Better than expected jobs numbers, solid earnings, strong consumer spending, and an accommodative FOMC continues to melt-up the indexes this morning.  Tariffs and trade seem to no longer be of concern as the bulls continue to stretch the indexes higher breaking records along the way.  However, I want to offer up a word of caution as we gap to new highs this morning.  The SPY and QQQ are stretched a long way from their 50-day averages and remember that sometimes gap up opens produce pop and drop patterns.  Be careful not to chase, keeping in mind gap up opens is a great time to take some profits.

Overnight Asian markets closed mixed but mostly higher on optimism of a huge Asian Pacific trade deal expected in 2020.  European markets are bullish across the board this morning on renewed trade optimism, and the US Futures are in full-on beast mode ahead of earnings and economic reports.  Currently the Dow is expected to gap more than 125 points breaking above price resistance to make a new record high at the open.

On the Calendar

We have a massive week of earnings reports this week, with more than 1600 companies reporting.  We get started with more than 200 reports today.  Notable reports include UBER, AAN, AWR, APLE, WTR, BHC, CC, CDE, ED, RACE, FE, FRPT, GCI, GRPN, HTZ, MAR, MOS, PXD, PBPB, PRU, O, SHAK, S, SYY, & UAA.

Action Plan

The bulls are in beast mode this morning, and the DIA is likely to join its compadres the SPY and QQQ with a new record breakout as long as it doesn’t stumble before the open.  As always I will be watching the open closely, but I will not chase the move with the fear of missing out.  Instead, I will focus on the price action making sure buyers will show up to support the gap.  Big gap up opens can often produce the dreaded pop and drop pattern, so waiting a few minutes won’t hurt anything and may, in fact, provide an opportunity to take some profits.  Gaps are gifts!

Friday’s big rally pushed the T2122 indicator near the bearish reversal zone, and this morning’s gap could stretch the indexes right to the top.  One thing that gives me a little pause this morning is that BA is looking to gap up even-through weekend news suggests there could be further delays getting the 737 Max back in the air.  However, if earning’s continue to roll in strong and the Factory Orders number is good, we could rip higher squeezing out any remaining short-hands.  We have had much better earnings than the market expected with strong consumer buying, and an accommodative FOMC the melt-up could easily continue to stretch the indexes higher.

Trade Wisely,

Doug

Although it was disappointing to see the bearish price action yesterday, the end of day rally indicated the bulls are still in control as price supports proved strong.  Of course earnings will play a big role this morning; the majority of the attention of the market will likely turn to the big economic reports to find inspiration.  We have had a very event-driven but with more than 1600 companies expected to report next week there will no time to take a break.  Plan your risk into the weekend accordingly.

During the night, Asian markets close their trading week mixed but mostly higher after their government expressed long-term trade concerns.  However, European markets see modest gains across the board this morning.  US Futures are also showing bullishness this morning, pointing to a modest gap up ahead of the Employment Situation number and earnings results.  Keep a close eye on the ISM Mfg. number at 10 AM Eastern as it may prove to be the biggest market-moving report of the day.

On the Calendar

We get a little break on the Friday Earnings Calendar with just over 100 companies reporting.  Notable reports include ABBV, BABA, LNG, CVX, D, XOM, LYB, NWL, STX, X, and WPC.

Action Plan

Yesterday’s price action was disappointing after China’s unfavorable comments regarding trade.  However, a late-day rally saved the index charts from technical damage, and the bulls remain in control.  Although we have a significant day of earnings, the major focus will be in the Employment Situation report and the ISM MFG number that may prove to be the biggest market-moving numbers of the day. 

As we head into the uncertainty of another weekend, remember to take some profits.  Although we seem to have kicked the Phase 1 trade deal and Brexit down the road and have the FOMC behind us, we can’t become complacent in this very news-driven market.  With all the major indexes holding support and well above their 50-day averages, I remain bullish though somewhat cautious as prices work to prove support.  Remember, we have a very big week of earnings, with more than 1600 companies expected to report, so rest up this weekend the coming week will require us to be at our best.

