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Earnings Start JNJ Trial Stops

October 13, 2020 by Ed Carter

On Monday, markets gapped up three-quarters of a percent and then continue to rally most of the day for no particular reason. Then we saw a half-percent selloff the last 90 minutes of the day, again with no news explanation. That said, profit-taking makes sense after such a run of gap-ups and white candles. On the day, QQQ was up a gaudy 3.09%, its best day since April with AAPL and AMZN leading the charge in front of their big events on Tuesday. However, the large-caps were also quite positive with the SPY up 1.58% and the DIA up 0.86%. VXX dropped to 21.85 and the T2122 remains deep in the overbought territory at 97.55 (but notice it did pull back just a bit). Bond markets were closed, but Oil (WTI) fell almost 3% again to $39.52/barrel.

While I said there was no particular explanation for Monday’s market move, it is possible “hope for more stimulus” was the cause. However, there were no headlines on the negotiations, the last word from both sides was an impasse, and the political focus has moved to the confirmation of ACB. However, after-hours Bloomberg reported that their analysts are again seeing patterns in the CBOE NDX Volatility index as they saw during the summer. Specifically, they claim to again see signs of day-trading options traders from the new, stay-at-home economy (read Robinhood traders) pushing moves in both directions during the day. This new group of traders is driving marginal demand for contracts (particularly in the big-name FAANGM tickers) that, in turn, leads to increased volatility and outsized moves as they pile in and out both during premarket and during the day.

After the close, DIS announced they are reorganizing their various divisions to make their primary focus the video streaming business. Technology research company Gartner also announced that the US personal computer industry had the best in 10 years on Q3. PC shipments were up almost 11.5% for Q3 and they are expecting blow-out quarterly reports by HP, DELL, AAPL, MSFT along with various foreign PC makers. However, overnight JNJ halted Phase 3 vaccine testing due to an unexplained illness.

On the virus front, in the US we have now gone over 8 million cases, with the numbers showing we now have 8,038,037 confirmed cases and 220,018 deaths. The 7-day average daily new case count rose again to 50,612/day. Dr. Fauci (NIH) told reporters that “the US is on a trajectory of getting worse” with 31 states are trending upward in daily cases compared to one week ago. (Not good as we are just now entering Winter and flu season.) One example of the problem is the small population state of ND, which has less than 20 ICU beds available for the entire state, recorded nearly 500 new cases on Monday, and is already shipping patients to other nearby states. The main model used by the White House Task Force (Univ. of Washington) is predicting 180,000 more deaths in the US by the end of January unless major improvements in mask usage and social distancing are implemented.

Globally, the numbers rose to 38,097,303 confirmed cases and the confirmed deaths are now at 1,086,400 deaths. This comes as the world is adding 1 million new cases every 3 days. In the UK, PM Johnson is under fire from all sides for continuing with his “half a loaf” approach. He increased restrictions Monday, but did not institute a second two-week national lockdown that the scientific advisory committee has been urging for 3 weeks. In the meantime, the daily case count in the UK is 3 times that of their worst pre-summer lockdown week. France also continues to have major issues as their national testing positivity rate reached 12.8% Monday. Spain, Italy and Germany also all continue to struggle with new measures as their second wave surges continue.

Overnight, Asian markets started strong (following the US), but fizzled. However, they did close modestly positive. Australia led the gainers up 1.04%, but most of the Asian exchanges ended flat to modestly green such as Shanghai +0.04%, Japan +0.18%, South Korea -0.02%, and Hong Kong was closed due to a typhoon. In Europe we see a mixed, but much redder scoreboard so far today. All 3 of the major bourses are negative, with FTSE down 0.41%, DAX down 0.42%, and CAC down 0.33% as of mid-day. As of 7:30am, US futures are mixed with the QQQ implying a gap up of 0.96%, but the large-caps are both projecting a red open with the DIA down 0.38% and SPY down 0.08%.

The major economic news for Tuesday is limited to Sept. Core CPI (8:30 am) and Sept. Fed Budget Balance (2 pm). and no earnings reports scheduled for Monday. However, earnings season kicks off again with BLK, C, SAL, FAST, FRC, JNJ, JPM, and WIT all reporting before the open. Other major events include the AAPL iPhone product refresh and AMZN Prime Day.

Both earnings season, as well as AMZN Prime days (and competitor sales), kick-off in an attempt to jumpstart Xmas sales early, AAPL is holding its iPhone launch event today. Those are likely to be the drivers today, although the JNJ Trial stoppage will also likely have an impact. However, there is always room for political or stimulus news causing volatility in this triple-silly season.

So, with the pandemic, political, and earnings risk hanging overhead, be careful, nimble, and potentially light in your trades. Lock-in profits whenever you can and maintain your discipline. Stick to your rules, follow the trend, and don’t chase moves you have missed. Our job as traders is to reduce risk and create consistent gains, not knock the cover off the ball every time we swing.

Swing Trade Ideas for your consideration and watchlist: CSX, FITB, MCD, DVAX, F, TLRY, ET. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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Stimulus Hopes Remain Alive

October 12, 2020 by Ed Carter

Markets gapped up Friday on more hope for stimulus. After that the large-caps ground sideways in a slight downtrend. This left them in indecisive candles. However, the QQQ continued an uptrend and closed near its highs. For the day, QQQ was up 1.53%, SPY up 0.89%, and DIA up 0.58%. The VXX fell over 5% to 22.29 and T2122 remains deep in the overbought territory at 98.89. 10-year bond yields were essentially flat at 0.779% and Oil (WTI) fell 1.63% to $40.52/barrel.

On the stimulus front, over the weekend the White House raised their offer and Chief Economic Advisor Kudlow said they may go well above the Democrat-proposed $2.2 trillion. The White House also sent another letter to Congress pleading to separate another portion of the package (PPP loans/grants this time) as a stand-alone bill. Still, House Speaker Pelosi seems to be holding her ground that no piece-meal one-off bills will be passed and any bill must be part of a larger agreement. So, both of the main negotiators say the sides remain at an impasse. Worse yet, Republican Senators have also attacked the White House’s attempt to reach a deal by raising the offer, and now say there is virtually no chance of passing any deal before the election. However, market optimism for a deal soon remains alive as negotiations continue.

