Markets gapped up again on Wednesday (0.60% in the SPY, 0.42% in the DIA, and 0.83% in the QQQ) and then looked to be following Tuesday’s example as we sold off to reach the lows by 10:15 am.  However, then the dip-buyers stepped in to lead a steady rally that lasted until noon.  After a 45-minute rest for lunch, the bears stepped in to drive us back near the lows by 2:30 pm, when another rally took over.  This action gave us indecisive Doji or Spinning Top-like candles on the day.  The large-cap indices managed to climb back just above while the QQQ remains just below its T-line (8ema).  The DIA is also continuing to ride along its 50sma.

On the day, all ten of the sectors were in the green with the Consumer Cyclical sector (+3.11%) way out front leading the way higher as the Energy sector (+0.12%) lagged behind.  Meanwhile, the SPY was up 0.75%, the DIA was up 0.40%, and the QQQ was up 0.47%.  This took place on lower-than-average volume.  At the same time, the VXX was down 2.72% to 13.61, and T2122 spiked back up to just outside of the overbought territory at 77.72.  10-year bond yields fell again to 3.679% and Oil (WTI) was down a whopping 4.85% to $73.21 per barrel.  So, overall, it was a very indecisive back-and-forth day that remains in the consolidation of the last 2+ weeks.

In economic news, December ISM Mfg. PMI came in slightly below expectations at 48.4 (compared to a forecasted value of 48.5 and below the November value of 49.0).  Meanwhile, November JOLTs Job Openings came in higher than expected at 10.458 million (versus the 10.000 million forecast and the October value of 10.512 million).  Later, the December FOMC Minutes were released.  In the minutes, it was clear that overall the group felt that restrictive policy was still in order until data indicated that inflation was clearly in a “sustained” downward trend toward 2 percent.  The minutes also show that no voting members expect rate cuts during 2023.  Finally, after the close, the API Weekly Crude Oil Stock Report came out showing a 3.298-million-barrel build (the first increase in three weeks), which was unexpected given the general consensus that the holiday week travel could cause a drawdown. 

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In stock news, CRM announced it is cutting 10% of its workforce (which should be roughly 7,900) and reducing office space in cost-cutting measures.  CRM had already laid off hundreds of employees in November.  Later, GM reclaimed its US sales crown from TM in 2022. GM sold 2.27 million vehicles (up 2.5% over 2021) compared to TM sales of 2.1 million (down 9.6% from 2021).  Meanwhile, BLK is delaying redemptions from its UK property funds after a flood of investors have been seeking to exit Britain’s property market.  During the afternoon, JEF surged following a Nikkei Asia report that SMFG is in the process of raising its stake in Jeffries.  The CEO of SMFG told the outlet that he wants to increase the stake to between 20% and 50% of JEF as soon as discussions with US regulators and JEF management are concluded (SMFG already owns a 5% stake in JEF). 

In government action news, CACC was sued by the US Consumer Finance Protection Bureau and the NY State Attorney General for predatory auto lending (misleading its customers and tricking them into taking high-cost loans on used cars).  Elsewhere, COIN reached a $100 million settlement (which includes a $50 million penalty) with the NY State Dept. of Financial Services for failure to comply with laws regarding account creation.  The FTC disclosed that it had forced OI to drop non-compete requirements that limited where its employees could seek work after leaving OI.  (The agreements had covered about 1,700 workers.)

In energy news, Venezuela’s lack of dredging maintenance has caused a problem for CVX as it attempts to load and move four tanker ships.  The joint ventures with the Venezuelan government intended to bring heavy crude to the US (Mississippi refineries).  The channel to oil terminal in Venezuela is only deep enough to allow tankers to load up to half capacity.  Small tankers are being used to shuttle the heavy oil to a ship-to-ship transfer at sea to fill the larger tankers.  Elsewhere, as mentioned above, the API Weekly Crude Stock report also showed a 1.2-million-barrel build in gasoline (compared to an expected 486k barrel drawdown).  However, there was also a 2.4-million-barrel drawdown in distillate (diesel and heating oil) stocks.

Overnight, Asian markets were mostly green.  Shenzhen (+2.13%), Singapore (+1.55%), and Hong Kong (+1.25%) led the region higher while only a couple of exchanges were in the red.  In Europe, we see a more mixed picture but still leaning to the upside at midday.  The FTSE (+0.46%), DAX (-0.09%), and CAC (+0.05%) lead the region as usual with no clear direction chosen yet in early afternoon trade.  As of 7:30 am, US Futures are pointing to a start to the day just on the green side of flat.  The DIA implies a +0.05% open, the SPY is implying a +0.15% open, and the QQQ implies a +0.29% open at this hour.  At the same time, 10-year bond yields are up a bit to 3.688% and Oil (WTI) is up 2.27% to $74.49/barrel in early trading.

The major economic news events scheduled for Thursday include Dec. ADP Nonfarm Employment Change (8:15 am), Weekly Initial Jobless Claims and Nov. Trade Balance (both at 8:30 am), Dec. Global Composite PMI and Dec. Services PMI (9:45 am), and EIA Weekly Crude Oil Inventories (11 am).  The major earnings reports scheduled for the day include STZ, HELE, LW, MSM, RPM, SCHN, and WBA all before the opening bell.  There are no major earnings reports scheduled for after the close.

In economic news later in the week, on Friday, we get Dec. Avg. Hourly Earnings, Dec. Nonfarm Payrolls, Dec. Participation Rate, Dec, Unemployment Rate, Nov. Factory Orders, and Dec. ISM Non-Mfg. PMI.  And in terms of earnings, on Friday, GBX reports.

So far this morning, WBA, CAG, MSM, and HELE have all reported beats on both the revenue and earnings lines.  Meanwhile, RPM missed on revenue while reporting in line on earnings.  (STZ, LW, and SCHN report closer to the opening bell.) 

In late-breaking news, AMZN has announced it will be laying off more than 18,000 employees.  This is a much larger number than the 10,000 layoffs the tech giant had originally planned.  We also have three previously unplanned Fed speakers today (Harker at 7:30 am, Bostic at 9:20 am, and Bullard 1:20 pm).  And on the Congress front, after six failed votes, the Republicans are no closer to electing a new Speaker of the House as a group of 20 extreme conservatives are revolting in a combination of “give us even more power”, “let any one GOP Congressman call for a new Speaker vote at any time”, and “I’ll never vote for McCarthy” protests.  A seventh vote will begin again at noon today.  (The good news is that since the GOP has no real agenda, the first real piece of House business does not have to come for weeks, when the Debt Ceiling will need to be increased to avoid the US defaulting on its debt.)

With that background, it looks like all three major indices are trying to start the day slightly green. The SPY and DIA are holding on above their T-line and the QQQ is retesting its own T-line (8ema) from below this morning. The consolidation which has been holding for the last two weeks still seems to have a grip on the market. So, be careful about getting too bullish too soon. This market could still break in either direction. Sitting on your hands remains not the worst idea ever. However, if you trade, continue to either be very nimble or prepared to wait out any short-term pressure your position might face. The volumes are likely to pick up this week but the big money eases back into the market slowly and it hasn’t happened yet. (Remember, the big money does not chase. They buy strictly in a price band and will wait for the price to come back to them.)

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

Swing Trade Ideas for your consideration and watchlist: EOSE, MASI, CLF, CAT, IAG, BBWI, BIDU, and AUY. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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 Tuesday, stocks started the year off with a bull trap head-fake as the major indices all gapped higher (SPY gapping 0.54% higher, DIA gapping 0.33% higher, and QQQ gapping 0.91% higher) and then following through to the upside for 10-15 minutes.  However, as I said, this was a bull trap that was met with a selloff that lasted until 12:50 pm when we hit the lows of the day.  From that point, stocks have churned to the side in a fairly tight range before a minor rally in the last 90 minutes.  This action gave us black-bodied candles with wicks on both ends that gapped up to open above the T-line and then crossed back down.  The SPY, DIA, and QQQ all ended as Dark Cloud Cover signals but not ideal ones with the lower wicks in place.

On the day, seven of the ten sectors were in the red with the Energy sector (-4.23%) way out front leading the way lower as the Communication Services sector (+0.91%) held up best.  Meanwhile, the SPY was down 0.42%, the DIA was down 0.03%, and the QQQ was down 0.68%.  This took place on lower-than-average volume, with the QQQ notably lower than the two large-cap indices.  At the same time, the VXX was down just less than 1% to 13.99 and T2122 fell but still remains in the mid-range at 40.70.  10-year bond yields fell to 3.767% and Oil (WTI) was down 3.84% to $77.21 per barrel.  So, overall, it was a “gap and crap” bull trap day to start the year off by staying in the consolidation of the last 2+ weeks.