Trade Wisely,

Doug

Lower rates and strong earnings reports inspire the bulls to reach out to new record highs in the SPY.  Not only that, but both the SPY and QQQ successfully tested and held the support level of the recent breakout.  Well done, bulls!  Unfortunately, trade war uncertainty once again raised its ugly head during the night, tempering the bullish sentiment as we head toward today’s open that chalked full of enough earnings and economic calendar events to keep everyone guessing, what comes next?

Asian markets closed mixed but mostly higher after reporting their 6^th straight manufacturing decline.  European markets see only red this morning with rising doubts about the trade war deal.  US Futures have slightly improved this morning from overnight lows but continue to point to a modestly bearish open due to trade war concerns.  With the Employment Situation and ISM number on Friday, we should not be surprised to see a choppy day of price action as we wait.

On the Calendar

The Thursday earnings calendar is a busy one, with nearly 340 companies expected to report results.  Notable reports include MO, AMCX, AMT, ADM, CAR, AVP, BLL, APRN, BMY, CHD, CI, CLX, COR, DNKN, DD, EL, EXC, FCAU, FTNT, GLPI, HFC, IP, IRM, KHC, MELI, NNN, RMAX, SNY, SIRI, STOR, TRI, W, WU, WWE, XYL, and YETI.

Action Plan

We have and interesting set of circumstances facing the market this morning.  A rate cut that the market wanted, good earnings reports yesterday, and another big day of them today, but the futures are reacting negatively to downbeat comments on trade from China.  China was in the news for a second time last night, stating their manufacturing activity shrank for the 6^th straight month due to trade war pressures.  Congress is expected to vote today on the rules they will follow in the impeachment process, which is likely to be a distracting and firey side show of political gamesmanship.

Technically speaking, yesterdays price action turned out to be very bullish with the SPY and QQQ testing and proving to hold breakout support.  Although the DIA still has a lot of work to do before it reaches new record highs, the bulls showed strength holding the downtrend breakout as support after a quick test.  Trade war worries add another wrinkle in an already busy day full of earnings events and possible market-moving economic reports.  If that’s not enough to keep the market guessing, remember, we still have the Employment Situation, and the ISM reports on Friday morning.  Waiting on those could produce some choppy price action after the morning rush as we wait.

Trade Wisley,

Doug

Today the market faces a literal deluge of events.  Nearly 380 companies report earnings, including big tech market-movers like AAPL & FB after the bell today.  At 8:30 AM Eastern, we get the latest reading on the GDP that the consensus estimate suggests will come in below 2 percent.  Then at 2:00 PM, the FOMC rate decision that may excite or disappoint the market, creating significant price volatility.  Swing and position traders will have tough decisions to make while quick and experienced day traders will likely have the upper hand.  Anything is possible, so think carefully about how you approach the day.

Asian markets, with the uncertainty of the Fed rate decision, looming closed the day down across the board.  European markets trade cautiously mixed but mostly lower this morning ahead of the big data dump.  US Futures that were down most the night are now hovering near the flat line ahead of the deluge of events.  There could be some excitement during the morning rush but don’t be surprised if the market action becomes light and choppy waiting on the FOMC decision.  After that, it’s anyone guess!

On the Calendar

Today we have the biggest round of earnings reports so far this season with nearly 380 companies fessing up to their results.  Notable earnings include AAPL, FB, AKS, AWK, APA, ARCC, ADP, BKR, EAT, BG, CME, CTCH, CROX, DIN, ETR, EWIX, ETSY, GRMN, GE, HCP, HES, H, LM, TREE, LYFT, MANT, MCK, MET, MGM, TAP, MYL, RCL, SPG, SNE, SO, S, SFM, STAG, SBUX, SU, SPWR, SKT, TDOC, TUP, TWLO, VIAV, WDC, WMB, WING, YUM, & ZNGA.