The Chinese Central Bank made it easier to short the yuan over the weekend. Sunday night the Chinese currency traded down 0.6% (a significant move for forex). Of course, a weaker yuan makes non-Chinese products and commodities more expensive in China and also makes Chinese products and commodities cheaper throughout the rest of the world. In addition, the Chinese government announced a market-based reform that will give local authorities more power to regulate local businesses. These moves could be related to US-China trade relations, but were definitely seen as positives by the Asian markets.

On the virus front, in the US, the numbers show we now have 7,992,810 confirmed cases and 219,702 deaths. After 56,652000 cases Thursday, the 7-day average daily new case count rose again to just over 50,000/day, while the lagging average of deaths remains flat at 725/day. 31 states are trending upward in daily cases, with only 3 states trending downward compared to one week ago. At the same time, the US government has struck a $486 billion deal with AZN for 100,000 doses of an antibody cocktail treatment similar to the one President Trump received. Delivery should begin by the end of 2020 with the US having the option to buy up to another 1 million doses by the end of 2021.

Globally, the numbers rose to 37,795,463 confirmed cases and the confirmed deaths are now at 1,081,934 deaths. This comes as the world is adding 1 million new cases every 3 days. In Europe, things are getting bleak again. Germany confirmed the most daily virus-related deaths since May on Saturday. Meanwhile, Russia, the Czech Republic and Hungary all reported records for new cases on both Saturday and Sunday. Italy’s new cases climbed for a sixth straight day, reaching the highest daily level since March. In the UK, on Sunday a government Minister announced new restrictions, and one of the chief scientific advisors told the BBC a second national lockdown was quite possible unless they can curb the sharp rise in cases and hospitalizations.

Overnight, Asian markets were mostly higher, with outsized gains in China. Shenzhen (+3.31%) led that way, followed by Shanghai (+2.64%), and Hong Kong (+2.20%). The only appreciable loser on the day was Malaysia (-0.78%). In Europe, markets are also mostly higher Monday. The FTSE (-0.08%) is flat while the DAX (+0.28%), and CAC (+0.52%) are positive. As of midday the only significant loss is in Greece (-1.54%). As of 7:30am, US futures are implying a mixed open with the Dow flat (+0.01%), S&P500 up (+0.45%), and the Nasdaq gapping (+1.37%).

There are no major economic news and no earnings reports scheduled for Monday.

With earnings season (as well as AMZN Prime days and the AAPL iPhone launch event) not starting until Tuesday and no economic news scheduled for today, Monday may be a “wait and see” day for the markets. However, there is always room for political or stimulus news causing volatility. This is especially true given the market’s love for more stimulus and apparent willingness to assume it will come sooner or later, and if later then bigger. Also, don’t forget today is a federal holiday, and bond markets are closed.

So, with the political, economic, and earnings risk hanging overhead, be careful, nimble, and potentially light in your trades. Lock-in profits whenever you can and maintain your discipline. Stick to your rules, follow the trend, and don’t chase moves you have missed. Welcome back and I hope it was a great weekend.

Swing Trade Ideas for your consideration and watchlist: DOMO, WKHS, AAPL, FVRR, INTC, KO, GNUS. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

Waiting on Stimulus and Earnings

October 9, 2020 by Ed Carter

Markets gapped a half percent higher at the open on Thursday on continued hope for stimulus, despite a worse than expected Weekly Jobless Claims number. However, they then proceeded to grind sideways in a tight range for the rest of the day. The DIA and QQQ both printed indecisive black-bodied Hanging Man type candles, while the SPY printed a white-bodies version closing near the highs. On the day SPY was up 0.89%, QQQ up 0.53%, and the DIA up 0.48%. The VXX fell 4% to 23.51 and T2122 rose very high into the overbought territory at 98.87. 10-year bond yields fell slightly to 0.779% and Oil (WTI) gained 3.3% to $41.27/barrel.

During the day, there were news stories around whether or not a 2^nd Presidential debate will happen and House Speaker Pelosi saying there will be no airline industry bailout without the broader stimulus bill (calling the President’s bluff from Tuesday on no further stimulus negotiations). After that, President Trump told reporters that despite his order to stop 2 days ago, negotiations are on-going and have now become productive. The market largely shrugged off all 3 stories without blinking. Finally, after hours, it was reported that the President does want a broader stimulus deal and despite his (and White House staff’s conflicting statements…even during time of the most recent negotiation call) Treasury Sec. Mnuchin is negotiating on behalf of the President.

The US Census Bureau reports that nearly 60 million US households expect a member of their family to lose their job or take a pay cut in the next 4 weeks. They went on to report that 23% of Americans are finding it “somewhat” or “very” difficult to cover typical household expenses. However, at the same time, MS released a report saying that US households have saved an extra $1.1 trillion in “savings buffer” so far this year (as compared to pre-covid household savings). I take this to mean the high-end of the income scale has socked away considerably more than usual while the low-end of the scale are barely getting by.

On the virus front, in the US, the numbers show we now have 7,834,289 confirmed cases and 217,750 deaths. After 56,652 cases Thursday, the 7-day average daily new case count rose again to just under 47,000, while the lagging average of deaths rose only slightly to 725 after another 957 died. On Thursday, TX reported a 4-week high in hospitalizations and WI began building field hospitals to offset its own surge in hospitalizations. NY and NJ also both saw the largest number of new cases since mid-May. Meanwhile, several other (mainly Northern) states also saw a record number of new cases. However, in relatively good news, HHS Sec. Azar said that IF the vaccines in phase 3 now are approved and IF production goes as planned by the companies involved, then the US may have enough vaccine doses for the whole country by the end of March.