In economic news, December Mfg. PMI came in exactly as expected at 46.2 (which was down from the November value of 47.7).  Elsewhere, US construction spending in November unexpectedly rebounded, climbing 0.2% and lifted by nonresidential structures.  (Forecasts had expected a decrease of 0.4%.) Single-family homebuilding still fell for the month despite the overall increase.

SNAP Case Study | Actual Trade

In stock news, LUV has been sued for not providing refunds to all the passengers left stranded by the more than 15,000 flights it canceled around Christmas.  (Instead of a refund, LUV gave people impacted 25,000 airline points.) In a letter to the CEO of LUV, US Sec. of Transportation Buttigieg had said last week that the law requires refunds unless the passengers accept rebookings.  At the same time, NVDA has announced a partnership with Taiwanese contract manufacturer Foxconn to make “electronic control units” for use in self-driving vehicles.  Elsewhere, a small portion of MSFT employees (video game testers at the subsidiary Zenimax Studios) have voted to form the first union among the tech giant’s workforce.  MSFT released a statement saying they would avoid a formal election process overseen by the NLRB by voluntarily recognizing the union after the overwhelming vote by the 300 employees.  Late in the day, the state of Kentucky warned C, JPM, and BLK of potential divestment from those stocks over those companies’ refusal to finance projects of fossil-fuel energy companies.  After the close, South Korea fined TSLA $2.2 million for misleading customers about the driving range of its vehicles in lower temperatures. (Cold weather can cut the range of TSLA vehicles by up to 51%.)  Finally, also after the close, AMZN said it has reached an agreement with unspecified lenders for an $8 billion unsecured loan (which is odd, considering they have 35 billion in cash and cash equivalents on hand).

In miscellaneous news, the FBI arrested two Washington state men in connection with Christmas Day attacks on electric substations in the Tacoma area.  (It was not reported whether the attack in Washington was linked to the North Carolina and South Carolina substation attacks earlier in December.)  Elsewhere, NYMEX front-month Natural Gas futures broke below $4/mmBtu, down 11% on the day.  This brought natty down 40% from the best December price and down 60% from the August high.  In Britain, UK rail workers went on strike Tuesday and will continue their strike for a week.  Later in the month, both ambulance drivers and nurses announced they will strike as well. Finally, TSLA got hammered again Tuesday, closing down 12.24%, which was actually 3.5% better than its low for the day.

In government news, after failing to elect a new Speaker of the House during the first three rounds of voting, Republicans adjourned the House for the day.  It appears that 20 extreme GOP members have dug in with their opposition to presumptive Speaker McCarthy and his supporters are not backing down either.  This is the first multi-ballot vote for Speaker of the House in 100 years (and only the second such situation since before the Civil War). The House will reassemble and resume voting for a Speaker again at noon eastern.

Overnight, Asian markets were mixed with Hong Kong (+3.22%) shooting higher on the backs of BIDU and BABA Hong Kong shares after Ant Group was given permission to expand into consumer finance.  South Korea (+1.68%), Australia (+1.63%), and New Zealand (+1.00%) rounded out the leaders.  On the other side, Japan (-1.45%) and India (-1.04%) paced the losses.  Meanwhile, in Europe, the exchanges are mostly green at midday.  The FTSE (+0.65%) lags, with the DAX (+1.64%) and CAC (+1.74%) leading the region higher.  There are only a couple of exchanges in the red, chiefly led by Norway (-1.24%) in early afternoon trade.  As of 7:30 am, US Futures are pointing toward another green start to the session.  The DIA implies a +0.21% open, the SPY is implying a +0.26% open, and the QQQ implies a +0.43% open at this hour.  At the same time, 10-year bond yields are plunging this morning to 3.681% and Oil (WTI) is off another 2.90% to $74.72/barrel.

The major economic news events scheduled for Wednesday include December ISM Mfg. PMI, Nov. JOLTs Job Openings (both at 10 am), FOMC Meeting Minutes (2 pm), and API Weekly Crude Oil Stock (4:30 pm).  The major earnings reports scheduled for the day are limited to UNF before the opening bell.  There are no major earnings reports scheduled for after the close.

In economic news later in the week, on Thursday, Dec. ADP Nonfarm Employment Change, Weekly Initial Jobless Claims, Nov. Trade Balance, Dec. Global Composite PMI, Dec. Services PMI, and EIA Weekly Crude Oil Inventories are reported.  Finally, Friday, we get Dec. Avg. Hourly Earnings, Dec. Nonfarm Payrolls, Dec. Participation Rate, Dec, Unemployment Rate, Nov. Factory Orders, and Dec. ISM Non-Mfg. PMI.

This is another very light week for earnings as on Thursday we get reports from CAG, STZ, HELE, LW, MSM, RPM, SCHN, and WBA.  Finally, on Friday, GBX reports.

In late-breaking news, Bloomberg reports China is pausing its massive investments into creating its own semiconductor industry meant to compete with the US.  Beijing will instead focus efforts on pumping liquidity into the property sector as a massive wave of Covid is pressuring the housing system.  Meanwhile, in the US, mortgage demand fell 13.2% last week compared to two weeks earlier.  This came as 30-year fixed-rate mortgages increased from 6.34% to 6.58% (nearly double the 3.33% that ended 2021).

With that background, it looks like all three major indices are trying to gap up to retest their T-line (8ema) this morning. Just remember yesterday’s “gap and crap” before you go chasing the move. At least at the open, all three look like they will still be in that consolidation that has been holding as we have chopped around the last two weeks. So, be careful about getting too bullish too soon. Sitting on your hands is not the worst idea ever. However, if you trade, continue to either be very nimble or prepared to wait out any short-term pressure your position might face. The volumes are likely to pick up this week after the holidays but don’t be surprised if the big money eases back into the market slowly. (Remember, the big money does not chase. They buy strictly in a price band and will wait for the price to come back to them.)

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

Swing Trade Ideas for your consideration and watchlist: TEVA, VZ, SH, CLF, QID, and AUPH. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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 on the last day of 2022 (opening down 0.70% in the SPY, down 0.45% in the DIA, and down 1.09% in the QQQ).  All three major indices then ground sideways in a tight range near that opening level.  However, at 1 pm there was a 30-minute selloff across the board taking us to the lows of the day at 1:30 pm.  Another 90-minute sideways grind ensued before a strong, year-ending rally kicked in at 3 pm.  This rally took stocks out on their highs for the day.  None of the three indices was able to get back to its T-line (8ema) and all three still remain below their 50sma.  However, the SPY was able to stay over the support level that has held it up for the last two-plus weeks.  This action gave us white-bodied Hammer candles in the SPY and DIA and a larger white-bodied candle with a lower wick in the QQQ.

On the day, eight of the ten sectors were in the red with the Utilities sector (-0.96%) leading the way lower as the Energy sector (+0.45%) held up best.  Meanwhile, the SPY was down 0.26%, the DIA was down 0.22%, and the QQQ was down just 0.06%.  This took place on lower-than-average volume, with the QQQ notably lower than the two large-cap indices.  At the same time, the VXX was flat at 14.12 and T2122 climbed but remains in the mid-range at 55.56.  10-year bond yields climbed to 3.879% and Oil (WTI) was up 2.69% to end the year at $80.51 per barrel.  So, overall, it was a gap-down, dead-market day with a late-day rally on light volume, all within a downtrend consolidation.

For the month of December, SPY closed down 6.19%, the QQQ closed down 9.23% and both printed Bearish Engulfing candles.  However, the DIA held up best, closing down 4.28% and just printing a black candle that managed to stay above its Monthly T-line.  On the year, SPY fell 19.48%, DIA was down just 8.80%, but QQQ led the way by falling a whopping 33.07%.  That included the big dos (market movers) TSLA (down more than 65% on the year), AAPL (down almost 27% on the year), AMZN (down almost 50%), MSFT (down almost 29%), NVDA (down more than 50%), AMD (down 55%), META (down more than 64% on the year), GOOG (down almost 39%), NFLX (down more than 51%), and INTC (down almost 49% on the year).

