached the highest level in two years, citing a decline in the expected demand from China.

In Autoworker contract talks or strike news, President Biden said Wednesday that he expects the UAW and major automakers to work around-the-clock to avoid a strike.  He also said the White House was engaged with both sides encouraging progress in the negotiations.  For its part, the UAW outlined plans for a series of strikes targeting specific individual auto plants of all three top carmakers.  However, the currently planned strikes would not be company-wide for any of the three.  (This would be the first ever simultaneous strike against the Big 3.)  The current contract expires tonight at midnight and the strikes have already been authorized by workers.  The union said the best offer from the companies was a 20% wage hike spread over 4.5 years offered by F with the other two offering two to 2.5% less than F.  Meanwhile, the UAW lowered its demand from 40% to 36% over the same 4.5-year period.  On Wednesday night, F CEO Farley “rebuffed” comments made by UAW President Fain (who had said F was not taking bargaining seriously).  Instead, Farley blamed Fain for giving “no genuine counteroffer” to the most recent F proposal.  Farley went on to blame Fain for being absent from a Tuesday meeting that he and F Chair Bill Ford expected him.  (Fain later replied he was elsewhere meeting with STLA negotiators.)  As a side note, it does seem odd and unwieldy to hold all three negotiations at the same time, but separately.  Yet the companies do claim to have different issues and situations.  The bottom line of all this is that we seem to be 16 hours from strikes at individual auto plants, which will last varying lengths and rotate between plants for each automaker (a tactic designed to force the companies to either lock all autoworkers out or cause maximum chaos).

With that background, it looks like the Bulls are making at least a modest push this morning. All three major index ETFs are back above their T-line (8ema). The SPY and QQQ are also back above their 50sma while the DIA is just below that average. All three gave us “gap ups” in the early session but the candles are still small and are not showing premarket follow-through (at least yet). The short, mid, and long-term trends remain bullish, but action has been choppy within those trends recently. In terms of extension, none of the major index ETFs are very far from their T-line and the T2122 indicator is now just inside the oversold range. So, there is plenty of slack for either the Bulls or the Bears to make a move. Again, it’s a matter of finding the buyers or sellers to get the move started…one way or the other.

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 saw us gap down at the open, down 0.34% in the SPY, down 0.23% in the DIA, and down 0.47% in the QQQ.  At that point, all three of the major index ETFs ground sideways for about and hour.  Then we started some modest wave action, mostly to the side in SPY, a bigger swing to the upside in the DIA, and mostly to the downside in the QQQ all until 1:30 p.m.  However, all three then sold off for two hours and then traded sideways in a tight range the last 30 minutes of the day.  This action gave us a white-bodied Inverted Hammer in the DIA, a black-bodied Inverted Hammer, and a black-bodied candle with an upper wick in the QQQ.  All three retested their T-lines (8ema) during the day with QQQ and SPY failing while SPY held up and closed above.  This all happened in well-below-average volume in all three of the major index ETFs (far below in the DIA). 

On the day, six of the 10 sectors were in the red with Technology (-1.35%) way out front leading the rest of the market lower while Energy (+1.81%) was way out front holding up better than any other sector.  At the same time, the SPY lost 0.56%, DIA lost just 0.05%, and QQQ lost 1.11%.  VXX gained slightly to close at 20.93 and T2122 climbed slightly again but remained in the mid-range at 38.02.  10-year bond yields fell a bit to close at 4.272% while Oil (WTI) popped up 1.87% to close at $88.92 per barrel.  So, on balance, it was a bearish day.  However, it was not very decisive, and overall, it felt like the market is still waiting…maybe on the CPI data. 

The major economic news reported Tuesday started with the EIA Short-Term Energy Outlook.  That report projects that global oil output will be 101.2 million barrels per day in 2023 and then rise again to 102.9 million barrels per day in 2024. Meanwhile, global oil demand will reach 101.0 million barrels per day in 2023 and rise to 102.3 million barrels per day in 2024.  This means EIA projects a 0.2 million barrel per day surplus of oil this year and a 0.6 million barrel per day surplus in 2024.  (All of those numbers would be all-time record highs.)  Despite the projected surpluses, somehow, EIA projects a decline of global oil inventories of almost half a million barrels per day for the rest of 2023.  This led them to predict Brent oil averaging $93/barrel in Q4.  The same report said that the US has regained its spot as the world’s largest LNG exporter after the fire-closed Freeport LNG terminal in TX reopened following an eight-month outage. Later, the WASDE Ag Report from the USDA reflected challenging weather conditions (hot and dry in the Midwest) in the last month.  The USDA lowered their expected crop yields for both corn and soybeans (down 1.3 bushels per acre to 173.8 in corn and down 0.8 bushels per acre to 50.1 for soybeans).  This impact was partially offset by a big jump in the number of acres of corn planted this year.  Then after the close, the API Weekly Crude Oil Stocks Report showed an unexpected increase.  The report found a build of 1.174 million barrels on the week (compared to a forecast calling for a drawdown of 2 million barrels and the prior week’s 5.521-million-barrel drawdown).