Globally, the numbers rose to 36,802,540 confirmed cases and the confirmed deaths are now at 1,067,551 deaths. This comes after almost 350,000 new cases and almost 6,500 new deaths were recorded globally on Thursday. In Europe, France logged another record high on the 7-day average of new cases and expanded restrictions in response as did Russia. Italy saw the largest number of new cases in a day since early April. In addition, Spain’s President ordered for a 15-day state of emergency in the capitol Madrid, but a judge later blocked his order leaving confusion. Meanwhile the UK reported that their economy expanded 2.1% in August (but that growth was less than a third of July’s growth).

Overnight, Asian markets were mixed, with China (back from a holiday) catching up with a 3% gain in Shenzhen and a 1.68% gain in Shanghai. However, Japan, South Korea, and Hong Kong were flat to red. The remaining Asian exchanges were mixed on modest moves. exchanges. In Europe, markets are also mixed. The FTSE (+0.42%) and CAC (+0.31%) are positive while the DAX (-0.10%) is flat to down. This is typical with outliers like Portugal (-1%) and Finland (+0.71%) at this point in the day. As of 7:30am, US futures are pointing toward another modest gap higher. The DIA and SPY are implying a 0.47% gap up, while the QQQ is implying a 0.32% gap higher.

There is no major economic news and no earnings reports scheduled for Friday.

After a grinding, sideways day Thursday, it seems like the bulls were waiting on follow-up news on stimulus after the gap. With turmoil in the White House position and the 2 sides of the negotiation still not giving way or making nice (Pelosi and Trump both questioned the other’s mental faculties Thursday), that may not be in the cards. That said, there are a lot of politicians on both sides of the aisle and branch of government that are up for election. You can bet most of them would like to deliver another package this month, regardless of whether any stimulus/relief reaches anyone before the election.

And while this goes on, remember there is no other scheduled news today or Monday (Federal holiday) with Earnings season kicking off on Tuesday. So, with the political, economic, and earnings risk hanging overhead, be careful about the risk you want to carry into the weekend. It’s payday, so don’t forget to take some money off the table and lock-in profits where you can. If you are trading, be light, quick and disciplined. Stick to your rules, follow the trend, and don’t chase moves you have missed. Have a great day and weekend.

Swing Trade Ideas for your consideration and watchlist: No trade ideas for Friday. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

VP Debate and Stimulus Hope Tops Market

October 8, 2020 by Ed Carter

Markets gapped up Wednesday on hope that President Trump’s flip to tweeting for “one piece at a time” of the stimulus he wants would result in another relief package happening. Stocks then ground sideways until the early afternoon. At that point, the bulls stepped in to lead an afternoon rally. Most of Tuesday’s post-tweet losses were regained by the close Wednesday. On the day, DIA was up 1.84%, SPY up 1.74%, and QQQ up 1.73%. The VXX was down 3% to 24.50 and T2122 climbed further into overbought territory to 91.51. 10-year bond yields rose again to 0.783%, but Oil (WTI) fell about 2% to $39.98/barrel.

In stock news, IBM is surging in premarket after it announced plans to spin off an IPO of its Managed Infrastructure unit. Following the Presidential treatment / endorsement, REGN has asked the FDA for emergency use authorization of the cocktail given to President Trump. REGN shares were also up in premarket. Optimism also continues over stimulus, despite the President’s unilateral stoppage of negotiations, as markets seem to think pieces will get done soon as long as the President gets his way.

For a change of pace, the Vice-Presidential debate is leading all non-stock news (instead of the pandemic). While both sides spin the talking points and claim victory in the event, it seems the biggest take-away for markets may be a calming effect of seeing much more adult behavior. There were still clashes, but both debaters were allowed to finish a sentence without being talked over and badgered while speaking. This is likely reassuring to investors.

On the virus front, in the US, the numbers show we now have 7,776,796 confirmed cases and 216,788 deaths. After almost 49,000 cases Wednesday, the 7-day average daily new case count rose again and is now back up to 45,565, while the lagging average of deaths remains relatively flat now at 721 after another 932 deaths.

Globally, the numbers rose to 36,439,437 confirmed cases and the confirmed deaths are now at 1,061,239 deaths. In the UK, Scotland has ordered all bars closed as of Friday for at least 16 days. At the same time, the UK released a study saying that the mass hospitalizations and deaths are only coming from 14% of patients, because 86% of cases are asymptomatic (which of course makes it harder to stop the spread). This comes as the Czech Republic reports the highest new case count since the start of the pandemic and Central Europe has surpassed Southern Europe (Spain, Italy, and France) as the epicenter in Europe. In North American, Canada has reached a new high in its weekly average of new cases, with 80% of the cases coming from Ontario and Quebec.

Overnight, Asian markets were mostly higher on modest gains with Japan (+0.96%) leading the gainers among the major exchanges. In Europe, so far today we see green across the board, again on modest gains. Among the major European Bourses, the FTSE is at +0.45%, the DAX at +0.65%, and the CAC at +0.50% as of mid-day. As of 7:30am, US futures following Europe and pointing to roughly half percent gap higher at the open. The DIA is implying a 0.49% gain, SPY a 0.44% gain, and QQQ a 0.58% gain at the open.

The major economic news for Thursday is limited to Initial Jobless Claims (8:30 am) and a Fed speaker (Kaplan at 6 pm). Major earnings reports on the day are limited to AYI and DPZ before the open.

The bulls put in an impressive day Wednesday on the rebound from the Tuesday late-day tweet drubbing. We are close to being back where we were just prior to that tweet on what had looked like a positive Tuesday. If the gap higher stays in place for the next couple hours, that move will put markets at (or even just above) the closest resistance level, giving the bulls that chance to deliver a higher-high to make a bullish trend.

Volatility still reigns. The market is simply assuming stimulus without a truly clear path to it taking place. So, continue to be careful. However, if you can be light, nimble, and short-term, this could be a tradable move. In any case, stick to those rules and don’t chase moves you have missed. Lock-in those profits every chance you get. Remember that a trader’s job is to consistently take gains and reduce risk, not win bragging-rights.