SNAP Case Study | Actual Trade

In economic news, on Friday, the Chicago PMI came in considerably stronger than was expected at 44.9 (versus a forecast of 40.0 and a November reading of 37.2).  Yet it is important to note that any reading below 50.0 indicates a contraction.  Then on Saturday, China released its own PMI.  The reading showed that the PMI fell to 47.0 from the November reading of 48.0 (economists had forecast a value of 48.0).  This was the third straight lower reading and the largest fall since the beginning of the pandemic in 2020.

In stock news, on Friday, Canada’s Antitrust Tribunal finally (after months of turmoil) approved the ROG acquisition of SJR for $14.77 billion.  This ruling dismissed the Canadian government’s opposition to the deal.  However, the Canadian Commissioner of Competition indicated the government will appeal the decision, but this was a major hurdle that was overcome.  Meanwhile, in the pharmaceutical space, Reuters reports that PFE, GSK, BMY, AZN, and SNY raised the list price of 350 drugs as of January 1. The increases were 6.4% on average and follows 1,400 drug price increases during 2022.  The drug industry says this is in preparation for the Inflation Reduction Act that was passed in 2022 and that allows the government to begin negotiating drug prices, but not until 2026.  After the close Friday, ACTG announced it is conducting an internal investigation into the apparent misconduct of its former CEO over the misuse (personal use) of funds and for making charitable contributions in his own name.  Also, after the close, a US District Judge ordered NCLH to pay the government of Cuba $110 million in damages and another $3 million in legal fees for use of a port.

In miscellaneous news, TSLA reported record Q4 vehicle deliveries of 405,278 (which was a 40% increase over Q4 2021).  However, the number was still 15,500 below the consensus analyst estimate.  Elsewhere, Eurozone Mfg. PMI rose in December to 47.8 (up from 47.1 in November).  The number still does not indicate expansion, but the trend is positive.  In particular, both Germany and France showed gains for the month. Meanwhile, a new variant of the Omicron strain of Covid is quickly becoming the most prevalent in the US.  The XBB.1.5 variant is deemed “highly immune evasive” meaning existing vaccines and treatments are less effective against this strain.  The number of cases of this variant are doubling each week at the moment and currently account for 41% of all US cases according to the CDC. Finally, it flew under the radar, but there was yet another terror attack on New Year’s Eve. This time it was “only” a single Islamic extremist with a machete in NYC, but this will make headlines and is worth watching for potential additional attacks or news.

Overnight, Asian markets were mixed.  Malaysia (-1.44%) and Australia (-1.31%) paced the losses.  Meanwhile, Hong Kong (+1.84%), Shenzhen (+0.92%), and Shanghai (+0.88%) led the gainers.  In Europe, the exchanges lean heavily to the green side with only Norway (-0.26%) in the red at midday.  The FTSE (+1.49%), DAX (+0.74%), and CAC (+0.59%) are leading the region higher in early afternoon trade. As of 7:30 am, US Futures are pointing toward a green start to the day.  The DIA implies a +0.28% open, the SPY is implying a +0.25% open, and the QQQ implies a +0.37% open at this hour.  At the same time, 10-year bond yields are down to 3.771% and Oil (WTI) is off 1.27% to $79.23 per barrel in early trading.

The major economic news events scheduled for Tuesday are limited to December Mfg. PMI (9:45 am).  There are no earnings reports scheduled for the day.

In economic news later in the week, on Wednesday, we get Dec. ISM Mfg. PMI and Nov. JOLTs Job Openings.  Then, Thursday, Dec. ADP Nonfarm Employment Change, Weekly Initial Jobless Claims, Nov. Trade Balance, Dec. Global Composite PMI, Dec. Services PMI, and EIA Weekly Crude Oil Inventories are reported.  Finally, Friday, we get Dec. Avg. Hourly Earnings, Dec. Nonfarm Payrolls, Dec. Participation Rate, Dec, Unemployment Rate, Nov. Factory Orders, and Dec. ISM Non-Mfg. PMI.

This is another very light week for earnings as on Wednesday we hear from UNF.  On Thursday we get reports from CAG, STZ, HELE, LW, MSM, RPM, SCHN, and WBA.  Finally, on Friday, GBX reports.

In government news, the 118th Congress will convene today with the GOP in control of the House. However, there is division among the GOP caucus as it appears that Republican Leader (and presumptive Speaker of the House) McCarthy does not yet have the votes to be confirmed as Speaker. Even after promising to give away a ton of power, dollars, and control (among his giveaways was allowing any 5 Republicans to be able to force a vote of “no confidence” causing a new election for Speaker) this vote will be a close-run thing. Some analysts think the holdouts will force a second or third ballot to extract more concessions. However, there is no public contender or alternative for the job. Regardless of the outcome, it looks like the process will take a little more time and will therefore delay the swearing-in of the House (which only follows the election of the Speaker).

With that background, it looks like all three major indices are trying to gap up through their T-line (8ema) this morning. However, at least at the open, they look like they will still be in that consolidation that has been holding as we have chopped around the last two weeks. So, be careful about getting too bullish too soon. A morning pop can be (and regularly has been) faded as well as one up day being followed by a down day the next. So, either be very nimble or prepared to wait out any short-term pressure your position might face. The volumes are likely to pick up this week after the holidays but don’t be surprised if the big money eases back into the market. Remember, they like to do bracket-price buying.

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

Swing Trade Ideas for your consideration and watchlist: No Trade Ideas Today. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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 higher at the open Thursday as the SPY opened 0.79% higher, the DIA opened 0.61% higher, and the QQQ opened 1.13% higher.  All three major indices then saw a morning follow-through to the upside reaching the highs at about noon.  Then the doldrums took over as the entire market traded sideways in a very tight range and on low volume all afternoon. The SPY and DIA both did manage to climb back above their T-line, with the DIA also crossing back above its 50sma and the SPY gapped up through the support level it failed Wednesday.  This action is giving us white-bodied candles with small wicks at both ends.  The DIA is also a Bullish Harami signal.

On the day, all ten sectors were in the green with the Technology sector (+3.08%) leading the way higher as the Consumer Defensive sector (+0.55%) lagging behind.  Meanwhile, the SPY was up 1.78%, the DIA was up 1.07%, and the QQQ was up 2.44%.  At the same time, the VXX was down 1.26% to 14.13 and T2122 climbed out of the oversold territory into the mid-range at 47.47.  10-year bond yields fell back down to 3.826% and Oil (WTI) is down fractionally to $78.70 per barrel.  So, overall, it was a bullish, low-volume day in a downtrend consolidation.

In economic news, the Weekly Initial Jobless Claims came in exactly as expected at 225k (versus a forecast of 225k and last week’s reading of 216k).  Later in the day, the EIA Weekly Crude Oil Inventories came in unexpectedly higher than forecasted, with a build of 0.718 million barrels (compared to a forecasted drawdown of 1.520 million barrels and the prior week’s drawdown of 5.894 million barrels).  EIA also said that gasoline inventories fell unexpectedly by 3.1 million barrels (compared to an expected inventory build of 520k barrels). Meanwhile, distillate (diesel and heating fuel) inventory unexpectedly grew 282k barrels (versus a forecasted 2.05 million barrel drawdown).

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In stock news, Thursday morning, Elon Musk told TSLA employees they should not be bothered by “stock market craziness” (like TSLA being down 70% on the year).  That may be a tougher sell to higher-level employees who get part of their compensation in stock options.  Musk also urged them to “go all out the next few days” to make TSLA Q4 numbers look as good as possible.  Later, the Wall Street Journal reported that AAPL iPhone production is starting to catch up with demand.  The paper reported that the situation is far from normal (due to waves of covid cases), but at least it was better than in November when workers were rioting to get out of the main production facility (in order to avoid infection).  Elsewhere, LUV said late in the day that it plans to return to normal operations “with only minimal disruptions” on Friday after over a week of massive cancelations and delays.  Earlier in the day, LUV had said the outages of the last week will definitely have an adverse impact on Q4 results.  Finally, HSY was hit with a class action lawsuit claiming the company’s dark chocolate contain harmful levels of lead and cadmium.

In energy news, TRP said Thursday that it has completed a controlled restart of the Keystone pipeline after a 21-day outage.  While the cleanup from the third major spill from the pipeline will take months to complete, the flow is back to the 622k barrels per day as it was prior to the closure.