In stock news, TSM announced Tuesday that it will invest $100 million into ARM as part of the latter’s IPO.  (TSM is the world’s largest chipmaker and ARM is the major chip design rival to the x86 architecture used by INTC and AMD.)  At the same time, the CEO of LAW announced he will step down from both his CEO and Board Member roles.  LAW announced an existing board member (Scott Hill) as interim CEO.  Later, the CFO of WFC said Tuesday that he expects more layoffs are ahead but gave no timeline for cuts or details on causes. WFC has been cutting for years, having cut more than 40,000 headcount since Q3 of 2020.  However, they still had 233,834 employees at the end of June.  Elsewhere, BA reported that its deliveries decreased in August as it delivered 35 jets (main competitor EADSY delivered 52 in August).  This is well down from BA’s year-to-date average of 43 planes delivered per month.  Later the CEO of WMT told a GS Investor Conference that the company was well-positioned and he actually believes prices will fall in 2024 (at least a bit).  He went on to say that WMT is concerned about inflation in certain categories but is also already seeing “pockets of disinflation” and given the job market and wage increases the company feels “pretty good about where the consumer is in the US.”  In the afternoon, AAPL unveiled their new iPhone 15 line as well as a new Watch.  The phones feature brighter screens and an enhanced camera.  The phones go on sale September 22.  Later, XOS revealed that it has won a contract with the state of CA (and local authorities) to acquire electric step vans and other vehicles for government use in that state.  At the end of the day, PFE / BNTX set its list price for the latest COVID-19 shots at $120/dose while MRNA we tits price at $130/dose.  On Tuesday evening, the CEO of BP resigned (effective immediately) over charges of failing to disclose past personal relationships with colleagues.

In stock government, legal, and regulatory news, EU antitrust regulators asked MSFT competitors and customers for comments on the impacts they may experience if the MSFT-proposed remedies (to gain approval for the ATVI acquisition) are approved. No formal EU investigation of the remedies has been launched.  So, this may just be a precaution or it could signal the EU is waiting for the UK Competition Authority’s final decision before taking another step itself.  Elsewhere, the US Dept. of Defense signed a $21 million deal with a subsidiary of TLOFF (Canadian metal miner) to increase US nickel production by exploring the possibility of a mine in MN.  At the same time, US House Republicans held a hearing of their Chinese Communist Party Committee, hearing from several witnesses.  Interestingly, the party of “less regulation” supported the call from former Trump SEC Chair Clayton’s call for all companies over $50 billion (or with China-based revenue over $10 billion) to report on the company’s exposure to China. (I suppose they believe they can spin it that this is good additional reporting while also opposing climate risk reporting as too onerous but that logic illudes me.) At mid-afternoon, the FDA ruled that the active ingredient in many over-the-counter cold and allergy medicines is not effective.  New research found the active ingredient gave no better results than placebo.  (The next step is for the FDA to decide whether the medicines based on this ingredient need to be removed from sale.)  Later, HYMTF (Hyundai) and Kia asked a US judge to reject lawsuits filed by 17 cities for a failure to install anti-theft technologies in millions of their vehicles.  (A TikTok-inspired crime has led to millions of HYMTF and Kia vehicle thefts burdening police and leading to dozens of crashes and 10 deaths, as of February.)   The automakers responded that the real cause was lax policing by the cities rather than easy-to-steal cars.  (96% of all new vehicles sold since 2015 have had immobilizers, which would stop/limit this type of theft.  However, only 26% of HYMTF and Kia cars contain those devices.)  Meanwhile, a federal “Interagency Working Group on Mining Laws” issued a 168-page report that among other things called on Congress to introduce royalties on US hard rock mining and graduating (increasing over time) mining fees to encourage more and faster development of US mines for materials like lithium, cobalt, and nickel.  After the close, the CDC Advisory Panel voted 13-1 in favor of widespread use of the new COVID-19 vaccines for anyone 6 months of age and older.  In the evening, the SEC filed suit against VIRT (broker) for misleading investors/traders into believing it properly safeguarded confidential information when in reality anyone working for the company in 2018-2019 could access all information with just common usernames and generic passwords shared amongst the broker’s offices.  This allowed their proprietary traders to access holdings, prices, and volumes to aid in their own trading.  Finally, the FDA warned CVS and WBA against manufacturing and selling unapproved eye products (some of which were being illegally marketed for treating medical conditions like cataracts, glaucoma, and conjunctivitis).

