Friday saw another serious gap down in the SPY (-1.20%) and DIA (-1.08%) but only a 0.34% gap down in the QQQ.  However, after a half hour of volatility, all three major indices got in lock step to sell off until 10:30 am and then slowly drift sideways with a very modest bearish trend that reached the lows of the day at about 2:30 pm.  At that point, the bulls stepped in to rally us up off the lows this last hour as volatility kicked in for expiration gyrations.  This action is giving us gap-down, black-bodied, indecisive, Spinning Top type candles in all the major indices.  The SPY and QQQ have both now dropped down through their 50sma while the DIA bounced up off its own 50sm after a test of that level as a support.  Volume has been above average in the DIA, but much less so in the SPY and QQQ.

On the day, all ten of the sectors are in the red with Utilities (-1.50%) leading the way lower while the Healthcare (-0.30%) and Basic Materials (-0.43%) sectors held up best.  At the same time, the SPY was down 1.63%, the DIA was down 1.15%, and the QQQ was down 0.95%.  The VXX is flat at 15.01 and T2122 dropped deep inside of the oversold territory at 7.25.  10-year bond yields were down from the open to 3.484% and Oil (WTI) was down 2.36% to $74.31 per barrel.  So, overall, it was a bearish and volatile day where we only the DIA was able to stay above its 50sma.

In economic news, the Manufacturing PMI came in below expectation at 46.2 (versus a 47.7 forecast and 47.7 previous reading). The same was true for Services PMI which came in at 44.4 (compared to the 46.8 forecasted and 46.2 prior reading).  In addition, the S&P Global Composite PMI was also below expectations at 44.6 (versus 47.0 which was forecasted and the prior reading of 46.4).

SNAP Case Study | Actual Trade

In stock news, BAYRY and the state of OR finalized a $698 million settlement resolving chemical environmental pollution claims dating all the way back to 1977.  The root cause was PCBs manufactured by MON (which BAYRY acquired).  Elsewhere, the NHTSA has opened an investigation into GM Cruise robotaxis after 242 reports of the vehicles unexpectedly stopping in the middle of the street, snarling San Francisco traffic and stranding passengers.  At the same time, BMO reported that it has raised $1.9 billion of capital by issuing new shares in an effort to increase its capital cushion with a turbulent economy ahead.  In other news, FFIE fell more than 26% on Friday after the company revealed that production plans for its long-delayed luxury electric vehicle will depend on the company getting additional financing.  In layoff news, it was reported by Bloomberg that internal sources tell them GS is preparing to fire 8% of its workforce (4,000 people).  Finally, the US Dept. of Labor announced after the close that AMZN had failed to record work-related injuries at six different warehouses located in five states.  This included 14 separate OSHA safety violations, each with a fine of a paltry $14,500.

In energy news, US gasoline prices hit a 15-month low on Friday as the AAA reported that the national average price dropped to $3.18/gallon.  Meanwhile, the EU Energy Ministers are meeting in Brussels in furious negotiations to agree on a price cap for Natural Gas prices as their national leaders agreed should happen last week.

In miscellaneous news, LHX announced Sunday that it has agreed to buy AJRD for $58/share.  (It is worth noting that LHX competitor LMT was forced to drop its own deal to buy AJRD earlier this year when antitrust regulators sued to block a deal.)  Then this morning (US time) META was warned by the EU that it is breaching EU Antitrust Laws by abusing its position to corner the online classified advertising market.  In Elon Musk news, he launched a poll asking Twitter users whether he should step down as CEO and 57.5% of respondents (17.5 million votes cast) said “yes.”  This comes one day after the third-largest TSLA shareholder told Musk he should resign as CEO of TSLA.

Overnight, Asian markets leaned heavily to the downside.  Shanghai (-1.92%), Shenzhen (-1.51%), and Japan (-1.05%) led the region lower with only India (+0.83%) and Singapore (+0.49%) in the green.  However, in Europe, with the sole exception of Russia (-0.82%), exchanges are green across the board at midday.  The FTSE (+0.54%), DAX (+0.53%), and CAC (+0.62%) lead the region higher although the gains are broad and similar across the continent in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a modestly higher start to the day.  The DIA implies a +0.20% open, the SPY is implying a +0.28% open, and the QQQ implies a +0.37% open at this hour.  10-year bond yield have jumped up to 3.535% and Oil (WTI) is up nearly a half of a percent to $74.60/barrel in early trading.

There are no major economic news events scheduled for Monday.  There are no major earnings reports scheduled for before the open.  However, after the close, HEI and SCS report.

In economic news later this week, on Tuesday, we get Nov. Building Permits, Nov. Housing Starts, and API Weekly Crude Oil Stocks Report.  Then, 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. Also, remember that Friday is a half-day as markets close early for virtual Christmas Eve.

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

With that background, it looks like markets will start the week in a modestly bullish mood. (Up, but still inside of Friday’s candles.) The DIA and SPY may have closed last week sitting on minor support levels. In either case, the bears have the short-term trend in their favor. However, we are over-extended to the downside in terms of the T-line and also 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).

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

On Thursday, markets opened with strong gaps lower after disappointing economic news on top of follow through to the Fed announcements.  (SPY gapped down 1.26%, DIA gapped down 1.07%, and QQQ gapped down 1.43%.)   There was a strong follow-up selloff for the first 40 minutes of the day which then turned into a secondary, slow and steady selloff that lasted up until 2:30 pm.  At that point, the bulls stepped in to rally us up off the lows to retest the support/resistance level that had been broken in the large-cap indices at about 3:15 pm.  However, that retest failed and the bears stepped back in to retrace about halfway back to the lows by the close.  This action gave us large, black-bodied, candles that have fallen through a support level in all three major indices.  All three are also starting to get a little extended from their T-lines (8ema), especially in the QQQ.

On the day, all ten of the sectors are in the red with Technology (-3.70%) leading the way lower while the Energy sector (-0.50%) held up best.  In the meantime, the SPY was down 2.44%, the DIA was down 2.18%, and the QQQ was down 3.32%.  This action took place on greater than average volume.  The VXX spiked by 6.25% to 14.96 and T2122 dropped well inside the oversold territory at 8.85.  10-year bond yields were down as well to 3.448% and Oil (WTI) was down 1.42% to $76.18 per barrel.  So, overall, it was a bearish follow-through day where the QQQ gave up support and the large-cap indices continue to fight to hold onto their own support levels.

In economic news, there were several signs of a slowing economy Thursday.  Weekly Initial Jobless Claims did come in lower than expected at 211k (compared to a forecast of 230k and last week’s value of 231k).  However, at the same time, the NY Fed’s Empire State Mfg. Index came in significantly lower than was forecasted at -11.20 (versus -1.00 expected and the previous +4.50) and the Philly Fed Mfg. Index came in lower than expected at -13.80 (versus the -10.0 that was forecast, but better than the previous month’s -19.4).  November Retail Sales also came in lower than expected at -0.6% (compared to -0.1% forecasted and the previous reading of 1.3%).  In addition, November Industrial Production grew less than expected at +2.51% (compared to the previous month’s +3.34%).  Then Oct. Business Inventories grew less than expected at +0.3% (versus +0.4% forecasted and the prior reading of +0.2%).  Finally, Oct. Retail Inventories fell 0.5% compared to the Sep. fall of 0.4%.

SNAP Case Study | Actual Trade

In stock news, Reuters reports that GRAB has frozen hiring in an effort to cut costs.  In another Reuters report, it was revealed that a joint venture involving the parent firm of  SHEL and Dutch energy company Eneco has won the right to build a large wind farm in the North Sea.  Elsewhere, NFLX fell 8.63% after an online trade magazine report said the streamer’s new ad business is suffering a slow start and is not delivering the viewership that had been promised to advertisers.  Later in the day, Bloomberg reported that GE is considering the purchase of two units that are in process of being spun off by MDT.  In other news, MULN announced it has received an order for 6,000 electric cargo vans.  In related auto news, F raised the base price of its cheapest F-150 Lightning electric truck to $56,000.  On the legal front, UL announced it has resolved litigation with its independent board (over the sale of its Ben & Jerry’s ice cream business in Israel).  Finally, French prosecutors raided the headquarters of GE in France late Thursday as part of a probe into GE tax fraud.

