Futures are wildly mixed this morning the Dow Futures
pointing to a gap down of more than 150 points while the SP-500 and NASDAQ Futures
point to modest gains. The huge decline
in the Dow is due to the sharp decline in BA shares after a second 737 Max 8 plane crash. It is also important to note that we have a
potential market-moving Retail Sales number
at 8:30 AM Eastern after the very disappointing
results in the last reading.
As the SPY and QQQ move higher this morning remember to
respect the possible overhead price resistance above. If a lower high failure would to occur that
would be technically very damaging so stay focused on price action and avoid
chasing the morning gap. Let’s wait and
see if buyers step up after the open in support of the gap. The Whitehouse
has forwarded the new budget that includes a border wall funding and threats of
yet another government shutdown are already spinning the political rhetoric. Also keep in mind the US/China negotiations
could still be a huge market-moving event if or when we finally get news on the
subject.
On the Calendar
On the Earnings Calendar we have 100 companies reporting today.
Action Plan
We have a very interesting market
setup this morning that could make for a challenging day. Asian markets that began three trading day lower
managed to close modestly positive despite
global growth concerns. European are currently
slightly higher across the board ahead of a crucial Brexit vote while US Futures
are widely mixed. Currently the Dow Futures
point to a gap down of more than 150 mostly due BA shares falling sharply as
the result of another plane crash.
However, the SP-500 and the NASDAQ futures are pointing to gap up opens
that may retest resistance levels.
It will be interesting to see
how this plays out with such mixed results at the open. Keep an eye on overhead resistance levels in
both the SPY and QQQ and be very careful about chasing the open. The Retail Sales number at 8:30 AM Eastern
could be critical for the day. The last
reading on retail sales saw a decline -1.2% and consensus for today is for a
reading 0.0% which means the futures could quickly change before the open
depending upon actual number.
With an ugly decline
yesterday I think most traders went into the close hoping the Friday Employment Situation number would get the bulls
back on the job. Unfortunately China’s very disappointing trade numbers last night
has the markets around the world reacting significantly
lower as the global slowdown theme continues to spread.
Futures are pointing to
a gap down of more than 100 points but that could greatly improve or get worse depending on the economic reports at
8:30 AM Eastern. This has obviously been a
rough week for the market and the failure
has key resistance levels does not help the technical
picture of the market. Consider carefully
the risk you carry into the weekend keeping in mind that we’ve still could
hear about a US/China trade deal.
On the Calendar
A little slower day on the Friday earnings calendar with just under 60 reports today. No particularly notable except maybe MTM
today.
Action Plan
Looking at the futures
this morning I wish I had held more of
the hedge positions through today. Futures were lower but pretty benign until China released trade numbers that were
sharply lower than expected. Asian
markets closed sharply lower and currently European are also declining across
the board.
Today is the big Employment situation
number. Estimates expect 180k jobs created
and that the unemployment rate will tick down to 3.9 %. That would be a very good number but sharply
lower than 304K reading last month. We
also have the Housing Starts number that disappointed on the last reading so keep
a close eye on the futures at 8:30 AM eastern as the open could improve or get
worse very quickly, Consider the risk
you hold into the weekend and remember we’ve yet to hear news on the US/China
trade deal. Have a great weekend everyone.
As always with a gap open we want
to avoid the urge to chase. Wait and watch
the price action after Clues of a slowing economy that continue to pop
up in the economic data have slowly begun a toll on this tremendous bull run. Slowing retail and housing were swept aside due to hopes of a forthcoming US/China
trade deal. The appears to be growing weary of the wait and yesterdays disappointing
trade numbers added additional pressure.
Thus far the selling has been very controlled and after such
a steep rally should not have been a surprise.
Futures this morning are currently trying to rally off the overnight low
but are suggesting a modest gap down at the open. Although we may see in increase in price volatility as fear grows I would be careful not
to chase the gap waiting to see if sellers
support the move.
On the Calendar
We have 185 companies fessing up to quarterly results
today. Among the notable earnings are:
COST, BKS, AOBC, BURL, CRCM, CHUY, LOCO,
GNC, HRB, HOV, KR, PLUG & UMH.
Action Plan
Disappointing economic
growth numbers in Europe, US trade deficits, North Korea appearing to restart
their nuclear program while the world
continues to wait for a US/China trade
deal have the futures looking gloomy this morning. The bulls have worked pretty hard to hold
price action supports are beginning to falter as hungry bears continue the gap to see
if sellers support the move lower with additional selling.
T2122 this morning is likely
to reach the bullish reversal zone at the open.
That doesn’t mean we should get an immediate bounce it only suggests the
odds of a relief rally are growing as long as there is not a piling on of more
bad news. So far this has been a very controlled
pullback but this mornings gap down has the potential to increase price volatility.
While the market waits
for details of the US/China negotiations the
price action has become very light and choppy and there is a danger of
over-trading a dull market. Traders can
easily become bored during choppy markets talking themselves into trader they
would normally avoid just to have something
to do and break the boredom.
If the overall market is patiently
waiting perhaps we should do the same.