In Autoworker contract talks or strike news, auto industry and stock analysts’ notes are coming hot and heavy as the current contract end nears.  BCS said their sources tell them the talks are proceeding very slowly and there is now a high likelihood of a strike.  At the same time, Third Bridge says their analysis finds F the most vulnerable to a strike of the Big 3.  (They say this is based on F’s reliance on just a few high-value models to make their numbers…including the F-series pickups.) 

Overnight, Asian markets were mixed but leaned bearish.  Shenzhen (-1.14%) was by far the biggest loser followed by Australia (-0.74%), and Thailand (-0.66%).  On the plus side, New Zealand (+0.52%) and India (+0.38%) were the leading gainers.  In Europe, things are much more on the red side at midday.  There are only two very modestly green bourses while the CAC (-0.90%), DAX (-0.91%), and FTSE (-0.47%) lead the region lower in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modestly lower open.  The DIA implies a -0.14% open, the SPY is implying a -0.11% open, and the QQQ implies a -0.11% open at this hour.  At the same time, 10-year bond yields are up a bit to 4.30% and Oil (WTI) is up another two-thirds of a percent to $89.40 per barrel in early trading.

The major economic news scheduled for Wednesday includes August Year-on-Year CPI and August Month-on-Month CPI (at 8:30 a.m.), EIA Weekly Crude Oil Inventories (10:30 a.m.), and Federal Budget Balance (2 p.m.).  The major earnings reports for the day include CBRL and REVG before the open.  There are no major reports scheduled for after the close. 

In economic news later this week, on Thursday, we get August Month-on-Month PPI, Weekly Initial Jobless Claims, August Retail Sales, July Business Inventories, July Retail Inventories, and the Fed Balance Sheet. Then Friday, August Export Price Index, August Import Price Index, NY Empire State Mfg. Index, August Year-on-Year Industrial Production, August Month-on-Month Industrial Production, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan Consumer 12-month Inflation Expectation, and Michigan Consumer 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Thursday, we hear from ADBE, CPRT, and LEN.  Finally, on Friday, there are no major earnings reports scheduled again.

In miscellaneous news, Reuters reports that unless the current regional drought ends, the Panama Canal will further reduce the maximum number of daily vessel transits.   Many ships already need to reduce loads (containers or bulk) for the transit and then wait to reload on the other side.  (Currently 32 ships per day can transit, down from 36, and the maximum draft has been reduced from 50 feet to 44 feet.)  The canal uses 50 million gallons of fresh water for every ship it transits and the lakes feeding the canal system are drying up due to prolonged drought.  Elsewhere, just ahead of its auction, Citgo (Venezuela-owned and US seized oil refiner) was valued at between $32 and $40 billion.  (The refiner was seized to satisfy $23 billion in claims against Venezuela.)  Citgo is the seventh-largest US oil refiner.  Finally, the US Census Bureau reported that average US individual income fell for the third straight year to a median $74,580.  Similar declines have historically led to recessions.  However, those recessions have usually come at the beginning of the declines, not after the third year.  At the same time, the agency reported that the number of Americans living in non-metro areas outgrew urban populations for the first time in three decades in 2021.

In late-breaking mortgage news, the Mortgage Brokers Association released their weekly data.  This week the national average 30-year, fixed-rate, conforming loan rate increased to 7.27% (up from 7.21%).  As a result, overall demand for mortgages dropped 0.8% from the previous week (and was 31% lower than the same week in 2022).  This included a 5% week-over-week drop in refinance loan applications and a 1% increase in applications for new home purchase loans.

With that background, it looks like markets are waiting on the CPI data today. All three of the major index ETFs are giving us very small premarket candles so far. The DIA is still slightly above its 8ema while the SPY remains slightly below its own T-line. QQQ is the furthest below its T-line but that is not far and it is giving us the best-looking candle this morning. QQQ is also retesting its 50sma, sitting right on that level at the moment. We are likely to see a reaction to CPI (either bullish or bearish). So, expect volatility as we get closer to the open and shortly after the opening bell. The very short-term and mid-term trends remain bullish, but only just so in the short-term. (The previous short-term downtrend has been broken, but we have not yet proven we can hold above that line. So, it is really just a presumed resumption of the mid-term uptrend as of now.) In terms of extension, none of the major index ETFs are very far from their T-line and the T2122 indicator is still sitting in the lower end of its mid-range. So, there is plenty of slack for either the Bulls or the Bears to make a move. Again, it’s a matter of finding the buyers or sellers to get the move started and the CPI data may help with that…one way or the other.