In energy news, TRP announced Thursday that its Keystone pipeline spill in Kansas spilled crude that was diluted with bitumen.  Bitumen sinks in water and in the ground, which complicates cleanup.  (The last major spill involving bitumen took years due to this complication.)  However, in good news for TRP, the pipeline partially reopened. In other energy news, the state of CA approved $2.9 billion to install 90,000 new charging stations in the state by 2025.  (This is part of the state’s goal to reach 250,000 charging stations in the state by then.)  Finally, after the close, NERC (North American Electric Reliability Corporation, in charge of the electric grid) officials said that both the Midwest and CA electric grids are being pushed to their limits and there are high risks of energy grid shortfalls both this winter and for the next five years.  In the Midwest, more electric generation capacity is being taken offline than is coming online.  Meanwhile, in CA, demand variability is the key risk.  Both areas are also being pressured by demand that is increasing due to climate issues.

In miscellaneous news, overnight the Senate passed (on a bipartisan 71-19 with 10 abstentions) a 1-week funding package to keep the government past today.  The House had passed its version of the same bill on Wednesday by 224-201 with far less bipartisanship on the part of the GOP in the House.  This will be a stop-gap until an omnibus spending bill can be passed on Dec. 23. (when Congress leaves for Xmas).  Elsewhere, Elon Musk has fully drunken the Kool-Aid as he banned journalists he did not like from Twitter overnight.  Those include CNN, The New York Times, Washington Post, Voice of America, and many independent journalists.  It seems the “free speech absolutist” really has some exceptions to his rule.  Finally, today is quad-witching.  So, look out for volatility as we have open interest of $8 trillion in options alone this week.  This is just shy of last year’s record levels where we saw huge volume jumps and a large increase in volatility.

After the close, ADBE came in just shy of estimates on revenue but beat on earnings estimates.  So far today, ACN, DRI, and WGO have all reported beat to both the top and bottom lines.  It is worth noting that the ADBE, CAN, and DRI beats were all the result of revenue and earnings growth (not lowered estimates).  However, the WGO beat was against lowered forecasts and actually showed significant negative growth on both lines.

Overnight, Asian markets were mostly in the red.  Japan (-1.87%), Taiwan (-1.40%), and Singapore (-1.01%) led the region lower while Malaysia (+0.78%) and Hong Kong (+0.42%) held up best.  Meanwhile, in Europe, with the sole exceptions of Russia (+0.03%), we see red across the board at midday.  The FTSE (-1.19%), DAX (-0.44%), and CAC (-1.18%) are leading the way lower in early afternoon trade.  As of 7:30 am, US Futures are pointing to another gap down to start the day.  The DIA implies a -0.98% open, the SPY is implying a -0.98% open, and the QQQ implies a -0.61% open at this hour.  At the same time, 10-year bond yields are back up to 3.497% and Oil (WTI) is down almost 2% to $74.63/barrel in early trading.

The major economic news events scheduled for Friday are limited to Mfg. and Services PMIs (both at 9:45 am).  The major earnings reports scheduled for before the open are limited to ACN, DRI, and WGO.  There are no reports scheduled after the close.

With that background, it looks like an ugly start to the day, where all 3 major indices have given up support levels, the DIA seem to be reaching to retest its previously broken long-term downtrend line, and quadruple witching is going to throw extra volume and volatility into the mix. All 3 indices are also crossing back down through their 50sma (despite a “Golden Cross” just 2 days ago in the DIA). We are also closing out a second straight down week in all 3 of those. However, we are a little over-extended in the major indices both in terms of the T-line (8ema) and in terms of the T2122 indicator. So, the bears are in control, but be ready for more whiplash as we close out the week.

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 just on the red side of flat Wednesday but then started a slow grind higher, rising all the way into the 2 pm FOMC announcements.  However, traders did not like what they saw from the Fed and we got a massive, volatile selloff for the next 5 minutes, leading into a sideways chop until 2:30 pm when Fed Chair Powell began to speak.  Once again this caused another huge selloff for 5 minutes taking us to the lows of the day.  Then the dip-buyers stepped in and have been rallying back up toward the T-line (8ema) on the daily chart up until 3:15 pm when the bears stepped back in.  This action is giving us indecisive, black-bodied, Spinning Top candles in all major indices.

On the day, eight of the ten sectors are in the red with Financial Services (-1.12%) and Energy (-1.10%) leading the way lower while the Healthcare (+0.15%) sector held up best.  Meanwhile, the SPY was down 0.64%, the DIA was down 0.47%, and the QQQ was down 0.74%.  This action took place on greater than average volume.  The VXX fell by 3.43% to 14.08 and T2122 dropped to just outside the oversold territory at 26.22.  10-year bond yields were also volatile but now down to 3.479% and Oil (WTI) was up more than 2.6% again to $77.38 per barrel.  So, overall, it was a mildly bullish day right up until the Fed chopped it down with an axe.  After that, it was schizophrenic while traders try to evaluate the Fed projection, parse the Fed statement, and read between the lines of Chair Powell’s responses to questions.

In economic news, the November Import Price Index fell more than expected at -0.6% (compared to the forecast of -0.5%) and the November Export Price Index fell less than expected at -0.3% (versus the forecast of -0.4%).  Both of those indicate a lessening of inflation pressure.  Later in the morning, EIA Weekly Oil Inventories unexpectedly spiked (following last night’s API lead) by 10.231 million barrels (compared to a forecasted 3.595 million barrel drawdown).  However, as we know, the Fed was the main stage of the day.  The Fed is projecting Q4 Interest Rates of 4.4% this year, 5.1% in 2023, 4.1% in 2024, and 3.1% in 2025.  They said they expect longer-term interest rates to be 2.5%.  They also decided to increase Interest rates to 4.25% – 4.50% (a smaller than the recent, 0.50% hike).  The FOMC statement said they welcome the October and November reductions in inflation, but then implied they will keep rates high through 2023 (when the market had been expecting a rate cut in the next year). Meanwhile, the unanimously-approved policy statement remains hawkish.  During his presser, Powell echoed this when he said the Fed policy is not “sufficiently restrictive” yet and “more rate hikes are appropriate.”  Finally, he said it will take “substantially more evidence that inflation is cooling” (before stopping the ever more restrictive policy).

SNAP Case Study | Actual Trade

In stock news, CVX announced that it is forming a joint venture with a Swedish firm Baseload Capital to develop large-scale geothermal electricity generation projects in the US.  Elsewhere, GM recalled 825k 2020-2023 trucks and SUVs over an issue with daytime running lights and headlights.  In Canada, the trial over the ROG purchase of SJR wrapped up with many expecting a quick verdict.  (The two are on the same side seeking the deal to go through with the Canadian government blocking their merger over antitrust concerns.)  Meanwhile, a subsidiary of AIG filed for bankruptcy last evening in order to complete the wind-down of the business unit that was at the center of the 2008 financial crisis.  The unit still owes its parent $37 billion and AIG has already taken the $37 billion as a loan loss.  Finally, after the close, WBD raised its estimates of “scrapped content” expenses to $3.5 billion (a $1 billion increase).

In government news, on Wednesday, it was reported that the SEC will be voting on rules that would require orders to be auctioned at market (which would kill the existing “payment for order flow” model that brokerages use as of today).  After the close, the SEC did vote to move forward on the new rule proposals.  Elsewhere, the SEC and Dept. of Justice filed charges against 8 social media influencers for securities fraud in relation to a “pump and dump” scheme.  In unrelated news, the same agencies charged an employee of major financial services firm TIAA-CREF with “front-running” that company’s trades, which amounts to both securities and wire fraud.  Finally, the NLRB voted 3-2 to throw out a Trump-era rule that prohibited small “micro union” organizing (which is a key union organizing tactic where small groups organize and then the small groups can merge into one larger union (when the union might not have won a vote of all employees of a company or facility).

