Markets ended the week with a bullish move. SPY gapped up 0.61%, DIA gapped up 0.40%, and QQQ gapped up 0.93%.  From there, all three major index ETFs chopped sideways with an early afternoon slump followed immediately by a mid-afternoon rally that lasted into the close. This action gave us gap-up, white-bodied candles in all three.  The SPY and QQQ printed white, Spinning Top, Bullish Harami candles.  Meanwhile, DIA just printed a gap-up, strong white-bodied candle that not only closed near the highs, but within nine cents of the all-time high close.  This all took place on average volume in the DIA, as well as slightly below-average volume in the SPY and QQQ.

On the day, all 10 sectors were in the green with Basic Materials (+2.15%) out front leading the way higher.  Meanwhile, even the laggard Consumer Defensive was up 0.65%.  SPY gained 1.05%, DIA gained 1.07%, and QQQ gained 1.08%. VXX dropped 5.98% to close at 45.94% and T2122 spiked back up to the top end of its overbought territory to close at 97.91.  On the bond front, 10-year bond yields fell to 3.799% and Oil (WTI) popped 2.59% to close at $74.90 per barrel.  So, Friday saw a Bull recovery from Thursday’s profit-taking.  This was perhaps on the basis of Thursday’s Fed voter comments indicating a rate cut could be on the way in September or perhaps on the VP Harris DNC performance.  Regardless of reason, after the gap up, markets sold the news from Fed Chair Powell’s presentation (which more or less confirmed what the other Fed members had said Thursday).   However, that did not last long as an afternoon rally took us out higher…especially in the DIA.

The major economic news scheduled for Friday was limited to July Building Permits, which came in a bit stronger than expected at 1.406 million (compared to a forecast of 1.396 million and a June value of 1.454 million).  Later, July New Home Sales came in much stronger than predicted at 739k (versus a forecast of 624k and June’s reading of 668k). 

In Fed news, Fed Chair Powell all but confirmed a September rate cut.  Powell said, “The time has come for policy to adjust. The direction of travel is clear, and the timing and pace of rate cuts will depend on incoming data, the evolving outlook, and the balance of risks.”  On the topic of inflation, he said, “My confidence has grown that inflation is on a sustainable path back to 2 percent.”  On the employment situation, Powell pointed out, “It seems unlikely that the labor market will be a source of elevated inflationary pressures anytime soon. We do not seek or welcome further cooling in labor market conditions.”  Putting the two Fed mandates together, Powell said, “The upside risks to inflation have diminished. And the downside risks to employment have increased.” 

Later, Chicago Fed President Goolsbee also signaled his support for a September rate cut, telling CNBC, “Everything we wanted to happen to get rates down has happened.”  He continued, saying the current policy would be appropriate to cool and overheating economy, but currently the economy “is not overheating.”  He went on to say, “I don’t think inflation will get stuck above 2%.”  He also noted “warning signs” about employment (specifically citing the July Nonfarm Payrolls data).  In a separate interview with Bloomberg, Goolsbee basically flat out said he’ll vote for rate cuts and spent the interview discussing how fast and/or steadily the FOMC will cut.  Goolsbee said, “I don’t think it makes sense to get into a big debate (over 25 basis points versus 50 basis points).”  He continued, “little gradations like that aren’t what matters the most. What matters the most is the longer-run path of policy.” Goolsbee concluded by saying, “What will warrant the speed at which we cut rates, or how much we pause the cutting, will be determined by how the economy performs (during the cutting process).”

In stock news, on Friday, AMZN CEO Jassy said the company’s AI software had saved its software teams “4,500 developer-years.” Later, Reuters reported that MTH is talking with investment bankers exploring the sale of its Columbia Distributing unit for about $2 billion, with potential buyers including Columbia insiders.  At the same time, Reuters provided some background on the NSRGF (Nestle, the world’s largest food maker) CEO leaving Thursday. The report said that CEO Schneider was ousted unexpectedly for underperformance at a board meeting Thursday night.  Later, Chinese smartphone maker Honor (a former Huawei unit) announced it received an undisclosed investment from CHL as Honor gets ready for its planned IPO. 

Meanwhile, technology industry outlet “The Information” reported Friday that META has canceled plans for a premium version of its mixed-reality headset in response to poor sales performance of AAPL’s $3,500 Vision Pro headset.  In unrelated news, Bloomberg reported that AAPL is now targeting September 10 for the launch of new iPhone, watches, and AirPods.  After the dog and pony show, the products will be available for sale on September 20 according to the report.  Later, after the close, NSC announced it had reached a tentative, 5-year collective bargaining agreement with four labor unions.  The agreement covers 30% of NSC’s workforce and will provide 3.5% wage increases each of the next five years, as well as increased vacation, and enhancements in healthcare benefits.  Also after the close, CNBC reported that INTC has retained MS to help it fight off activist investors after the company has lost 60% of its stock value and a board member stepped down.

In stock legal and governmental news, on Friday, Reuters reported that despite US sanctions, 11 Chinese state-linked entities have access to the most advanced chips and AI tools via contracts with AMZN cloud services.  The report states that federal agencies are considering if action can be taken. In addition, the Biden Administration is talking to the House Foreign Affairs Committee on potentially changing legislation to close the loophole.  Later, Reuters reported that JNJ that has halted the count of votes (from plaintiffs on whether or not to accept the terms of the company’s $6.48 billion settlement offer) and resumed negotiations with talc-caused cancer plaintiffs.  This comes a month after the company reported it “had” more than 75% support and would ask the judge to force remaining holdouts to accept the settlement.  After the close, UK newspaper the Telegraph reported that the British NHS is expected to reject the LLY early Alzheimer’s drug donanemab. This comes less than a week after a separate UK agency, Medicines and Healthcare products Regulatory Agency, had said that a different Alzheimer’s drug (Lecanemab) was a poor value for taxpayers.

Overnight, Asian markets were mostly green with only two of 12 regional exchanges in the red.  Hong Kong (+1.06%), India (+0.76%), and Thailand (+0.73%) led the region higher.  In Europe, we see a similar picture taking shape with five of the 15 bourses in the red.  The CAC (+0.15%), DAX (-0.21%), and FTSE (+0.48%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a start just on the green side of flat.  The DIA implies a +0.13% open, the SPY is implying a +0.16% open, and the QQQ implies a +0.04% open at this hour.  At the same time, 10-Year bond yields are at 3.81% and Oil (WTI) has spiked to $76.79 per barrel in early trading.

The major economic news scheduled for Monday is limited to July Durable Goods and July Core Durable Goods (8:30 a.m.).  The major earnings reports scheduled for before the open is limited to PDD.  Then, after the close, BHP, HEI, and TCOM report.

In economic news later this week, on Tuesday we get Conference Board Consumer Confidence and API Weekly Crude Oil Stock report.  Then Wednesday, EIA Crude Oil Inventories are reported.  We also hear from Fed Governor Waller and Fed member Bostic.  On Thursday, we get Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Preliminary Q2 GDP, Preliminary Q2 GDP Price Index, July Goods Trade Balance, Preliminary July Retail Inventories, July Pending Home Sales, and the Fed Balance Sheet.  We also hear from Fed member Bostic.  Finally, on Friday, we get July Core PCE Price Index, July PCE Price Index, July Personal Spending, Aug Chicago PMI, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, Michigan 5-Year Inflation Expectations.

In terms of earnings reports later this week, on Tuesday we hear from BMO, BNS, SCSC, YY, JWN, and PVH.  Then Wednesday, ANF, BBWI, CHWY, DCI, FL, HMY, SJM, KSS, LI, PDCO, RY, AFRM, COO, CRWD, FIVE, GEF, GES, HPQ, NTAP, NTNX, NVDA, OKTA, PSTG, CRM, VEEV, and VSCO report.  On Thursday, we hear from AEO, BBY, BIRK, BF.B, BURL, CPB, CM, DG, GMS, OLLI, PSNY, TITN, AMRK, ADSK, DELL, GAP, LULU, MRVL, and ULTA.  Finally, on Friday, JKS and MNSO report.

So far this morning, PDD missed on revenue while beating on earnings.

In miscellaneous news, on Friday, the UK Maritime Operations agency said three fires have been seen on a Greek-flagged tanker in the Red Sea. The crew of the tanker was evacuated on Thursday after an attack by Yemeni Houthi rebels.  (The tanker contains 150,000 metric tons or 1,050,000 barrels of crude oil.)  Then, on Saturday, NASA made the decision to leave the BA Starliner crew at the International Space Station until they can be retrieved by a by a SpaceX ship in February.  NASA decided that it was too risky to have humans aboard the attempt to return BA’s Starliner to earth.

With that background, all three major index ETFs gapped modestly higher to start the premarket. However, they are diverging just a bit since that start. SPY and DIA both are giving us small white-bodied candles in the early session. Meanwhile, QQQ has printed a slightly larger black-body candle that is fading its premarket gap. All three remain well above their T-line (8ema) and the short-term trend is still strongly bullish. At the same time, the mid-term bearish trend is bullish. In the long-term, we are now clearly back in a Bull trend. In terms of extension, SPY and DIA are a bit stretched above their T-line. At the same time, the T2122 indicator is up at the top of its overbought range. So, the market is in need of more rest or pullback. However, keep in mind that the market can remain overdone longer than you can stay solvents predicting turns. Remember the mantra “follow, don’t lead, but also don’t chase” in mind. (In a volatile market, that may mean sitting on your hands.) With regard to those 10 big dog tickers, they are evenly split, led by the biggest dog NVDA (+0.67%) and lagged by META (-0.63%).

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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Mr. Market gave us a Bull trap on Thursday on all-day profit-taking after a strong two-week rally.  The SPY gapped up 0.33%, DIA opened 0.18% higher, and QQQ gapped up 0.48%.  However, that was pretty much it for the Bulls for the day. From there all three major index ETFs sold off the rest of the session.  This action Black-bodied, Bearish Engulfing candles in all three. However, all three of them also remain above their T-line (8ema).  It also gave us a higher high in the SPY, DIA, and QQQ.  Still, once again this took place on below average volume in all three major index ETFs.

On the day, nine of the 10 sectors were in the red with Technology (-1.82%) way out front leading the others lower.  On the other side, Financial Services (+0.09%) held up better than the others and was the only green sector.  Meanwhile, SPY lost 0.78%, DIA lost 0.37%, and QQQ lost 1.59%.  VXX popped 4.20% to close at 48.86% and T2122 dropped back out of its overbought territory and back into the top end of its mid-range to close at 73.58.  On the bond front, 10-year bond yields popped to 3.865% and Oil (WTI) popped another 1.42% to close at $72.94 per barrel.  So, Thursday we had reversal (or more likely a profit-taking day ahead of Fed Chair Powell’s presentation set for Friday at 10 a.m.  

The major economic news scheduled for Thursday included Weekly Initial Jobless Claims, which were just as expected at 232k (compared to a 232k forecast and up just a bit from the prior week’s 228k).  At the same time, Weekly Continuing Jobless Claims came in up but still below expectations at 1,863k (versus the 1,870k forecast and the prior week’s 1,859k).  Later, S&P Global Mfg. PMI was a bit light at 48.0 (compared to a 49.5 forecast and the July 49.6 reading).  At the same time, S&P Global Services PMI were a bit stronger than predicted at 55.2 (versus the 54.0 forecast and the July 55.0 value).  This gave us an S&P Global Composite PMI that was also better than anticipated at 54.1 (compared to the 53.2 forecast and July’s 54.3 reading).  Later, the July Existing Home Sales were slightly better than predicted at 3.95 million (versus a forecast of 3.94 million and up from June’s 3.90 million number).  Then, after the close, the Fed Balance Sheet showed a $16 billion increase on the week, rising from $7.178 trillion to $7.194 trillion.  (Note: The Fed balance sheet reduction or QT caused some market disruption when first started.  The Fed then promised to stop QT prior to wider trouble taking shape.  Since the ECB, Bank of Japan, and Bank of England have now all also started tightening, Bloomberg speculates the Fed is regulating its own balance sheet reduction to avoid trouble.)