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 gapped up on Monday (up 0.59% in the SPY, up 0.49% in the DIA, and up 0.86% in the QQQ).  After that we had a sag in all three major index ETFs that lasted until 11 a.m.  At that point, the SPY and QQQ had only retraced about half of their morning gap before beginning a long, slow rally that lasted the rest of the day.  On the other hand, DIA continued to sell until almost noon, at which point it had recrossed the morning gap up.  Then DIA followed the other two majors with a very modest afternoon rally getting back up into the middle of the gap.  This action gave us a white-bodied Hammer that bounced up off the T-line (8ema) in the SPY and QQQ, as well as a black-bodied Spinning Top that bounced up off the T-line in the DIA. Both the SPY and QQQ crossed back above their 50sma. This all happened on well-below-average volume (far-below in the DIA) in the major index ETFs. 

On the day, nine of the 10 sectors were in the green with Consumer Cyclical (+1.04%) and Communication Services (+0.96%) leading a broad rally while Energy (-0.82%) was the only laggard in the red.  At the same time, the SPY gained 0.66%, DIA gained 0.25%, and QQQ gained 1.18%.  VXX fell another 2.35% to close at 20.78 and T2122 climbed again but remained in the mid-range at 37.21.  10-year bond yields climbed up to close at 4.294% while Oil (WTI) fell just a couple of pennies from Friday’s close to close at $87.31 per barrel. So, on balance, the bulls won the day again and the breadth has improved in the last few days.  (For example, 302 of the S&P500 were in the green Monday.)  However, the breadth is starting from a very low level and, as an example, only 158 of the S&P500 were up more than the SPY itself.  (TSLA did a lot of lifting in both the SPY and QQQ on its +10.09% day.)  DIA remains the weak link and laggard. 

There was no major economic news reported Monday.  However, the NY Fed released the results of its August Consumer Sentiment survey.  The bank said that respondents now see slightly higher inflation a year from now compared to the July survey.  August showed 3.6% is expected in a year while 3.5% was expected a year out in July.  When looking out three years, the average expectation fell slightly from 2.9% in July to 2.8% in August.  For the five-year horizon, consumers expect 3.0%, which is up slightly from the 2.9% 5-year-out expectation in July.  Elsewhere, a Commissioner for the CFTC proposed the creation of a national database (hard to believe one does not yet exist) where investors and law enforcement can research past fraud convictions and civil fines from agencies for financial misconduct.

In stock news, early Monday QCOM announced it will continue supplying AAPL with 5G chips for its phones and tablets until at least 2026.  Previously, the deal was set to end at the end of 2023 and AAPL purchased the INTC modem business in 2019 with the expectation they could replace QCOM with internally-made modems.  Later, STLA announced that is has teamed up with an investment firm to begin the third phase of its share buybacks (which is part of the $1.5 billion buyback program announced back in February).  This round of buybacks will be comprised of roughly $537 million.  At about the same time, BA announced that Vietnam Airlines committed to order 50 of the company’s 737-8 jets for $7.8 billion during President Biden’s post-G20 Summit visit to their country.  At the same time, back in the US, SJM announced an agreement to acquire TWNK for $5.6 billion ($4.6 billion plus $1 billion in assumed debt).  Elsewhere, DIS and CHTR (second-largest cable operator) reached a deal midday, ending the service disruption that was impacting CHTR customers.  (Despite media predictions of this contract dispute potentially changing the industry, it looks as if that was much more hype than reality.)  In the mid-afternoon, EVGO announced it had received the first batch of 350kw fast chargers from DLTEF.  After the close, analysts say that TSLA’s huge 10% gain was fueled almost completely by industry reports that TSLA’s new “Dojo” supercomputer could add $600 billion in market value by helping speed up the move into robotaxis and software services.  In response, stock analysts from JPM, MS, and others raised their TSLA target prices and the stock exploded higher.  After the close, GE announced it would sell its 32.4 million share stake in AER via an underwritten public offering.  (The deal is worth $2 billion at AER’s closing price.)  GE had previously sold 18 million shares of AER in March.  Also after the close, UPS said it expects its new contract with the Teamsters to increase its wage and benefit costs by 3.3% annually over the life of the contract, which expires July 31, 2028.