In miscellaneous news, overnight it was reported that despite his statements otherwise, Elon Musk has sold another $3.58 billion of TSLA stock.  This brought his total 2022 sales of the stock to almost $40 billion.  Then in late-breaking news, across the pond the Bank of England has followed the Fed to raise interest rates 0.5% (to 3.5%), which is also a slowing of increase from November’s ).75% increase.  Of note, is that the decision to take this action was a 6-3 vote (not unanimous).  Finally, the FTX saga continues as it was reported overnight that someone wrote and stored code that was designed to hide the movement of money from FTX to Alameda Research (which was SBF’s personal investing company) by hiding the liabilities. Bloomberg reports that this code was found in a GitHub account that bears the name of an FTX executive.

After the close, LEN, NDSN, and TCOM all reported beats on both the revenue and earnings lines.  However, it is worth noting that although LEN had an 11% earnings beat, it reduced its forward guidance. (JBL is scheduled to report at 8 am.)

Overnight, Asian markets leaned heavily red as the region gave its reaction to the Fed news from yesterday.  South Korea (-1.60%), Hong Kong (-1.55%), and India (-1.32%) led the region lower while only Shenzhen (+0.32%) managed any gains.  Meanwhile, in Europe, we see a lot of red but three smaller exchanges remain in the green at midday.  With that said, the FTSE (-0.44%), DAX (-1.15%), and CAC (-1.15%) are more typical and lead the region lower in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a gap lower to start the day.  The DIA implies a -0.75 open, the SPY is implying a -0.96% open, and the QQQ implies a -1.22% open at this hour.  10-year bond yields are falling again at 3.466% and Oil (WTI) is off one-tenth of a percent to $77.20/barrel in early trading.

The major economic news events scheduled for Thursday include November Retail Sales, Weekly Initial Jobless Claims, NY Fed Empire State Mfg. Index, and Philly fed Mfg. Index (all at 8:30 am), Nov. Industrial Production (9:15 am), as well as October Business Inventories and October Retail Inventories (both at 10 am).  The major earnings reports scheduled before the open are limited to JBL. Then after the close, ADBE reports.

In economic news later this week, on Friday, Mfg. PMI and Services PMI are reported.  Meanwhile, in earnings later this week, on Friday, we hear from CAN, DRI, and WGO.

The Fed’s message that the inflation fight will take longer and require higher terminal rates than the market has assumed thus far has now had a night to sink in. While the initial wave of volatility has subsided, this morning we get the rethink move of the re-reaction (which closed out Wednesday in a rebound wave). It looks like all 3 major indices will gap back below their T-lines (8ema) at the open today. However, it is far from certain whether the bears have the energy for a long run lower. After all, inflation is coming down, gas prices are as low as they have been in a year, layoffs have picked up (but nothing like they were in 2008), and the indications are that the consumer is still spending for the holidays. So, the world is not ending.

With that background, the short-term trend is bullish trendline looks like it might be broken today if we get any follow-through to the current premarket candles. . There is no problem with over-extension yet, either in terms of the T-line (8ema) or the T2122 indicator. So, both sides have room to run, if they have the buyers/sellers to do it. On the charts, we see resistance right above in the DIA (as well as T-line support/resistance in all 3) as well as potential support not far below in the SPY, QQQ, and DIA. Be ready for more whiplash as we get another shotgun blast of economic data at 8:30 am.

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: GSK, MRK, DXCM, HAL, NIO, TSLA, DKNG, and CRK. 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

Tuesday was the definition of “Whipsaw” as traders loved the CPI data and turned what had already looked like a gap up into a massive gap higher.  (The SPY gapped up 2.8%, the DIA gapped 2.14% higher, and the QQQ gapped up a whopping 3.82% at the open.)  However, then the bears showed up, driving a strong and persistent selloff until 1 pm.  That selloff had completely faded the opening gap in all 3 major indices (and more than faded it in the DIA).  By that point, the bulls were rested and began a slow rally back in the other direction until 2 pm, when another selloff began.  This volatile action gave us very large, gap-up, black candles with lower wicks in the DIA, SPY, and QQQ.

On the day, eight of the ten sectors are in the green with the Energy (+1.75%) sector leading us higher while the Communication Services (-0.13%) and Consumer Defensive (-0.11%) sectors were the laggards.  Meanwhile, the SPY was up 0.76%, the DIA was up 0.35%, and the QQQ was up 1.08%.  This action took place on greater than average volume.  The VXX fell by 4.14% to 14.58 and T2122 remains in the mid-range at 65.67.  10-year bond yields were also volatile but now down to 3.507% and Oil (WTI) was up more than 2.8% to $75.25 per barrel.  So, overall, it was an extremely volatile day that saw a range that was many times the close-to-close move.

In economic news, the November CPI showed a much smaller-than-expected increase of +0.1% (compared to the forecast of +0.3% and the October reading of +0.4%).  This was the smallest increase since August of 2021.  It also translates into an annualized consumer inflation of 7.1% (compared to 7.3% that was forecasted and the 7.7% annual CPI was sitting at last month.  As mentioned, the market loved this news since it is strong evidence that Fed moves to date have started to bring inflation down.  (And traders expect this to translate into a smaller rate hike and softened tone in the Fed announcement and presser today.)  Later, after the close, API reported that oil inventories unexpectedly rose by 7.8 million barrels this week (versus the forecast of a 3.9-million-barrel drawdown and last week’s 6.4-million-barrel drop). This was particularly unexpected given the midwest pipeline shutdown that is depriving a major storage hub of 662k barrels per day.

SNAP Case Study | Actual Trade

In stock news, BA reported that its plane deliveries rose in November to 48 (up from 35 in October). Meanwhile, STLA recalled 1.4 million 2019-2022 Dodge Ram pickups over faulty tailgate latches.  In other auto news, F announced it is adding a third “crew” to its Dearborn F-150 Lightning electric vehicle assembly plant (increasing production capacity by 50%).  In the health industry, Reuters reports the MRNA Covid-19 vaccine has been now shown to work against the melanoma type of cancer.  This news drove MRNA stock massively higher, closing up 19.63% on the day.  Elsewhere, RTX has announced a $6 billion stock repurchase program.  Finally, the CEO of UAL told the media on Tuesday that UAL and its main competitors are preparing for a “mild” recession in 2023.  He went so far as to say that “if he didn’t read the Wall Street Journal or watch CNBC the word recession would not even be in his vocabulary right now.” Along those same lines, DAL said Wednesday morning that it expects to double earnings in 2023 due to “rebounded and robust” travel demand.

In anti-trust news, according to Bloomberg, AAPL will allow alternative app stores onto iPhones by the end of 2023…but only in the EU (where it is being forced to do so by anti-monopoly law).  This may end up a boon for MSFT, META, AMZN, and any other company with a major app store.  Meanwhile, ILMN began pre-emptively defending its purchase of Grail, by pledging to keep selling its DNA sequencing services to other firms.  This comes ahead of an FTC commissioner’s vote on the deal, which is the final US hurdle.  Still, the EU antitrust regulators have already temporarily blocked the deal and are set to make a final decision in early 2023.  Finally, on Tuesday, MSFT President Smith said the company has offered to agree to a legally-binding FTC Consent Decree that would force MSFT to continue providing the “Call of Duty” game franchise to rival game platforms if the FTC would allow the acquisition of ATVI to proceed.  (The EU is still investigating the deal and has promised to decide whether or not they’ll allow it by March 2023.)

In miscellaneous news, part of the reason behind Tuesday’s big rally in oil was that the Dollar dropped hard against all its major pair partners. The expectation of less hawkish action and verbiage out of the FOMC would have a weakening effect on the dollar.  Yet another impact of the good inflation news was a drop in mortgage rates.  A 30-year fixed-rate mortgage has dropped to 6.28%, which is nearly half a percent lower than the rate at the end of November.  Elsewhere, on Tuesday the Pentagon switched course and recommended that the US give Patriot Missile systems to Ukraine for air defense.  (Those are made by RTX, LMT, and BA.)  President Biden still needs to approve the shipments, but if it is done, it would be a major increase in capability for Ukraine to keep their country’s power grid online as repaired.

After the close, ABM reported beats on both the revenue and earnings lines.  However, ABM also lowered its forward guidance.  So far this morning, REVG has posted a beat on both the top and bottom lines.