In miscellaneous news, the US Treasury Dept. said Thursday that starting on Jan. 1, electric vehicle leases can qualify for up to $7,500 in tax credits.  The decision also lifts the 200,000 vehicles per manufacturer cap and allows cars assembled outside of the US to qualify.  Essentially, this group of decisions will benefit all makers o electric vehicles.  In related news, Energy-company-funded US Senator Manchin has called for the Treasury Dept. to pause the implementation of those tax credits (despite it having previously been passed into law) saying the Treasury decisions are inconsistent with the intent of the law and would weaken our country’s energy security.

Overnight, Asian markets were mixed, but leaned to the upside on mostly modest moves.  South Korea (-1.93%) was an outlier to the downside while Shanghai (+0.51%), Thailand (+0.45%), and Taiwan (+0.37%) led the more numerous gainers.  In Europe, with the lone exception of Athens (+0.55%), we see red across the board at midday.  The FTSE (-0.48%), DAX (-0.83%), and CAC (-0.65%) are leading the region lower in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a down start to the last day of the year.  The DIA implies a -0.31% open, the SPY is implying a -0.47% open, and the QQQ implies a -0.75% open at this hour.  At the same time, 10-year bond yields are up a bit to 3.839% and Oil (WTI) is off about a half of a percent to $78.07/barrel in early trading.

The major economic news events scheduled for Friday are limited to Chicago PMI (9:45 am).  There are no earnings reports scheduled for the day.

In late-breaking news, there is word out of Beijing that they have found a promising covid treatment, claimed to be as effective as PFE’s Paxlovid. The new pill is so far called VV116 (developed by two Chinese drug makers) and trials are showing it may have fewer side effects than the PFE treatment. Beyond that, the key things to keep in mind today are that this is the last day of 2022 trading, and also we have a 3-day weekend ahead. So, get your account ready (small, hedged, or purposefully ready to ride out volatility) for the long news cycle.

With that background, it looks like all three major indices are looking to open up back below their T-line (8ema) but still inside the choppy bear trend consolidation pattern of the last two weeks. The DIA is also looking to open up back below its 50sma as that test continues. At this point, over-extension is not a problem in any of the major indices. However, remember that we are likely to continue seeing very light volume as fund managers get out of town to extend their New Year’s weekend celebration even further. Obviously, think long and hard before you go chasing too many new positions unless you are very nimble. This is not the time to be trying to save your month or year with some hero trade.

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

Swing Trade Ideas for your consideration and watchlist: No Trade Ideas Today. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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 and then, after an hour of waffling sideways, began a slow but consistent roller coaster ride lower.  All three major indices have now fallen below their T-lines (8ema) and the DIA is also dropped through its 50sma (the other two have been below their own 50sma for some time).  The SPY also fell through its support level (which had held it up since 12/19).  For its part, QQQ closed at a new low close for the year, and looks like it is on the hunt to reach a new 2022 overall low. This action gave us black-bodied candles in the DIA, SPY, and QQQ. (They could be seen as Evening Star signals in the DIA and SPY.) Yet again, this is happening at a very low volume.

On the day, all ten sectors were in the red with the Energy sector (-2.43%) leading the way lower while the Healthcare sector (-0.55%) held up best.  Meanwhile, the SPY was down 1.22%, the DIA was down 1.14%, and the QQQ is down 1.32%.  At the same time, the VXX was down 0.21% to 14.31 and T2122 fell back into the oversold territory at 14.31.  10-year bond yields surged from the early lows to 3.888% and Oil (WTI) is down just over one percent to $78.66 per barrel.  So, overall, it was a bearish, but low-volume day.

In economic news, November Pending Home Sales came in well below expectations at -4.0% (versus the forecast of -0.8% but better than the October reading of -4.6%).  Then, after the close, the API Weekly Crude Oil Stock Report showed that inventories fell by 1.3 million barrels last week (compared to a drawdown of 3.069 million barrels in the week prior).  This was the second straight week of oil inventory declines.  However, the API also showed a build in gasoline inventories by 510k barrels and an increase in distillate stocks by 388k barrels.

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In stock news, LUV continues to struggle as it was forced to cancel 60% of its flights (another 2,500) on Wednesday.  The airline is in serious trouble as it has already had to cancel nearly 60% of Thursday’s flights.  Elsewhere, GILD purchased the remaining rights for an experimental cancer therapy from JNCE for $67 million.  (GILD already owned a portion of those rights.  This deal also eliminates the GILD potential liability of  needing to pay JNCE up to $685 million in milestone payments as well as percentage of sales royalties if the drug does get to market.)  Meanwhile, ABB completed the sale of its 19.9% remaining stake in the power grid business which it had previously sold 80.1% to Hitachi.  Late in the day, the US 9^th Circuit Court of Appeals revived a lawsuit against GOOGL, HAS, MAT, and other companies for violating the privacy of children (luring kids under age 13 to their websites and then tracking online them without parental consent).  The decision was unanimous by a 3-0 vote.

In energy news, Reuters reported Wednesday that Russian natural gas exports are now expected to come in 45% lower in 2022 than they did in 2021.  This includes the increase in exports to China.  As a result (and partially offsetting the volume loss), the global average price of natural gas has increased 45% during 2022.  More significantly, the trends are expected to accelerate in 2023 since the EU ban on Russian natural gas has now come into effect.  In related news, ship insurers said Wednesday that they are cancelling war risk coverage across the Russia, Ukraine, and Belarus region as of January 1.  This is a response to the re-insurers cancelling coverage due to sanctions. However, under pressure from the Japanese government, Japan’s own insurers have decided to continue covering ships in Russian waters.   Finally, XOM has filed suit against the EU in a move aimed to block the new windfall profits tax (which could cost XOM up to $2 billion by the end of 2023). 

In miscellaneous news, the US announced Wednesday that it is reinstituting rules that require passengers 2 years of age and older to get a negative covid test to enter the US from China, Hong Kong, and Macau.  In Europe, Italy announced they will begin testing incoming passengers from China and they also asked the EU to institute tighter restriction on travelers from the China region.  Finally, related to the Russian invasion of Ukraine, Russia fired another massive salvo of more than 100 missiles at Ukrainian civil infrastructure targets (mostly electrical grid, water facilities, and housing targets). 

Overnight, Asian markets leaned to the downside.  Thailand(+0.85%), Malaysia (+0.78%), and India (+0.38%) managed to stay green.  However, the rest of the region was in the red, led by South Korea (-1.94%), Japan (-0.94%), and Australia (-0.94%).  In Europe, markets are leaning to the upside on modest moves at midday.  The FTSE (-0.19%) is one of the few laggards while the DAX (+0.25%), and CAC (+0.13%) are more typical of the region in early afternoon trade.  As of 7:30 am, US Futures point toward a green start to the day.  The DIA implies a +0.22% open, the SPY is implying a +0.42% open, and the QQQ implies a +0.58% open at this hour.  At the same time, 10-year bond yields are flat at 3.879% and Oil (WTI) is down 1.43% to $77.83/barrel in early trading.

The major economic news events scheduled for Thursday are limited to Weekly Initial Jobless Claims (8:30 am) and EIA Weekly Crude Oil Inventories (11 am).  There are no earnings reports scheduled for the day.

In economic news on Friday, we get the Chicago PMI.

This is an extremely light week for earnings with no reports scheduled for either Thursday or Friday.

With that background, it looks like the three major indices are looking to open up with modestly bullish, inside candles. This is welcome news for the bulls after the DIA gave up T-line and 50sma support and the SPY fell through a significant support level on Wednesday. Over-extension is not a problem yet in any of the major indices, despite the T2122 reading. Just remember that the very light volume of a holiday-sandwiched short week can exaggerate market moves. So, don’t go chasing too many new positions unless you can get in and out very quickly or you are willing to ride the trade through the new year. It’s time to get your 2022 trading book squared up, book your tax losses, and prepare for next year. This is not the time to be trying to save the month or year.

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

Swing Trade Ideas for your consideration and watchlist: No Trade Ideas Today. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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

The large-cap indices opened flat on Tuesday and then meandered sideways in a fairly narrow range on either side of the breakeven point the rest of the day.  However, QQQ opened down a quarter of a percent and preceded to sell off hard the first 30 minutes of the day.  Then it followed the large-cap lead by trading sideways in a fairly narrow range near the lows of the day right into the close.  DIA managed to hold above its 50sma after a retest as well as holding its T-line (8ema).  Meanwhile, SPY managed to hang onto the support level it has been leaning on for a week.  This action left us with an indecisive Doji in the DIA, an indecisive Spinning Top type candle in SPY, and a large, black-bodied candle with a small lower wick in the QQQ.  This all happened on very low volumes.