In stock government, legal, and regulatory news, a US federal judge ruled against the motion by META, ruling that the company must face a lawsuit claiming they have violated the medical privacy of patients.  At least 664 Hospitals and clinics had let META collect Pixel tracking data, which was then sold to advertisers by META like all other tracking data. In a follow-up to an earlier report, RTX took a $3 billion charge and told airline customers that an average of 350 of EADSY (Airbus) jets will need to be grounded each year (with a maximum of 650 at one time in 2024).  This is needed in order to remove the Pratt & Whitney (owned by RTX) engines to check for a metal flaw in internal engine parts.  RTX estimates 700 engines will need to be removed from jets to undergo a lengthy quality inspection and that process will last through 2026.  (A microscopic impurity was inadvertently introduced into the metal powder used to make internal parts of the engines, potentially causing engine failures when in operation.)  In COVID news, the FDA authorized COVID-19 vaccines from BFE/BNTX and MRNA. (A third vaccine from NVAX is still under review.)  The approval paves the way for the release of the two vaccines later this week.

After the close, CASY and ORCL both missed on revenue while beating on earnings.  Neither company changed forward guidance, although the ORCL quarterly guidance did disappoint by not raising after weaker than was expected cloud revenue for the quarter being reported.

In Autoworker contract talks or strike news, STLA said they plan to make a new offer to the UAW after the union made its own counteroffer on Sunday.  The UAW responded by saying they are ready to negotiate 24×7 until things get hammered out and that some progress has been made, but there is a long way to go.  For its part, STLA sent an email to employees saying the negotiations are on a good path and that many of the negotiating subcommittees had reached a tentative deal over things like health and safety concerns.  Elsewhere, industry analyst J.D. Power said they estimate that the production cuts from a strike against all three major automakers could raise new car prices by 1% each week the strike lasts.  They also say TM, HMC, and VLKAF (Volkswagen) could be winners from a domestic-maker strike.  However, JDP believes they would run out of inventory quickly as well amidst any significant-length strike.  (The current contract ends at midnight on Thursday night and the union has already voted to authorize a strike.)

Overnight, Asian markets were mostly in the red but the biggest movers were on the green side.  Japan (+0.95%) and Taiwan (+0.85%) were by far the largest gainers.  At the same time, South Korea (-0.79%) and Hong Kong (-0.39%) were the leaders of the more numerous down exchanges.  In Europe, the bourses are more evenly split at midday, with six of the 15 exchanges in the green, led by Russia (+1.03%) while eight of the bourses are in the red, led by Finland (-1.11%).  The CAC (-0.06%), DAX (-0.32%), and FTSE (+0.52%) are typical of the spread and lead the region on volume as usual.  In the US, as of 7:30 a.m., Futures are pointing toward a down start to the day.  The DIA implies a -0.18% open, the SPY is implying a -0.26% open, and the QQQ implies a -0.28% open at this hour.  Meanwhile, 10-year bond yields are flat at 4.29% and Oil (WTI) is up a little more than two-thirds of a percent to $87.90 per barrel in early trading.

The major economic news scheduled for Tuesday includes the EIA Short-Term Energy Outlook and WASDE Ag Report (both at noon), August Federal Budget Balance (2 p.m.), and API Weekly Crude Oil Stock Report (4:30 p.m.).  In addition, SEC Chairman Gensler is scheduled to testify before the Senate Banking Committee at 10 a.m. There are no major earnings reports scheduled for Tuesday, either before the bell or after the close. 

In economic news later this week, on Wednesday, August Year-on-Year CPI, August Month-on-Month CPI, and EIA Weekly Crude Oil Inventories are reported.  On Thursday, we get August Month-on-Month PPI, Weekly Initial Jobless Claims, August Retail Sales, July Business Inventories, July Retail Inventories, and the Fed Balance Sheet. Then Friday, August Export Price Index, August Import Price Index, NY Empire State Mfg. Index, August Year-on-Year Industrial Production, August Month-on-Month Industrial Production, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan Consumer 12-month Inflation Expectation, and Michigan Consumer 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Wednesday, CBRL reports.  On Thursday, we hear from ADBE, CPRT, and LEN.  Finally, on Friday, there are no major earnings reports scheduled again.

In miscellaneous news, AAPL is expected to introduce another new iPhone (v15) today.  At the same time, the US vs. GOOG antitrust case gets underway.  This case accuses GOOG of using exclusive (or effectively exclusive) business contracts to stop competitive search engines from gaining or even maintaining any market share. GOOG is expected to counter by claiming the definition of search is too narrow and if you include searches on AMZN, the AAPL store, SPOT, DASH, and many others then it is possible to say GOOG does not have a search monopoly.