Overnight, Asian markets leaned heavily to the green side.  Taiwan (+1.49%), South Korea (+1.13%), and Malaysia (+0.89%) led the rally while Chinese exchanges lagged.  Meanwhile, in Europe, exactly the opposite is taking shape at midday.  The only green on the European board is Athens (+0.18%) and Denmark (+0.20%).  At the same time, the FTSE (-0.24%), DAX (-0.51%), and CAC (-0.38%) are typical and lead the region lower in early afternoon trade.  As of 7:30 am, US Futures are just on the green side of flat.  The DIA implies a +0.15% open, the SPY is implying a +0.15% open, and the QQQ implies a +0.10% open at this hour.  10-year bond yields are just south of flat at 3.503% and Oil is up 1% to $76.21/barrel in early trading.

The major economic news events scheduled for Wednesday include the November Import/Export Price Index (8:30 am), EIA Crude Oil Inventories (10:30 am), Fed Q4 Interest Rate Projections, Fed Economic Projections, FOMC Statement, and the Fed Interest Rate Decision (all at 2 pm), and FOMC Press Conference (2:30 pm).  (Note that Fed Futures have priced in an 80% probability of a 0.50% rate hike today.) The major earnings reports scheduled for before the open are limited to REVG.  Then after the close, LEN, NDSN, and TCOM report.

In economic news later this week, on Thursday, we get November Retail Sales, Weekly Initial Jobless Claims, NY Fed Empire State Mfg. Index, Philly fed Mfg. Index, Nov. Industrial Production, Oct. Business Inventories, and Oct. Retail Inventories are reported.  Finally, on Friday, Mfg. PMI and Services PMI are reported.

In earnings later this week, on Thursday we get reports from JBL and ADBE.  Finally, on Friday, we hear from CAN, DRI, and WGO.

As all eyes look toward the Fed today, Bloomberg implies that somebody knew something early about CPI data which led to yesterday’s strong rally. Bloomberg says that there were massive bullish bets made in the minute prior to the release of CPI information. This magnified the premarket action and led to the huge gap-ups at the open. Only time will tell whether this will be investigated and whether the SEC could prove any inside info was acted upon.

With that background, the short-term trend is bullish after yesterday’s rollercoaster ride. Premarket prices are now essentially flat and there is no problem with over-extension, either in terms of the T-line (8ema) or the T2122 indicator. So, both the bulls and the bears have room to run once the FOMC gives its current verdict. Be ready for more whiplash as we are getting economic and interest rate projections in addition to the Fed release (and that statement’s verbiage will be parsed nine ways to Sunday). Then, a half hour later, Powell speaks AND answers questions. So, there will be something (probably several things) for both camps the latch onto today. And that is how you get the violent jerks back and forth as “average sentiment” gets worked out over an hour or two. (Also, beware that it is quite possible we then have another reassessment overnight and yet another market reaction to the news on Thursday morning.)

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: XLE, FNGU, GSK, HAL, APA, NEM, GEO, FIVN, ARDX, and AMAT 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 Monday, stocks gapped slightly higher at the open (less than a quarter of a percent in the large-cap indices and essentially none in the QQQ).  From that point, the bulls stepped in to lead a very slow and steady rally that lasted right into the close.  (The QQQ rally really kicked into high gear at 2:30 pm, while the other indices saw the rally speed up just before 3 pm.)  This action gave us white-bodied candles that remained inside the range for the last few days.  It also should be noted that the SPY, DIA, and QQQ all crossed back above their T-line (8ema) from below.  All-in-all, it seems like Monday was a modest melt-up that finally kicked into gear late as traders wait on the CPI tomorrow and the FOMC announcements Wednesday.

On the day, all ten sectors ended in the green with Energy (+2.08%) leading us higher and the Basic Materials (+0.30%) and Consumer Cyclical (+0.46%) sectors being the laggards.  Meanwhile, the SPY was up 1.43%, the DIA was up 1.57%, and the QQQ was up 1.26%.  All of this action took place on less than average volume (although the DIA did manage to climb above average volume).  The VXX fell by 0.59% to 15.21 and T2122 climbed back outside of the oversold territory at 53.75.  10-year bond yields were up to 3.615% and Oil (WTI) was up more than 3.5% to $73.52 per barrel.

In economic news, it was interesting to see that both 3-year notes and 10-year notes were auctioned off by the Treasury Dept. on Monday. Both of these came in more than half a percent lower than the previous auction.  Later in the afternoon, the November Federal Budget Balance came in $1 billion worse than expected at -$249.0 billion (as compared to the forecast of -$248.0 billion).  Elsewhere, the US Senate is aiming to pass another stop-gap spending bill to keep the government open.  A vote is expected Friday and will keep the government open for another week while details of a longer-term $1.5 trillion omnibus spending bill are hammered out (although the 2 parties agreed to generalities last weekend).

SNAP Case Study | Actual Trade

In stock news, the US Energy Dept. announced Monday that they have finalized a $2.5 billion low-cost loan for the lithium battery joint venture formed by GM and South Korean LG Energy Solutions.  The loan will be used to finance manufacturing facilities in OH, TN, and MI.  Elsewhere, in the afternoon, Bloomberg reported that GS is planning to cut at least 400 hundred more jobs as it restructures its retail consumer business.  In other GS news, the company will stop making unsecured consumer loans according to a report from Reuters.  In legal news, the US Supreme Court has ruled that the state of CA can ban flavored tobacco products in a case brought by BTI (which now owns RJ Reynolds).

In BA news, on Monday, Indian airline India Air announced a historically large new order for jet planes.  Specifics were not shared other than it includes up to 500 jets delivered over the next decade from both BA and Airbus.  Then early this morning, UAL and BA announced that the airline has placed orders to buy 100 of the BA 787 Dreamliner jets with deliveries scheduled between 2024 and 2032.  (These planes will replace 100 existing BA 767s that United operates.)

In energy news, as of late Monday, TRP has yet to determine the cause of the 14,000+ barrel crude oil leak (from the Keystone pipeline) in KS.  The pipeline normally delivers 622,000 barrels per day and has been down since Wednesday with no timetable for the resumption of operations.  Oil trades indicate this was a driver behind Monday’s WTI rally and said if the outage lasts until the coming weekend, that could push the Cushing OK storage hub below the minimum required operating volume as well as crippling gulf region refineries.

After the close, ORCL beat on both the revenue and earnings lines.  However, JOAN missed on both the top and bottom lines.  ORCL also lowered its forward guidance.

Overnight, Asian markets were mixed on generally modest moves.  Singapore (+0.98% was an outlier to the upside as Hong Kong (+0.68%) and India (+0.60%) led to the upside while Shenzhen (-0.66%) and Taiwan (-0.61%) led to the downside.  In Europe, the exchanges are generally green at midday.  The FTSE (+0.39%), DAX (+0.82%), and CAC (+0.67%) lead the region higher while only Russia (-0.64%) and Portugal (-0.07%) are in the read in early afternoon trade.  Meanwhile, as of 7:30 am, US Futures are pointing toward a half percent gap higher to start the day.  The DIA implies a +0.56% open, the SPY is implying a +0.48% open, and the QQQ implies a +0.46% open at this hour.  10-year bond yields are down again to 3.587% and Oil (WTI) is up a quarter of a percent to $73.37/barrel in early trading.

The major economic news events scheduled for Tuesday is limited to November CPI (8:30 am) and API Weekly Crude Oil Stocks (4:30 pm).  The major earnings reports scheduled for before the open are limited to CNM.  Then after the close, ABM reports.

In economic news later this week, on Wednesday, November Import/Export Price Index, EIA Crude Oil Inventories, Fed Q4 Interest Rate Projections, Fed Economic Projections, FOMC Statement, Fed Interest Rate Decision, and FOMC Press Conference are reported.  On Thursday, we get November Retail Sales, Weekly Initial Jobless Claims, NY Fed Empire State Mfg. Index, Philly fed Mfg. Index, Nov. Industrial Production, Oct. Business Inventories, and Oct. Retail Inventories are reported.  Finally, on Friday, Mfg. PMI and Services PMI are reported.