On the day, six of the ten sectors were in the green with Communications Services (+0.54%) leading the way higher as the Technology sector (-1.09%) lagged behind.  Meanwhile, the SPY was down 0.39%, the DIA gained 0.13%, and the QQQ was down 1.41%.  At the same time, the VXX is flat at 14.34 and T2122 fell but also remains in the mid-range at 35.40. 10-year bond yields surged up to 3.847% and Oil (WTI) was up fractionally to $79.81 per barrel.  So, overall, it was a dead day between the holidays with the exception of a morning selloff in the high-tech QQQ. Chief among the reasons for the QQQ selloff was another brutal -11% day for TSLA and 7% down day for NVDA.

In economic news, the November Goods Trade Balance came in better than expected at -$83.35 billion (compared to a forecast of -$96.90 billion and October’s reading of -$98.80 billion).  Meanwhile, the November Retail Inventories fell by 0.3% (not as big of a drop as in October, when Retail Inventories dropped 0.7%).  After the close, Reuters reported that the Case Shiller national home price index increased 9.2% in October, which was the first single-digit gain in more than two years (+10.7% in September).  At the same time, Fannie Mae and Freddie Mac said the annual home price growth slowed to 9.8% for October (down from +11.1% in September).  So, housing prices continued to outpace inflation in the fall, but the increases are slowing.

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In stock news, on Monday, NIO lowered its guidance for the number of vehicles it will deliver in Q4.  They lowered the estimate from 43,000-48,000 down to 39,000, citing covid-related supply chain disruptions.  Elsewhere, a portion of ATVI’s workforce (the group from the studio named Proletariat, who created the World of Warcraft game, that ATVI recently acquired) have voted to unionize. MSFT is still fighting to purchase ATVI, but the FTC is fighting that MSFT acquisition for antitrust reasons.  Meanwhile, LUV remains under fire from the US DOT (and the public) after canceling another 2,589 flights Tuesday, which was 30 times more cancellations than the airline with the second-highest number of canceled flights.

In miscellaneous news, the Wall Street Journal reported Tuesday that the FDA is now planning to make recommendations on the regulation of products containing CBD (a non-psychoactive cannabis component).  The decision will come in the next couple of months and depending on that decision new agency rules or Congressional actions may be required for the next step.  Elsewhere, US refineries across the Southeast and Gulf Coast began after a pipeline outage over Christmas shutdown a 500k barrels per day supply from North Dakota and last week’s winter storm caused refinery shutdowns in Texas, Louisiana, and Mississippi.  Finally, ECB Vice President de Guindos told Bloomberg that mild temperatures November-December, along with high winds (which aid European wind power generation), have eased the economic outlook across Europe. However, he went on to say 2023 will be difficult as the ECB forecasts inflation will fall to 3% by the end of next year while GDP is forecast to remain under 1%.

In China news, as has been reported for weeks now, the wave of covid cases across that country is building to epic levels since their dropping of restrictions.  Hospitals in several regions (including the manufacturing and supply chain hub of Shanghai) are stretched to the limits.  It has gotten to the point where the government has simply stopped providing numbers again and all anyone has to go from is images of stacks of corpses all over crematoria and hospitals, patients being treated sitting in hospital halls, and anecdotal reports from doctors who say they are overwhelmed and 35% of medical staff continue working even though they too are sick.  With that backdrop, Taiwan, Japan, the US, and Europe are now considering new travel restrictions that will ban flights, require negative tests, and/or impose quarantines again on travelers coming from China.

Overnight, Asian markets were mostly in the red.  Hong Kong (+1.56%) was an outlier with a three other small winning exchanges.  At the same time, South Korea (-2.24%), Taiwan (-1.08%), and Shenzhen (-0.86%) led the rest of the region lower. However, in Europe, with the exceptions of Russia (-0.51%) and Greece (-0.19%), we see green across the board at midday.  The FTSE (+0.94%), DAX (+0.10%), and CAC (+0.24%) are leading the region higher in early afternoon trade. As of 7:30 am, US Futures are pointing toward a modestly green start to the day.  The DIA implies a +0.29% open, the SPY is implying a +0.26% open, and the QQQ implies a +0.20% open at this point.  At the same time, 10-year bond yields have fallen to 3.82% and Oil (WTI) is off three-tenths of a percent to $79.30/barrel in early trading.

The major economic news events scheduled for Wednesday are limited to November Pending Home Sales (10 am) and the API Weekly Crude Oil Stocks Report (4:30 pm).  The only major earnings report scheduled for the day is CALM before the open.  There are no earnings reports scheduled for after the close.

In economic news on Thursday, the Weekly Initial Jobless Claims and EIA Weekly Crude Oil Inventories are reported.  Finally, on Friday, we get the Chicago PMI.

This is an extremely light week for earnings with no reports scheduled for either Thursday or Friday.

With that background, it looks like, of the three major indices, only DIA is moving in premarket. (The other two are gapping slightly, but indecisive in their premarket action.) However, the DIA is now at a retest a resistance level, just above its upturning T-line (8ema). Meanwhile, is stuck in the body range of the prior three daily candles (below its T-line) and the QQQ is just trying to hold on after an awful day by TSLA and NVDA helped drag that index lower Tuesday. Over-extension is not a problem yet in any of the major indices. However, the very light volume of a holiday-sandwiched short week can exaggerate market moves. So, don’t go chasing too many new positions unless you can get in and out very quickly or you are willing to ride the trade through the new year.

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

Swing Trade Ideas for your consideration and watchlist: PAGS, VTNR, and WTI. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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 saw a modest gap lower at the open (0.49% in the QQQ, 0.17% in the DIA, and 0.31% in the SPY).  From that point, we saw a morning swing lower, followed almost immediately by a swing back above the Thursday close.  One last swing lower took us back toward the open.  However, that was the end of the volatility for the day.  The rest of the day saw a very slow, steady, tight range with a slightly bullish trend move for the entire last 5 hours of the day.  This action gave us white-bodied candles with tiny upper wicks and larger lower wicks.  The DIA even managed to print a Bull Engulfing candle. The SPY managed to hold its support level and the DIA managed to hold its 50sma yet again.  All of this happened on lower-than-average volume again.

On the day, all ten of the sectors were in the green with Energy (+2.213.10%) leading the way higher as the Technology (+0.03%) and Healthcare (+0.04%) sectors lagged.  Meanwhile, the SPY gained 0.58%, the DIA gained 0.51%, and the QQQ gained just 0.22%.  At the same time, the VXX fell 2.71% to 14.35 and T2122 has climbed up into the center of the mid-range at 50.96. 10-year bond yields surged up to 3.751% and Oil (WTI) was up 2.40% to $79.35 per barrel.  So, overall, it was a mildly volatile morning that turned into a dead market most of the as traders left early for the long holiday weekend (and to beat the storm).

In economic news, on Thursday, Q3 GDP was revised up to 3.2% (from the previous estimate of 2.9% and far above the Q2 final GDP of -0.5%).  The Q3 Price Index was also revised upward to 4.4% from the prior estimate of 4.3% but far, far below the Q2 reading of +9.0%.  Weekly Initial Jobless Claims also came in slightly better than was forecasted at 216k (versus the expected 222k and a tad above the previous week’s 214k).  Then, on Friday, Nov., Durable Goods Orders fell 2.1% (compared to a forecast of -0.6% and the Oct. reading of +0.7%).  The Nov. PCE Price Index (the Fed’s favorite inflation indicator) came in at 5.5% (well down from the October reading of 6.1%) and showed a second straight month of decline.  November Personal Spending also came in below expectation at +0.1% (versus the forecast of +0.2% and the October reading of +0.9%).  Michigan Consumer Sentiment also beat expectations at 59.7 (versus the forecast of 59.1 and the prior reading of 59.1).  Finally, Nov. New Home Sales were massively stronger than expected at +5.8% (versus a forecast of -4.7% but still well below the October value of +8.2%).  However, this did amount to an actual increase in the homes sold to 640k in November compared to only 605k in October.  So, overall, the economy seems to be stronger than expected, yet inflation is falling some, and consumers are generally feeling better than forecasted.  The FOMC could not have asked for much more than that for Xmas.