In Fed news, the Jackson Hole Symposium began.  Kansas City Fed President Schmid told CNBC that he has an open mind about rate cuts in September.  Schmid said, “It bears looking harder at it (the unemployment rate).  I’m going to let the data show where we lead (but) I would agree with several of my colleagues that you probably want to act maybe before (inflation) gets to two (percent) but that sustainability toward two I think is really important.”  Later, Boston Fed President Collins indicated she feels it will soon be appropriate to cut interest rates. Collins said, “We’ve seen quite a lot of reduction in inflation. The reduction to me is consistent with more confidence that we are on that trajectory and with labor markets healthy overall, I do think that soon it is appropriate to begin easing.”  She also seemed to signal that quarter-point rate cuts are the way to go, saying “I think a gradual, methodical pace once we are in a different policy stance is likely to be appropriate.”  By mid-morning, Philly Fed President Harker told Reuters that as of now he is ready to cut rates in September.  Harker said, “For me, barring any surprise in the data we’ll get between now and then, I think we need to start this (rate cut) process.”

After the close, BBAR, NDSN, SNOW, TBBB, URBN, and ZM all reported beats on both the revenue and earnings lines. Meanwhile, A, CAAP, and SNPS reported misses on revenue while beating on earnings. However, BMA missed massively on both the top and bottom line.

In stock news, on Thursday, Reuters reported that Japanese company Softbank is in serious talks to invest $684 million in SHCAY (Sharp electronics).  At the same time, AMKAF announced it is evaluating but has not decided upon contingency strategies in Canada after the two top Canadian freight railroads (CP and CNI) locked out their employees and shut down operations Thursday.  Later, research firm Jato Dynamics reported that BMWYY (BMW) overtook TSLA to become that largest-selling electric vehicle maker in Europe in July.  At the same time, Bloomberg reported that CME and SPGI are in discussion about the sale of their OSTTRA joint venture. (Bloomberg says the joint venture is values between $2 billion and $4 billion.)  Later, AAP announced it had struck a deal to sell its Worldpac unit to CG for $1.5 billion in cash.  At the same time, WMT announced it has partnered with QSR (Burger King) to offer meal discounts to the retailers paying members.  The move is designed to let WMT to better compete with AMZN Prime. 

Meanwhile, F announced it had cancelled its planned 3-row electric SUV. (That vehicle had been scheduled to roll off assembly lines in 2025.)  Later, the PARA buyout saga continued as private media veteran Bronfman raised his bid from $4.3 billion to $6 billion.  At the same time, miners TECK and RIO joined the crowd of companies looking for alternatives after the Canadian rail shutdown.  The two said they would need to truck some products and defer shipment on many commodities.  (They mainly produce iron ore, aluminum ore, copper, and molybdenum in Canadian mines.  The diamonds RIO mines there are not shipped by rail.)  Later, Reuters reported that ELH is in talks with private equity firms TPG, KKR, and others over a potential sale.  ELV (an insurer) is also among the suitors.  At the same time, ACDVF (Air Canada) pilots voted to authorize a strike.  (Any strike cannot take place prior to a 21-day “cooling off” period.)  After the close, GM and UBER announced a multi-year partnership to deploy Cruise robotaxis on the UBER platform.  (UBER already has a similar deal with GOOGL’s Waymo unit in Phoenix, AZ, which has been in operation since October.)

In stock legal and governmental news, on Thursday, the NHTSA announced that GM has agreed to recall 1,200 Cruise robotaxis over hard braking issues.  Later, Reuters reported that AAPL will change how users choose browsers and other default apps (in the EU only) in response to European Digital Markets Act.  (This will end the billions of dollars in fees GOOGL previously paid AAPL to have Chrome be the default browser on iPhones and iPads.)   At the same time, a Washington DC Appeals Court ruled to revive an antitrust lawsuit against AMZN that had been brought by the district. The suit alleges that AMZN pricing policies (restrictions on third-party sellers and their own suppliers) illegally stifle competition.  Later, GOOGL announced it has struck a “first in the nation” deal with the state of CA to fund newsrooms in the state in exchange for ending legislation that would have forced GOOGL and other tech giants to pay in order to distribute new content generated in the state.  The plan calls for GOOGL to pay $15 million the first year, while the state will pay $30 million.  During the next four years, CA’s contribution drops to $10 million per year while GOOGL’s increases to $20 million per year.  (The deal was immediately criticized by journalists because it will help create AI tools to support journalists, which they feel will replace journalists with computers.) 

Meanwhile, after the close, NASA said it expects to announce the decision on how the two-person BA Starliner crew will be brought back to earth on Saturday.  The crew has been stranded at the International Space Station since the start of June after the glitchy Starliner leaked helium propellent before, during and after it travelled to the ISS.  Also after the close, the Financial Times reported that AZN has warned it would seek to relocate its vaccine manufacturing site to the US (from the UK) amidst a negotiation deadlock with the UK over a planned cut in state aid. (The previous Conservative party administration had pledged $118 million in grants for the operation, but the new Labour government, which was left with a broken budget, has said it expects to cut the grants to $53 million under newly-required austerity measures.)  Later, the NRLB determined that AMZN is a “joint employer” of subcontracted drivers who delivered packages for the company in CA.  This ruling came after an unfair labor practices charge resulted in an investigation by the agency.

Overnight, Asian markets were mostly green on modest moves with just four of the 12 regional exchanges showing red.  Thailand (+1.03%) was the outlier and leader of the gains while Malaysia (-0.36%) had the worst showing.  In Europe, the picture is even brighter with just one bourse in the red against 14 in the green at midday.  The CAC (+0.53%), DAX (+0.57%), and FTSE (+0.33%) lead the region higher in early afternoon trade.  Meanwhile, in the US, at 7:30 a.m., Futures are pointing toward a gap higher to start the day.  The DIA implies a +0.35% open, the SPY is implying a +0.51% open, and the QQQ implies a +0.75% open at this hour.  At the same time, 10-Year bond yields have backed down to 3.848% and Oil (WTI) is up 1.3% to $73.96 per barrel in early trading.

The major economic news scheduled for Friday is limited to July Building Permits (8:30 a.m.), and July New Home Sales (10 a.m.).  We also head from Fed Chair Powell at 10 a.m. as the Jackson Hole Symposium also continues.  The major earnings reports scheduled for before the open include GFI.  Then, after the close, there are no major earnings reports schedule.

So far this morning, UI missed on revenue while beating on earnings.

In miscellaneous news, on Thursday, the Equipment Leasing and Finance Assn. reported that US companies increased their borrowing to finance equipment in July.  The report stated that July credit for equipment by US companies were up 11% from June’s $10 billion figure. Elsewhere, after the close, the Canadian government stepped in to end the freight rail shutdown in the country.  The government ordered the railways and union to enter into binding arbitration.  However, according to the AP, it’s uncertain how quickly the workers will return to work.  Still, the Canadian Labour Minister said he expects the trains to be running again within days. CNI said they had ended their lockout within an hour of the government’s order. However, there was no word from CP as of 9 p.m. eastern.

With that background, all three major index ETFs gapped higher to start the premarket and have given us white body candles since then. QQQ is the most volatile of these, showing what looks like a fat-bodied Spinning Top at this point while the others have little wick. All three remain well above their T-line (8ema) and the short-term trend is still strongly bullish despite Thursday’s candle. Meanwhile, the mid-term bearish trend remains broken, though one could argue a new mid-term bullish trend has not formed yet (due to a lack of higher high to go with yesterday’s higher low). In the long-term, we are now clearly back in a Bull trend. In terms of extension, the pullback Thursday helped relieve much of the stretch above the index ETF T-lines. At the same time, the T2122 indicator has dropped back out of its overbought territory and is in the upper end of its mid-range. So, the market has room to run either direction. However, the Bears have more slack to play with Friday. Remember the mantra “follow, don’t lead, but also don’t chase” in mind. (In a volatile market, that may mean sitting on your hands.) With regard to those 10 big dog tickers, all 10 are in the green this morning, led by the biggest dog NVDA (+1.30%) and followed by the second-biggest dog TSLA (+1.067%). Meanwhile, NFLX (+0.43%) is the laggard. Finally, remember its Friday. So, prepare your account for the weekend news cycle and don’t forget to take profits. After all, Friday is payday.

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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Wednesday brought more indecision and rest.  SPY gapped up 0.20%, DIA opened 0.18% higher, and QQQ opened up 0.16%.  From there, all three major index ETFs wandered back and forth across their gaps all day long.  This action gave us Spinning Top candles in all three, with SPY and QQQ both having white bodies and DIA having a small black body.  All three also remain above their T-line (8ema).  It also gave us a higher high, higher low, and higher close in SPY and QQQ while DIA got the higher high and higher close coming up a touch short on the low front. Yet again, this took place on well-below average volume in all three major index ETFs.

On the day, all 10 sectors were in the green as both Basic Materials (+1.48%) and Consumer Cyclical (+1.43%) were well out in front leading the others higher.  On the other side, Communications (+0.01%) and Energy (+0.04%) lagging well behind the other sector.  Meanwhile, SPY gained 0.35%, DIA gained 0.10%, and QQQ gained 0.47%.  VXX climbed 1.56% to close at 46.89 and T2122 climbed back up well into its overbought territory to close at 90.97.  On the bond front, 10-year bond yields fell to 3.801% and Oil (WTI) dropped another 1.85% to close at $71.82 per barrel.  So, again on Wednesday we had an indecisive, yet bullish day.  Perhaps it could even be seen as a pause or rest day.

The major economic news scheduled for Wednesday was limited to EIA Weekly Crude Oil Inventories which had a much larger-than-expected drawdown of 4.649 million barrels (compared to a forecasted 2.000-million-barrel drawdown and the prior week’s 1.357-million-barrel inventory build).  The Bureau of Labor Statistics also released the US Payrolls Benchmark.  While widely referred to as a revision of the Nonfarm Payroll data, it really is not.  It actually is the difference between two sets of data which are derived from completely different sources. At any rate, the release was a -818k number (compared to three of the last four benchmark releases, which were each +400k to +500k).  This release was interpreted as the Nonfarm Payrolls data released monthly having over-estimated job additions by 818k jobs this year.  Theoretically, this would mean that the job market started cooling much sooner than widely noticed and could give the Fed more evidence that a rate cut is needed.  (Side note: Bloomberg reported that at least three major foreign banks, MFG, BNPQY, and NMR obtains the report early by directly calling the BLS.)

In Fed news, on Wednesday, July’s Fed Meeting Minutes were released.  The minutes summarized the opinion of FOMC voters as leaning toward a September rate cut…if the data continues as it has been trending.  Specifically, the minutes said, “the vast majority of policymakers observed that, if the data continued to come in about as expected, it would likely be appropriate to ease policy at the next meeting.” The report also noted that “many participants” felt the current stance was restrictive and argued that if inflation data continued to show cooling, holding rates as they are would increase the drag on the economy.  It said that all the voters were on board with rates being held flat at the July meeting.  However, also saying “several” indicating recent inflation reductions and increases in joblessness “had provided a plausible case for reducing the target range 25 basis points at this (July) meeting or that they could have supported such a decision.”  Finally, the report noted a “dwindling camp” of FOMC members still feared that premature easing could rekindle inflation. 

After the close, BBAR, NDSN, SNOW, TBBB, URBN, and ZM all reported beats on both the revenue and earnings lines. Meanwhile, A, CAAP, and SNPS reported misses on revenue while beating on earnings. 

In stock news, on Wednesday, Bloomberg reported rumors that WMT plans to sell its #3.74 billion stake in JD.  At the same time, Reuters reported multiple analysts were telling clients that OXY had reached “Buffett Put” territory.  (In other words, OXY has fallen to a price, below $60, where BRKB has routinely bought millions of shares.) Later, Bloomberg reported that OKTGP is in exclusive talks and near a deal to acquire RILYN for undisclosed terms.  At the same time, Reuters reported that BN is working with UBS and BAC to arrange financing to acquire GRFS.  Later, after the close, HAL reported that it was hit by a cyberattack.  The extent and impact of the attack are not yet determined.  At the same time, TD announced the sale of 40.5 million shares of SCHW, which reduces its ownership of SCHW to 10.1%.  Later, MSFT reworked its business units and announced the changes at an investor presentation Wednesday.  MSFT lowered what it now called its “Intelligent Cloud” unit forecast by as much as $5 billion for 2024 (from a high estimate of $28.9 billion to a new low estimate of $23.8 billion).

Elsewhere, it is widely expected a lockout (or, if not, strike) will stop Canadian railroads as of today.  CNI and CP are both expected to participate in the shutdown.  This could have major impacts on many businesses such as CF, NTR, CHRW, GLNCY, MERC, as well as oil, coal, and automakers. (Update: The shutdown did take place. So, all Canadian rail transportation is offline. For anyone unfamiliar with Canada, this is the vast, vast majority of all freight movement in the country. Canadian population is heavily centered on a handful of cities with a relatively sparse road network between, but the vast distances crossed by rail. The fact that most of those cities are found at a seaport or near the US border also makes Canadian rail freight problematic for US companies.