Eventually the stalemate will be
broken and the market could suddenly move either up or down. Unfortunately,
that big move often happens overnight and the result can be very costly if you
find that you’re on the wrong side of the
move. Exercise your discipline, stay focused
on price action and carefully weigh the risks of
over-trading a dull market.
On the Calendar
On the Earnings Calendar we have more than 120 companies reporting.
Notable reports are, ANF, AEO, BJ. BKCC, BREW, DLTR, SWRE & RST.
Action Plan
Yesterday was a mind-numbingly boring day with light volume
chop as the market waits for news on the trade
deal. The entire range of the DIA
yesterday was less than $1.50 closing
just 0.09 cents below the open of the day.
There are certainly very good looking
stocks but keep in mind a single new report could move the market substantially
so be careful not to over-trade out of sheer boredom.
Asian markets closed mixed over-night and currently European markets are mixed and mostly flat as
it seems the entire world is watching and waiting. Currently the futures are pointing to a modestly lower open having recovered about 50% from
their overnight lows. Perhaps earnings
and economic reports can break the logjam this morning and we can pick a
direction. If not it would be wise to
remember that really big moves often happen overnight on news events. Over-trade a dull market and you can easily
find yourself on the wrong side of the move.
Plan your risk accordingly.
On Sunday the Wall Street Journal triggered a buy the rumor rally
when they reported that the US and China are “in the final stage of completing a
trade deal.” The story offered nothing
as to an actual completion date of the agreement and had little to no details
about what’s included. Nonetheless, markets
around the world have reacted bullishly to the hope that some kind of agreement is forthcoming hopefully
sooner than later.
We have more than 500 companies reporting earnings this week
and busy economic calendar as we move toward the Friday Employment Situation report. The index trends are still up but we still have those pesky price resistance levels above
that continue to demand respect. As we
saw on Friday a gap into price resistance can prove dangerous and costly if you
chase into it with a fear of missing out.
Wait for proof in the price action after the gap that buyers are
stepping in supporting the gap to avoid those nasty pop and drop patterns.
On the Calendar
On the Earnings Calendar we have 64 companies stepping up to report earnings results today.
Action Plan
Friday’s gap up open into resistance found sellers and through
our the morning gave back the entire gain
and at one point was looking pretty grim.
Fortunately the bulls went back to
work in the afternoon recovering about half of the initial morning gap. This morning futures are once again signaling
a gap up open with Asian and European markets
also bullish overnight. On Sunday the
Wall Street Journal reported that the US
and China are “in the final stage of completing a
trade deal.” It cited that Beijing was offering some lower tariffs on U.S. Products and markets responded bullishly
around the world.
Unfortunately the story said nothing about the timeline to completion and little to no detail
as to the contents in the agreement. A true to form buy the rumor market pop! Nonetheless, the trend is still up and thus
far key resistance levels are still holding and must be respected. We have another big week of earnings reports
and several significant economic reports culminating on Friday with the big
Employment Situation number on Friday morning.
As always, avoid chasing the morning
gap waiting instead for proof in the price action that buyers are going to set
in supporting the gap.
Asian markets closed
higher overnight even after China manufacturing
numbers declined for the 3rd straight month. European markets are also higher across the board
this morning due to fresh US-China trade comments according to CNBC. Consequently,
US Futures are pointing to a substantial gap up this morning supposedly in reaction to yesterday’s GDP number
if you believe the news.
Currently the futures suggest a gap of more than 175 Dow points
this morning to test key resistance index levels. Those caught short could enhance the bullish move,
buying to cover in a so-called
short squeeze. We should also be on
guard for the possibility of a pop and
drop pattern at or near price resistance. Don’t chase with the fear of missing out,
take a breath and wait to see if buyers step in supporting the gap before
adding risk ahead of the weekend.
On the Calendar
We get a little break on the Earnings Calendar with just 50
companies reporting earnings today. Notable
reports today are XRAY, FL and SNH.
Action Plan
Futures are sharply higher this morning though I’m not sure
why other than the bulls just want to go
up. CNBC is suggesting it due to US/China
trade comments but the only story I can find on the subject suggests that Intellectual Property Theft remains a major sticking point. There is also a suggestion that the market is
responding to yesterday’s strong GDP news.
Odd, but okay. Nonetheless we are looking at a substantial gap up this morning
and those caught short may trigger a short squeeze this morning.
Although we have a lighter day on the earnings calendar we
have several potential market-moving
economic reports this reports morning. Remember
to not chase a morning gap especially right
into price resistance. Wait to see if
buyers step in supporting the gap because we don’t want to get caught in a classic pop and drop at price resistance. If
resistance does break an attack of record market
highs may be in the cards. Have a fantastic weekend everyone!
The North Korean summit abruptly ends with no deal and with the public Cohen political drama now behind closed doors the US Futures are suggesting only a modestly lower open. However, with more than 280 companies reporting and a busy economic calendar a lot could still change as we move toward this mornings bell.