SNAP Case Study | Actual Trade

In stock news, on Friday it was announced that GOOGL’s YouTube had won out over rivals AMZN, AAPL, and DirecTV (owned by T and TPG) in the bidding war for NFL Sunday Ticket content.  The price is $2 billion per year for seven years.  Also on Friday, TSLA shares dropped hard as the company announced it has doubled the US discounts for Model 3 and Model Y vehicles.  Elon Musk also pleaded to stop the stock bleeding by saying the will probably not sell any more TSLA stock for two years, but “definitely not in 2023.”  Elsewhere, the US government awarded LMT a $1.05 billion contract for the delivery of F-35 aircraft and awarded a separate $497 million contract to BA for the delivery of CH-47F helicopters. On Saturday it was announced that META will pay $725 million to resolve a lawsuit stemming from its 2016 sale of 87 million American’s data to Cambridge Analytica in support of the Trump campaign.  (However, a judge must still approve the settlement.)  On Monday, TM announced its global car production in November increased by 1.5% to a record 833,104 vehicles.  MA also said that their statistics show US retail sales grew 7.6% this holiday season (well above the 7.1% they had forecasted in September but still below 2021’s 8.5% year-on-year growth).  The bill also guarantees $44.9 billion in military, humanitarian, and economic aid to Ukraine as the Russian war against that country is now in its 11^th month.

In country or government news, China is reeling from Covid with more than 37 million cases (and that is per Chinese government data).  However, on Monday anecdotal reports from Reuters crowded commuter trains in Shanghai and Beijing for the first time in a couple of weeks.  So, even as TSLA was forced to pull forward its previously planned plant shutdown to 12/25/22 – 1/2/23, some businesses are attempting to muddle through the latest wave.  Meanwhile, in the US, the Congress and Senate passed its $1.7 trillion omnibus spending bill to keep the government running through September 2023.  The bill included a 10% increase in Defense spending ($858 billion, well more than requested by President Biden) and a lesser 5% increase in Domestic spending.  Finally, US airlines were forced to cancel over 17,000 flights between Wed. and Monday due to winter storms.  This put a crimp into airline profits on what has been traditionally the third-largest travel weekend of the year.

In miscellaneous last-minute news, LUV is under scrutiny from the US Dept. of Transportation as the company has canceled or delayed 80% of its flights Monday and Tuesday. For comparison, in the same period, DAL has canceled 9% of its flights while UAL canceled just 1%. Meanwhile, in China, a few provinces are reaching the critical level related to available ICU beds in the covid wave that has followed reopening. Specifically, the Zhejiang province near Shanghai now has 1 million active hospitalized cases and forecasts a peak of about 2 million near New Year’s day. Most of these are now elderly patients (50%, up from the normal 20%), which are most likely to turn into ICU cases. This could pose a threat to nearby (and supply chain critical) Shanghai.

Overnight, Asian markets were mixed but mostly green.  Australia (-0.63%) and Hong Kong (-0.44%) were the only red in the region.  Meanwhile, Shenzhen (+1.16%), Thailand (+1.01%), and Shanghai (+0.98%) led the region higher.  In Europe, with the lone exception of Portugal (-0.27%), we see a green picture across the board at midday.  The FTSE (+0.05%) is flat while the DAX (+0.71%) and CAC (+1.00%) lead the region higher in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a green start to the day.  The DIA implies a +0.58% open, the SPY is implying a +0.52% open, and the QQQ implies a +0.29% open at this hour.  At the same time, 10-year bond yields are up to 3.773% and Oil (WTI) is up another half of a percent to $79.92/barrel in early trading.

The major economic news events scheduled for Tuesday are limited to Nov. Goods Trade Balance and Nov. Retail Inventories (both at 8:30 am).  There are no major earnings reports scheduled for before the open or after the close on Tuesday.

In economic news on Wednesday, we get Nov. Pending Home Sales and the API Weekly Crude Oil Stocks Report.  On Thursday, the Weekly Initial Jobless Claims and EIA Weekly Crude Oil Inventories are reported.  Finally, on Friday, we get the Chicago PMI.

This is an extremely light week for earnings as only CALM reports Wednesday.  There are no reports scheduled for either Thursday or Friday.

With that background, it looks like all three major indices are again fading from early premarket bullishness, but will still look to open to the upside. with the DIA looking to retest its T-line (8ema) and the SPY failing its premarket test of that level. Over-extension is not an issue in any of the major indices. The SPY is looking to join the DIA in another test of the T-line (8ema). Both tests come from below as the bulls look to get back above. This holiday-sandwiched short week is likely to be light on volume. So, don’t go chasing too many new positions unless you can get your move very quickly or you are willing to ride the trade through a long weekend and likely dead week to follow.

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

Swing Trade Ideas for your consideration and watchlist: SQQQ, FDX, XLE. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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 higher on Wednesday (0.4% in the QQQ, 0.5% in SPY, and 1% in the DIA).  Then we saw strong follow-through until 11 am. At that point, we saw a sideways grind within a tight range for the rest of the day.  This action gave us something that could be seen as a Morning Star type pattern in the SPY and QQQ.  For the day, we got gap-up, white-bodied candles with smaller wicks on both ends. It is worth noting that the DIA did break up through its T-line (8ema) once again during the day.

On the day, all ten of the sectors were in the green with Energy (+2.21%) leading the way higher while the Consumer Defensive (+1.10%) sector lagged.  Meanwhile, the SPY gained 1.48%, the DIA gained 1.59%, and the QQQ gained 1.45%.  At the same time, the VXX fell 3.78% to 13.99 and T2122 has climbed up into the mid-range at 47.54. 10-year bond yields surged up to 3.671% and Oil (WTI) was up 2.94% to $78.47 per barrel.  So, overall, it was a strong bullish morning and then a dead afternoon that gave markets some relief from bearish over-extension (call it a Santa Relief pop).

In economic news, Q3 Current Accounts (Exports minus Imports) came in better than expected at a $217.1 billion deficit (compared to a forecasted $222.0 billion deficit or the prior reading of a $238.7 billion deficit).  Later in the morning, Conference Board Consumer Confidence came in well above expectations at 108.3 (versus the forecast of $101.0 and the previous reading of 101.4).  Meanwhile, November Existing Home Sales came in below forecast at 4.09 million (compared to the expected 4.20 million and the October reading of 4.43 million).  Finally, EIA Weekly Crude Oil Inventories showed a greater drawdown than expected at -5.894-million-barrels (versus the forecast of -1.657-million-barrels and far lower than last week’s massive 10.231-million-barrel inventory build). So, it seems the improvement in Import/Export ratio and an unexpected big jump in consumer confidence trumped concerns over slipping home sales.

SNAP Case Study | Actual Trade

In stock news, GM recalled 140,000 Chevy Bolt electric cars (2017-2023) over fire hazard in the event of a crash related to seatbelt tensioners igniting the carpet.  In other news, TSP (self-driving truck company) announced it will lay off 25% of its workforce.  The move comes less than a month after TSP ended (or had terminated?) a deal to co-develop autonomous trucks with Navistar.  In Europe, Germany announced it has now ended its proceedings against GOOGL related to the company’s online news service. This came after the company made changes to benefit German news publishers.   Elsewhere, UAA has hired the current President of MAR to be the new CEO of UAA beginning in February.  Finally, SLDP announced it has agreed to a $20 million deal with BMWYY (BMW automotive) to produce batteries in the carmaker’s German plants through 2024.

In Fed news, seven Republican Senators have introduced a bill that would dramatically change the Fed.  The bill calls for all Fed Regional Bank Presidents to become political nominees of the President, which would then also require Senate approval.  It also calls for reducing the number of Fed Regional Banks from 12 to 5 and instead of rotation, all 5 Presidents would then be permanent voting members of the FOMC.  It’s unclear how this “politicizing in the name of depoliticizing” of the Fed would help remove politics (which was the stated goal of the seven Senators).  However, it is clear the primary concern of the GOP Senators is stopping the Fed from researching the economic impacts of climate change and social factors.  Speaking of the Fed, a survey of CFOs conducted by the Richmond Fed found that two-thirds of them say their firms will not curtail spending plans due to the Fed rate hikes.  30% said rate hikes have already caused them to reduce spending.  However, on average, the CFOs said their companies would not reduce spending unless Fed rates hit 6.4% (a level far above the currently forecasted terminal rate at this point).