Action Plan

It’s always tough to know with to do on a day so chalked full of potentially market-moving events.  First, we have our biggest day of earnings reports so far this quarter with just short of 380 reports. Both AAPL and FB report after the bell today, which means anything is possible Thursday morning, making it a difficult decision on the risk held overnight.  Secondly, with a very big day on the economic calendar beginning with ADP numbers, the GDP report, Petroleum Status report, and then at 2:00 PM Eastern the FOMC decision on interest rates followed directly by the Chairman’s press conference.

Fed fund futures suggest a very high likelihood of a rate cut today, which of course, the market always loves.  The big question to be answered is will the FOMC hint of more possible cuts in the future or disappoint the market, suggesting they finished.  If so, might the market react negatively?  It’s anybody’s guess!  I would expect some volatility early in the morning session, but would not be at all surprised to see the market become very slow and choppy as we wait for the interest rate decision.  Futures were slightly bearish overnight but have recovered to suggest a flat open at the time of writing this report.  However, with so much data for the market to digest before the open, anything is possible, and we will have to stay on our toes and remain flexible.

Trade Wisely,

Doug

The question of a new record high received an affirmative answer yesterday as both the SPY and QQQ finally broke through the stubborn resistance level.  However, before we can officially claim victory and sound the all-clear signal, they must now prove they can hold this new level as support.  Earnings disappointments after the bell yesterday have the US Futures looking a bit pensive this morning as we face more than 250 new reports today.  The bulls are clearly in control but stay flexible and focused on price action because sentiment can change with such a barrage of data.   

Overnight, Asian markets closed mixed but mostly lower, and the European markets this morning currently are flat to mostly lower as they monitor earnings and the pending UK Brexit related election.  US Futures trade mixed this morning with Dow pointing to bearish open that seems to be getting heavier as the morning progress, but that could quickly change though out the morning depending on earning results. 

On the Calendar

Tuesday’s Economic Calendar indicates more than 250 companies will report results today.  Notable reports include AMD, ALL, AMGN, AOS, AN, BIDU, SAM, BP, CAKE, CB, COP, GLW, CMI, DENN, DLR, ECL, EA, EPR, EXR, FEYE, GM, GRUB, HCA, HLF, IR, K, KKR, LDOS, MA, MAT, MRK, MDLZ, PAYC, PFE, PSA, SPGI, SHOP, SYK, WH, XRX, YUMC, & EXN.

Action Plan

Yesterday the SPY and QQQ finally found the inspiration to break out while the DIA continues to struggle with price resistance.  Breaking out is only one step in the equation; now, they must prove it can hold the new lofty prices as support.  As we wait for the FOMC interest rate decision, we have another big day of earnings reports to digest as well as the Case-Shiller Report, Consumer Confidence, and Pending Home Sales.  Price volatility is likely during the early session, but it could significantly slow after the morning rush as we wait on the FOMC.

Technically Speaking, the Bulls are in control with all four of the major indexes holding above their 50-day averages.  However, with earnings misses after the bell such as GOOGL, the Futures seem a bit pensive this morning ahead of a fresh round of reports.  As I am writing this report the Futures are mixed with the Dow suggesting a slightly lower open.  That, of course, can quickly change for the better or worse as the morning earning reports roll out in quick succession.  T2122 suggests there is still room to move higher, although beginning to look a bit extended as the VIX tests a 12 handle. 

Trade Wisely,

Doug

A busy economic calendar and about 900 companies reporting earnings will give the market a fire hose of data to digest this week.  Wednesday afternoon, the FOMC is expected to cut the interest rate for the 3^rd time this year, and we’ll cap the week with the Employment Situation and ISM reports.  Indeed a very busy week as the market knocks on the door of record highs. 

Asian markets closed the day green across the board on US-China trade optimism.  European markets are mixed but mostly higher this morning as the EU grants an extension to January 31 for Brexit.  US Futures are bullish this morning and may create new record highs in SPY, and the QQQ at the open assuming earnings reports and the International Trade in Goods report don’t change the current sentiment.  Buckle up; it could be a wild ride this week!

On the Calendar

The Monday Earnings Calendar had just short of 140 companies reporting quarterly results.  Notable reports include AKAM. GOOGL, T, AVB, BYND, CTB, EPD, LEG, L, NXPI, ON, QSR, SPOT, TXRH, TMUS, RIG, VNO, WBA, and WELL.