Swing Trade Ideas for your consideration and watchlist: KNDI, BIDU, TXMD, GNUS, LB, OKE, ABUS, AAPL, SRNE. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

Trump Ends Talks But Now Wants Pieces

October 7, 2020 by Ed Carter

Tuesday was, shall we say, interesting. After a small gap down in the QQQ (and up open in the large-caps), markets ground sideways for most of the morning, until Fed Chair Powell told us the economy needed more stimulus once again. This was seen as just the push negotiations needed and markets rallied hard on the news. Unfortunately, at 3 pm the President tweeted that he has ordered a halt to any negotiations on more stimulus until after the election (so much for “GET IT DONE”). Stocks immediately fell off the cliff (down 2.50%) and closed near their lows. The DIA and SPY printed large Bearish Engulfing signals, but all 3 major indices printed big, ugly black candles. On the day, DIA was down 1.35%, SPY down 1.42%, and QQQ down 1.78%. The VXX was relatively flat, climbing to 25.26 and T2122 fell, but remains inside over-bought territory at 84.25. 10-year bond yields spiked on the President’s tweet to 0.749% and oil rose to $40.18/barrel.

While the halt to stimulus talks hammered the airline industry, BA had some additional news. On the down side, BA slashed plane production forecasts by 11% and went on to say they do not expect the industry to recover for 10 years. However, on the plus side the FAA proposed a pilot training program (for training and certifying pilots to fly the fixed 737 Max) and said they are finalizing the physical changes requirements list that will allow the 737 Max to be recertified. This is a very positive milestone to getting that plane back on the market.

To top or yesterday’s episode of Political Theatre, our President has again reversed course overnight and is now again urging Congress to approve stand-alone portions of the stimulus program (no negotiation, just give him the parts he wants). Markets seem to taking this as hope for pieces of the stimulus package. However, this may well be just another of his negotiating tactics. No word on if anyone will take his pleading serious or what the Democratic reaction might be this time.

As mentioned yesterday, House Democrats released the Committee Report on the 16-month investigation into anti-trust activities by the tech giants. The report says that AAPL, AMZN, FB, and GOOG all have monopoly power over their respective industries and should be treated that way. Specifically, the report calls for prohibiting dominant companies from entering adjacent business lines (such as Google owning YouTube). It also would increase enforcement agency budgets and tell them to presume a merger is anti-competitive until the merging companies show the merger would not impact competition. Finally, it calls for prohibiting dominant firms from preferring their own products over competitors (making it hard, impossible, or much more expensive to use competitor products or services). Republicans have said the broader measures are “non-starters” for the GOP. However, with bi-partisan cooperation on that committee, some changes are expected to be made as a result of the investigation.

On the virus front itself, in the US, the numbers show we now have 7,724,207 confirmed cases and 215,849 deaths. The 7-day average daily new case count continues to rise and is now back up to 44,310, while the lagging average of deaths remains relatively flat now at 719 after Tuesday’s 790 deaths. New case counts continue to grow, but the rate increase only rose in half the states overnight (which is actually a decrease in the number of states showing increasing rates, if that makes sense). Wisconsin continues to experience a very bad situation with record new cases, new hospitalizations and new deaths. As a result, Governor Evers instituted more emergency orders Tuesday to limit gatherings as well as building and room occupancies.

Globally, the numbers rose to 36,097,083 confirmed cases and the confirmed deaths are now at 1,055,639 deaths. The broadening spread in Paris has the city’s Intensive Care beds filling fast as the patient load jumped overnight from about 420 ICU patients per day a month ago to 1,426 overnight. Germany also reported the highest new case count since April overnight. In fact, only 4 of the 27 countries in the EU do not report case counts at what the EU determined to be the “critical” level.

Overnight, Asian markets were slightly mixed, but leaned to the positive side. Japan was flat, Shanghai down 0.20% and Malaysia down 1.32%. However, Australian was up 1.25%, Hong Kong up 1.09% and Thailand up 1.08%. The rest of the region saw more modest gains. In Europe, markets are also mixed but leaning red with no substantial winners at mid-day. Among the 3 major European Bourses, the FTSE is flat at +0.06%, the DAX down 0.40%, and the CAC down 0.23%. The rest of the markets are showing modest losses (except Russia which is down 1.55%) at this point. As of 7:30am, US futures are pointing to a significant gap higher. The DIA is implying a 0.63% gain, SPY a 0.58% gain, and QQQ a 0.53% gains at the open.

The major economic news for Wednesday is limited to Oil Inventories (10:30 am), September FOMC Minutes (2 pm), FOMC Statement (2 pm), and 3 Fed speakers (Kashkari at 1 pm, Williams at 2 pm, and Williams again at 3 pm). Major earnings reports are limited to LW and RPM both before the open

Volatility continues its reign. With uncertainty high around the virus, the election, the President’s health (and unpredictable behavior), markets are in a knee-jerk cycle of concerns. If you feel you have to be trading in this environment, be light, be nimble, and be short-term. In any case, stick to your rules, follow the trend, and don’t chase moves you have missed. Keep locking-in those profits, because a trader’s job is to make consistent gains…not win bragging-rights about out-guessing some reversal.

Swing Trade Ideas for your consideration and watchlist: NLS, SQ, W, DHI, WHR, LB, AAPL, PINS. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

Futures Flat as Stimulus Talks Continue

October 6, 2020 by Ed Carter

Monday saw a gap higher about seven-tenths of a percent and continued a strong morning rally apparently on less concern over the President’s health and hope for more stimulus. After a mid-day grind sideways, a late day rally took the markets out near the highs. This left us with large white candles across all 3 major indices. On the day, QQQ closed up 2.13%, SPY up 1.77%, and DIA up 1.70%. VXX fell 3% to 24.97 and T2122 rose deep into overbought territory at 92.64. 10-year bond yields rose strongly to 0.778% and Oil (WTI) spiked 6% to $39.35/barrel.

On the stimulus story, House Speaker Pelosi and Treasury Sec. Mnuchin spoke for an hour Monday without reaching a deal. However, the two sides will exchange proposal documents and are scheduled to speak again today. In related news, LUV told its union employees that it can only avoid mass layoffs if they take large pay cuts (unknown amount) and that there was no time for long, complex negotiations over this matter. The company has already cut executive salaries by 20%.