In stock legal and governmental news, on Wednesday, India’s Commerce Minister Goyal accused AMZN of predatory pricing practices. However, he stopped short of announcing any investigation or charges.  (Many time in the past, Goyal has attacked AMZN and WMT-backed Flipkart of actions that are detrimental to India’s brick-and-mortar stores.)  At the same time, the NHTSA announced a new recall of 9,100 Model X sport utilities over a roof trim that could separate.  (This is the second such recall over the same issue since 2020.)  Later, Reuters reported that the UK’s competition watchdog has now shutdown its existing investigations of AAPL and GOOGL related to their app stores.  Sources told Reuters the agency is waiting on new UK laws covering digital markets. 

Meanwhile, C told Reuters it has added a new section to its SEC quarterly reports in response to SEC queries.  (The SEC fined C $136 million for a lack of progress in fixing its data management issues in mid-July.)  Later, after the close, TD announced it expects to finalize a settlement of both civil and criminal money laundering investigations by the end of the calendar year.  In anticipation of fines and other non-monetary penalties, TD says it will take an additional $2.6 billion provision in its Q3 results.  Also after the close, DB announced it had reached settlements with more than half of the plaintiffs who had accused the bank of underpaying them related to the acquisition of Postbank years ago. (Details of the settlements weren’t disclosed.)

Overnight, Asian markets were mixed but leaned toward the green side.  Only five of the 12 exchanges in the region were in the red as Shenzhen (-0.82%) was by far the biggest loser.  On the other side, Hong Kong (+1.44%) and Japan (+0.68%) led the gainers.  In Europe, a much rosier picture is taking shape with just two spots of red among the 13 green bourses at midday.  The CAC (+0.22%), DAX (+0.30%), and FTSE (+0.18%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modest green start to the morning. The DIA implies a +0.07% open, the SPY is implying a +0.21% open, and the QQQ implies a +0.32% open at this hour.  At the same time, 10-Year bond yields are up to 3.829% and Oil (WTI) is up half a percent to $72.29 per barrel in early trading.

The major economic news scheduled for Thursday include Weekly Initial Jobless Claims and Weekly Continuing Jobless Claims (both at 8:30 a.m.), S&P Global Mfg. PMI, S&P Global Services PMI, and S&P Global Composite PMI (all at 9:45 a.m.), July Existing Home Sales (10 a.m.), and the Fed Balance Sheet (4:30 p.m.).  The Jackson Hole Symposium also starts at 8 a.m.  The major earnings reports scheduled for before the open include AAP, BIDU, BILI, BJ, CSIQ, IQ, NTES, PTON, TD, VIK, and WSM. Then, after the close, BMA, INTU, ROST, and WDAY report. 

In economic news later this week, on Friday we get July Building Permits, and July New Home Sales.  The Jackson Hole Symposium also continues.

In terms of earnings reports later this week, on Friday, we hear from GFI.

So far this morning, BILI, BJ, BWLP, PTON, TD, and WB all reported beats on both the revenue and earnings lines.  Meanwhile, BIDU and VIK missed on revenue while also beating on earnings.  On the other side, AAP and IQ beat on revenue while missing on earnings.  However, CSIQ and NTES missed on both the top and bottom lines.

With that background, we see some divergence in the premarket. DIA opened and has remained flat in the early session. Meanwhile, SPY gapped up slightly and has followed-through with a modest white-body candle in the premarket. However, the big mover was QQQ which gapped lower but was met with buying and has printed a large white-body candle without wick in the early session. All three remain well above their T-line (8ema) and the short-term trend is still strongly bullish. Meanwhile, the mid-term bearish trend is broken, though one could argue a new mid-term bullish trend has not formed yet (due to a lack of higher low in the strong run higher). In the long-term, we are now clearly back in a Bull trend. In terms of extension, as I mentioned all three are stretched to the upside relative to their T-line. The T2122 indicator has now back up in its overbought territory. So, again, the market needs a pullback or at least a rest to maintain a healthy trend. However, remember that the market can stay overextended a lot longer than we can stay solvent predicting a reversal. So, keep the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, nine of the 10 are in the green this morning, led by the biggest dog NVDA (+1.19%) while NFLX (-1.49%) is the lone laggard. It might be worth noting that NVDA has also traded five times the dollar-volume as the next largest trading stock this 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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Markets were undecided on Tuesday.  SPY opened down 0.07%, DIA opened 0.12% lower, and QQQ opened down 0.16%.  At that point, SPY and QQQ rallied to recross their opening gap and reach the highs by 10 a.m. From there they sold off reaching the lows 45 minutes later and then bobbing along those lows until 1 p.m. when they rallied to recross the gap again by 2:25 p.m. and then recross it once more in a slow modest slide into the close.  For its part, DIA had a similar path for the day but with much less magnitude of waves.  This action gave us indecisive, black-bodied Doji-type candles in all three major index ETFs. It also gave us a higher high and a higher low than Monday by a lower open and close.  Again, this happened on well-below average volume in all three major index ETFs.

On the day, nine of the 10 sectors were in the red with Energy (-2.14%) a full 1.5% out in front of the other sectors leading markets lower.  On the other side, Healthcare (+0.05%) was the only sector in the green. Meanwhile, SPY lost 0.16%, DIA fell 0.13%, and QQQ lost 0.21%.  VXX popped 3.92% to close at 46.17 and T2122 dropped back out of the overbought territory to close in the top end of its mid-range at 70.83.  On the bond front, 10-year bond yields fell to 3.81% and Oil (WTI) dropped another 0.74% to close at $73.82 per barrel.  So, Tuesday was more of a rest and/or indecision day for traders as markets wandered around the small opening gap all day. By the closing bell, markets had small black bodies.  However, even at their extremes, none of the major index ETFs were more than half a percent from their Monday close.

The major economic news scheduled for Tuesday was limited to API Weekly Crude Oil Stocks after the close, which showed a 0.347-million-barrel inventory build (compared to a forecasted 2.800-million-barrel drawdown and well above the prior week’s 5.205-million-barrel drawdown). 

In Fed news, on Tuesday, Fed Governor Bowman (a hawk) told an Alaska Bankers conference that she is still cautious about changing Fed policy.  Bowman said, “it will become appropriate to gradually lower the federal funds rate to prevent monetary policy from becoming overly restrictive…”  However, she continued, “we need to be patient and avoid undermining continued progress on lowering inflation by overreacting to any single data point (apparently a reference to July’s 4.3% Unemployment value).”  Bowman noted doubts about data quality, saying “Increased measurement challenges and the frequency and extent of data revisions…make the task of assessing the current state of the economy…challenging.”  This led to her conclusion, “I will remain cautious in my approach to considering adjustments to the current stance of policy.”

After the close, KEYS, LZB, PAGS, and TOL reported beats on both the revenue and earnings line.  Meanwhile, ALC, JKHY and ZTO missed on revenue while beating on earnings.  However, COTY missed on both the top and bottom lines.

In stock news, on Tuesday, the PARA takeover saga continued as a new suitor made his interest official, submitting a $4.3 billion bid via the acquisition of National Amusements.  Later, JNJ announced they have agreed to buy V-Wave (a heart failure treatment maker) for $600 million up front and potentially an additional $1.1 billion in milestone payments (based on the development of V-Wave’s treatments).  Meanwhile, GOOGL announced its Waymo robotaxi unit had doubled its “paid rides” to 100k per week over three months of operation.  (Not bad considering Waymo only has 700 of its robotic taxis.)  Meanwhile, WFC announced it had agreed to sell its “non-agency third-party Commercial Mortgage Servicing” unit to private firm Trimont.  The terms of the sale were not disclosed.  At the same time, STLA announced it was delayed its investment plans for Belvidere, IL.  This came after the UAW filed grievances Monday alleging STLA has violated the terms of its November 2023 contract.  STLA denied this charge.  After the close, MCHP announced it had detected potentially unauthorized activity on its network systems that had disrupted operations at come facilities.  (The activity was seen Aug. 17 and again on Aug. 19.)  The company said it is working to bring all of its systems back online.  Also after the close, BBAI (and AI company) announced it had won a contract of up to $2.4 billion over 10 years with the FAA.

In stock legal and governmental news, on Tuesday, the EU announced it would slash its previously announced additional tariffs on electric vehicles imported from China. For example, TSLA will pay an additional 9% tariff (much lower than the previously-announced 20.8%).  These “punitive duties” are on top of the EU’s standard 10% tariff on imported cars.  The European Commission said that the changes come after it had verified the Chinese government subsidies EV companies had received.  At the same time, the FDA approved JNJ’s “chemotherapy-free” combination treatment for a type of non-small cell lung cancer.  (This puts the JNJ treatment in competition with AZN’s blockbuster drug Tagrisso.)  Later, DIS backed down in the face of heavy bad publicity and announced it will drop its motion to dismiss a lawsuit.  Previously, DIS claimed that a user agreement accepted for a 2019 free trial of DIS+ streaming service prevented a FL widower from suing over the wrongful death of his wife.  (His wife died from allergic reaction to food served at a DIS restaurant in 2023, after the couple had informed the restaurant of the allergy and the restaurant claimed to accommodate food allergies.) Instead of forced arbitration, DIS now says the case can be decided in court. 

Elsewhere, the Dept. of Transportation announced the ALK acquisition of HA had been cleared by the Justice Dept. and was now under DOT review.  Later, the NHTSA announced BMWYY (BMW) is recalling 721k vehicles over electrical short-circuit risk due to a faulty water pump connector seal.  At the same time, the FAA has formally required the inspection of all BA 787 Dreamliner jets over the five recent “mid-air dive” reports that have been tied to pilot seat adjustment turning off the autopilot.  Later, the UK competition watchdog agency announced it had accepted META’s proposed changes to the way it uses customer’s data in advertising.  At the same time, a US Appeals Court revived a lawsuit against GOOGL.  The class-action suit alleges that GOOGL continued to collect personal data of Chrome browser users after they chose not to synchronize their browser to Google accounts.

After the close, WBD pledged to spend at least $8.5 billion to produce movies and TV shows in Las Vegas after the company received a tax incentive package.  Finally, a TX Trump-appointed federal judge struck down the FTC ban on most non-compete agreements required for employees.  (The same judge had temporarily blocked the ban in July.)  The ruling said the FTC does not have the authority to ban practices it deems as unfair competition methods, even though the agency was tasked by Congress is enforcing federal antitrust laws.  (Appeals will very likely follow, but with the uber-Republican SCOTUS, the odds of the bans coming back into effect are long at best.)

Overnight, Asian markets were mixed again as seven of the 12 regional exchanges were in the red.  Taiwan (-0.85%) and Hong Kong (-0.69%) paced the losses while Thailand (+0.73%) was by far the biggest gainer.  However, in Europe, we see green across the board at midday.  The CAC (+0.42%), DAX (+0.48%), and FTSE (+0.17%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modestly green start to the morning.  The DIA implies a +0.14% open, the SPY is implying a +0.19% open, and the QQQ implies a +0.22% open at this hour.  At the same time, 10-Year bond yields are at 3.822% and Oil (WTI) is up by a fraction to $73.31 per barrel in early trading.

The major economic news scheduled for Wednesday is limited to EIA Weekly Crude Oil Inventories (10:30 a.m.) and July FOMC Meeting Minutes (2 p.m.).  The major earnings reports scheduled for before the open include ADI, DY, M, TGT, TJX, and ZK.  Then, after the close, A, CAAP, LU, NDSN, SNOW, SNPS, URBN, and ZM report.

In economic news later this week, on Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, S&P Global Mfg. PMI, S&P Global Services PMI, S&P Global Composite PMI, July Existing Home Sales, and the Fed Balance Sheet are reported.  The Jackson Hole Symposium also starts.  Finally, on Friday we get July Building Permits, and July New Home Sales.  The Jackson Hole Symposium also continues.

In terms of earnings reports later this week, on Thursday, AAP, BIDU, BILI, BJ, CSIQ, IQ, NTES, PTON, TD, VIK, BMA, INTU, ROST, and WDAY report.  Finally, on Friday, we hear from GFI.

So far this morning, ADI, DY, M, and TGT have all reported beats on both the revenue and earnings lines.  Meanwhile, ZK missed (massive miss) on revenue while staying in line on earnings (still a loss).

