The trend is still up, But…

The trend is still up

The overall market trend is up and the bulls continue to maintain a remarkable amount of energy and tenacity to drive forward.  However, with the index now in the ninth week up and drawing near major resistance levels it may be time to raise caution levels.  Although the market seems convinced that there will be a positive outcome of the trade negotiations it’s possible we have already priced in that possibility.  Which means any negative news coming out the negotiations or delay in the completion would receive a harsh reaction by the market.

On the Calendar

Recently we have seen bonds going up with the market and yesterday gold and silver joined in with a big burst of buying.  That’s an odd occurrence and makes me wonder what will decouple first.  With the Dow up over 4200 points in nine weeks on its own should give everyone a little pause on it own.  Remember to take some profits as stock and indexes near resistance levels and be careful chasing new entries this late in the rally.

calendar

On the Earnings Calendar we have nearly 190 companies reporting earnings today.  Some of the notable earnings today are: WBA, FDX, A, ALB, CAR, SAM, CAKE, CDE, CYH, CVS, GRMN, GDDY, HFC, IAG, JACK, NE, OC, PAAS, O, SO & RGR.

Action Plan

As the indexes move closer and closer to major resistance levels I feel the need to become more and more cautious about adding new long long positions.  Though I’m cautious let me be very clear that the  trend is still up and the bulls are still currently very much in control.  I am also beginning to become concerned that the market has already priced in a trade deal with China.  Which means if there is any negative news or a delay in its completion the market could react harshly.

Today we have the release of the FOMC Minutes of the last meeting.  Don’t be surprised to see light and  choppy price action leading up to its release and some price volatility directly after.  There is a news report out this morning suggesting the market could be a bit more sensitive to the minutes given length and elevation fo the current rally.  Futures are pointing to a modestly lower open this morning but with all the earnings reports this morning that could easily change.  As always stay focused on price and protect trading gains and your capital as we move closer and closer to resistance levels.

Trade Wisley,

Doug

Trade negotiations resume

Trade negotiations resume

The US Futures are taking a little rest this morning as US/China trade negotiations resume amid new tensions here in America.  Asian markets were flat and mixed overnight while European markets slide south with banks leading the way.  As a result US markets futures are currently pointing lower but there is still a lot of morning earnings yet to come to influence today’s open.

Without question the index trends are still up and the bulls at least to this point appear to have almost limitless energy to drive higher.  There are clues that this run is overextended and profit taking could soon begin but it would be unwise to fight a relentless bull run.  Trying to predict a top is just as wrong as trying to predict a market bottom.  Eventually the bulls will rest and the price will pullback but wait for the clues and follow them rather than predict.  Having said that I would be cautious about adding too many long positions this late in the rally.

On the Calendar

calendar

On the Earnings Calendar we have 159 companies reporting results today.  Among the most notable today, WMT, AAP, NBL, LC, AWK, CTB, CXW, DVN, ECL, FE, GPC, HLF, HST, HSBC, KAR, LZB & TSRH.

Action Plan

After a nice 3-day weekend the current futures look as if they want to extend the vacation by taking a little rest this morning with a modest pullback at the open.  Don’t be too surprised if the overall market is a little sluggish this morning as well with many traders likely extending their vacation as well.  US/China trade negotiations resume today here in the US amid new tensions.  Expect some fast price action if there are any news leaks from the negotiation table.

Earnings continue to roll in by in large positive and although we are seeing a little softness this morning the bulls are clearly in charge and the trends are still up.  According to T2122 we are very overextended but with indexes so close major resistance levels I would not be at all surprised to see the markets continue to extend to test them.  I see these resistance levels at the DIA 260 area, SPY 281, QQQ 171 and IWM around 158. 

Trade Wisely,

Doug

Bulls show Resiliency

Bulls show Resiliency

After more than a month and a half bull run the bulls continue to show resiliency fighting hard yesterday after a very disappointing retail sales report.  Overnight future traded into the red as the Asian markets reacted to the possibility of a slowing US Economy but this morning the futures have recovered pointing to modest bullish open. 

Take a look at the weekly index charts with our a single down candle since 12/28/18 with the Dow nearly 3700 points off the low and the SP-500 nearly 400 points higher.  Truly an amazing rally that has provided traders with fantastic gains.  Considering that as we head into the weekend be careful not chase entries this late into the rally and remember to take some profits. 

On the Calendar

calendar

On the Earnings Calendar we get a little break today with only about 50 companies fessing up to earnings results.  Notable reports DE, MCD, NWL, PEP, RBS, YNDX.