Related to the year-long Tech Giant Anti-trust hearings in Congress, a Republican committee member (Buck, CO) told Politico that the committee report will call for AMZN and AAPL being prevented from owning marketplaces in which they sell their own products as well as those of competitors. Other portions of the Democratic majority recommendations would represent a major update of the Glass-Steagall anti-competition law. The release of the report is being delayed after last-minute new information surfaced related to the FB purchase of Instagram in 2012 and to incorporate GOP comment and objections. Buck also told the reporter that the things proposed by the committee are non-starters for Republicans. In an unrelated story, AAPL stopped the sale of competing speakers and earphones ahead of the launch of their own new products in those areas.

On the virus front, in the US, the numbers show we now have 7,679,908 confirmed cases and 215,039 deaths. The 7-day average daily new case count continues to rise and is now back up to 44,397, while the lagging average of deaths remains relatively flat now at 747. The new case count is rising in 36 states as of Monday (based on 7-day average). The CDC also revised its guidance again Monday, reversing course to acknowledge that the virus can linger in the air up to hours and can be transmitted via airborne particles. The FDA also reported that it now expects at least one “emergency use” vaccine application by year-end. Meanwhile, Dr. Fauci again warned that the US is still lagging behind where it needs to be on Covid-19 testing coming into Winter.

Globally, the numbers rose to 35,740,361 confirmed cases and the confirmed deaths are now at 1,046,633 deaths. In the EU, the European Medicines Agency has begun a rolling review of the BNTX vaccine (Oxford UK study). This does not reduce the approval hurdles, but does speed up the process of evaluation. In good news, India reported the lowest new case total (61, 267) it has seen in 6 weeks. However, in less bright news, several European countries are introducing new restrictions. France, has raised the alert level to maximum in the region around Paris, ordering the closing of bars again for at least 15 days. Germany mandated that Parliament wear masks at all times and the Czech Republic declared a second state of emergency.

Overnight, Asian markets were mixed but leaned to the green side as Australia’s central bank held steady on policy and rates. India (+1.38%) was the only mover of more than 1%. In Europe, markets are also mixed but leaning green. The 3 major European Bourses are all slightly positive, with the FTSE up 0.05%, DAX up 0.17%, and CAC up 0.33%. The losses seen are all in smaller markets like Denmark, Switzerland, and Amsterdam. As of 7:30am, US futures are all just on the red side of flat. The DIA is flat at -0.02%, SPY -0.23%, and QQQ -0.36%.

The major economic news for Tuesday includes August Imports, August Exports, and August Trade Balance (all at 8:30 am), August JOLTS (10 am), and a trio of Fed speakers (Chairman Powell at 10:40 am, Harker at 11:45 am, and Kaplan (6 pm). On the earnings front, PAYX reports before the open and LEVI reports after the close.

After Monday’s strong bullish run, we still have no stimulus, but the President did get released to the White House medical facilities (versus actual hospital). With earnings starting in a few days, it seems the market is both assuming and anticipating another shot of “free money” stimulus. This comes as Piper Jaffray reports teen spending has hit an all-time low. So, while it’s hard to bet against the bulls here, there is no general economic optimism or stimulus underpinning the move…just expectation. In fact, most economists say the recovery is slowing and expect some sort of recession in 2021 regardless. So, be very wary of volatility or, heaven forbid, the government or economy not meeting market expectations.

I was dead wrong yesterday about the gap-and-fade. The bulls never looked back for some unknown reason. I suppose that’s just another reminder to not predict…just follow the chart. So, stick to your rules, follow the trend, and don’t chase moves you have missed. Don’t get too far exposed either direction in this volatile market. Also remember to keep locking-in profits, because a trader’s job is to make consistent gains…not win bragging-rights.

Swing Trade Ideas for your consideration and watchlist: LB, NIO, NUAN, BLNK, FB, AAPL, BA, INTC. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

Markets Looking to Gap Up to Open Week

October 5, 2020 by Ed Carter

Markets saw a significant gap lower at the open Friday on the news of the President’s positive Covid diagnosis. However, this gap was immediately faded by more than half as a roller coaster day between the prior close the and the gap-down open ensued. By day end, all 3 major averages left large upper wicks and bodies at the lower end of the candle. QQQ was a particularly ugly black-body candle as the FAANGM stocks all got hammered on the day. At the close, QQQ was down 2.81%, SPY down 0.95%, and DIA down 0.48%. The VXX gained 3% to end at 25.78 and T2122 (4-week New High/Low Ratio) jumped back up into overbought territory at 86.40. 10-year bond yields rose to 0.704% and Oil (WTI) fell again to $37.05/barrel. This all said, the action for the week did break the streak of losing candles for the first time in 5 weeks.

Lost in the “Trump positive test” news cycle was a disappointing September Payrolls report. While the Unemployment Rate did fall to 7.9% for the month, this happened mostly on a drop in workforce participation (almost 1.1 million people dropped out of the workforce and stopped looking for work) and there were also fewer than expected jobs created in September (660k new jobs versus 800k+ expected). So, combined with the previously reported drop in Personal Expenditures, the economic recovery appears to be weakening significantly and talk of a continuing V-shaped economic recovery is no longer consistent with the data. However, a weakening economic recovery does not necessarily equate directly to a weakening stock market.

Regarding the stimulus negotiations, White House quarantines, a number of additional positive tests, and staff retesting and isolation protocols (given the incubation periods of the virus) undoubtedly added to the difficulty of negotiations. However, the main stumbling block Friday continued to be that the two sides are far apart on key issues. So, while many specific groups (like the airline industry) and the market in general all continue to anticipate more stimulus is imminent, no deal is yet in sight. However, after the close Friday Senate Majority Leader McConnel said “they were getting closer” and then Saturday the President urged Congress to “GET IT DONE” (as if his negotiators had nothing to do with the process).