In earnings later this week, on Wednesday we get reports from REVG, LEN, NDSN, and TCOM.  On Thursday we get reports from JBL and ADBE.  Finally, on Friday, we hear from CAN, DRI, and WGO.

Equity markets are looking for good CPI news this morning and especially looking for a softer tone and only 0.50% rate increase by the Fed on Wednesday. We may see a melt-up in anticipation with a general “wait to see” attitude by the big money. Meanwhile, the crypto world continues to reel as early today the SEC said that the head of the FTX exchange (Sam Bankman-Fried) defrauded investors to the tune of $1.8 billion and in the aftermath of the FTX collapse the Binance exchange (the world’s largest crypto exchange) halted outflows of the USDC stablecoin this morning. Bianance said the halt was temporary while it carries out a “token swap” (which just means swapping one digital currency for another electronically)…which on its own could cause more fear in the crypto world.

With that background, the short-term bearish downtrend line has now been broken in all three major indices and it looks like the bulls are looking to move even higher(at least in premarket trade). However, the big Nov. CPI report will have a lot to say about the open as well. Over-extension is still not a problem at all either in terms of the T-line (8ema) or the T2122 indicator. So, the bulls have room to run if traders want to move the market. Just bear in mind that the market risk is to the downside where a disappointing CPI (in this case too high) could crush the bull’s hopes and turn the bears loose.

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: NVDA, GSK, FDX, QCOM, SWKS, LEVI, and T. 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 down very modestly on Friday.  They then spent most of the day in waves and “dead flat” periods grinding sideways that lasted until 3:15 pm.  At that point, all three major indices sold off hard in the last 45 minutes of the day, closing very near the lows.  This left all of them as some form of a black-bodied inverted hammer candle.  All three also failed a retest of their T-line (8ema).  The QQQ also closed right at its major support level.  So, overall, it was a blah day, punctuated by profit-taking or a bearish selling spree during the last hour.

On the day, all ten sectors ended in the red with Energy (-1.76%) leading us lower and the Financial Services (-0.22%) and Utilities (-0.23%) sectors holding up the best.  In the meantime, the SPY was down 0.75%, the DIA was down 0.91%, and the QQQ was down 0.64%.  All of this action took place on less than average volume.  However, it was close to average than the last few days.  The VXX climbed by 2.14% to 15.30 and T2122 fell back just inside of the oversold territory at 19.67.  10-year bond yields were up sharply to 3.586% and Oil (WTI) was flat at $71.59 per barrel.  

In economic news, the market was disappointed by November PPI (Wholesale-level inflation) which came in at +0.3% (versus the forecasted +0.2% and the October value of +0.3%).  So, traders had expected more evidence that inflation was starting to come down (in order to give the Fed cover to do a smaller rate hike this week) and were then disappointed.  As a result, premarket action went from implying a modest gap higher to actually delivering a modest gap lower at the open.  Later in the morning, Michigan Consumer Sentiment came in higher than expected at 59.1 (compared to the forecast of 56.9 and the previous value of 56.8).

SNAP Case Study | Actual Trade

In stock news, Reuters (which obtained an internal memo) reported Friday that TSLA is suspending production of its “Model Y” in China from at least Dec. 25 through year-end. It’s unclear if “Model 3” production will also be halted.  The unplanned shutdown is a response to upticks in covid labor losses (related to the recent relaxation of zero-covid policies in Shanghai as well as parts supply (reduced for the same reason).  In other auto news, STLA announced Friday that in February it will indefinitely shut down a Jeep Cherokee production plant in IL (1,350 employees).  The UAW told Reuters that internal company documents show the company is moving Cherokee production to its Mexican plant.  Elsewhere, ERIC and AAPL have reached a global patent license deal which ended a legal fight over royalty payments for 5G technology used in iPhones. Meanwhile, on Monday, MSFT announced a 10-year cloud services deal with the London Stock Exchange, part of which was MSFT acquiring a 4% stake in the exchange. Finally, it was announced today that AMGN has agreed to buy HZNP for $26.4 billion (or $116.50/share cash, a 20% premium on Friday’s closing price).

In index news, the QQQ (Nasdaq 100) will rebalance as of the opening bell on Dec. 19.  Changes include the addition of RIVN, WBD, CSGP, GFS, BKR, and FANG.  The tickers being removed are VRSN, SWKS, SPLK, BIDU, MTCH, DOCU, and NTES.  So, the index will remain tech-heavy, even as it diversifies, and will be reduced from 102 to 101 tickers.  Many exchange-traded funds and actively managed mutual and hedge funds are bound by rules stating they must own all of the “current members” of that index.

In miscellaneous news, on Friday the WTO ruled that steel and aluminum import tariffs levied by the US (former President Trump) violate global trade rules. However, in a nod to US steelmakers and unions, President Biden has appealed the ruling to the WTO Appeals Court. This makes the ruling null because the Appeals Court is shut down since the US has been blocking the appointment of WTO “judges”. (US Aluminum and Steel firms: ARNC, SCTM, KALU, AA, CLF, CRS, CMC, NUE, STLD, X) Elsewhere, over the weekend, the Keystone oil pipeline leak in Kansas is the largest spill in the US for more than a decade.  As of Sunday, TRP (the pipeline operator) said they have not found the cause of the 14,000+ barrel spill and have no plans on restarting operations with various investigations ongoing.  Finally, on Sunday, the NASA Orion capsule splashed down after completing its 25-day mission to and week of orbiting the moon.  Hours before it did so, a SpaceX rocket took off carrying a lunar lander made by the Japanese company iSpace.  If they land successfully, it would be the first company (non-governmental entity) to reach the moon.  (To date, only the US, Russia, and China have been able to successfully land missions on the moon.)

Overnight, Asian markets were almost exclusively red on generally modest moves.  Thailand (+0.16%) was the only green while Hong Kong (-2.20%) was the only move greater than 0.90% in the region.  In Europe, a similar story is taking shape at midday.  The FTSE (-0.19%), DAX (-0.29%), and CAC (-0.38%) lead the region and are typical with only the FTSE MIB (+0.05%) in the green in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a modest gap higher to start the day.  The DIA implies a +0.19% open, the SPY is implying a +0.28% open, and the QQQ implies a +0.32% open at this hour.  Meanwhile, 10-year bond yields are falling to 3.536% and Oil (WTI) is off 0.69% to $70.53/barrel in early trading.

The major economic news events scheduled for Monday are limited to the November Federal Budget Balance (2 pm).  There are no major earnings reports scheduled for before the open.  Then after the close, JOAN, report.

In economic news later this week, on Tuesday we get November CPI and API Weekly Crude Oil Stocks.  Then Wednesday, November Import/Export Price Index, EIA Crude Oil Inventories, Fed Q4 Interest Rate Projections, Fed Economic Projections, FOMC Statement, Fed Interest Rate Decision, and FOMC Press Conference are reported.  On Thursday, we get November Retail Sales, Weekly Initial Jobless Claims, NY Fed Empire State Mfg. Index, Philly fed Mfg. Index, Nov. Industrial Production, Oct. Business Inventories, and Oct. Retail Inventories are reported.  Finally, on Friday, Mfg. PMI and Services PMI are reported.

In earnings later this week, on Tuesday, we hear from CNM and ABM.  Then Wed. we get reports from REVG, LEN, NDSN, and TCOM.  On Thursday we get reports from JBL and ADBE.  Finally, on Friday, we hear from CAN, DRI, and WGO.

All eyes (globally as well as in the US) seem to be looking toward the Fed. As of this moment, Fed Futures are showing that a 75% probability of a 0.50% rate hike and less than a 25% probability of a 0.75% rate hike has been priced into the market. The CPI data on Tuesday may give us a clue, but suffice it to say the market is expecting a slowing of the increases and no matter what the Fed does, it will have plenty of critics.

With that background, the short-term trend remains bearish. However, it looks like all three major indices are holding ground in premarket trading. In fact, the SPY and QQQ look as if they could be trying to form a short-term bottom for their pullbacks. Either way, over-extension is not a problem in terms of the T-line (8ema) or the T2122 indicator (where we are just barely inside oversold territory). So, they have room to run if traders want to move the market.