In miscellaneous news, on Tuesday, a research report from CBRE said that the North American datacenter capacity has jumped 70% in the last year due to the AI craze. The electrical demand of datacenters alone now stands at 3.9 gigawatts.  The report said more than 500 megawatts of new datacenter demand went online in just the eight largest US markets in the first half of 2024.  (For reference, that 500 megawatts adding in H1 was roughly equivalent to the entire data center capacity of Silicon Valley at the end of 2023.)  Elsewhere, the SEC approved (along party lines with GOP-appointed members fighting the move) the new rules proposed in June that will allow the Public Company Accountancy Oversight to hold employees, partners, contractors, and others to be held accountable for negligence if audits are found to be in violation (fraudulent).  Meanwhile, Bloomberg reported Tuesday evening that the “Carry Trade” is back on but in reverse.  For many years, investors borrowed Yen in Japan at almost non-existent interest rates and “carried the money” to the US to invest in higher-yielding vehicles.  With July’s Japanese rate hike and the fall in the Dollar, traders are now borrowing Dollars to put into Japanese investments.  The idea is that speculators are betting that Japan will increase rates more and the US sill start cutting rates next month.  (I’m not sure I buy that reporting given the relative differences in US and Japanese interest rates even after Japan’s July hike.  Nonetheless, that is what Bloomberg reports.)

With that background, markets seem to be resting or indecisive again this morning. All three major index ETFs made a very modest gap higher to open the premarket, Since that point they have traded indecisively but have small white body Spinning Top candles at this time of the early session. With that said, all three remains far above their T-line (8ema) and the short-term trend is still strongly bullish. Meanwhile, the mid-term bearish trend is broken, though one could argue a new mid-term bullish trend has not formed yet (due to a lack of higher low in the run). In the long-term, we are now clearly back in a Bull trend. In terms of extension, as I mentioned all three are stretched to the upside relative to their T-line. However, the T2122 indicator has now pulled back out of its overbought territory into the top part of its mid-range. So, the market does still need a pullback or at least a rest. However, Tuesday’s candle helped some. Just remember that the market can stay overextended a lot longer than we can stay solvent predicting a reversal. So, keep the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, six of them are in the green, led by AMZN (+0.69%) while GOOGL (-0.60%) is the laggard. However, the biggest dog (in terms of dollar-volume traded), is NVDA (-0.01%) followed by TSLA (-0.07%), which are both undecided this 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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Markets started Monday in a flat manner.  SPY opened +0.08%, DIA opened up 0.13%, and QQQ opened just 0.01% higher.  From there, all three major index ETFs ground sideways for the better part of an hour.  At that point, all three saw a major volatility event with a 5-minute crash down followed immediately by a 5-minute spike right back up.  Then the Bulls took over, leading a steady rally for the rest of the day with a bullish spike the last 10 minutes in SPY and QQQ.  For its part, DIA’s rally died out at 1 p.m., after which it ground sideways with a modestly bearish trend the rest of the day until it too had a Bull spike the last 10 minutes. This action gave us large white-bodied candles in all three major index ETFs.  SPY and QQQ ended the day on the highs while DIA had a small upper wick.  This happened on well-below average volume in all three major index ETFs.

On the day, all 10 sectors were in the green with Healthcare (+1.98%) well out in front followed by Technology (+1.37%) leading the way higher. On the other side, Consumer Defensive (+0.43%) being the lagging sector.  Meanwhile, SPY gained 0.96%, DIA was up 0.58%, and QQQ gained 1.31%.  VXX fell another 1.44% to close at 44.43 and T2122 jumped back up into the top end of its overbought territory at 96.23.  On the bond front, 10-year bond yields fell to 3.875% and Oil (WTI) dropped 2.86% to close at $74.46 per barrel.  So, Monday was a less volatile but also quite bullish day as traders could not justify bearish trades, but were also afraid to pile in (with heavy volume) on the long side either.  It is worth noting that SPY and DIA closed less than one percent below their all-time high closes.  However, QQQ closed still 4.5% below its all-time high close.  Interestingly, an equal-weighted version of the SPY (where all stocks have the same weight as AAPL) hit a new all-time high Monday.

The major economic news scheduled for Monday was limited to the July US Leading Economic indicators Index, which came in below expectations at -0.6% (compared to a forecast of -0.4% and a June reading of -0.2%).  

In Fed news, on Monday, the Wall Street Journal reported Minneapolis Fed President Kashkari said it was appropriate to discuss potentially cutting interest rates at the FOMC meeting in September.  The article quoted Kashkari as saying, “The balance of risks has shifted, so the debate about potentially cutting rates in September is an appropriate one to have.”  The WSJ went on to say that Kashkari indicated progress has been made on inflation but the labor market has shown some “concerning signs.”  The article quoted him as saying, “I’m still unclear how tight policy is, but the balance of risks in my view have shifted more towards the labor market and away from the inflation side of our dual mandate.”   Elsewhere, Fed Governor Waller did not comment on the economy or monetary policy.  However, he did address say the Fed is looking into the financial stability risks related to stablecoins and non-bank holders.

After the close, FN and PANW reported beats on both the revenue and earnings lines.  It is worth noting that FN raised forward guidance while PANW lowered its guidance.

In stock news, on Monday, Reuters reported that LUV has started a campaign to fight off Elliott Investment Management’s attempt to replace two-thirds of its board members as a prelude to ousting the CEO and the LUV board Chairman.  (Elliott did the same thing at SBUX in the past.)  In a letter to employees, (seeking union and individual employee shareholder support) CEO Jordan said “Don’t be fooled – this is a battle for the heart of our company and our future – your future.”  At the same time, Reuters reported that APA is exploring the sale of its Permian Basis oil and gas properties for roughly $1 billion.  The article said APA has retained two investment banks to help facilitate a sale.  Later, Reuters also reported that ANCTF (operator of the Circle-K convenience stores) has made a preliminary takeover bid for SVNDF (large Japanese 7-Eleven store operator) for roughly $38 billion. 

Elsewhere, GM laid off 1,000 salaried software and services unit employees globally on Monday.  (Roughly 600 of those jobs are located in MI with the rest spread around the world.)  Later, the UAW union said it was filing a number of grievances against STLA and could launch a nationwide strike against the automaker.  The UAW says STLA is not honoring the production (job) commitments it has made in later-2023 contract negotiations.  After the close, GPRO announced it will cut about 15% of its workforce (only 139 jobs) as it seeks to restructure.  At the same time, Reuters reported that BA has grounded its test fleet of 777X jets after inspections found a failure of the engine mounting structure.

In stock legal and governmental news, on Monday, the US State Department approved the sale of $100 million of Javelin missiles (produced by GD) to Australia.  Later, KR sued the FTC seeking to block the regulator from reviewing its proposed $25 billion acquisition of ACI.  In the suit, KR alleges that the FTC is unconstitutional.  After the close, Reuters reported that two dozen state Attorney’s General have amended their lawsuit against LYV.  The new filing shows that the AGs are looking for three times the damages incurred for each customer in the suit they filed in May.  In related news, 10 more states joined the lawsuit Monday, bringing the total to 36 plus the District of Columbia. 

Elsewhere, also after the close, PPC agreed to pay $100 million to settle claims it had conspired with rivals to reduce the pay given to chicken farmers.  (TSN, SAFM, and others had previously settled the same case for much lower amounts.)  At the same time, the FAA issued a airworthiness directive for BA 787 jets after receiving five reports of sudden mid-flight dives.  (The dives were found to be related to movement of the captain’s seat disconnecting the autopilot without notice.)  Meanwhile, IEP and its CEO Carl Icahn settled charges from the SEC of operating a “Ponzi-like scheme.”  In the settlement, IEP agreed to pay $2 million.

Overnight, Asian markets were mixed with five of the 12 exchanges in the red.  Japan (+1.80%) was by far the biggest gainer while Shenzhen (-1.25%) and Shanghai (-0.93%) paced the losses.  In Europe, the picture is a little more red with only four of the 15 bourses in the green at midday.  The CAC (+0.09%), DAX (-0.07%), and FTSE (-0.70%) are leading the region lower in early afternoon trade.  Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward a mixed and flat start to the morning.  The DIA implies a -0.04% open, the SPY is implying a +0.09% open, and the QQQ implies a +0.11% open at this hour.  At the same time, 10-Year bond yields are at 3.873% and Oil (WTI) is just on the green side of flat at $74.42 per barrel in early trading.

The major economic news scheduled for Tuesday is limited to API Weekly Crude Oil Stocks (4:30 p.m.). Fed members Bostic (1:35 p.m.) and Vice Chair Barr (2:45 p.m.) also speak.  The major earnings reports scheduled for before the open are is limited to RERE, AS, FUTU, HTHT, LOW, MDT, VIPS, and XPEV.  Then, after the close, ALC, SQM, COTY, JKHY, KEYS, LZB, PAGS, TOL, and ZTO report.

In economic news later this week, on Wednesday, we get EIA Weekly Crude Oil Inventories and July FOMC Meeting Minutes. One Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, S&P Global Mfg. PMI, S&P Global Services PMI, S&P Global Composite PMI, July Existing Home Sales, and the Fed Balance Sheet are reported.  The Jackson Hole Symposium also starts.  Finally, on Friday we get July Building Permits, and July New Home Sales.  The Jackson Hole Symposium also continues.

In terms of earnings reports later this week, on Wednesday we hear from, ADI, DY, M, TGT, TJX, ZK, A, CAAP, LU, NDSN, SNOW, SNPS, URBN, and ZM.  On Thursday, AAP, BIDU, BILI, BJ, CSIQ, IQ, NTES, PTON, TD, VIK, BMA, INTU, ROST, and WDAY report.  Finally, on Friday, we hear from GFI.

So far this morning, AS, FUTU, and MDT reported beats on both the revenue and earnings lines.  Meanwhile, LOW and XPEV missed on revenue while beating on earnings.  On the other side, VIPS beat on revenue while missing on earnings.  It is worth noting that LOW also lowered its forward guidance.

In miscellaneous news, on Monday, major US freight-forwarder CHRW announced it has begun to divert some US customer ocean cargo away from Canadian ports.  This is being done in anticipation of a Canadian rale strike as soon as August 22.  (Much of ocean cargo continues its journey on rail prior to switching to truck for the last leg of delivery.)  Elsewhere, GS analysts cautioned their clients that next week’s US Non-Farm Payroll data revision is likely to overstate labor market weakness.  GS suggests the overstatement will be due to the quarterly census of Employment which does not account for employment of illegal immigrants.  Secondly, GS says even if it did take immigrants into account, that this census is consistently revised upwardly later.  All told, GS believes the revision will be 300k-500k jobs too low.

With that background, it looks like traders are uncertain early this morning. All three major index ETFs gapped up modestly to start the premarket. However, all three have also sold back down printing small black-body candles in the early session. With that said, all three are still far above their T-line (8ema) and the short-term trend is clearly strongly bullish. Meanwhile, the mid-term bearish trend is broken, though one could argue a new mid-term bullish trend has not formed yet (due to a lack of higher low in the run). In the long-term, we are now clearly back in a Bull trend. In terms of extension, as I mentioned all three are stretched to the upside relative to their T-line. At the same time, the T2122 indicator is now in the top half of its overbought territory. So, the market is in need of a pullback or at least a rest. Just remember that the market can stay overextended a lot longer than we can stay solvent predicting a reversal. So, keep the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, seven of them are in the green, led by AMD (+1.10%) again. However, the biggest dog (in terms of dollar-volume traded), is NVDA (-0.39%), which is leading the losers in that group lower.

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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

On Friday, the Bulls closed out a strong week with modest gain.  SPY gapped down 0.32%, DIA gapped down 0.23%, and QQQ gapped +0.39%.  Next, all three major index ETFs meandered back and forth across the gap until 11:30 a.m.  From there, all three rallied briskly until 1 p.m.  The rest of the day saw a slow and weak pullback. This action gave us white-bodied candles with modest upper wicks in the SPY, DIA and QQQ.  During the day, QQQ retested and held above its 50sma.  This happened on very low volume in the SPY and QQQ as well as below-average volume in the DIA.

On the day, nine of the 10 sectors were in the green again with Financial Services (+0.78%) and Communication Services (+0.72%) leading the way higher.  On the other side, Industrials (-0.01%) was the only sector in the red (barely).  Meanwhile, SPY was up 0.22%, DIA gained 0.21%, and QQQ gained 0.13%.  VXX fell slightly to close at 45.23 and T2122 also pulled back just a bit to stay in the overbought territory at 86.11.  On the bond front, 10-year bond yields fell to 3.883% and Oil (WTI) dropped 2.00% to close at $76.60 per barrel.  So, Friday was a less volatile but bullish day as traders got ready for the weekend.