On the virus front, in the US, the numbers show we now have 7,637,066 confirmed cases and 214,615 deaths. The 7-day average daily new case count continues to rise and is now back up to 43,804, while the average of deaths remains 736. 33 states have rising case counts, 26 have increasing hospitalizations, and 12 have increasing death counts due to the virus. NYC has had to order another shutdown of businesses and schools in the 9 worst-infected zip codes of the city as test positivity has again reached 18% in some areas. Even worse situations are happening in states across the country, especially the Northern half of the nation, like WI with 24% positive tests, but the South is not spared as MS reached 42% test positivity this weekend (which is noteworthy because their Governor just ended the MS mask mandate).

Globally, the numbers rose to 35,437,479 confirmed cases and the confirmed deaths are now at 1,042,344 deaths. In France, has raised the alert level to maximum in the region around Paris, ordering the closing of bars again in that area as restrictions will last 15 days. Elsewhere in Europe, cases are surging even more in the UK, where PM Johnson warned the British people to prepare for a rough winter ahead. In addition, the British Health Minister prohibited mixing of families in any indoor setting for many cities in the north of the country (including Liverpool). Both Germany and importantly Italy continue to report the highest new case count since April and Poland reported an all-time record number of cases for the third day in a row on Sunday.

Overnight, Asian markets were green almost across the board, with only two Chinese exchanges flat or down. Australia (+2.59%), South Korea (+1.29%), and Japan (+1.23%) led the gainers. In Europe, markets are green across the board so far this morning. The Big 3 bourses are typical, with the FTSE up 0.83%, DAX up 0.74%, and CAC up 0.88%. As of 7:30am, US futures are following Europe and pointing to a gap higher of two-thirds of a percent in the large-caps and eight-tenths in the Nasdaq apparently on reports or assumptions the President Trump’s health is improving.

The major economic news for Monday is limited to Sept. Service PMI (9:45 am) and Sept. Mfg. PMI (10 am). There are no earnings reports scheduled on the day.

We all know that the market hates uncertainty and we already had plenty related to the virus, election, and stimulus. This has been compounded over the weekend by uncertainty about the President’s health, as well as the White House gave us a steady stream political posturing, mixed messages, and outright lies about his treatment and condition. This was punctuated by him pulling a Sunday evening “drive by photo op” stunt for the nightly news cycle. All this is to say, volatility continues as uncertainty reigns now.

Personally, I expect a gap-up and then snap-back reaction this morning as over-reaction has been the norm for markets for some time. Even with a gap-up, the only thing we can do is to trade the chart and right now that shows resistance above with no bullish trend yet in place. So, we can either continue to sit on the sidelines or be very careful and quick in this market. If you do trade, stick to your rules, follow the trend, and don’t chase moves you have missed. Remember to keep locking-in profits, because it’s the singles and doubles that add up to championships, not the occasional home runs.

Swing Trade Ideas for your consideration and watchlist: INTC, BA, HD, TOL, NIO, BLNK, LB, URI, BIDU, DDOG, PNR Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

Trump Positive Test Leads Market News

October 2, 2020 by Ed Carter

Markets saw a significant gap higher at the open Thursday on renewed hopes for a new stimulus deal. However, we then faded that gap and started a roller-coaster day bouncing between the prior close and that cap-up open. In the end, this gave us indecisive Doji or Spinning Top candles in all 3 major indices. On the day, QQQ (led by those huge FAANGM stocks) closed up 1.59%, SPY up 0.64%, and DIA up 0.23%. VXX was basically flat at 25.01 and the T2122 (4-week New High/Low Ratio) remains in the mid-range at 53.55. 10-year bond yields were also flat at 0.679% and Oil (WTI) fell 4% to $38.58/barrel.

Despite the pre-market optimism Thursday, House Speaker Pelosi and Treasury Sec. Mnuchin were unable to reach a deal on more stimulus. This as the airline industry laid off 45,000 workers (more than the 32,000 threatened), but said they would rehire them if aa new $25 billion relief program is passed. In addition, reports surfaced saying the expiration of the $600 Enhanced Unemployment Payments has already begun causing a drag on the economy in terms of reduced personal expenditures. And more Fed speakers also echoed prior FOMC comments that more stimulus is needed. While no deal was reached Thursday, the House did pass another $2.2 Trillion stimulus bill, but again Senate Republicans are likely to not even consider the bill (2^nd since May). Nonetheless, Speaker Pelosi told reporters that talks would continue today.

The (strangely) bi-partisan House Antitrust Committee completed its seventh and final hearing on antitrust actions by AAPL, AMZN, GOOG, and FB. A report will now be written and reviewed by committee members for at least several days. The themes seem to be increased staffing and funding for enforcement agencies, reversing court decisions that have over-ridden Congressional anti-trust intentions, shifting the burden to companies to prove that mergers were not anti-competitive, and prohibiting “anti-discriminatory” behaviors by companies. No specifics have yet been leaked on potential legislative remedies.

On the virus front, in the US, the numbers show we now have 7,497,256 confirmed cases and 212,694 deaths. The 7-day average daily new case count is back up to 42,952, while the 7-day average of deaths remains 731. This includes 30 states with increasing new case counts. Of course, the big US virus news today is that the President, First Lady, and close Trump Aide Hicks all tested positive and are now in quarantine. Their health is not an issue since they have the best healthcare possible for treating them. However, the image is important. In other virus news, AMZN reports that just under 20,000 of their employees have contracted Covid-19 so far (but for reference they have 1.37 million employees. So, compared to the general public, that 20,000 number is a bit over 40% less than expected.) CNBC also reported that vaccine trial participants (for PFE and MRNA candidates) have reported intense side-effects (fever, head/body aches, and exhaustion), but that those symptoms have only lasted a day on average. However, this was based on a minuscule sample of only 5 test subjects.

Globally, the numbers rose to 34,529,418 confirmed cases and the confirmed deaths are now at 1,028,517 deaths. (An increase of about 328,000 cases and 8,934 deaths.) Italy reported the highest increase in new cases since April on Thursday. However, following the President’s test results, no more international virus headlines were reported.