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: COUP, CLX, BDX, NVDA, OGN, KHC, GSK, MOMO, and PUMP. 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 Thursday, stocks gapped modestly higher at the open (up 0.5% in the SPY, 0.4% in the DIA, and up 0.5% in the QQQ).  Then after a 15-minute fade of the gap (except in the DIA), a rally took us to the highs by 10:30 am.  From there, we saw a pullback to the open level in slow narrow-range trading until 1 pm.  At that point, the bulls stepped in for a renewed rally that took us to new highs by 1:45 pm.  However, another selloff took us back to the lows by 2:15 pm.  Finally, price ground along the low end of the day’s range within a tight range.  This action gave us gap-up, white-body, indecisive Spinning Top candles that failed a retest of the T-line (8ema) from below.  None of the 3 major indices has been able to break their short-term downtrend.

On the day, eight of the ten sectors were in the green with the Technology sector (+1.62%) leading the way higher while Energy (-0.74%) and Communications Services (-0.75%) were the weakest sectors. In the meantime, the SPY was up 0.79%, the DIA was up 0.59%, and the QQQ was down 1.18%.  The VXX fell by more than 2% to 14.98 and T2122 has climbed a bit to 34.91.  10-year bond yields were up to 3.489% and Oil (WTI) was off a half of a percent to $71.68 per barrel.  So, Thursday saw a modest gap higher followed by indecision on very low volumes.

In economic news, Weekly Initial Jobless Claims came in exactly on forecast at 230k.  This was 4k higher than last week.  However, continuing claims reached an 11-month high.  Later, Freddie Mac reported that the average 30-year, fixed-rate mortgage fell again this week to 6.33% (down from 6.49% the prior week).  Gasoline prices are also lower than they have been in a year this week, with EIA analysts saying they expect the national average to dip below $3/gallon in the near future. 

SNAP Case Study | Actual Trade

In stock news, Reuters reported that CS has been able to raise $2.39 billion in new capital to help finance its turnaround plan.  Elsewhere, AVY told a conference that it is experiencing a “challenging finish to the year.”  AVY shares plunged on the news.  In other news, Bloomberg reported that the financers behind $13 billion of the money that Elon Musk used to buy Twitter are in discussions to restructure the debt, with Musk putting up TSLA stock as collateral.  In banking news, Reuters reports that multiple sources have confirmed that GS is slashing yearly bonuses for senior employees.  In more hopeful news, the CEO of GM said she expects car sales to rebound by more than 9% in 2023 (15 million units versus 13.7 million in 2022).

In government news, the House overwhelmingly approved (by 350-80) a record $858 billion Defense spending bill for 2023 ($45 billion more than requested by President Biden).  Meanwhile, the FTC voted 3-1 to officially block the MSFT acquisition of ATVI. Later in the day, the FTC announced plans to sue to enforce their decision. Elsewhere, the SEC warned public firms to study and report their exposure to cryptocurrency risks, which have been unreported to this point in general.  Finally, overnight the short-lived Democratic majority in the Senate slipped as AZ Senator Sinema announced she is leaving the Democratic party to become an independent.

In energy news, oil majors XOM and CVX both announced Thursday that they will be significantly expanding CAPEX investments in the US and Canada in 2023.  Finally, oil closed lower for the fifth straight day on Thursday despite the closure of the major Canada-to-US Keystone pipeline (which delivers 622k barrels per day to the US and is operated by TRP).

After the close, AVGO, CHWY, LULU, RH, and DOCU all reported beats on both the revenue and earnings lines.  Meanwhile, COO beat on revenue while missing on the earnings line.  Unfortunately, COST missed on both the top and bottom lines.  It is worth noting that RH and AVGO raised their forward guidance while COO lowered its own guidance.  Then this morning, LI reported misses on both the top and bottom lines.  LI also lowered its forward guidance.

Overnight, Asian markets were mostly green as Chinese covid-easing and a $108 billion Chinese bond sale (to be used for economic stimulus) boosted the region.  Hong Kong (+2.32%), Japan (+1.18%), and Taiwan (+1.05%) led the region higher.  Then in Europe, we see a mixed and modest market at midday.  The FTSE (-0.12%) lags while the DAX +0.32%) and CAC (+0.02%) indicate the mood of the continent 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 +0.18% open, the SPY is implying a +0.32% open, and the QQQ implies a +0.43% open at this hour.  At the same time, 10-year bond yields are down just a tick to 3.485% and Oil (WTI) is up eight-tenths of a percent to $72.07 per barrel in early trading.

The major economic news events scheduled for Friday are limited to November PPI (8:30 am) and Michigan Consumer Sentiment (10 am).  The major earnings reports scheduled for the day include Thursday, we hear from LI before the open.  There are no earnings reports after the close.

With that background (and remembering that we have Wholesale Inflation data at 8:30 am), it looks like all three major indices are retesting their T-lines (8ema) in premarket trading. Therefore, obviously, over-extension is not a problem either in terms of the T-line (8ema) or the T2122 indicator. The short-term trend does remain bearish (despite yesterday’s green day) within the mid-term bullish trend now broken. However, all three major indices look like they will be testing that short-term downtrend with their open this morning. The QQQ was able to climb back up above its support level (despite a significant test on Wednesday and Thursday). And if the bulls cannot put in a strong rally today, we are headed toward a down week (the first in the DIA in a month). Lastly, remember that its Friday with a weekend news cycle ahead and a Fed meeting next week.

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 down modestly (a half of a percent in the QQQ and a quarter percent in the large-cap indices) on Wednesday.  Price then proceeded to meander sideways all day on low volume except for the DIA (which is looking like it will achieve average volume).  This action is giving us black-bodied indecisive Doji candles in all three major indices.  The QQQ managed to retest and fail resistance while the SPY and DIA did not get down to the level of testing support again.

On the day, nine of the ten sectors were in the red with Healthcare (+0.55%) by far the strongest and Energy (-0.65%) and Consumer Cyclical (-0.68%) the weakest sectors.  In the meantime, the SPY was down 0.17%, the DIA was up 0.01%, and the QQQ was down 0.42%.  The VXX was up by more than 1.45% to 15.29 and T2122 has climbed back out of the oversold territory to 20.52.  10-year bond yields were down a bit to 3.42% and Oil (WTI) was off 2.55% to $72.36 per barrel. So, Wednesday was an indecisive day that amounted to a fifth straight down day in the SPY and a fourth straight in the DIA.

In economic news, Q3 Unit Labor Costs rose far less than expected at +2.4% (versus a forecast of +3.1% and the Q2 increase of 3.5%).  Q3 Nonfarm Productivity was also up more than expected at +0.8% (compared to a forecast of +0.6% and the Q2 value of +0.3%). This caused a small gap lower as traders interpreted modestly good economic data as not pushing the Fed in either direction.  Later in the morning, we saw EIA Weekly Oil Inventories fall more than expected at -5.187 million barrels (versus the forecast of -3.305 million barrels but still nowhere near as much of a drawdown as the prior week’s 12.580 million barrels).

SNAP Case Study | Actual Trade

In stock news, LUV reinstated its dividend Wednesday after a three-year suspension.  The CEO of the company cited a strong return of travel demand as he announced the company will pay $0.18/share to shareholders of record on January 31.  Later, Reuters reported that AMZN was offline mid-morning.  No details on the cause of the outage were given.  In other AMZN news, Washington DC has sued the company for diverting tips intended for delivery drivers to its own coffers.  Elsewhere, the CEO of C said she expects trading revenue to rise 10% in the current quarter while investment banking fees will fall 60% (in line with industry norms this quarter).  In “you don’t say” news, the CEO of COIN said he expects the revenue of their cryptocurrency trading platform to be down 50% for 2022 compared to 2021.  This comes after their competitor FTX and Celsius Network both filed for bankruptcy as well as the massive crash of crypto prices.  In legal news, CVNA is meeting with lawyers and bankers to discuss ways to restructure its debt load with the risk of bankruptcy rising.