Action Plan

We had a nice weekend where there were no additional uncertainties, and in fact had a few resolutions.  First, according to reports, some provisions of the Phase 1 trade agreement are coming together.  The report was very thin on details but enough to move the market substantially toward record highs.  The Yield curve that shook the market a few months ago is improving, and the FOMC is expected to lower the interest rate for the 3^rd time on Wednesday afternoon.  GM reached an agreement with striking workers, and the ISIS leader Baghdadi met his end this weekend improving the US relationship with Syria.

US Futures, suggest a bullish open that may print all-time highs in the SPY at the QQQ, at the time of writing this report.  Although the DIA is lagging behind, the bullish engulfing candle popping out of a consolidation rage on Friday suggests a break of the current downtrend is possible with the futures suggesting a gap up of about 70 points at the open.  Of course with a big round of earnings reports, this morning and the International Trade in Goods report at 8:30 AM Eastern anything is possible.  We have a very big week of economic data, so keep in mind price action could become very light and choppy as we wait.

Trade Wisely,

Doug

With a mixed bag of earnings results, the overall market continues to struggle with the overhead resistance of all-time highs.  After receiving another late-day rally yesterday, the bulls have the upper hand but lack the inspiration to push forward with confidence.  With a lighter Friday earnings calendar and the big disappointment report by AMZN, the bulls and bears seem equally matched as we head into the weekend.

Asian markets closed mixed with the uncertainties of trade and Brexit still hanging overhead.  European markets also trade mixed this morning due to the mixed bag of earnings results and a possible Brexit vote ahead.  US Futures currently appear to lack in energy this morning, dancing around the flat line ahead of fresh reports and a Consumer Sentiment report at 10 AM Eastern. 

On the Calendar

We have a lighter day on the Earnings Calendar this Friday, with just over 63 companies expected to report.  Notable reports include BUD, CHTR, GT, ITW, LEA, PSX, PSXP, VFC, VTR, VZ, WY, WETF, AND YNDX.

Action Plan

US markets struggled yesterday with the DIA under pressure ending the day with mixed results.  This morning US Futures this morning recovered from some overnight losses but also seem a bit confused hovering around the flat line.  Vice President Pence delivered an address with harsh words directed at China on trade and human rights practices.  He also delivered some scathing criticism of the actions of NKE and the NBA organization regarding the Hong Kong protesters.  Trade negotiators are scheduled to speak by phone next Friday.

With another late-day rally yesterday, the bull continues to hold a stronger hand and continues to focus on the all-time high resistance levels above that have proven to very challenging to breach.  While companies such as INTC and JNPR produced better than expected earnings results, AMZN delivered a big disappointment.  As we head into the weekend with such a mixed bag of earnings results, Friday trading has the potential to produce another choppy day of price action.

Trade Wisely,

Doug

A sharp end of day rally greatly improved yesterday’s developing candle patterns that had spent most of the day choppy and leaning bearish.  However, at the close, the DIA and IWM remain in a bullish consolidation with the SPY leading the pack with a bullish piercing pattern and the QQQ not far behind.  It has been an odd earnings season, to say the least, but, thus far the results have provided just enough inspiration to keep in the bears at bay.  With a huge day of earnings and economic reports anything is possible, but as of now the bulls have a slight momentum advantage.

Asian markets closed mixed but mostly higher, even as economic growth in South Korea continues to slow.  European markets see nothing but green this morning responding to earnings as Brexit uncertainty continues to swirl.  US Futures currently indicate a modestly bullish open this morning ahead of a slew of earnings results and several key economic reports.

On the Calendar

Today on the Earnings Calendar, we have the biggest day of reports since the 4^th quarter reports began.  Notable reports include MMM, AB, AMZN, AAL, AEP, AZN, COF, CERN, CINF, CTXS, CMCSA, CUBE, DECK, DOW, FE, FSLR, GILD, GNC, HSY, HBAN, ILMN, INTC, JNPR, KIM, LH, NOK, NOC, ONDK, RTN, RCL, LUV, SWK, TMUS, TROW, TWTR, VLO, VRSN, V, and AUY.