For the week, SPY gained 4.00%, DIA gained 2.93%, and QQQ gained 5.47%.  This was the best weekly performance for the year in all three.  All three major index ETFs also crossed above their Weekly T-line (8ema).  In addition, DIA also closed at a new weekly high close.

The major economic news scheduled for Friday included July Building Permits, which came in light at 1.396 million (compared to a forecast of 1.430 million and a June value of 1.454 million).  At the same time, July Housing Starts also were light at 1.238 million (versus the 1.340 million forecast and June’s 1.329 million reading).  Later, Michigan Consumer Sentiment was better than predicted at 67.8 (compared to the 66.7 estimate and July’s 66.4 number).  At the same time, Michigan Consumer Expectations were even more positive at 72.1 (versus the 68.5 forecast and July’s 68.8 value).  On the inflation front, Michigan 1-Year Inflation Expectations were flat at 2.9% (compared to a forecasted 2.8% but in-line with July’s 2.9% reading).  For the longer-term, Michigan 5-Year Inflation Expectations were also flat at 3.0% (versus a 2.9% forecast and the July 3.0% survey result).   

In Fed news, on Friday, Chicago Fed President Goolsbee told NPR that he is leaning toward rate cuts at this point.  Goolsbee said, “You don’t want to tighten any longer than you have to…and the reason you’d want to tighten is if you’re afraid the economy is overheating, and this is not what an overheating economy looks like to me.”  He did decline to say whether he thought that first cut should be in September.  However, he said, “If we move toward less restrictiveness, it will help ease some of these credit conditions.”  He then went on to say that he thinks credit conditions appear tight now and he flagged rising unemployment as a “warning sign.”  In the end though, Goolsbee signaled his support for a gradual (rather than fast) pace to rate cute.  Analysts took this to mean he would support a quarter percent cut rather than a half percent.

In stock news, on Friday, UBS announced it will divest its Quantitative Investment Strategies unit to private Manteio Partners for an undisclosed amount.  (The QIS unit manages about $1.5 billion in quant funds.)   Later, RIVN said it has temporarily halted production of AMZN delivery vans due to a shortage of parts.  (AMZN is RIVN’s largest investor, holding a 16% stake.)  Meanwhile, MA announced it will cut 3% of its global headcount (about 1,000 jobs being cut) by the end of September.  Later, Reuters reported that BA and LMT are in talks to sell their ULA rocket-launching joint venture to Sierra Space for between $2 billion and $3 billion.  At the same time, CNBC reported on noise complaint issues made against AMZN related to its air drone delivery program in College Station, TX.  The latest complaints come after AMZN asked for approval to expand its air deliveries in the city from 200 to 470 flights per day and expanding hours of air operations to 7a.m. – 10 p.m. (AMZN drones create up to 60 decibels of noise, which is half that of a chainsaw and more than one-third less than heavy equipment according to OSHA.)

In stock legal and governmental news, on Friday, the US Dept. of Commerce said that TXN will receive $1.6 billion towards the construction of three new facilities under funding approved by the CHIPS Act.  At the same time, shareholders of formerly acquired German Postbank rejected a settlement offer from DB.  An attorney for the shareholders said the proposal was a “crackhead offer that was dead on arrival.” Later, GSK said it would seek dismissal of an upcoming lawsuit related to Zantac causing cancer.  The move followed Thursday’s court ruling in favor of GSK.  At the same time, a US Appeals Court threw out Dept. of Transportation safety standards for pipeline operators.  (The case was brought by the Natural Gas Assn. of America who argued the Hazardous Materials standards do not provide sufficient benefits to outweigh the costs they would incur to comply.)  At the same time, the NHTSA announced that F is recalling 85k Explorer SUVs equipped with the “Police Interceptor” package due to risks of engine fire.  The recall covers 2020-2022 model years. 

Elsewhere, a federal appeals court narrowed an injunction that blocked enforcement of a CA law aimed at protecting children’s online safety.  The court ruled that while the group suing to stop the law is likely to show the law violates the first amendment, but that the lower court failed to recognize than many provisions of the law could survive after removing first amendment concerns.  (AMZN, GOOGL, and META are the hallmark members of the group that sued.)  At the same time, the State Dept. approved the same of $264 million of RTX missiles to Canada.  Later, the FTC filed suit against ABG, alleging that its dealerships charged Black and Latino customers higher prices and routinely added services to customer contracts without consent.  Meanwhile, Reuters reported that unsealed documents from a TX court showed that TPX’s proposed $4 billion takeover of Mattress Firm was “intended to eliminate future competition.”  At the same time, a US District Judge temporarily blocked the launch of a sports streaming service (joint venture) from DIS, FOX, and WBD based on antitrust claims from smaller rival FUBO.

Overnight, Asian markets were mostly green as only three of the 12 exchanges were left showing red.  Japan (-1.77%) was the biggest mover in the region while Thailand (+1.56%) and Malaysia (+1.53%) paced the gains.  In Europe, we see a similar picture taking shape.  Only three of the 15 bourses are in the red and a couple of those are barely red.  The CAC (+0.34%), DAX (+0.15%), and FTSE (-0.04%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a flat start to the morning.  The DIA implies a -0.02% open, the SPY is implying a +0.01% open, and the QQQ implies a -0.02% open at this hour.  At the same time, 10-Year bond yields at down to 3.875% and Oil (WTI) is off three-quarters of a percent to $76.08 per barrel in early trading.

The major economic news scheduled for Monday is limited to US Leading Economic indicators Index (10 a.m.)  We also hear from Fed Governor Waller (9:15 a.m.).  The major earnings reports scheduled for before the open are is limited to EL and ZIM. Then, after the close, FN and PANW report.

In economic news later this week, on Tuesday, API Weekly Crude Oil Stocks are reported. Fed members Bostic and Barr also speak.  Then Wednesday, we get EIA Weekly Crude Oil Inventories and July FOMC Meeting Minutes. One Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, S&P Global Mfg. PMI, S&P Global Services PMI, S&P Global Composite PMI, July Existing Home Sales, and the Fed Balance Sheet are reported.  The Jackson Hole Symposium also starts.  Finally, on Friday we get July Building Permits, and July New Home Sales.  The Jackson Hole Symposium also continues.

In terms of earnings reports later this week, on Tuesday, RERE, AS, FUTU, HTHT, LOW, MDT, VIPS, XPEV, ALC, SQM, COTY, JKHY, KEYS, LZB, PAGS, TOL, and ZTO report.  Then Wednesday we hear from, ADI, DY, M, TGT, TJX, ZK, A, CAAP, LU, NDSN, SNOW, SNPS, URBN, and ZM.  On Thursday, AAP, BIDU, BILI, BJ, CSIQ, IQ, NTES, PTON, TD, VIK, BMA, INTU, ROST, and WDAY report.  Finally, on Friday, we hear from GFI.

So far this morning, EL and ZIM reported beats on both the revenue and earnings lines.

In late-breaking news, AMD announced Monday that it will acquire server manufacturer ZT Systems for $4.9 billion (75% cash and 25% stock).  This is part of the move toward offering total AI solutions rather than just selling AI Chips or AI processing cards.  The industry move is toward being able to sell entire AI computing server racks to corporate clients at a higher margin.  Elsewhere, China announced it had made a deal with the US to cooperate on matters of financial stability after talks in Shanghai last week.  The PBOC (Chinese Central Bank) said the deal covers capital markets, cross-border payments, and the two country’s monetary policy.  A statement on the deal from the US Treasury, SEC, and Fed (agencies that participated in the talks from the US) as well as the details are not yet available.  However, the belief is that the talks were aimed at heading off any global systemic risk such as from the volatile and stressed Chinese bond markets.

With that background, all three major index ETFs are just on the green side of flat at the moment. For what it is worth, all three have printed small, white-body candles with lower wicks at this point. All three are still extended above their T-line (8ema) and the short-term trend is clearly strongly bullish. Meanwhile, the mid-term bearish trend is broken, though one could argue a new mid-term bullish trend has not formed yet. In the long-term, we are now clearly back in a Bull trend. In terms of extension, as I mentioned all three are stretched to the upside relative to their T-line. At the same time, the T2122 indicator is now in the lower half of its overbought territory. So, the market is in need of a rest or pullback. With that said, remember the market can remain overextended a lot longer than we can stay solvent predicting a reversal. So, keep the mantra “follow, don’t lead, but also don’t chase” in mind. With regard to those 10 big dog tickers, six of them are in the green, led by AMD (+1.98%). However, the biggest dog (in terms of dollar-volume traded), is down with NVDA (-0.14%) among the laggards.

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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Markets gapped strongly higher Thursday and then followed through slowly the rest of the day.  SPY gapped up 1.05%, DIA gapped up 1.17%, and QQQ gapped up 1.35%.  From there, all three major index ETFs rallied until 12:30 p.m.  At that point pulled back slightly for 30 minutes and then resumed its rally until 3:45 p.m.  Only late-day profit-taking the last 15 minutes kept us from closing at the highs.  This action gave us gap-up, white-bodied candles in all three major index ETFs.  DIA printed a gap-up, white-bodied, Spinning Top.  Meanwhile, SPY and QQQ both gave us gap-up, white-bodied, large-body candles with small wicks on both ends.  (Bear in mind, that SPY is up 8.5% in nine days, QQQ is up 12% over that time, and slow, plodding DIA is up 5.5% in the same span.)  This all happened on just under average volume in all three of the major index ETFs.

On the day, nine of the 10 sectors were green with Consumer Cyclical (+2.69%) and Technology (+2.46%) out in front leading the gainers higher.  At the same time, Communication Services (-0.35%) was the only sector in the red and more than 0.50% worse-performing than the next most lagging sector.  Meanwhile, SPY gained 1.71%, DIA gained 1.45%, and QQQ gained 2.53%.  VXX fell another 3.82% to close at 45.34 and T2122 climbed into the overbought territory at 89.26.  On the bond front, 10-year bond yields spiked to 3.923% and Oil (WTI) gained 1.30% to close at $77.98 per barrel.  So, Thursday was the Bulls’ day from the 8:30 a.m. data drop onward.  SPY and QQQ crossed back above their 50sma.  However, all three major index ETFs are now quite stretched above their T-line (8ema) indicating the need for rest, pullback, and/or profit-taking.

The major economic news scheduled for Thursday included Weekly Initial Jobless Claims, which came in lower than expected at 227k (compared to a 236k forecast and the prior week’s 234k).  In terms of ongoing unemployment, the Weekly Continuing Jobless Claims were also down a bit at 1,864k (versus the 1,880k forecast and the prior week’s 1,871k).  At the same time, July Core Retail Sales were down a tick, but much better than expected at +0.4% (compared to the +0.1% forecast and the June +0.5% reading).  On the headline number, July Retail Sales were very strong at +1.0% (versus a forecast of +0.4% and much stronger than June’s -0.2% value).  In terms of manufacturing, the NY Empire State Mfg. Index was bad but better than predicted at -4.70 (compared to a -5.90 forecast and the July -6.60 number).  Down the road, the Philly Fed Mfg. Index was worse than anticipated at -7.0 (versus a +5.4 forecast and down sharply from July’s 13.9 reading). 

In terms of Manufacturing employment, the Philly Fed Mfg. Employment Index was -5.7 (down from July’s 13.9 value).  On the trade front, the July Export Price Index showed an increase of 0.7% month-to-month (compared to 0.0% forecast and June’s -0.3%).  At the same time, July Import Price Index was up a tick +0.1% (versus a forecast of -0.1% and June’s 0.0% number). Later, July Industrial Production was down to -0.6% (compared to a -0.3% forecast and June’s +0.3%). Later, June Business Inventories came in as expected at +0.3% (versus a +0.3% forecast and a May +0.5% reading).  At the same time, June Retail Inventories were also as predicted at +0.2% (compared to the +0.2% forecast and up a touch from May’s 0.0% value).  Later, June TIC Net Long-Term Transactions showed a large increase to +$96.1 billion (versus a +$56.3 billion forecast and well up from May’s -$54.1 billion reading.  Finally, after the close, the Fed Balance Sheet showed a small expansion for the week to $7.178 trillion from the prior week’s $7.175 trillion.