Overnight, Asian markets were mixed. Australia (-1.39%), Japan (-0.67%), Thailand (-0.81%) and Indonesia (-0.87%) paced the losers. Meanwhile, South Korea (+0.86%), Hong Kong (+0.79%), and India (+1.51%) paced gainers. In Europe, markets are red across the board, perhaps in reaction to the positive tests at the White House. Among the big 3 bourses, the DAX is down 0.96%, CAC down 0.87%, and FTSE off 0.67%. These are typical for other European markets although some of the smaller markets like Russia, Sweden and Portugal are down significantly more due to their own outbreaks. As of 7:30am, US futures are following Europe. We are looking at implied gap downs of about 1.4% in the large-cap indices and 2% in the tech-heavy Nasdaq.

The major economic news for Friday includes Sept. Nonfarm Payrolls, Sept. Avg. Hourly Earnings, and Sept. Unemployment Rate (all at 8:30 am), Michigan Consumer Sentiment (10 am), and a Fed speaker (Harker at 9 am). There are no earnings reports scheduled for Friday.

Prior to the President’s diagnosis, the last Jobs Report before the November election was anticipated to drive markets this morning. Pre-report consensus expects the report to show a slowing, but continuing recovery of the jobs lost since March. However, now that there has been a Covid-19 positive, the news cycles and market mindshare are likely to be dominated by that and whether the White House adheres to CDC guidelines on the quarantine and post-positive precautions. That said, the market is prone to over-reaction followed by snap-backs, has a short attention span, and historically-speaking no person (including the President) has tended to have long-term impacts on the market.

After Thursday’s “gap and indecision,” we would normally like to see which way the market breaks. Today’s situation makes that less of a chart-based follow-up. So, be cautious, small, and quick in your trading until we get a read on the trend. Stick to your discipline. Don’t try to predict, chase moves that got away, or abandon your trade plans. Follow the trend and keep locking in profits and reducing risk. Also, regardless of theWhite House situation, today is Friday. So consider whether you want to lighten up over the long news cycle. Among the things we don’t know are what will happen on last-ditch stimulus talks (even though the Senate already left town for a long weekend) and how the situation may impact the President’s tweeting. He may have more time for it now, which is just to say it is an unknown and potential for more market-moving “news.”

There are no trade ideas today. Members can come to the trading room to see what we look at once things settle, but its too volatile to plan trades in front of the initial over reaction and snap back. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

Stimulus Hope, Layoffs and Good Earnings

October 1, 2020 by Ed Carter

After the severe disappointment of the Presidential debate and in the face of a bad GDP number, the bulls stood strong, gapping prices slightly higher on hope for a new stimulus deal. However, later reports of more failure on that front led to a selloff, only to again bounce as the bulls refused to give up. At the end of the day the 3 major indices were left with large upper wicks with the SPY having failed another test of the 50sma. On the day the DIA gained 1.20%, SPY gained 0.83%, and QQQ gained 0.68%. Given the debate fiasco, that was not too bad at all. The VXX was flat at 24.86 and T2122 remained in mid-range at 54.74. 10-year bond yields rose to 0.686% and Oil (WTI) rose to $39.90/barrel. This all closed out a down month for September and brought the quarter to an end.

Prior to the open, both Speaker of the House Pelosi and Treasury Sec. Mnuchin had said they were hopeful for a deal on another round of stimulus. However, then mid-day Senate Majority Leader McConnell came out to say the two sides were far apart. At day end Mnuchin said “they had made a lot of progress, but have no agreement” and that they would try again on Thursday. For their part, House Democrats gave more time for progress, delaying a vote on their latest $2.2 Trillion stimulus bill. It is notable that once again another trio of FOMC speakers called for more fiscal stimulus to get the economy out of a ditch. In addition, Dallas Fed President Kaplan said interest rates near zero will be needed for as much as 3 more years until we have weathered this crisis.

After the close, ALL announced they are cutting 3,800 jobs. JPM also said they will now resume job cuts, after pausing during earlier stimulus rounds, but only announced 400 cuts for now. In addition, the Fed announced they are extending the limits on big bank dividends and stock buybacks through at least Q4 as new stress tests are kicking off. UAL and AAL moved ahead with plans cut more than 32,000 jobs as the federal bailout funding ended Wednesday night and no new money has been approved. Still, in other air industry news the FAA Chief was upbeat after flying in the BA 737 Max during the day, although he said more fixes are needed and gave no timeline for any recertification.

On the virus front, in the US, the numbers show we now have 7,450,637 confirmed cases and 211,778 deaths. The 7-day average daily new case count is back up to 42,686, while the 7-day average of deaths is now 731. MRNA said Wednesday that they do not expect to apply for an emergency use authorization for their vaccine candidate prior to the election. They said the soonest they would have enough safety data would be November 25. Meanwhile the AZN trial in the US is still on hold with FDA Chief Hahn refusing to say why, noting the reason is confidential. However, in better news New York City, indoor dining is being allowed to resume at 25% capacity today.

Globally, the numbers rose to 34,201,965 confirmed cases and the confirmed deaths are now at 1,019,580 deaths. (An increase of about 315,000 cases and 6,200 deaths.) Israel reported a record number of new cases, despite its recently-invoked second lockdown. Spain announced new restrictions, reducing retail business capacities and outlawing gatherings of more than 6 people. A large study in India (3 million subjects) has found that super-spreaders are a serious problem with 8% of the infected responsible for 60% of new cases. The study also found that while children are spreaders, it is primarily among their age group and the much bigger threat of spread comes from people in their late teens and 20s.

Overnight, Asian markets were mostly green on mixed moves. Australia (+0.98%) and South Korea (+0.86%) led the major markets, while only Shanghai (-0.20%) and Malaysia (-0.53%) showed in the red. In Europe, we see a very similar story so far today with a lot of green, but uneven moves. The FTSE (+0.82%) and CAC (+0.84%) are up nicely, but the DAX (+0.29%) has more modest gains. As of 7:30am, US futures are following Europe and are pointing to significant gaps higher. The QQQ is leading the way (implied +1.29% open), with both large-cap indices pointing toward a 0.80% gap up.