In last-minute stories, Bloomberg reports that Mexico has overtaken China to become the US’s largest supplier of goods (origination point of US imports). Interestingly, Mexico’s currency is the strongest-performing one in the world so far this year, which is saying something given the strength of the Dollar. The Mexican stock market is also one of the best-performing. Elsewhere in the world, Russia’s Putin traveled across his country to meet North Korea’s Kim Jung Un. Putin is desperate for more weapons for his so-far-failed invasion of Ukraine and North Korea has always been and probably will always be in desperate need of economic assistance.

With that background, it looks like the Bears want to test the Bulls resolve after a positive Monday. The SPY and DIA are both retesting their T-line (8ema) from above and the SPY is retesting its 50sma from above in this morning’s premarket action. All three major index ETFs are showing very small candles at this time. So, it may be a wait-and-see market or it could be that there is indecision early this morning. Either way, we are not seeing major volatility or move so far before the opening bell. The very short-term and mid-term trends remain bullish, but only just so in the short-term. (The previous short-term downtrend has been broken, but we have not yet proven we can hold above it. So, it is really a presumed resumption of the mid-term uptrend.) As far as extension goes, none of the major index ETFs are very far from their T-line and the T2122 indicator is still sitting in the lower end of its mid-range. So, there is plenty of slack for either the Bulls or the Bears to make a move. Again, it’s a matter of finding the buyers or sellers to get the move started.

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

Friday was a “much ado about nothing” day in the market.  All three major index ETFs opened flat.  Then they rallied to the highs of the day by mid-morning and slowly sold off, reaching the lows of the day at about 3:30 p.m. Finally, the SPY, DIA, and QQQ all rallied modestly in the last 30 minutes.  This action gave us white-bodied, indecisive candles in all three major index ETFs.  The SPY and QQQ printed high-wick, Inverted Hammer type candles while the DIA printed more of a white-bodied Spinning Top candle.  All three retested their T-lines from below…and failed that test, with DIA closing right at its T-line (8ema) while the other two closed below theirs.  The SPY and QQQ also retested their 50smas from below, with QQQ managing to close about a dime above its 50sma while the SPY filed its test.

On the day, five of the 10 sectors were in the green with Energy (+0.91%) out in front leading the way higher and Industrials (-0.45%) by far the biggest loser among the sectors.  At the same time, the SPY gained 0.15%, DIA gained 0.24%, and QQQ gained 0.14%.  VXX fell a bit over two percent to close at 21.27 and T2122 climbed up out of the oversold territory to the lower end of the mid-range at 29.33.  10-year bond yields were up slightly to close at 4.258% while Oil (WTI) gained another half of a percent to close at $87.33 per barrel.   This all happened on far-below-average volume in all three of the major index ETFs.  So, on balance, the bulls won the day.  However, there was not a lot to feel good about for the Bulls with those upper wicks and failures to clearly break through moving averages.  

For the week, all three major index ETFs printed black, Bearish Harami candles.  The DIA also fell through its weekly T-line (8ema).  However, both the SPY and QQQ retested their own weekly T-lines and passed that test, remaining above.  All three major index ETFs remain well above their weekly 50sma, with the SPY and QQQ far above.  Those latter two remain in a weekly PBO (potential J-hook in formation) pattern of a strong bullish uptrend.  DIA is in the same weekly pattern, but is in a much weaker (and possibly breaking or being challenged uptrend…depending on how you draw it).

There was no major economic news reported Friday.  However, to summarize Fed speakers during the week, we repeatedly heard something like there is no hurry to move and it may well be worth not hiking in September…but we are not declaring victory over inflation and it is very possible we may need to hike or otherwise tighten later.  This included Dallas Fed President Logan (normally more hawkish) saying late Thursday “Another skip could be appropriate … this month but my base case, though, is that there is work left to do.”  Another usually hawkish member, Fed Governor Waller came right out and said it earlier, “We can just sit (to see if inflation keeps trending in a downward direction).”  Meanwhile, other Fed speakers tended to tow the “let’s wait to see what more data says” line in their comments during the week.  For example, NY Fed President Williams said “It’s still an open question as we go forward.  Have we got sufficiently restrictive to achieve that (a 2% Fed inflation goal)?”  While this went on, as of the Friday close, Fed futures indicated that the market has priced in a 93% chance of no rate hike at the September FOMC meeting.  (That probability is up 7% from one month prior.)