In Fed news, on Thursday St. Louis Fed President Musalem indicated he was more open to a rate cut than before.  Speaking in KY, Musalem said his confidence (that inflation is going down) was bolstered by recent data.  He continued, “It now appears the balance of risks on inflation and unemployment has shifted … the time may be nearing when an adjustment to moderately restrictive policy may be appropriate.”  At the same time, in a Financial Times interview, Atlanta Fed President Bostic said he is now open to a rate cut in September (the opposite of his public expressions recently).  Bostic said, “Now that inflation is coming into range, we have to look at the other side of the mandate, and there, we’ve seen the unemployment rate rise considerably off of its lows.”  He continued, “…and so I’m open to something happening in terms of us moving before the fourth quarter.” Later, Philly Fed President Harker told an economic conference that a rate cut is the next step for monetary policy and the timing may be getting closer.  However, he hedged on when that might take place.  In response to a question implying an intra-meeting cut, Harker said, “I believe that we may be in the position to see the rate decrease this year … But I would caution anyone from looking for it right now and right away.”

After the close, AMAT, COHR, GLOB, HRB, and LNVGY all reported beats on both the revenue and earnings lines.  Meanwhile, AMCR missed on revenue while beating on earnings.

In stock news, on Thursday, LMT announced it has agreed to acquire LLAP for $450 million.  Later, GOOGL announced it is expanding its AI-generated summaries of searches to six new countries two months after first rolling out the feature.  In addition to the US (where the feature has been available since May), Brazil, India, Japan, Mexico and Britain now have access to AI summaries.  After the close, KR announced plans to cut prices by $1 billion after its $25 billion acquisition of ACI closes.  (KR had previously promised $500 million in lower prices across all acquired ACI locations.)

In stock legal and governmental news, on Thursday, CVX agreed to pay $550 million to Richmond, CA in a settlement.  The deal will see CVX buy the city’s withdrawal of a November ballot initiative that would have sought a tax on refineries in the city. (CVX has a refinery that produces 250k barrels per day inside the city limits.)  Later, the FDA laid out new stricter goals for sodium content of packaged foods. In the announcement, the FDA said it was seeking “voluntary curbs” from packaged food makers like PEP, KHC, and CPB.  However, fast-food chains such as MCD, QSR (Burger King), and YUM would also be on the hook.  The cuts, with a goal of within three years, would cut sodium to 20% below the 2021 levels. 

Elsewhere, TEL agreed to pay a $5.8 million fine to the Dept. of Commerce for illegally shipping electronics components to China.  Later, the State Dept. approved a $5 billion sale of LMT’s Patriot missiles to Germany.  In Canada, the national government rejected the request from CNI (Canadian National Railway) for imposed binding arbitration between the railroad and its Teamster Union employees.  (The railroad, along with CP, have said they will lock out employees starting August 22 to avoid an employee strike.)  At the same time, a second federal court (this on in FL) has blocked the FTC ban on worker noncompete agreements.  Later, a federal judge in CA ruled that PEP can be sued over marketing for its Gatorade Protein bars.  (The bars have more sugar than protein, which is more typical of candy bars than protein bars.)  At the same time, STLA shareholders filed suit against the company, alleging fraud under the accusation the company concealed rising inventories and sales weakness prior to the company’s July 25 earnings report. 

Meanwhile, in CA, Governor Newsom proposed a plan requiring refiners in the state to maintain minimum reserves of gasoline.  The measure, aimed at curbing gas prices is aimed at a situation where the states refiners had less than a 15-day supply of gas in inventory 63 days in 2023. (A study found that prices spiked when refiners let inventory fall because they were taking refineries offline to increase prices.)  Later, BAYRY (Bayer) won a legal fight Thursday when the US 3^rd-Ciruit Court of Appeals rejected a claim by a PA landscraper which alleged the company’s Roundup weedkiller did not carry a warning label and caused his cancer sue to repeated and prolonged use.  The court ruled that federal law protects the German parent company from liability from state laws requiring a cancer label.

Overnight, Asian markets were nearly all green.  Only Shenzhen (-0.24%) was in the red while Japan (+3.64%), Taiwan (+2.07%), South Korea (+1.99%), and Hong Kong (+1.88%) led broad and strong gains.  In Europe, the picture is more mixed with six of 15 exchanges in the red.  The CAC (+0.18%), DAX (+0.52%), and FTSE (-0.46%) lead the region in early afternoon trade.  Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward a start just on the red side of flat.  The DIA implies a -0.08% open, the SPY is implying a -0.11% open, and the QQQ implies a -0.02% open at this hour.  At the same time, 10-Year bond yields are down to 3.873% and Oil (WTI) is off  2.83% to $75.96 per barrel in early trading.

The major economic news scheduled for Friday includes July Building Permits and July Housing Starts (both at 8:30 a.m.), and then Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations (all at 10 a.m.)  The major earnings reports scheduled for before the open is limited to FLO.  There are not reports scheduled for after the close.

So far this morning, missed on revenue while beating on earnings.

In miscellaneous news, on Thursday, GS lowered its Q3 GDP forecast from 2.6% to 2.4% after disappointing industrial production data for July.  Elsewhere, Bloomberg reported Thursday that GS is telling clients it expects a rally based on the return of so-called systematic funds.  These funds had made the largest dollar-volume selling since the pandemic over the past month, based on volatility index signals.  However, now the VIX has returned to the levels seen in May-July in the last week, those funds are and will be returning to the buy-side.  Meanwhile, Bloomberg also reported that ADSK is likely to face legal action.  It reported internal documents from ADSK that said the company had continued using the sales strategy of offering deep discounts on multi-year deals to corporate customers who pay up front. The company pledged to investors to stop using the tactic in 2021, but internal documents say the company has continued using the strategy in order to pull forward cashflow and meet short-term financial goals.

In late-breaking news, WMT raised its guidance for the full year citing steady consumer health and the relative strength of the overall economy. WMT CFO Rainey said, “…our members and customers…remain choiceful, discerning, value-seeking, focusing on things like essentials rather than discretionary items, but importantly, we don’t see any additional fraying of consumer health.”  Still, while raising its full-year 2024 forecast, the numbers do point to a second half that is not quite as strong as the first six months.  They are just stronger than earlier predicted.  Elsewhere, the Biden Administration released the prices for the first 10 drugs that resulted from the first-ever Medicare price negotiations. BMY, LLY, JNJ, MRK, AZN, NVS, AMGN, ABBV, and NVO are makers of those first 10 drugs subject to price negotiation and the White House says the lower prices will save Medicare $6 billion in the first year (based on 2023 drug demand data).

With that background, all three major index ETFs gapped up modestly to start the premarket. However, all three have also sold off in a more or less volatile way during the early session and are now back to just below flat so far this morning. All three are still extended above their T-line (8ema) and the short-term trend is clearly strongly bullish (even if the Bears could say they’re just in strong Bear Flag patterns). Meanwhile, the mid-term trend remains bearish, but with the downtrend line under pressure. In the long-term, we are now clearly back in a Bull trend. In terms of extension, as I mentioned all three are stretched to the upside relative to their T-line. At the same time, the T2122 indicator is now in the middle of its overbought territory. So, the market is in need of a rest or pullback. Don’t be surprised if we see some Friday profit-taking. With that said, remember the market can remain overextended a lot longer than we can stay solvent predicting a reversal. So, keep the mantra “follow, don’t lead” in mind. With regard to those 10 big dog tickers, six of them are in the green, led by NFLX (+0.46%) and the biggest dog, NVDA (+0.44%) pacing the gains. Finally, remember its Friday. So, prepare your account for the weekend news cycle and also bear in mind that today is options expiration day.

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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Wednesday saw a mostly flat open after CPI data. SPY opened up 0.16%, DIA opened down just 0.03%, and QQQ “gapped” up 0.19%.  From there, the whipsaw was on for the SPY and QQQ, both of which saw a selloff the first hour followed by a strong rally until noon and another selloff the hour after that.  Meanwhile, DIA’s morning selloff was much smaller and its mid-morning rally was stronger and lasted longer.  Then in the afternoon, things settled down as the wave got smaller in all three major index ETFs.  This action gave us indecisive candles in the SPY and QQQ, but a more bullish candle in the DIA.  All three remained well above their T-line (8ema).  SPY printed a white-bodied Spinning Top, QQQ printed a black-bodied Spinning Top, and Dia printed a white-bodied candle with no lower wick and a modest upper wick.  This all happened on above average volume in the DIA as well as below-average volume in the SPY and QQQ.

On the day, six of the 10 sectors were green with Financial Services (+0.98%) well out in front leading the gainers higher. Meanwhile, Basic Materials (-0.39%) and Consumer Cyclicals (-0.33%) leading the losers lower.  At the same time, SPY gained 0.32%, DIA gained 0.57%, and QQQ gained 0.03%.  VXX dropped another 6.51% to close at 47.14 and T2122 dropped back a bit more toward the center of its mid-range at 65.04. On the bond front, 10-year bond yields fell a bit to 3.839% and Oil (WTI) fell another 1.61% to close at $77.09 per barrel. So, Wednesday was a bullish, but fairly volatile day with the mega-cap DIA leading the rest of the market higher.  This came after what analysts called “encouraging” CPI data that was the lowest since March of 2021.  (It might be of interest to note that prior to the CPI release, 47.5% of Fed Fund Futures expected a quarter point rate cut in September.  At the end of the day, 64.5% are now expecting a quarter-point rate cut.  In both cases, the entire remainder expects a half percent cut.)

The major economic news scheduled for Wednesday were limited to July Core CPI (Year-on-Year) that was down a tick, as expected, at 3.2% (compared to a forecast of 3.2% and down slightly from June’s 3.3%).  On the monthly basis, July Core CPI was actually up a tick as expected at +0.2% (versus a +0.2% forecast and June’s +0.1% reading).  On the headline number, July CPI (Year-on-Year) was down more than was predicted at +2.9% (compared to a +3.0% forecast and prior month value).  On the monthly basis, July CPI was up as predicted at +0.2% (versus a +0.2% forecast and the June -0.1% reading).  Later, the EIA Weekly Crude Oil Inventories showed an unanticipated build of 1.357 million barrels (compared to a forecasted drawdown of 1.900 million barrels and the prior week’s 3.728-million-barrel drawdown). 

After the close, CSCO reported beats on both the revenue and earnings lines.  (CSCO also raised its forecasts and guidance, yet still announced cutting as many as 6,000 jobs.)  Meanwhile, STNE beat on revenue while missing on earnings.

In stock news, on Wednesday, MU and Korea’s Samsung followed the third major computer memory manufacturer in raising prices by 15%-20%.  At the same time private company Mars (of candy bar fame) announced they have agreed to buy K for $36 billion.  Later, the CFO of UBS said the company would sell the CS mortgage servicing unit it acquired in the CS buyout.  (No buyer or financial terms were mentioned.)  At the same time, SHAK announced it has rolled out sidewalk robots to deliver orders in Los Angeles for those orders placed via the UBER Eats app.  Later, SEC filings showed that INTC liquidated its stake in ARM during Q2, raising almost $147 million for the 1.18 million shares it sold.  Meanwhile, as part of its earnings call, CSCO announced it will cut 7% of its global workforce.  This is the company’s second round of cuts in 2024, having cut 5% (about 4,000 jobs) in February.  At the same time, SEC filings showed that BRKB took new stakes un ULTA and HEI and increased its holdings of CB and SIRI during Q2.  The same report stated that BRKB reduced its positions in COF and FND.  Later, ALK flight attendants rejected the tentative contract deal the airline had struck with their union.

In stock legal and governmental news, on Wednesday, the state of TX added NWG to its list of “bad companies” that cannot do business with the state because they do not own oil and gas stocks.  At the same time, LLY sent “cease and desist” letters to spas, telehealth companies, wellness centers, and doctors demanding that they stop selling unapproved “copycat” versions of LLY’s Zephound and Mounjaro weight loss and diabetes drugs.  Later, D and EQNR were the winning bidders in the Dept. of Interior auction of offshore wind rights off DE, MD, and VA. At the same time, the FTC finalized its ban on companies buying or selling fake online reviews.  The new rules give the agency the power to levy fines of up to $51,744 per violation. The rules were supported by AMZN, GOOGL, and YELP.  (Surveys show the new rules are supported by 90% of online shoppers.) 