Action Plan

After a disappointing Retail Sales report and discovering that the President is planning to declare a national emergency the market dipped slightly to end the day.  However, the bulls fought back hard all day long choosing to ignore the data with amazing resiliency.  Ironically Asian markets traded lower across the board in response to a slowing US Economy and overnight US Futures traded into the red.  Once again the bulls refuse to lose and this morning the as I write the morning note,  futures markets are pointing to modest gains at the open.

There is no doubt that the index trends are still up and although they appear stretched and losing price momentum more upside is certainly possible driven by earnings results.  As we head toward the weekend remember to take some profits and evaluate the level of risk you will hold through the weekend.  We have had an incredible month and a half bull run providing great profits, don’t give it back by chasing entries so late in the rally.  Have a great weekend everyone!

Trade Wisely,

Doug

A bit puzzling

A bit puzzling

I find the hyper-confidence currently displayed by the US markets a bit puzzling this morning especially with president reportedly considering a 60-day extension of the tariff deadline.  Nonetheless the bulls are in full on beast mode this morning ahead a huge day of earnings reports and government shutdown delayed retail sales numbers.

Asian markets were subdued overnight as trade negations are scheduled to continue into Friday.  However, European markets are higher amid earnings result and the US Futures currently indicate another gap up open.  There is not a clue in the price action suggest bearishness but this late in the rally I must admit concern about adding new long risk with the indexes so extended.  Enjoy the ride and hold on tight and let’s hope the negotiations progress as positively as the market is pricing everything.

On the Calendar

On the Earnings Calendar we have more than 220 companies reporting earnings today.  Watch for notable reports from NVDA, CM, CGC, AMAT, ARCH, ANET, AZN, AVP, BLMN, CBS, CC, CME, KO, CS, DUK, GEO, IRM, SIX, WM & ZTS.

Action Plan

We have another interesting day ahead of us and I have to be honest the hyper-confidence of the US Market has me nervous and a bit puzzled.  First, reports are now questioning whether or not the President will sign the compromise bill which would avoid the Friday night government shutdown.  I find that difficult to believe but if true I’m confident the market will react negatively if that were to occur.  Secondly, the market seems to believe a Chain trade deal is imminent but the president reportedly is considering a 60 extension of the deadline.

Would that not suggest negotiations are not going that well and how is dragging this threat out another 60 days reason to gap the market higher this morning?  Things that make me say Hmmm?  Asian markets were very subdued overnight but European markets and US Future are still determined to run higher.  Remember we have a big day of earnings and Retail Sales numbers that may move the market around before the open.

Trade Wisely,

Doug

Market Celebrated

Market Celebrated

Yesterday the market celebrated Congress passing a deal to avoid another government shutdown but we sill have another hurdle to clear, the presidents signature.  He has remarked that he doesn’t like the deal but has also said he doesn’t think there will be another shutdown.  Markets are higher around the world on hopes that US/China trade talks are progressing positively.  Although there has been no news of progress the president seems to have softened his tariff deadline.  Talk about keeping the market on the edge of its seat!

Futures are bullish this morning ahead of a big day of earnings and a potential market-moving CPI report out before the open.  The bulls are large and in charge and trend continues to rise but I continue to see signs of diminishing momentum and some overbought conditions.  Stay bullish but stay focused on price action clues of weary bulls and profit-taking.  This late in the rally be careful not to overextend and remember to take some profits along the way!

On the Calendar

calendar

On the Earnings Calendar we have a very big day with 170 companies reporting.  Among the notable reports keep your eyes on, AIG, FUN, CTL, DBA, EQIX, FOSL, DLPI, HCP, HLT, H, KGC, LPX, MRO, NTAP, STAG, SPWR, WCN, WMB, WH & YELP.

Action Plan

After a big day up as the market responded to Congressional deal to avoid a shutdown.  Now it’s up to the President to sign it and although he says he doesn’t like it he also said he doesn’t think there will be another shutdown.  Let’s hope he does sign it because if not the market will be very disappointed and react negatively very quickly. 

Today we have a big day of earnings and a CPI report for the market to chew on before the open.  The Asian market and European markets are bullish on hopefulness of US/China trade negotiation progress.  To my knowledge there has not been any news on the subject other than President has mentioned he may soften his tariff deadline position.  As a result, Us Futures currently point to a bullish gap up open.  I plan to remain bullish on the market as long as the trend holds but with T2122 pegged near 100 I also want to careful not to overextend with long positions. 

Trade wisely,

Doug

Congress has a deal.

Congress has a deal

Yesterday’s indecisive price action yesterday gave way to bullish excitement during the evening after hearing the Congress has a deal to avoid another government shutdown.  The good news spread around the world with Asian markets closing with substantial gains across the board.  European markets are also currently bullish across the board with US Futures pointing to a Dow gap up around 200 points.