In miscellaneous news, Sam Bankman-Fried of FTX infamy has arrived in the US after extradition from the Bahamas.  It is unclear if it is related to this, but overnight his co-Founder of FTX (Gary Wang) and his co-CEO of Alameda Research both pleaded guilty to charges and agreed to cooperate with prosecutors in their case against SBF.  Elsewhere, China announced that in January it will cut quarantine requirements for overseas travelers.  With that said, estimates are that China now has over 1 million active cases and is dealing with up to 5,000 virus deaths per day.  Major cities (like Beijing and Shanghai) are also largely self-quarantining due to the post-repression massive outbreaks.  So, it is uncertain how the Chinese economy is coping (growing on the opening or faltering on the resulting wave of illness).

After the close, MLKN reported beats on both the earnings and revenue line. However, MU missed on both the top and bottom lines.  MU also lowered its forward guidance and announced a 10% reduction in its staff as well as the suspension of bonuses.  So far this morning, KMX has reported significant misses on both lines.  (PAYX reports at 8:30 am.)

Overnight, Asian markets were mostly green.  Shanghai (-0.46%), India (-0.39%), and Shenzhen (-0.33%) were the only red in the region.  Meanwhile, Hong Kong (+2.71%), Taiwan (+1.47%), and South Korea (+1.19%) led the region higher.  In Europe, we see a similar picture taking shape at midday.  The DAX (-0.18%), CAC (-0.04%), and FTSE MIB (-0.10%) are the only red in the region.  Meanwhile, the FTSE (+0.45%) leads the bulk of the continent’s exchanges in modest gains in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a modestly red start to the day.  The DIA implies a -0.17% open, the SPY is implying a -0.13% open, and the QQQ implies a -0.18% open at this hour.  10-year bond yields are retreating to 3.654% and Oil (WTI) is up more than 1.5% to $79.49/barrel in early trading.

The major economic news events scheduled for Thursday include Q3 GDP, Q3 GDP Price Index, and Weekly Initial Jobless Claims (all at 8:30 am).  Major earnings reports scheduled before the open Wednesday include KMX and PAYX.  Then, after the close, there are no major earnings reports scheduled.

In economic news on Friday, Nov. Durable Goods, Nov. PCE Price Index, Nov. Personal Spending, Michigan Consumer Sentiment, and Nov. New Home Sales are reported.  Meanwhile, in earnings, on Friday, there are no reports scheduled.

With that background, it looks like all three major indices are fading from earlier bullishness with the DIA looking to retest its T-line (8ema) and the SPY failing its premarket test of that level. Keep in mind that the SPY still has its 50sma close overhead as another potential resistance. Overextension is not a problem at this point, either in terms of the T-line or T2122. Remember that the week is winding down with a half-day Friday and then the market is closed Monday. Also, note that with the huge storm wreaking havoc across the nation that traders may hit the door early in case of travel delays. That means it may be time to start hedging, flattening, or taking profits…and you will not be the only trader thinking that way. My point is, don’t go chasing too many new positions unless you can get your move very quickly or you are willing to ride the trade through a long weekend and likely dead week to follow.

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

Swing Trade Ideas for your consideration and watchlist: TWKS, RIG, BKR, MDB, DOCU, CAT, OKTA, SPXS, SQQQ, BIDU, and RWM. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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 Tuesday the large-cap indices opened flat while the QQQ gapped down half of a percent.  From that point, all three indices chopped sideways (with a slightly bullish trend in the large-caps) all the way into 3:30 pm.  The DIA continues to hold its retest of the 50sma from above and the SPY is holding on in its retest of a support level.  However, the QQQ continues to get the worst of the beating in the current downtrend. This action is giving us indecisive, white-bodied, Spinning Top type candles in all three major indices.  And these moves came on below-average volume.  

On the day, nine of the ten sectors are in the green with Healthcare (+1.50%) and Energy (+1.47%) leading the way higher while the Consumer Cyclical (-0.54%) sector fared worst.  Meanwhile, the SPY was up 0.14%, the DIA was up 0.31%, and the QQQ was down 0.08%.  At the same time, the VXX is down 0.75% to 14.54 and T2122 has climbed but remains in oversold territory at 14.54.  10-year bond yields surged up to 3.695% and Oil (WTI) was up 1.10% to $76.02 per barrel.  So, overall, it was an indecisive grind of a day in the bearish trend, which at least gave a little over-extension relief in the large-cap indices.

In economic news, November Building Permits came in lower than expected at 1.342 million (compared to the forecasted 1.485 million and the October reading of 1.512 million).  So, this amounted to an 11.2% decline month-on-month.  Meanwhile, November Housing Starts came in stronger than expected at 1.427 million (versus the forecast of 1.400 million and October’s reading of 1.434 million).  Finally, after hours, the API Weekly Crude Oil Stock Report showed a larger-than-expected drawdown of -3.069 million barrels (compared to the forecasted drawdown of 0.167 million barrels and last week’s large inventory build of +7.819 million barrels).

SNAP Case Study | Actual Trade

In bad actor company news, WFC agreed to a record $3.7 billion settlement with the US Consumer Financial Protection Bureau.  This included a $1.7 billion fine and more than $2 billion in compensation for victims.  This settlement was related to abuses tied to mortgages, auto loans, wrongly charged overdraft fees, and the unauthorized opening of checking accounts.  For its part, WFC released a statement saying many of the required actions had already been done and the company’s Q4 earnings will reflect expenses for the civil penalty and customer remediation efforts.  The company has now been labeled as a “repeat offender” by the CFPB and remains under a consent decree from the Federal Reserve over other offenses such as creating fake accounts to get around Fed capitalization rules. The settlement also does not offer immunity to any WFC employees that violated laws or the company from individual lawsuits related to losses and harm caused.

In stock news, the US Postal Service announced Tuesday that it intends to purchase at least 66,000 electric vehicles between now and 2028.  Of those, 45,000 – 60,000 will come from OSK.  In other transportation news, BA won the backing of SU Senator Cantwell (Chair of Senate Commerce Comm.) for a waiver from the FAA certification of meeting safety standards for 737 MAX planes. (Because a BA waiver from a deadline to meet safety standards is just what the world needs.)  Elsewhere, AMZN has reached a settlement with the EU over three different antitrust investigations.  AMZN avoided any fines in the three cases. 

In miscellaneous news, TRP submitted a plan for the reopening of the Keystone oil pipeline to US regulators on Tuesday.  The cleanup of the pipeline’s third major spill in five years will take months but, with approval, TRP hopes to have the pipeline back online soon.  Meanwhile, the Equipment Leasing and Finance Assn. (ELFA) reported that US companies borrowed 9% more to finance equipment investments in November than they had a year earlier.  The group said, “Labor markets are stable, inflation woes appear to be abating, consumers are spending, and businesses continue to expand and grow: a recipe for stable growth by providers of equipment financing.”  In political news, Ukrainian President Zelenskiy will address the US Congress in person today (in his first trip abroad since the Russian invasion of his country).

After the close, NKE and WOR reported beats on both the revenue and earnings lines.  However, FDX missed on revenue while beating on earnings (even though the beat is actually a 34.2% negative earnings growth).  FDX also lowered its forward guidance and announced an additional $1 billion in cost-cutting measures.  So far this morning, RAD has reported beats on both the top and bottom lines.  (CTAS, CCL, and TTC all report closer to the opening bell.)

Overnight, Asian markets were mixed with Australia (+1.29%) leading the gainers as India (-1.01%) paced the losses.  Most of the region produced modest moves in an even split of directions.  Meanwhile, in Europe, the region’s exchanges lean heavily to the upside with only Portugal (-0.05%) showing any red.  The FTSE (+0.87%), DAX (+0.71%), and CAC (+1.03%) are leading the region higher.  However, the gains are widespread and consistent in early afternoon trade.  As of 7:30 am, US Futures are pointing to a green start to the day.  The DIA implies a +0.64% open, the SPY is implying a +0.40% open, and the QQQ implies a +0.18% open at this hour.  10-year bond yields are down a bit to 3.681% and Oil (WTI) is up 2% to $77.76/barrel in early trading.

The major economic news events scheduled for Wed. include Q3 Current Accounts (8:30 am), Conf. Board Consumer Confidence and November Existing Home Sales (both at 10 am), and EIA Weekly Crude Oil Inventories (10:30 am).  Major earnings reports scheduled for before the open include Wednesday, CCL, RAD, and TTC.  Then, after the close, MU and MLKN report.