Elsewhere, a federal judge in Kansas City has blocked a state of MO state rule barring financial professionals from considering so-called ESG factors in any investment advice.  The rule had been supported by oil industry lobbyists.  At the same time, the federal judge in the case brought by Epic Games (Fortnite maker) issued an order requiring the company to give Android phone users more ways to download apps.  The judge expressed impatience with GOOGL’s stall tactics and protests about the cost and difficulty of implementing changes.  He also said he will appoint a three-person “compliance committee” to determine GOOGL compliance with orders.  Later, DIS filed “unique” (perhaps read that as preposterous) motion Wednesday, demanding that a wrongful death lawsuit be thrown out of court because the surviving spouse had signed up for a one-month trial of DIS+ years before the death.  DIS claims the terms of that trial would bar a consumer from ever filing a lawsuit against the company.  Later, the Committee on Foreign Investment fined TMUS $60 million for failing to prevent and report data breaches of sensitive data. (The agency scrutinizes national security risks of foreign investments and TMUS is majority owned by German DTEGY.) 

Meanwhile, a DE judge upheld the $267 million legal fee request for legal firms that represented shareholders in the $1 billion settlement against DELL.  (This was the largest-ever legal fee approved for a shareholder lawsuit.)  After the close, the Dept. of Justice filed a motion urging the court to accept the BA revised plea deal including the company pleading guilty to a criminal conspiracy to commit charge and paying $243.6 million fine after breaching a 2021 deferred prosecution agreement.  (Relatives of many of the 346 people killed in the two fatal 737 crashes that preceded the 2021 agreement have urged the plea be rejected.)  Also after the close, the SEC and CFTC announced that another group of Wall Street firms have agreed to pay $470 million to settle charges they violated recordkeeping and communications rules (using off the record texting to communicate between firms).  AMP, LPLA, RJF, BK, TD, LTSAP, and TFC were among the companies that settled. 

Overnight, Asian markets were mostly green with just three of the 12 exchanges in the red.  New Zealand (+1.10%), Shanghai (+0.94%), and Singapore (+0.90%) paced the gains while Taiwan (-0.60%) was by far the biggest loser.  In Europe, the picture is even more green at midday with only one of 15 bourses in the red. The CAC (+0.02%), DAX (+0.32%), and FTSE (+0.06%) lead the region modestly higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modest green start to the day here as well.  The DIA implies a +0.21% open, the SPY is implying a +0.10% open, and the QQQ implies a +0.15% open at this hour.  At the same time, 10-Year bond yields are up a bit to 3.845% and Oil (WTI) is up nine-tenths of a percent to $77.67 per barrel in early trading.

The major economic news scheduled for Thursday includes Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, July Core Retail Sales, July Export Price Index, July Import Price Index, NY Empire State Mfg. Index, Philly Fed Mfg. Index, Philly Fed Mfg. Employment Index, and July Retail Sales (all at 8:30 a.m.), July Industrial Production (9:15 a.m.), June Business Inventories and June Retail Inventories (10 a.m.), TIC Net Long-Term Transactions (4 p.m.), and the Fed Balance Sheet (4:30 p.m.).  We also hear from Fed member Harker (1:10 p.m.).  The major earnings reports scheduled for before the open include BABA, AIT, DE, GRAB, JD, NICE, SPTN, TPR, and WMT.  Then, after the close, AMCR, AMAT, COHR, GLOB, and HRB report. 

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

In terms of earnings reports later this week, on Friday we hear from FLO.

So far this morning, DE, NICE, TPR, and WMT all reported beats on both the revenue and earnings lines.  Meanwhile, BABA, AIT, GRAB, JD, and SPTN missed on revenue while beating on earnings. There were no tickers on the other side this morning.  However, DDS missed on both the top and bottom lines.

In miscellaneous news, on Wednesday, Reuters reported that a potential seaport strike is looming in September that would impact East and Gulf Coast ports.  The report cites a shipping industry expect saying the strike could back up and reroute cargo for weeks or potentially months. However, major importers such as WMT have been rushing their orders to get the shipments through the ports prior to the September 30 expiration of the current dockworkers contract. (Industry analysts say it takes about six days to clear the backlog caused by a one-day strike.  So, a strike lasting weeks would delay both import and export shipments for months.)  Elsewhere, Reuters reported that the US, which is one of the largest plastic producers in the world, will back a global treaty that calls for a reduction in plastic production.

In late-breaking news, WMT raised its guidance for the full year citing steady consumer health and the relative strength of the overall economy. WMT CFO Rainey said, “…our members and customers…remain choiceful, discerning, value-seeking, focusing on things like essentials rather than discretionary items, but importantly, we don’t see any additional fraying of consumer health.”  Still, while raising its full-year 2024 forecast, the numbers do point to a second half that is not quite as strong as the first six months.  They are just stronger than earlier predicted.  Elsewhere, the Biden Administration released the prices for the first 10 drugs that resulted from the first-ever Medicare price negotiations. BMY, LLY, JNJ, MRK, AZN, NVS, AMGN, ABBV, and NVO are makers of those first 10 drugs subject to price negotiation and the White House says the lower prices will save Medicare $6 billion in the first year (based on 2023 drug demand data).

With that background, it looks as if markets are indecisively bullish again this morning. All three major index ETFs opened the premarket higher, but had all traded in an uncertain manner since then, producing more wick than body in all cases. All three are above their T-line (8ema) and the short-term trend is clearly bullish (or could be said to be in strong Bear Flag patterns). Meanwhile, the mid-term trend remains bearish, but with the downtrend line under pressure. In the long-term, while the bullish trend line is broken, the longer-term charts remain bullish. In terms of extension, the SPY and especially QQQ remain a little stretched above their T-line but the DIA is in better shape. At the same time, the T2122 indicator remains in its mid-range. So, the market has some room to run if either side can find the momentum (which has been on the Bulls side for a little over a week). However, the Bears have more slack to work with at this point. With regard to those 10 big dog tickers, eight of the 10 are in the green led by AMZN (+0.85%). However, the biggest dog, NVDA (-0.49%) paces the losers and is once again the dollar-volume trading leader. (This time only leading by a factor of 3.5.)

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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Markets gapped up to start the day Tuesday on better-than-expected PPI data.  SPY gapped up 0.64%, DIA opened 0.31% higher, and QQQ gapped up 1.03%.  From there QQQ started a steady rally that lasted right into the close.  Meanwhile SPY and DIA took an hour to find their feet before following QQQ in steady rallies that lasted all day as well.  This action gave us large, gap-up, white-bodied candles in the SPY and QQQ.  At the same time, DIA had a large, gap-up white-body candle with wicks at both ends (particularly at the bottom).  DIA also crossed back above its T-line (8ema).  This all took place on average volume in DIA and below-average volume in the SPY and QQQ.

On the day, nine of the 10 sectors were green with Technology (+2.54%) out in front leading the gainers higher.  Meanwhile, Energy (-0.49%) was by far, by 1.21%, the weakest sector.  At the same time, SPY gained 1.63%, DIA gained 1.02%, and QQQ gained 2.48%.  VXX dropped another 7.93% to close at 50.42 and T2122 spiked all the way up to the top end of its mid-range at 72.94.  On the bond front, 10-year bond yields fell to 3.848% and Oil (WTI) fell 2.00% to close at $78.45 per barrel.  So, Tuesday was all Bulls, all the time after better-than-expected Producer Prices.  However, after an initial gap higher, price just steadily climbed as traders were generally happy, but also waiting on Wednesday’s CPI data.

The major economic news scheduled for Tuesday included July Core PPI (Month-on-Month) came in flat at 0.0% (compared to a forecast of +0.2% and well down from the June +0.3% reading). At the same time, July PPI (Month-on-Month) also came in down at +0.1% (versus a forecast and June value of +0.2%).  Then, after the close, the API Weekly Crude Oil Stocks report showed a much larger drawdown than predicted at -5.205 million barrels (compared to a forecasted -2.000 million barrel and the prior week’s +0.180 million barrels). 

In Fed news, on Tuesday, Atlanta Fed President Bostic reiterated that he expects the FOMC to cut rates by the end of the year, saying that recent economic data has made him “more confident” inflation is on the right path.   However, he also said that he was worried about cutting too soon.  So, he called for “a little more data” (before cutting) to lower the risk that the Fed might need to reverse course after starting cuts.  Bostic said, “If economy evolves as I expect, there would be a rate cut by the end of the year.”  He added that (the Fed needs to) “see a little more data” (to ensure that the inflation trend is real).  He continued, “It would be really bad if we cut rates and then had to raise them again” (after starting to cut rates).  Bostic concluded, “I am willing to wait, but it’s coming … It is coming.”

In stock news, on Tuesday, CG agreed to buy BAX’s kidney-care unit Vantive for $3.8 billion.  Later, SBUX hired the now-former CEO of CMG Niccol as its new CEO.  At the same time, LMT and GD announced they have signed an agreement to jointly build solid rocket motors for missiles starting in 2025.  (NOC and LHX have been the main suppliers of such components to the defense industry in the past.)  Later, BA said it had achieved plane deliveries that were in-line with expectations.  In July, BA delivered 43 aircraft, in-line with analyst expectations and flat year-on-year, but slightly below the CFO’s previous guidance that deliveries would be “on par with June’s 44 aircraft.”  (BA’s main rival Airbus, EADSY, delivered 77 aircraft in July.)  

Meanwhile, Reuters reported that BX is exploring the sale of its Clarion Events unit for roughly $2.6 billion.  Later, FIT, GOOGL, and PTON announced a partnership to produce and sell fitness content.  At the same time, Reuters reported that PARA will begin laying off 15% of its workforce (about 2,000 people) as it looks to cut costs and leverage AI technologies.  (90% of the job cuts are expected to be complete by September.)  Later, GOOGL unveiled new Pixel smartphones and other devices with deeper AI integration.  (This product announcement is several months ahead of GOOGL’s traditional October launches as the company attempts to keep up with AAPL’s AI-integrated product introductions.)  At the same time, TLRY announced it will buy four craft breweries from TAP for an undisclosed sum.  After the close, ALL said it has agreed to sell its employer voluntary benefits business to StanCorp for $2 billion.

In stock legal and governmental news, on Tuesday, Poland signed a contract to buy 96 AH-64E Apache attack helicopters and related maintenance equipment from BA for $12 billion.  Later, the NHTSA announced that GM is recalling 21,000 electric SUVs over anti-lock brake issues.  However, GM said it will solve the issue via an over-the-air update.  At the same time, F and MZDAF (Mazda) warned customers to avoid driving certain models still impacted by faulty Takata airbag inflators.  F said 374,300 vehicles had yet to have the previously-announced recall resolved while MZDAF estimated 83,000 of its US vehicles were still not fixed.  Later, INTC was sued by a Jewish former employee (VP of Engineering) who alleges that he was fired after complaining about a senior executive he believed was openly celebrating antisemitism. 

Elsewhere, the US Dept. of Defense announced the US had approved a $20 billion weapons package for Israel, including BA F-15 fighter jets worth $19 billion.  After the close, Bloomberg reported that the US Dept. of justice is mulling plans to seek the breakup of GOOGL after the agency’s recent court victory declaring GOOGL a monopoly and in violation of US antitrust law.  The report cited unnamed sources who say the DOJ is considering demanding GOOGL sell its Android phone operating system and Chrome browser businesses.  Also after the close, the state of TX sued GM, alleging the car company installed technology on more than 14 million vehicles to collect data about drivers to be sold to insurance companies.  Meanwhile, FE agreed to pay the SEC and state of OH $20 million to avoid prosecution in relation to a $60 million bribery scheme.

Overnight, Asian markets were mixed but leaned toward the green with eight of the 12 regional exchanges posting gains.  New Zealand (+2.06%, Taiwan (+1.06%), and South Korea (+0.88%) led the gainers.  On the other side, Shenzhen (-1.17%) was by far the biggest loser.  Meanwhile, in Europe, we see a much greener picture with only Belgium (-0.52%) in the red as opposed to 14 green bourses at midday.  The CAC (+0.43%), DAX (+0.46%), and FTSE (+0.35%) lead the region higher in early afternoon trade.  As of 7 a.m., US Futures are pointing toward a start just on the green side of flat ahead of CPI data.  The DIA implies a +0.02% open, the SPY is implying a +0.04% open, and the QQQ implies a +0.05% open at this hour.  At the same time, 10-Year bond yields are down to 3.83% and Oil (WTI) is down 0.31% to $78.11 per barrel in early trading.