In government news, US lawmakers declined to exempt BA from a looming deadline for a new safety standard related to its “737 Max” jets.  This loss will mean BA will need to rework safety systems on new planes before they can be certified by the FAA.  Meanwhile, after hours, GOOGL, ORCL, AMZN, and MSFT were awarded $9 billion in contracts by the Dept. of Defense related to “Cloud services.”  This comes a year after an AMZN lawsuit killed the previous awarding of these contracts to MSFT (based on bias introduced into the procurement process by former-President Trump).

In energy news, crude oil (WTI) fell again Wednesday in volatile trading, reaching close to the lowest level in a year.  The causes this time were the EIA report that showed an unexpected inventory build of 6.2 million barrels of distillates (like diesel fuel).  This post-refining inventory glut more than outweighed the crude oil inventory drawdown of 5.2 million barrels and the fall came in spite of news that Chinese oil imports reached the highest level in 10 months in November.  In other energy news, PSX announced that was one fatality and another contract employee injured in a crane accident at its Wood River IL refinery.

After the close, GEF and GME reported misses on both the revenue and earnings lines.  So far this morning, GMS, CIEN, KFY, and MOMO all reported beats on both the top and bottom lines. (HOV reports at 9:15 am.)

Overnight, Asian markets were mixed but leaned bearish with Hong Kong (+3.38%) and outlier on the post-Covid China opening news.  Australia (-0.75%), Taiwan (-0.53%), and South Korea (-0.49%) led the region lower.  Meanwhile, in Europe, the exchanges are mostly in the red at midday.  The FTSE (-0.05%), DAX (-0.34%), and CAC (-0.26%)  are typical of the continent with only three smaller exchanges in the green in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a modest green opening ahead of Jobless Claims.  The DIA implies a +0.13% open, the SPY is implying a +0.20%) open, and the DIA implies a +0.20% open at this hour.  10-year bond yields are up to 3.447% and Oil (WTI) is up 2.19% to $73.55/barrel in early trading.

The major economic news events scheduled for Thursday are limited to Weekly Initial Jobless Claims (8:30 am).   The major earnings reports scheduled for the day include Thursday, we hear from CIEN, GMS, HOV, and KFY before the open.  Then after the close, AVGO, CHWY, COO, COST, DOCU, LULU, and RH report.

In economic news later this week, on Friday, November PPI and Michigan Consumer Sentiment are reported.  In earnings later this week, on Friday, we hear from LI.

As stated above, Hong Kong skyrocketed overnight on the China opening story. Specifically, local Hong Kong media reported that the city is considering the outdoor mask requirement and reducing the isolation period for those who test positive for Covid-19. In addition, the Hong Kong government is considering replacing the need for two negative PCR tests with one rapid-antigen test for inbound travelers. Elsewhere, the Netherlands (home of ASML) appears to be falling in line with President Biden’s recently expanded chip sanctions for China (which restrict the sale of equipment used in the production of chip Fab facilities and which ASML is one of the world leaders in producing).

With that background, it looks like markets are setting up for a small gap higher, moving against the recent downtrend. Just remember Monday, when a similar gap-up turned into a slow all-day rout by the Bears. Over-extension is not yet a problem either in terms of the T-line (8ema) or the T2122 indicator. The short-term trend remains bearish within the mid-term bullish trend now broken. Only the large-caps indices still have support close below with the QQQ now not far below resistance (broken support). So, if the bulls cannot rally to hold those support levels we could see a bearish run for several percent in the near future.

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: CLX, PUMP, BK, PAAS, ANF. 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 markets opened flat only for all three major indices to start a long, steady selloff that lasted until 3:30 pm.  However, the shorts took profits the last 30 minutes of the day to take us out up off the lows. The SPY and QQQ both also failed their uptrend lines during the day.  This action gave us big black candles with small wicks at both ends.  All three major indices also retested and failed their T-lines (8ema) on the day.  This action took place on a larger-than-average volume in the DIA with a bit less than average volume in the SPY and QQQ.

On the day, nine of the ten sectors were in the red with only the Utilities (+0.11%) able to stay in the green while Technology (-2.23%) led the way lower. In the meantime, the SPY was down 1.45%, the DIA was down 1.05%, and the QQQ was down 2.07%. The VXX was up by more than 3% to 15.07 and T2122 has dropped into the oversold territory at 15.85.  10-year bond yields were down a bit to 3.531% and Oil (WTI) was off 3.38% to $74.35 per barrel.  So, Tuesday was slow melt which saw the large caps close down a fourth straight day and the QQQ close lower for the third straight session.

In economic news, October Imports were up about $3.5 billion while October Exports fell just under $2.5 billion. This gave us an October Trade Balance deficit that was a bit less than expected at -$78.20 billion (compared to a forecast of -$80 billion) but also above the prior month’s actual of -$74.10 billion.  Then after the close, the API Weekly Crude Oil Stock Report saw a larger-than-expected drawdown at -6.426 million barrels (versus a forecasted drawdown of 3.884 million barrels and last week’s drawdown of 7.850 million barrels).

SNAP Case Study | Actual Trade

In stock news, the EU Privacy Watchdog group ruled that META can no longer run ads based on users’ personal data without the users’ explicit consent.  On this side of the pond, the CEO of BAC told Bloomberg that the company will be slowing hiring as fewer than expected employees are leaving the company, but continues to seek talent.  This stands in contrast to MS, which let 2% of its workforce (1,600 people) go on Tuesday.  In other news, Bloomberg reported AAPL has scaled back and delayed (until 2026) its plans to offer self-driving car software for electric vehicles.  Meanwhile, a US District Judge ruled in favor of GSK, PFE, and SNY throwing out 50 thousand of US lawsuits that had claimed the heartburn drug Zantac caused cancer.  However, about 10,000 similar cases in state and local courts remain intact.  Finally, Reuters reports that MOS says that it is cutting potash production at its Saskatchewan Canada mine citing slower-than-expected demand.

In energy news, Oil (WTI) closed very near a one-year low on Tuesday.  This comes as Fed and recession fears have overcome last month’s OPEC+ production cuts.  Earlier in the day, the EIA released projections that US oil production for the year would rise marginally more than their previous estimates to 11.87 million barrels per day average (compared to the previous estimate of 11.83 million barrels per day).  They also now estimate that 2023 production in the US will reach 12.34 million barrels per day.  Still, they expect US oil consumption to be 20.36 million barrels per day and forecast that will rise to 20.51 million barrels per day in 2023.

After the close, PLAY and TOL reported beats on both the revenue and earnings lines.  Meanwhile, CASY missed on revenue while beating on earnings.  Unfortunately, SFIX missed on both the top and bottom lines.  It is also worth noting that TOL and SFIX have both reduced their forward guidance.

Overnight, Asian markets leaned to the downside.  Hong Kong (-3.22%) was an outlier while Australia (-0.85%), Singapore (-0.83%), and Japan (-0.72%) paced the losses.  Only Shenzhen (+0.17%) managed to stay green.  Meanwhile, in Europe, we see a similar picture taking shape at midday.  Only the FTSE MIB (+0.01%) and Greece (+0.15%) are in the green while the FTSE (-0.05%), DAX (-0.39%), and CAC (-0.41%) lead the way lower in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a red start to the morning.  The DIA implies a -0.29% open, the SPY is implying a -0.45% open, and the QQQ implies a -0.70% open at this hour.  10-year bond yields are up slightly to 3.54% and Oil (WTI) is on the green side of flat at $74.35/barrel in early trading.

So far this morning, THO and CPB reported beats on the revenue and earnings lines.  Meanwhile, UNFI beat on revenue while missing on earnings.  (ASO, BF.B, and OLLI all report later but before the opening bell.) 

The major economic news events scheduled for Wednesday include Q3 Labor Cost and Q3 Nonfarm Productivity (both at 8:30 am), and EIA Crude Oil Inventories (10:30 am).  The major earnings reports scheduled for the day include ASO, CPB, WLY, THO, and UNFI before the open.  Then after the close, GME and GEF report.