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The US dollar completed an eight-straight week of gains against its peers on Friday.  Elsewhere, a Fed report Friday showed that US household wealth jumped to a record in Q2, increasing 3.7% to $154.3 trillion.  This included a $2.6 trillion increase in US household equity holdings, while the value of their real estate rose just $2.5 billion in the quarter. Of course, the wealth gap continues to widen with most of than wealth concentrated in the top 10 percent of American households. (Which, in part, helps explain the “woe is us” reports of credit card debt climbing and people living paycheck-to-paycheck at the same time wealth is at record levels.)

In stock news, late Thursday night, an independent research group announced they had found a security flaw in AAPL iPhones that had allowed Israeli firm NSO to plant spyware on iPhones.  Then on Friday, ABG said it was buying private firm Jim Koons Automotive for $1.2 billion in order to expand its presence in the Mid-Atlantic region. Later, Bloomberg reported that BABA has decided to temporarily shelve its plans to IPO its Freshippo grocery chain due to poor performance in the consumer stock sector recently.  (BABA was hoping for a $6 billion – $10 billion valuation, but investment houses were advising roughly $4 billion would be achieved now.)  At the same time, Chinese auto market analyst CPCA announced that TSLA had more than doubled its Chinese market share in August thanks to significant discounts and tax breaks.  This allowed TSLA to return to unit sales growth for the month. Later, Reuters reported plastics and chemical maker COVTY has entered into discussions with suitor Abu Dhabi National Oil Company.  (In August, ADNOC had offered $12.4 billion for COVTY.)  Elsewhere, the Financial Times reported that the ARM IPO is already oversubscribed by five times (Reuters reported the number was more than six times oversubscribed) in the widely-watched tech IPO.  Later, SLTA announced it is expanding its battery production capacity by 60% globally.  No specific timetable was provided, but the company already has six battery plants under construction around the world and said there are more to come. At the same time, GNL shareholders approved a planned merger with RTL in an all-stock deal.  After the close, NKLA announced that one of its electric semi-trucks caught fire near company headquarters and that this was the second such incident in the last week.  Also after the close, GT announced they would cut 1,200 jobs in Europe, Africa, and the Middle East.

In stock government, legal, and regulatory news, KR announced it will sell 400 stores to private firm C&S Wholesale Grocers for $1.9 billion in an effort to gain approval for its $25 billion acquisition of ACI.  Elsewhere, in Congress, the House announced it will be holding more AI hearings this week including testimony from the President of MSFT and the Chief Scientist of NVDA.  On the Senate side, on Tuesday they will also hold an AI hearing.  Separately, on Wednesday, Senate Majority Leader Schumer is hosting a forum (non-hearing) intended to allow Senators and Congressmen to become more informed on AI matters.  These will consist of various industry presentations and Q&A sessions including one by META CEO Zuckerberg and TSLA CEO Musk.  At the same time, an FTC Administrative Judge ruled against INTU on Friday.  The ruling found that INTU engaged in deceptive advertising and deceived at least 4.4 million customers with ads claiming they were offering “free” tax products and services.  The ruling issued a “cease and desist” order, but no financial penalty.  Later KR announced they had agreed to a $1.4 billion settlement (paid over 11 years) to resolve thousands (most) of outstanding lawsuits by US states and local governments over opioid distribution.  This included $1.2 billion going to states, $177 million in attorney fees, and $36 million to Native American tribes.  In the afternoon, a US federal judge ruled META must face a lawsuit claiming it violated the medical privacy of patients who used medical facility websites that included a META Pixel tracking tool.  The judge ruled against META’s motions to dismiss the case.  In the afternoon, the FDIC released a report saying the agency should have been more aggressive in its policing of the risk management of FRCB prior to its failure in May.  (It said it was unclear if this could have saved the bank given the speed at which depositors pulled their money out of the bank.  However, it should have done more and sooner.)  After the close, the NHTSA cited inadequate inspections as the cause of a UAL 2021 jet engine failure.  Soon after the failure, the FAA ordered immediate inspections of all BA jets with RTX-made Pratt & Whitney 4000 engines.

In Autoworker contract talks or strike news, on Friday, STLA offered the UAW a 14.5% wage increase over four years.  This is far short of the UAW’s desired 46% increase and a reduction to a 32-hour work week.  Previously, GM offered a 10% immediate raise, followed by two other 3% increases over the four years.  The week before, F had offered 9% increase over four years along with a 6% lump-sum one-time payment.  The UAW contract with all of the “Big 3” automakers ends Thursday night at midnight.