Action Plan

Today this very odd earnings season hits a full stride with more than 250 companies reporting.  We can expect significant volatility throughout the day and with big reports after the bell the possibility of a substantial gap Friday morning.  Although most of yesterday’s price action was not showing much bullishness an end of day rally as dark pool volume consolidated to the market, it created a late-day rally improving the technical look of the index charts. 

The SPY left behind a bullish piercing pattern finishing the day as the strongest chart with the QQQ not far behind.  The DIA managed to rally back enough in the last few minutes of the day to remain in a bullish consolidation pattern holding above important supports.  If the bulls happen to find inspiration in today’s earnings and economic reports, an attack on all-time highs is possible.  Should earnings disappoint, the DIA seems most likely to display the stress and could test it’s 50-day moving average.  However, earnings reports have provided just enough positive results that the bulls remain in control so the current momentum although light favors the bulls.

Trade Wisely,

Doug

Yesterday push toward upward ended the day leaving behind some concerning technical patterns.  The Dow is beginning to show a possible lower high failure with disappointing reports from MCD, TRV, and CAT early this morning.  The SPY and QQQ left behind bearish engulfing candle patterns by the end of the day as it reacted to the uncertainty of Brexit and a big wave of reports today.  Although the price resistance above is proving to be quite challenging to breach, at least the indexes are still holding above their 50-day averages.

During the night, Asian markets closed mixed but mostly lower as Brexit seeks another extension from the EU.  Currently, European markets are mixed but slightly lower overall with the more Brexit political roadblocks to clear.  US Futures are also currently mixed with the Dow and SP-500 suggesting a lower open but the NASDAQ trying hard to hold on to modest gains even as Mortgage Applications drop by 12%. 

On the Calendar

On the Hump Day Earnings Calendar we have a big day with more than 200 companies reporting results.  Notable reports include ABB, AEM, AMP, SNTM, ARI, AVY, BX, BA, BCOV, CP, CAT, CLF, EBAY, EW, LLY, EFX, FFIV, F, LLY, FXC, GD, GWW, HLT, IVZ, LRCX, MSFT, MHP, NDAQ, NSC, ORLY, OC, PYPL, RCI, ROL, SEIC, NOW, SAVE, TSLA, TMO, WM, WGO, and XLNX.

Action Plan

After failing to pass an expedited schedule to complete the Brexit agreement and extension of the October 31^st, deadline extending the uncertainty fo the outcome.  It’s anyone’s guess what happens next and how their decisions could affect the overall market.  Earnings have taken over the headlines, and progress on the Phase One trade agreement seems to have faded entirely from the news cycle and the mind of the market.  Disappointing earnings our of MCD and TRV yesterday and the early morning miss from CAT is becoming concerning considering the lower high the index has begun to display.  We are still waiting for the embattled BA to report this morning.

Technically speaking, we have some worrisome patterns developing on the index charts.  The Dow is showing a possible lower high,  the SPY, and the QQQ printed bearish engulfing patterns very near price resistance levels, and the IWM continues to struggle with downtrend resistance.  On the positive side, all the indexes remain above their respective 50-day averages, and perhaps this is merely a rest.  I think traders must remain flexible and be careful not to overcommit directionally. 

Trade Wisely,

Doug

Good morning everyone everyone. Due to a short term internet outage I didn’t have the time to write the full blog today. However we must stay focused on price action and expect the market will either be pushed or pulled by the big round of earnings today.

Notable earnings include CMG, ARCH, BIIB, BYD, CNC, DFS, FITB, HAS, IRBT, JBLU, KMB, LMT, MCD, NAVI, NEE, NVS, NUE, PG, PHM, RRC, RF, SHW, SIX, SKX, TXN, TRU, TRV, UTX, UPS & WHR.

We also have the potential market-moving Existing Home Sales numbers at 10:00 AM Eastern today. Consensus is expecting a slight decline.

You can watch the Morning Market Prep with the link below and I wish you all a great day everyone!