In economic news later this week, on Thursday, we get Q3 GDP, Q3 GDP Price Index, and Weekly Initial Jobless Claims.  Finally, on Friday, Nov. Durable Goods, Nov. PCE Price Index, Nov. Personal Spending, Michigan Consumer Sentiment, and Nov. New Home Sales are reported. 

Meanwhile, in earnings later this week, on Thursday, we hear from KMX and PAYX.  Finally, on Friday, there are no reports scheduled.

In late-breaking news, mortgage demand surged 6% last week as interest rates fell to their lowest level since September.  New home purchase loan applications decreased 0.1% week-on-week, but this is to be expected in what is a normally very slow week for the housing market.  The national average rate for a 30-year fixed-rate conforming loan fell to 6.34% (down from 6.42%) over the week.  This caused a 6.1% increase in the demand for refinance loan applications.

With that background, it looks like all three major indices want to make a move back up toward their T-line (8ema) this morning. However, only the DIA looks like it put in a real bottom to the recent strong bearish move while the other two simply look like volatility testing the downtrend line at least for now. Keep in mind that the SPY has its 50sma close overhead as potential resistance and the DIA has a price-action resistance level not far above. So, don’t assume any bullish moves will go untested. Nonetheless, we remain extended to the downside and some relief was in order. (Just be aware that this relief can come in the form of a bullish move or sideways rest.) Be cautious and keep in mind that the week is winding down with a half-day Friday and then the market is closed Monday. That means it may be time to start hedging, flattening, or taking profits…and you will not be the only trader thinking that way. My point is, don’t go chasing too many new positions unless you can get your move very quickly or you are willing to ride the trade through a long weekend and likely dead week to follow.

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

Swing Trade Ideas for your consideration and watchlist: No trade ideas today. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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 Monday.  However, the bears immediately stepped in to drive all three major indices lower for a little over half of an hour.  We then saw a 30-minute bullish reversal followed by a second wave lower until 11:45 am.  From there, we saw a slower selloff that lasted until we saw some buying at the end of the day.  The SPY and QQQ move lower, away from their 50sma and T-line (8ema). Meanwhile, the DIA is retesting its 50sma from above while also moving further away from its T-line.  This action is giving us black-bodied candles with lower wicks that can certainly be seen to be forming Bearish Doji Continuation (Sandwich) patterns in the 3 major indices. 

On the day, all ten of the sectors are in the red with Technology (-1.74%) leading the way lower while the Consumer Defensive (-0.13%) sector held up best. Meanwhile, the SPY was down 0.85%, the DIA was down 0.47%, and the QQQ was down 1.60%.  All three of those indices made these moves on relatively low volume.  At the same time, the VXX is down 2.4% to 14.65 and T2122 remains deep in oversold territory at 8.93.  10-year bond yields surged up to 3.594% and Oil (WTI) was up 1.80% to $75.63 per barrel.  So, overall, it was a bearish grind of a day, giving us a fourth-straight down day to start the 4.5-day preholiday week.

In stock news, AAPL was fined $1.06 million by a French court Monday for imposing abusive commercial clauses on French App developers by the AAPL app store.  In other legal news, the SEC announced that HON will pay $200 million to settle US and Brazilian criminal and civil corruption charges related to bribing Brazilian state-owned energy company.  At the same time, MDLZ said Monday that it has agreed to sell its gum business (Trident and Dentyne) to a European gum and confectionary maker.  Elsewhere, Reuters reported that BLK plans no major changes to he way the company engages on and votes on environmental and social issues regardless of pushback from Texas GOP and national Republican politicians in general.  Meanwhile, seed and pesticide maker CTVA said it will cut a (trivial, 51) jobs next year as its exit from Russia has seen a cut in sunflower seed demand.  Finally, after hours, LCID announced it has now completed a $1.5 billion capital raise by issuing stock to Saudi Arabia’s Public Investment Fund.

SNAP Case Study | Actual Trade

In energy news, Reuters reported that Venezuelan-owned Citgo Petroleum is on track to make a record $2.5 billion profit this year.  The Houston-based Citgo plans to use the funds to repay debt and invest in the reliability of its operations.  (The company posted a $160 million loss in 2021.)  In other Reuters news, the agency reports that the US will become a net exporter of oil in 2023.  Current government data shows that the US is importing 1.1 million barrels per day (down sharply from 7 million barrels per day just 5 years ago) while at the same time, exporting 3.4 million barrels per day.  The US is also the leading LNG exporter in the world.  For 2022, the US was a net importer by 0.7%, but US oil production is planned to increase again to another record in 2023.  Finally, EU energy ministers agreed to a price cap for natural gas if electric prices exceed $191.11/megawatt-hour for three days).

In miscellaneous news, the Bank of Japan unexpectedly widened (doubled) the range for its rate cap for 10-year Japanese Bonds.  (They essentially will let rates vary up to a half of a percent on either side of the 0% target rate, leaving a 1% wide range.)  Analysts say that regardless of verbiage, this is a step toward a rate increase early next year which is a change for one of the region’s staunchest “rock bottom rates” central banks.  This move also caused the Yen to jump higher.  Elsewhere, EPIC games (Fortnite) took a big hit in a settlement with the FTC.  Epic will pay a $275 million penalty for violating children’s online privacy rights.  It will pay another $245 million in refunds for using deceptive practices (dark patterns) to get children to make accidental in-game purchases in its “free to play” game. Finally, it is worth noting that AMZN has now given back all of its Covid era gains with the stock down 50% on the year.

After the close, HEI reported beats on the revenue and earnings lines.  However, SCS missed on revenue while beating on earnings.  So far this morning, GIS beat on both the top and bottom lines.  Meanwhile, FDS missed on revenue while beating (by 11%) on earnings.

Overnight, Asian markets were red across the board as the Bank of Japan shocked the market with a new yield curve policy Japan (-2.46%), Taiwan (-1.82%), and Shenzhen (-1.58%) led the region lower.  Meanwhile, in Europe, there is a lot of red but still three smaller exchanges holding onto green at midday.  The FTSE (-0.02%) is flat while the DAX (-0.22%) and CAC (-0.21%) are typical of the modest red action in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a mixed, flat start to the day.  The DIA implies a +0.18% open, the SPY is implying a +0.03% open, and the QQQ implies a -0.19% open at this hour.  10-year bond yields are surging again to 3.653% and Oil (WTI) is up 1.33% to $76.19/barrel in early trading.

The major economic news events scheduled for Tuesday include November Building Permits and November Housing Starts (both at 8:30 am), and API Weekly Crude Oil Stocks (4:30 pm).  The major earnings reports scheduled for before the open include FDS and GIS.  Then, after the close, FDX, NKE, and WOR report. 

In economic news later this week, on Wednesday, Q3 Current Accounts, Conf. Board Consumer Confidence, Nov. Existing Home Sales, and EIA Weekly Crude Oil Inventories are reported.  Thursday, we get Q3 GDP, Q3 GDP Price Index, and Weekly Initial Jobless Claims.  Finally, on Friday, Nov. Durable Goods, Nov. PCE Price Index, Nov. Personal Spending, Michigan Consumer Sentiment, and Nov. New Home Sales are reported.

Meanwhile, in earnings later this week, on Wednesday, CCL, RAD, TTC, MU, and MLKN report.  On Thursday, we hear from KMX and PAYX.  Finally, on Friday, there are no reports scheduled.

One last tidbit of late news. The House passed a $1.7 trillion omnibus budget (lasting through September 2023) as the last piece of business for the year. The bill is expected to pass with bipartisan support in the Senate and be signed before the weekend deadline. The bill did not include either the Democrat’s hoped-for permanent status for expanded child tax credits or the Republican hoped-for tax cuts for businesses. However, on the heals of the committee report on the January 6 insurrection, it did include a tightening of law intended to prevent such events from occurring again.

With that background, it looks like markets want to start the day flat (ahead of housing data) with the exception of the still-bearish tech space. The DIA will be testing its 50sma again and SPY continues to test a support level. However, the QQQ has no such nearby support. Nonetheless, we are extended, both in terms of the T-line (8ema) and the T2122 (4-week new high/low ratio) indicator. So, some relief is in order. Be cautious and aware of the recent volatility (gaps and intraday reversals). Remember, chasing is a bad habit and a good way to walk into a slamming door.

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

Swing Trade Ideas for your consideration and watchlist: XLF, META, AAPL, BA, GOOG, TSLA, LEN, IAG, and MRNA. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 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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