Overnight, Asian markets were mixed but leaned toward the green side.  Shenzhen (+0.98%), India (+0.89%), and Shanghai (+0.84%) paced the gains.  Meanwhile, Taiwan (-0.86%), Hong Kong (-0.58%), and Japan (-0.43%) paced the 5 (or 12) down exchanges.  However, in Europe, we see nearly green across the board at midday.  Only Russia (-0.82%) is in the red while the CAC (+0.42%), DAX (+0.34%), and FTSE (+0.06%) lead the 15 green exchanges higher in early afternoon trade.  In the US, as of 7:30 am, Futures are pointing toward a green start to the day.  The DIA implies a +0.19% open, the SPY is implying a +0.41% open, and the QQQ implies a +0.61% open at this hour.  At the same time, 10-year bond yields are up a bit to 4.294% and Oil (WTI) is off by three-quarters of a percent to $86.89 per barrel in early trading.

There is no major economic news scheduled for Monday.  There are also no major earnings reports scheduled for before the opening bell.  However, after the close, CASY and ORCL report.

In economic news later this week, on Tuesday we get the EIA Short-Term Energy Outlook, WASDE Ag Report, August Federal Budget Balance, and API Weekly Crude Oil Stock report.  Then Wednesday, August Year-on-Year CPI, August Month-on-Month CPI, and EIA Weekly Crude Oil Inventories are reported.  On Thursday, we get August Month-on-Month PPI, Weekly Initial Jobless Claims, August Retail Sales, July Business Inventories, July Retail Inventories, and the Fed Balance Sheet. Then Friday, August Export Price Index, August Import Price Index, NY Empire State Mfg. Index, August Year-on-Year Industrial Production, August Month-on-Month Industrial Production, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan Consumer 12-month Inflation Expectation, and Michigan Consumer 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Tuesday there are no major reported scheduled.  Then Wednesday, CBRL reports.  On Thursday, we hear from ADBE, CPRT, and LEN.  Finally, on Friday, there are no major earnings reports scheduled again.

In miscellaneous news, on Friday, the SEC approved a NASDAQ request to allow a new AI-driven order type.  The new M-ELO order type would use AI to speed up the matching of orders at the midpoint of the bid-ask spread.  The new order type, first proposed in 2018, would allow investors to trade with 10-millisecond waiting periods.  (This means these orders would fill about 20% faster, greatly reduce non-fills, and reduce required holding times by more than 11%.)  It was not mentioned, but this certainly seems aimed at high-frequency traders and the benefit of brokers. Elsewhere, the state of AK filed suit against the US Dept. of Agriculture, seeking to block the decision announced Wednesday that President Biden was reversing a Trump-era ruling allowing large swaths (9.37 million acres) of the Tongass National Forest to be opened for logging, mining, and oil exploration and production.  Biden’s order canceled dozens of oil and gas leases issued in the last days of the Trump administration. Finally, on Sunday, the now-former CEO of BABA resigned. (It was not long ago that he was “relieved” of CEO and Chairman duties to focus on the new BABA Cloud business.) The unexpected move riles BABA shares in China.

In late-breaking geopolitical news, over the weekend, President Biden and Indian PM Modi announced a new international transportation network project meant to rival China’s “Belt and Road” initiative at the G20 Summit.  The idea is to invest in infrastructure connecting Asia, the Middle East, and Europe.  Not only will US-based multinationals benefit, but it will make the US and India an alternative funding source (competitor) to help limit the increase in Chinese influence in the world (achieved through financing and then takeover).  In a separate initiative, on Sunday it was announced the Biden Administration and Saudi Arabia have jointly entered into talks with multiple African nations to secure ownership of various mining operations (mostly rare earth mines).  Under the joint deals being offered, the Saudis would buy the mines and the US would be guaranteed the right to buy percentages of those mine’s production.  (Implied, but unstated, is that US force would be there to ensure the security of the mines should anything of an Islamic or Wagnerian nature threaten them.)  Finally, there was a major 6.8 earthquake in Morocco Friday.  (This was made “more major” because the region was not built or prepared for such a disaster.)  So far, 2,400 are known dead and 300k are homeless.

With that background, it looks like the Bulls are trying to make another move this morning. All three major index ETFs are back above their T-line (8ema) in the early session. The SPY and QQQ are also back above their 50sma. However, with its black premarket candle, the DIA has, so far, failed a retest of its 50sma. This leaves the SPY, QQQ, and DIA all on the green side of flat at least at this point. The very short-term and mid-term trends are now bullish, but only just so in the short-term. (The previous short-term downtrend has been broken, but we have not yet proven we can hold. So, it is really a presumed resumption of the mid-term uptrend.) As far as extension goes, none of the major index ETFs are far from their T-line and the T2122 indicator is sitting in the lower-end of its mid-range. So, there is plenty of slack for either the bulls or the bears to make a move…again, if they can find the buyers or sellers.

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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