As exciting as this is please remember we still have the US/China trade negotiations to deal with and the possible tariff increase at the end of the month.  Let’s hope the negotiations progress quickly and positively to clear this major stumbling block from the bullish path of the market.  Yesterday we experienced a pop and drop because buyers failed to support the morning gap. With the much bigger gap this morning we must also be careful not to chase and make sure buyers step supporting such a big pop.  News on then trade negotiations front could still create significant price volatility so stay on toes and focused on price action.

On the Calendar

calendar

On the Earnings Calendar 113 companies stepping up to report today.  Among the notable today are: ATVI, AYR, AKAM, ARCC, BXMT, DENN, GRPN, HUBS, TAP, OXY, SHOP, STE, TRIP, TWLO, UAA, WELL.

Action Plan

After a day of market indecision one of the stumbling blocks appears to have been cleared last night as the Congress looks to have finally agreed on the budget avoiding another government shutdown.  US Futures almost immediately started to rally on that news and good news has at this moment is suggesting a substantial gap up of more than 200 Dow points.

Can we now sound the all clear?  Not yet, remember we still have the bigger of the stumbling blocks, US/China trade.  News on the current negotiations could easily move the market dramatically so stay on your toes and don’t blindly chase this morning excitement at the open.  The trend is bullish and the bulls are clearly in control but let’s make sure we have buyers supporting this gap and not have the pop and drop we experienced yesterday if you’re holding long positions that gap into profit this morning remember that gaps are gifts and consider taking some of those gains the bank.

Trade Wisley,

Doug

Bullish Trends Continue

Bullish Trends

Bullish trends coupled with a solid defense of key support last Friday are providing a warm a fuzzy feeling this morning as the futures suggest a gap up open.  Positive earnings results have played a key role in providing the bullish energy and with another big week of earnings ahead lets hope that continues.  However, there are some very big stumbling blocks traders will have to keep an eye on this week that could easily derail current sentiment.

At the top of the list is the resumption of the US/China trade negotiations which of course the market is very sensitive too and could quickly reverse the market on any negative new report.  Secondly the Congress must work through their budget impasse or we face another government shutdown Friday night.  We should expect the political spin to be disruptive.  Last but not least is the lingering threat of a global slowdown and possible recession that keeps popping up in the news and weigh on the collective conscience of the market.  Let’s ride the bullishness as long as it lasts but make sure you have a prepared plan if the bulls lose footing due to political uncertainty.

On the Calendar

calendar

On the Earnings Calendar we have 110 companies stepping up to report results.  Among the notable reports today are, BHF, RE, L, OHI, RICK, QSR & VNR.

Action Plan

The market faces a very interesting week as the US/ China trade negotiations resume and Congress wrangles to break the impasse that could lead us into another government shutdown on Friday.  There is also more rumbling in the news of a possible global recession for the market to chew as well as a big week of earnings reports.  Despite the political uncertainty the futures are pointing to a positive open this morning with European markets bullish and Asian markets have closed mixed on the day.

On Friday the Bulls did a very good job of defending key price support levels.  DIA 250, SPY 267, QQQ 166 & IWM 145.  With the overall market trend still bullish and Friday’s bullish defense the expected morning open paints a positive chart pattern assuming the bulls can follow through.  T2122 has relaxed enough to give us room to the upside and the bulls have an obvious momentum advantage.  As good as all that sounds remember the rules about chasing a morning gap.  Remember no matter the warm of the fuzzy feeling of bullishness, political news certainly has the power to quickly shift sentiment so stay focused on price an plan your risk carefully.

Trade Wisely,

Doug

Trade Uncertainty

Trade Uncertainty

Once again US/China trade uncertainty raises its ugly head providing the Bears the energy to drive back the Bulls and test key support levels.  As uncomfortable as it might have been the tenacious Bulls stepped up and effectively defended price supports and the overall bullish market trend.  Currently the futures are suggesting that Bulls will once need a strong defense with an opening gap down of more than 100 points.

Overall this pullback was expected and normal healthy price action but the political uncertainty raises an additional challenge as traders face the weekend risk.  Remember you don’t have to trade every day and the view from this sideline can be very comforting as we head into the weekend.  After a great month of profits the last thing I want to do is try and predict the outcome of political uncertainty and give back hard-earned gains.  As a result my plan for the day is to protect my capital and quietly slide into a restful weekend.

On the Calendar

Calendar

On the Earnings Calendar we get a little break with only 52 companies reporting.  Among the notable reports,  ARNC, EXC, HAS, PSX & VTR.