In economic news later this week, on Thursday we get Weekly Initial Jobless Claims.  Then on Friday, November PPI and Michigan Consumer Sentiment are reported.  In earnings later this week, on Thursday, we hear from CIEN, GMS, HOV, KFY, AVGO, CHWY, COO, COST, DOCU, LULU, and RH.  Finally, on Friday, we hear from LI.

Overnight the Democrats expanded their tiny majority in the US Senate as Senator Warnock won the GA runoff election. Elsewhere, the first electric vehicle maker unionization vote is taking place in Ohio today and Thursday as the UAW seeks to unionize the GM battery plant in Northeastern Ohio. In non-election news, the large banks warned of recession yesterday and are preemptively cutting jobs to preserve profitability. For their part, WMT says the consumer is strong and we actually need a recession to tame inflation. This all came as the demand for mortgages fell again last week, even as mortgage interest rates fell from 6.49% to 6.41% for a 30-year, fixed-rate, conforming loan. The Mortgage Bankers Assn. said demand fell by 1.9% last week (but were 86% lower than the same week of 2021).

With that background, it looks like premarkets are down again as the QQQ test support and the SPY is reaching to do the same. DIA has not gotten there yet, but could do so on a bad day. The short-term trend remains bearish within the mid-term bullish trend no broken. Note that we have no extension from the T-line is only potentially a problem in the QQQ at the moment. However, we did dip into the oversold area of the T2122 indicator yesterday. Of course, we do have Q3 Productivity and Labor Cost data at 8:30 am, but those are not usually huge market movers. So, overall, if the bulls cannot rally to hold support levels we could see a bearish run for several percent in the QQQ and SPY (with the DIA holding up better on the rotation to the safety of the mega-cap names).

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 down on Monday (the large caps gapping down about 0.70% and the QQQ gapping down about 0.80%).   Then, after 90 minutes of waffling, the three major indices sold off until 3 pm.  However, we saw a little profit-taking by the shorts as we made a small bounce up off the lows at the close.  This action gave us large-bodied, black candles with wicks at both ends.  All three indices crossed back below their T-lines (8ema) on below-average volume.  This all happened on lower-than-average volume again.  However, the DIA was at least close to its average volume.

On the day, all ten sectors are in the red with the Energy (-3.03%) sector leading the way lower while the Utilities (-0.85%) sector lagged behind.  In the meantime, the SPY was down 1.80%, the DIA was down 1.37%, and the QQQ is down 1.68%.  The VXX was up by 1.74% to 14.63 and T2122 has dropped out of the overbought territory to 32.80.  10-year bond yields are up to 3.575% and Oil (WTI) was down 3.26% to $77.37 per barrel.  So, Monday started the week off bearishly with price testing the uptrend line (since mid-October) but still having potential support a couple of percent below.

In economic news, the November Services PMI came in above expectations at 46.2 (versus 46.1 which was forecasted, and 47.8 in October). Later, the ISM Non-mfg. PMI came in further above expectations at 56.5 (versus 53.3 forecasted and 54.4 in October).  November ISM Non-Manufacturing Employment Index was up to 51.5 from October’s 49.1 value.  Finally, October Factory Orders also came in above expectation at +1.0% (compared to a forecast of +0.7% and +0.3% in September ).  So, overall we got several pieces of better-than-expected economic data…which traders took as a bad thing, expecting it to potentially give the Fed reason to raise three-quarters of a percent again next week.

SNAP Case Study | Actual Trade

In stock news, on Monday, Reuters reported that the Shanghai TSLA plant output fell 20% in November.  However, TLSA replied by putting out a statement claiming that was “false news.”  Elsewhere, T settled charges with the SEC, agreeing to pay $6.25 million for disclosing nonpublic information to select research analysts.  Later in the day, it was reported that the state of TX has offered a path for “sanctioned firms” to get off the TX boycott list. (TX is boycotting some financial firms as investments because the oil state didn’t like the financial company’s policy of not backing companies that do not limit emissions.)  The only US firm on the current TX boycott list is BLK.  In a twist to last week’s supply chain story, investor groups at NSC and UNP have proposed shareholder resolutions that the companies offer workers a “reasonable amount” of paid sick leave (instead of none, which is now given and was the main issue that the unions had been holding out to get).  After the close, XOM raised the annual base salaries of all the top executives including the CEO effective January 1.  Also, after the close, PEP announced it will be cutting hundreds of headquarters jobs.

In miscellaneous news, overnight GS reported that they are seeing big bets from professional investors that a bad recession can be avoided. This comes in the form of $5 trillion in sector positioning that is typical for a soft landing in a business cycle. Elsewhere, China is reporting that last month’s new wave of Covid cases is starting to tail off. This comes as the Chinese government said a negative test would no longer be required to enter many public venues in Beijing. Finally, Bloomberg reports that there is a major hidden risk in the global finance system. It seems that of the $65 trillion of dollar debt held by foreign financial institutions, $39 trillion is hidden in the form of derivatives that are not held on the balance sheet. This amount is double the debt they do report on balance sheets and 10 times their capital. (You may recall that such swaps and derivatives were the cause of the 2008 financial crisis caused in the US.) So, any shock to the Forex market could potentially crash the major non-US banks, which would likely precipitate governments needing to step in and bail out the system as the US did in 2008, otherwise, the collapse would definitely crash global markets and economies.

So far this morning, FERG, AZO, and SIG all reported beats on both the top and bottom lines.  However, HEPS missed on both the revenue (badly) and earnings lines.

Overnight, Asian markets were mixed but leaned to the red side on modest moves.  Shenzhen (+0.67%), Japan (+0.24%), and Shanghai (+0.02%) were the green exchanges.  Meanwhile, Taiwan (-1.68%), South Korea (-1.08%), and Thailand (-0.53%) led to the downside.  In Europe, we see a similar and perhaps more down picture taking shape at midday.  The FTSE (-0.29%), DAX (-0.13%), and CAC (-0.19%) are leading the way on volume as usual with a couple of the smaller exchanges even more red and only three modestly green exchanges 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 +0.14% open, the SPY is implying a +0.18% open, and the QQQ implies a +0.29% open at this hour.  10-year bond yields are down again to 3.553% and Oil (WTI) is off 1.12% to $76.06/barrel.

The major economic news events scheduled for Tuesday include Oct. Imports/Exports and Oct. Trade Balance (both at 8:30 am), and API Weekly Crude Oil Stocks Report (4:30 pm).  The major earnings reports scheduled for the day include AZO, FERG, HEPS, and SIG before the open.  Then after the close, CASY, PLAY, and TOL report. 

In economic news later this week, on Wednesday, Q3 Labor Cost, Q3 Nonfarm Productivity, and EIA Crude Oil Inventories are reported.  On Thursday we get Weekly Initial Jobless Claims.  Finally, on Friday, November PPI and Michigan Consumer Sentiment are reported.

In earnings later this week, on Wednesday, ASO, CPB, WLY, THO, UNFI, GME, and GEF report.  On Thursday, we hear from CIEN, GMS, HOV, KFY, AVGO, CHWY, COO, COST, DOCU, LULU, and RH.  Finally, on Friday, we hear from LI.

President Biden is in AZ for a ceremony at the new TSM semiconductor Fab construction site. TSM has upped its investment in the location to $40 billion, which will double the number of Fabs built to two. Last week TSM announced they will build 4nm chips (next-gen state of the art) at those facilities rather than 5nm (current-gen state of the art) at the urging of AAPL, NVDA, and AMD. (Those TSM customers would like the chips made in the US to reduce supply chain shipping risks…let alone the risk of Chinese action against Taiwan. By the same token, the move also reduces TSM risk by no longer having all its eggs in one basket so to speak.)

With that background, it looks like premarkets are up modestly and perhaps looking to retest the T-line (8ema) as resistance. Of course, we have trade data at 8:30 am, but that is not likely to be a huge market mover. The short-term trend remains bearish within a mid-term bullish trend. Remember that the SPY and QQQ are now at (or near) uptrend support lines while the DIA seems to be wandering sideways looking for direction. Also, note that we have no extension problem either direction from either the T-line or in terms of the T2122 indicator.

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: INFN, CLX, U, AMD, TLT, VLDR, SBSW. 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