The major economic news for Thursday includes August PCE Index, August Personal Spending, and Weekly Jobless Claims (all at 8:30 am), Sept. Mfg. PMI (9:45 am), Sept. ISM Mfg. PMI and Sept. ISM Mfg. Employment (both at 10 am) and another trio of Fed speakers (Harker at 9:30 am, Williams at 11 am), and Bowman at 3 pm). Major earnings reports on the day include BBBY, CAG, STZ, and PEP before the open. There are no major reports after the close.

Hope for a stimulus deal and good earnings reports from BBBY and PEP have the bulls charged up again this morning. However, considerable resistance levels remain overhead…and there is no deal in hand yet. So, be careful expecting politicians to do as you want or as they should. Again, we still do not have a bullish trend, but the bearish trend has been broken. All we know for sure is that volatility and a lack of deliberate tradings remains the norm.

As we start a new month and quarter, markets may be trying to turn the page after a down September by getting off to a fast start. Just don’t let market enthusiasm overtake your discipline or rational thought. Don’t try to predict, chase moves that got away, or break your trading rules. Follow the trend and keep locking in profits and reducing risk. Say it with me…singles and doubles are the keys to success not swinging for the fence. Welcome to October.

Swing Trade Ideas for your Consideration and Watchlist: DHI, SPCE, ETSY, QCOM, AAPL, INTC, LEN. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

Debate Did Not Thrill Bulls

September 30, 2020 by Ed Carter

Markets did very little Tuesday, perhaps waiting on either the Presidential Debate or on a stimulus package deal. After a flat open, stocks traded flat to slightly lower on the day, printing black-body indecisive candles. The SPY and DIA both failed to break through their 50sma and the QQQ failed to break through its 20sma. On the day SPY was down 0.53%, DIA down 0.53%, and QQQ down 0.45%. The VXX was down a bit to 24.91 and T2122 fell back to mid-range at 45.12. 10-year bond yields fell to 0.65% and Oil (WTI) dropped almost 4% to $38.99.

House Democrats unveiled their $2.2 Trillion ($200 billion less than expected) stimulus plan early in the day as talks resumed between Treasury Sec. Mnuchin and Speaker Pelosi. The Tuesday session was simply to outline the new Democrat proposal specifics with actual negotiation talks scheduled to resume Wednesday. In related news, AAL unions and company officials said up to 19,000 employees will lose their jobs this week unless a deal is reached to support the airline industry.

After the close, DIS announced it will lay off 28,000 employees across its Theme Parks and Consumer Products divisions. UNH also announced the purchase of an AMZN prescription mail-order service called DivvyDose. GOOG has made a fresh round of concessions on data gathering as well as allowing third-party wearable device makers to work with Fitbit. The concessions are likely to earn it the EU approval for its $2.1 billion purchase of Fitbit.

On the virus front, in the US, the numbers show we now have 7,406,729 confirmed cases and 210,797 deaths. The 7-day average daily new case count is back up to 42,804, while the 7-day average of deaths is now 755. New York City spiked to over a 3% positive test rate on Tuesday for the first time in months. The city may reintroduce restrictions as soon as today with the possibility of closing schools again next week if the rate does not fall. This comes as Bloomberg reports a 40% increase in bankruptcy filings in the city compared to 2019. In good news, REGN announced after the close that its 2-drug cocktail therapy for Covid-19 has shown to reduce the length symptoms in 275 non-hospitalized virus patients, with serious side-effects in just 2 patients in early testing. At nearly the same time, MRNA also released its Phase 1 vaccine trial (done in April) findings of an “acceptable safety” level, with only moderate side effects found among the 40 study participants.

Globally, the numbers rose to 33,879,038 confirmed cases and the confirmed deaths passed a grim milestone, now at 1,013,241 deaths. Amidst surging R-naught numbers, the Dutch government tightened restrictions Tuesday, reducing restaurant/bar hours, reducing permissible visitors to homes, reducing maximum gathering sizes to 4, and reducing room occupancy to 30. In Germany, Chancellor Merkel vowed to avoid another full lockdown by using immediate local and regional quarantines as soon as a flare-up is detected. This all said, France and Spain still report double the new cases daily of the UK, which itself reports triple the number of the next closest country. So, the immediate new surge seems far worse in the South of Europe.

Overnight, Asian markets were mixed again, but lean to the red. Australia (-2.29%), Thailand (-1.61%), and Japan (-1.5%) pace the losers. Meanwhile, South Korea (+0.86%) and Hong Kong (+0.79%) are the only significant gainers. In Europe the losses are much more widespread so far today. The only green is in Portugal and Greece, but it should also be said that losses are moderate so far. The CAC is down 0.44%, the DAX down 0.42%, and the FTSE down only 0.10%. At 7:30am, US futures are all just on the red side, pointing to a gap down of about half a percent. However, GDP numbers at 8:30 am may greatly influence the open.

The major economic news for Wednesday includes ADP Nonfarm Employment (8:15 am), Q2 GDP (8:30 am), Sept. Chicago PMI (9:45 am), Au. Pending Home Sales (10 am), Crude Oil Inventories (10:30 am), and 3 more Fed speakers (Kashkari at 11 am, Bowman at 1:40 pm, and Kaplan at 6 pm). There are no major earnings reports on the day Wednesday.

Resistance held Tuesday as markets seemed to have been waiting on the debate. The futures this morning appear to signal that they didn’t hear anything they loved. So, we are left waiting on more news (GDP or a stimulus deal) to push the markets one way or the other. The only thing we know for sure is that we do not yet have a bullish trend, but the September downtrend has been broken as volatility continues.

With this being month-end, it is possible we see some window dressing today, although they certainly didn’t start that process yesterday. Don’t try to predict or guess the direction. Mr. Market has a way of making forecasters sorry they played that game. Either sit on the sidelines or be small and quick in your trading, looking for a trend in a smaller timeframe chart. If you do trade, stick to your rules, follow the trend, and don’t chase moves you have missed. Keep locking-in those profits, because singles and doubles are the keys to success.

Swing Trade Ideas for your Consideration and Watchlist: TGT, NUAN, BYND, CARR, TWTR, SNAP, PENN. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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