The major economic news scheduled for Wednesday are limited to July Core CPI and July CPI (both at 8:30 a.m.), and EIA Weekly Crude Oil Inventories (10:30 a.m.).  The major earnings reports scheduled for before the open include ARCO, EAT, CAE, CAH, DOLE, ESLT, ICL, PFGC, and UBS.  Then, after the close, CSCO, and STNE report. 

In economic news later this week, on Thursday, we get Weekly Initials Jobless Claims, Weekly Continuing Jobless Claims, July Core Retail Sales, July Export Price Index, July Import Price Index, NY Empire State Mfg. Index, Philly Fed Mfg. Index, Philly Fed Mfg. Employment Index, July Retail Sales, July Industrial Production, Jun Business Inventories, June Retail Inventories, TIC Net Long-Term Transactions, and the Fed Balance Sheet.  We also hear from Fed member Harker.  Finally, on Friday, July Building Permits, July Housing Starts, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Thursday, we hear from BABA, AIT, DE, GRAB, JD, NICE, SPTN, TPR, WMT, AMCR, AMAT, COHR, GLOB, and HRB.  Finally, on Friday, FLO reports.

So far this morning, CAH, DOLE, ESLT, and UBS all reported beats on both the revenue and earnings lines.

In mortgage news, interest rates fell to the lowest level in more than a year last week as the national average 30-year, fixed-rate, conforming loan rate fell to 6.54%.  As a result, applications for refinance loans surged 35% compared to the prior week and were up a massive 118% versus the same week in 2023.  On the new home front, new purchase applications rose just 3% for the week and were still down 8% from the same week in 2023.  Even with the disparity in demand growth, refinance loan applications only made up 48.6% of all mortgage applications on the week.

In miscellaneous news, on Tuesday, the US Dept. Agriculture announced expanding the testing for bird flu among beef at slaughterhouses.  200 US herds have tested positive for the avian flu since March with one sample found in a slaughterhouse.   At the same time, overseas, Chinese lending fell to a 15-year low in July as banks gave out just $36.28 billion in new loans according to the People’s Bank of China.  This was down 88% from June and far below the average analyst estimate.  (July is traditionally a slow loan demand month, but the miss was very large.)  Back in the US, the National Federation of Independent Business said its Small Business Optimism Index (survey results) rose to 93.7.  This was the highest reading, indicating the best small business sentiment in more than 2.5 years.

With that background, it looks as if markets are uncertain ahead of CPI data this morning. All three major index ETFs opened roughly flat and have printed indecisive (mostly wick) black-bodied candles since that point. (It is earlier than I normally report.) All three are above their T-line (8ema) and the short-term trend is clearly bullish (or could be said to be in strong Bear Flag patterns). Meanwhile, the mid-term trend remains bearish, but with the downtrend line under pressure in the QQQ. In the long-term, while the bullish trend line is broken, the longer-term charts remain bullish. In terms of extension, the SPY and especially QQQ are getting a little stretched above their T-line but the DIA remains in good shape. At the same time, the T2122 indicator is back toward the top end of its mid-range. So, the market has some room to run if either side can find momentum. However, the Bears have more slack to work with at this point. With regard to those 10 big dog tickers, six of the 10 are in the green led by the biggest dog, NVDA (+1.57%), once again also leads on the dollar-volume traded. (This time leading by a factor of five.) On the other side, GOOGL (-1.41%) is way out front pacing the losses after the overnight news that the DOJ is considering asking to have the monopoly company broken up.

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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Monday started with a gap higher.  SPY gapped up 0.24%, DIA gapped up 0.21%, and QQQ gapped up 0.19%.  From there, all three major index ETFs rode the whipsaw in descending-magnitude waves and a slight bearish trend the rest of the day. This action gave us a gap-up black-bodied Spinning Top in the SPY, a gap-up, white-bodied Doji-type candle in the QQQ, and a gap-up, black-bodied Bearish Engulfing candle in the DIA.  That meant that DIA retested and failed its T-line (8ema) while SPY and QQQ both retested and passed (stayed above) their own T-lines.  This happened on lower-than-average volume in all three major index ETFs.

On the day, eight of the 10 sectors were red with Communication Services (-0.76%) leading the way lower.  Meanwhile, the biggest mover was Energy (+0.95%) and by far the leader of the two sectors that held up best.   At the same time, SPY gained 0.05%, DIA lost 0.34%, and QQQ gained 0.22%. VXX fell another 1.83% to close at 54.76 and T2122 fell back into the top of the oversold territory at 18.18.  On the bond front, 10-year bond yields fell to 3.905% and Oil (WTI) spiked another 3.62% on Middle East war fears to close at $79.62 per barrel.  So, Monday was a whipsaw day with violent whips the first two hours of the day and then continuingly decreasing waves the rest of the day.  In general, it felt like a waiting day with traders wanting to see Tuesday’s PPI data.

The major economic news scheduled for Monday includes NY Fed 1-Year Consumer Inflation Expectations, which came in flat at 3.0% (the same as June’s 3.0% reading).  In addition, the Fed report showed a big drop in the medium-term (3-Year) inflation expectations from 2.9% in June to 2.3% in July.  However, the longer-term (5-Year) expectations stayed flat (the same way 1-Year expectations had) at 2.8%.  Later, the Fed Budget Balance came in lower than expected at -$244.0 billion (versus the -$254.3 billion forecast but far above June’s -$66.0 billion).

After the close, AGRO and SLF missed on revenue while beating on earnings.  On the other side, PACS beat on revenue while missing on earnings.

In stock news, on Monday, Canadian bank BNS announced it is buying a 14.9% stake in US regional bank KEY for $2.8 billion ($17.17 per share).  Later, both S&P and MCO (Moody’s) downgraded JBLU credit rating after JBU announced plans to raise $3 billion in debt.  (JBLU intends to use its flier rewards program as collateral for the new debt.)  Meanwhile, BAC CEO Moynihan told CBS that he is urging the Fed to “consider lowering rates to prevent a potential economic downturn.”  (He said he is basing that request on seeing BAC customers spending at a 3% growth rate in July and August, which is half as fast as the July-August spending increase in 2023.)  On the other hand, UBS reported that their research indicates that the probability of a US recession fell from just a few months ago.

Elsewhere, CVX announced Monday that it has begun production in the world’s first “ultrahigh pressure” oil field.  The field, located under US waters in the Gulf of Mexico is now set to open up many deep-sea oilfield projects that are only accessible using 20,000 pounds per square inch of pressure.  The single well platform opened Monday will produce 75k barrels of oil and 28 million cubic feet of natural gas per day for the next 30 years. (However, the project did cost $5.7 billion and nobody has ever operated at those pressures, let alone over long periods of time.)  BP hoped to match the CVX feet by 2029.  Later, after the close, XOM laid off 59 employees as it begins the job cuts related to the acquisition of Pioneer Natural Resources.

In stock legal and governmental news, on Monday, GOOGL announced that it is deactivating Russian-based AdSense (advertising) accounts.  The search giant said its decision was due to “the ongoing developments in Russia.”  However, some analysts said this was a response to Russia slowing down YouTube service in that country.  Later, Bloomberg reported JNJ now has the support of 75% of the tens of thousands of lawsuit plaintiffs to propose the $6.5 billion talc settlement for court approval.  (75% is the US Bankruptcy Court approval standard.)  If the story is true, the court could impose the settlement terms on all of the 61,000 claimants.  Later, the TX Attorney General announced his office has formally launched an election year investigation into CNP (Houston electrical utility) related to “fraud and waste” in the wake of the Hurricane Beryl power outages. 

Elsewhere, Bloomberg reported Monday that its own investigation has uncovered that store-brand versions of Mucinex Extended Release sold at WBA, CVS, TGT, and WMT contain cancer-causing agent Benzene.  The report says the news agency information has been sent to the FDA.  However, neither the agency nor any of the retailers would comment for the report.  Meanwhile, the Biden Administration announced new proposed rules aimed at reducing consumer wait times, cumbersome forms, and hard-to-cancel subscriptions.  The FTC has begun accepting comments on the proposed rules while the FCC is already moving toward a similar settlement with the major telecom providers.  The Dept. of HHS said it will introduce similar rules for major healthcare and insurance providers in the near future as well. 

Overnight, Asian markets were nearly green across the board.  Only India (-0.85%) kept the Bulls from a clean sweep.  Among the gainers, Japan (+3.45%) was far out front, followed by Singapore (+0.72%) and Shenzhen (+0.43%) leading markets higher.  In Europe, the picture is much more dour at midday with only four of 15 exchanges in the green.  The CAC (-0.19%), DAX (-0.03%), and FTSE (-0.08%) are typical of the modestly red trading in the region in the early afternoon.  Meanwhile, in the US, as of 7:30 a.m., Futures are pointing toward a mixed and modest start to the morning.  The DIA implies a -0.08% open, the SPY is implying a +0.18% open, and the QQQ implies a +0.28% open at this hour.  At the same time, 10-Year bond yields are down to 3.904% and Oil (WTI) is off a quarter percent to $79.88 per barrel in early trading.

The major economic news scheduled for Tuesday includes July Core PPI and July PPI (both tat 8:30 a.m.) and API Weekly Crude Oil Stocks report (4:30 p.m.).  In addition, Fed member Bostic speaks at 1:15 p.m.  The major earnings reports scheduled for before the open include Tuesday, HD, JHX, MLCO, ONON, SE, and TME.  Then, after the close, CIG, FNV, and NU report.

In economic news later this week, on Wednesday, July Core CPI, July CPI, and EIA Weekly Crude Oil Inventories report.  On Thursday, we get Weekly Initials Jobless Claims, Weekly Continuing Jobless Claims, July Core Retail Sales, July Export Price Index, July Import Price Index, NY Empire State Mfg. Index, Philly Fed Mfg. Index, Philly Fed Mfg. Employment Index, July Retail Sales, July Industrial Production, Jun Business Inventories, June Retail Inventories, TIC Net Long-Term Transactions, and the Fed Balance Sheet.  We also hear from Fed member Harker.  Finally, on Friday, July Building Permits, July Housing Starts, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, and Michigan 5-Year Inflation Expectations are reported.

In terms of earnings reports later this week, on Wednesday, ARCO, EAT, CAE, CAH, DOLE, ESLT, ICL, PFGC, UBS, CSCO, and STNE report.  On Thursday, we hear from BABA, AIT, DE, GRAB, JD, NICE, SPTN, TPR, WMT, AMCR, AMAT, COHR, GLOB, and HRB.  Finally, on Friday, FLO reports.

So far this morning, HD, JHX, and TLN reported beats on both the revenue and earnings lines.  Meanwhile, SE beat on revenue while missing on earnings.  However, ONON and TME missed on both the top and bottom lines.

In miscellaneous news, on Monday afternoon there was a 4.4 magnitude earthquake in Los Angeles (centered about 7.5 miles Northeast of downtown LA). Fortunately, there were no immediate reports of structural or infrastructure damage.  At the same time, Bloomberg reported foreign investment in China has fallen again this year, resulting in a net outflow.  Elsewhere, in Russia, Putin replaced the Chief of his General Staff (head of military) Gerasimov with the head of the FSB (successor to KGB) Bortnikov.  The move came after Ukrainian President Zelenskyy held a public staff meeting in which the Ukrainian military claimed they now control 1000 sq. km. of Russia’s Kursk region after seven days of their attack into the invader’s own country. Finally, in China, Bloomberg reports that Beijing has ordered rural banks to not settle recent bond purchase transactions as the central authorities attempt to control the country’s bond market rally. (In other words, Beijing is trying to force money into stocks.)

With that background, it looks as if markets are uncertain ahead of PMI data. All three major index ETFs gapped higher to start the premarket. However, all three have also sold off since then, printing black-bodied candles in the early session and taking price back to one or the other side of flat. DIA retested and has so far failed the retest of its T-line (8ema) while the SPY and QQ remain above their own T-line. The very short-term trend remains bullish while the mid-term trend is bearish. In the long term, while the bullish trend line is broken, the longer-term charts remain bullish. In terms of extension, all three major index ETFs are now back to being close to their T-line (8ema). At the same time, the T2122 indicator is back into the top of its oversold range. So, the market has some room to run if either side can find momentum. However, the bulls have slightly more slack to work. With regard to those 10 big dog tickers, nine of the 10 are in the green led by the biggest dog, NVDA (+1.61%), which also leads on the dollar-volume traded by a factor of six. TSLA (-0.28%), which is usually the second heaviest dollar-volume traded stock is the only red in the group, but is also working on very low dollar volume compared to the normal premarket.

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 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 gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

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