Action Plan

Yesterday’s selloff became a bit rough when the head of the US Economic Council reported that the US / China negotiations are still a long way from a deal.  The market then received a second blow when the Whitehouse moved the North Korean meeting to March.  Asian markets were lower across the board last night while European markets mostly chop sideways nearly flat on the day.  As I write this US Futures suggest a gap down open testing yesterdays lows and key support levels.

On the bright side the key levels I mentioned in yesterdays note held as support as the bulls effectively defended them with a nice late day rally.  With the looming political uncertainty of US/China trade what will traders do as we head into the weekend?  Without question the bullish trend is currently still intact and this pullback is nothing more than healthy price action.  However, it could easily become serious if the bulls retreat ahead of the weekend.  Let’s hope the new cycle is quiet today, cooler heads prevail and bulls continue to defend price support.  Have a great weekend everyone!

Trade Wisely,

Doug

Down but not Bearish.

bearish

Futures this morning are suggesting a lower open this morning, and although it’s down, it’s not bearish.  In fact, I would say a market pullback or consolidation is a sign of a healthy trend as long as the bulls defend support levels.  The Dow has rallied nearly 17% from the market lows and a full month of bullish trading without a pullback.  As resilient as the bulls have been, I doubt they will give up easily and will likely fight to hold key price supports.  In fact, this pullback could be very short lived as long as earnings continue to roll out positively.

If the market simply consolidates this can be a profitable time for stock pickers.  If supports are defended a pullback can setup new low-risk entries into existing trends?  So don’t fear a pullback embrace it because it’s the natural price action of the market.  It only becomes a problem is support levels fail because that usually means significantly higher price volatility.  Keep an eye on support and trend and remember Price is King.

On the Calendar

calendar

On the Earnings Calendar, we have a big dig day with 230 companies fessing up to earnings results.  Some of the notable today are ANGI, MT, CAH, COLM, DNKN, EXPE, GRUB, K, MAT, PENN, TWTR, TSN, WU, WWE & YUM.

Action Plan

Yesterday we saw a notable decline in bullish energy as the market slid sideways in a very choppy price action day.  This morning Futures are suggesting a pullback with the Dow expected to gap down more than 100 points.  Although a down day a pullback or merely a consolidation would be healthy for the overall market and does not at this time suggest bearishness.  With more than 200 companies reporting today anything is possible and futures could easily change their tune by the open.

Important support levels to watch DIA 250, SPY 267, QQQ 166 & IWM 145.  If bulls can defend those supports levels or above the odds of the bullish trend staying intact is very high.   Breaking those levels would add a bit of complication and likely see some fear and price volatility return to the market.  If the market consolidates it can be a profitable time for adept stock pickers as good patterns and trade setups will likely continue to develop.  As always stay focused on price action trading the chart not your bias.

Trade Wisely,

Doug

Bulls refused to give an Inch

Bulls refused to give an Inch

In an amazing show strength, the Bulls refused to give an inch and ultimately defied gravity pushing upward right into the close.  In the shadow of GOOG earnings that seemed to disappoint investors and ahead of State of the Union Address that may prove to be controversial the futures market currently points to yet another gap up open.  Go Bulls!

banner

As much as my current long positions are benefiting from the bullish activity adding new risk so late in the rally should be carefully considered.  The fear of missing out is a strong emotion that often causes traders to abandon their discipline and blindly chase into positions without consideration to risk or price resistance.  The market can certainly continue to rally from here, but it’s very important to plan acceptable risk trades and avoid chasing.   

On the Calendar

calendar

On the Earnings Calendar, earnings reports ramp up today with 150 companies reporting.  Among the notable reports: ALL, APC, ADM, BDX, BP, CNC, DLR, EA, EL, LAZ, PBI, RL, SNAP, VIAB & DIS.

Action Plan

The Bulls refused to lose continuing to defy gravity with Dow closing up 175 points.  During the evening Futures were lower as earnings from GOOG, GLUU, GILD and STX disappointed investors.  Surprisingly futures shook off the disappointment around 2:00 AM and began to rally strongly and have not looked back since.  As I write this, ahead of many of the morning earnings reports, futures are suggesting a gap up open of more than 75 points.

banner

Tonight is the delayed State of the Union address in which there is speculation that the President will declare a National Emergency to fund the border wall without Congressional approval.  Should that occur, it will most certainly set off a firestorm of controversy that could affect the overall market.  Pop some corn, put your feet and watch the show!  Though my long positions are likely to benefit from this morning bullishness, I will not chase entries so late in this rally.  If you do decide to enter new risk today make sure you wait for proof that buyers are in support of the morning gap.

Trade Wisely,

Doug

click/touch to navigate
Skip to toolbar