Even though the bulls have given up a little ground the last couple days they still are in control of the uptrend and fought back yesterday cutting the initial losses in half by the close. The bears on the other hand continue to defend key resistance levels putting market between a rock and hard place and we will have to watch price closely for clues. Perhaps we slip into a healthy consolidation resting after such an extraordinary market run. If that’s the case, there will be some good trading for stock pickers as companies with price momentum can continue to elevate with relatively low volatility. That of course will change dramatically if the bears began to gain the upper hand. Stay focused and flexible.
On the Calendar
We have a big day on the Earnings Calendar with more than
280 companies stepping up to report. Among
the notable earnings today are, DDD, ABB, ALRM, AMC, AMCX, BUD, ADSK, CARS,
CROX, ECA, GPS, EP, JCP, JD, KDP, LTC, MAIN, MAR, JWM, NRG, PRTY, SEAS, SPLK,
TC, VMW and WDAY.
Action Plan
After some initial selling the market became very choppy and
lethargic as the Cohen political drama which may be better described as a soap opera
played out at the US Capital. As near as
I could tell skimming through the highlights the only thing accomplished was
political grandstanding. The markets are
reacting lower this morning as due to the US/North Korean summit ends abruptly
with no deal. We also have India and Pakistan
exchanging air strikes as tensions between the two countries escalate.
Technically, the indexes continue to battle index resistance
levels and though the bulls gave up a little ground in the last couple trading
days they continue to fight hard to hold the current up trend. Asian markets closed lower and European are also
currently lower across the board this morning.
US Futures are pointing to a modestly lower open but with a big day of
earnings and economic reports anything is possible.
Futures are pointing to a modestly
lower open this morning as the market faces a day of historical events. First are
the decisions of nuclear disbarment of
North Korean a feat no sitting president has been able to accomplish.
Secondly a congressional hearing where the president’s former attorney is
expected to testify that is boss broke the law while
holding the highest office in the nation.
Add to that a big day of earnings reports and full economic calendar and
I think it’s safe to say the market has a lot a lot on its plate to digest.
The bulls have proven to be
very resilient and the trend is up so expect them to fight hard to defend against
any bear attack. However, we also have
to respect the price resistance in the index charts and plan for the
possibility that the political drama could impact the market with higher volatility. Saying that anything is possible would not be
an understatement and you never know exactly how the market could react with so
much to chew on today.
On the Calendar
On the Earnings Calendar we have a big day with more than
210 companies reporting quarterly results.
Some of the notable earnings are, AMT,
APA, BBY, BKNG, BOX, CPB, CHK, DF, FIT, TWNK,
HPQ, LB, LOW, ODP, PK, PBR, SQ, TDOC, TJX and WING.
Action Plan
As the US and North Korean
try to make nice while discussing nuclear disarmament abroad the president himself
will be under attack in a congressional hearing right here at home. Putting the president’s
challenges aside we should plan for the possibility of serious market impacts. As I write this morning note the futures are
pointing to only a modest decline at the open.
With a big day of earnings reports, important economic reports and a distracting
political drama anything is possible.
In our 11th week of rally and testing index price
resistance it would not be out of the question to see some profit-taking begin
or some price consolidation to reinforce a new level of support. However, the bulls have proven to be remarkably tenacious and with the market trend strongly
in their favor I would expect them to fight hard for higher prices. Avoid predicting, stay focused on price, remain
flexible, stay disciplined to your trading rules and prepare for a very interesting
day.
According to new reports the futures are down this morning because
investors are seeking clarity on the US / China trade deal. How can there be clarity when have been no
details and no deal has yet not yet finished?
Would it not be more likely that
the market is merely needing a rest after
the Dow has rallied nearly 4500 points in just over ten weeks? After an extraordinary run a rest or pullback is normal
and healthy price action to confirm or build price support.
The trend is still up and but there are warnings signs that
this run is a bit overextended. However,
at this time there are no clues of failure and the bulls have proven to be remarkably resilient
fending off bear attacks quite easily of late.
I would not expect them to give up easily now but stay focused on price action
clues waiting to see if the sellers show up in support or the morning gap down
or if buyers step in rejecting the low.
On the Calendar
On the Earnings Calendar we have over 200 companies reporting today. Among the most notable are, HD, M, BGS, BMO,
BNS, LNG, CSGP, CBRL, DISCA, ELF, EV, FTR, GWPH, HTZ, SJM, TREE, MELI, MYL,
PANW, PZZA, PSA, SDRL, SSTK, TIVO, VSI, and WTW.
Action Plan
If we are to believe the news
CNBC is citing that the futures are lower because investors want clarity on the US / China deal! Hmm, all along there has little to know
details and the fact is there has been no official deal as of now. Seems more likely
is down because simply because it needs a rest after Dow rally of nearly 4500 points! Nonetheless, Asian and European markets are lower this morning and it doesn’t
help the situation with HD missed on earnings early this morning.
The President is on his way to Vietnam to meet with Kim Jong-un
to discuss nuclear disarmament. Don’t be surprised if news reports from the
meeting create a little market volatility.
Keep an
eye on the Housing numbers this morning at 8:30 AM Eastern. Let’s hope
they show a better result than the
existing home sales numbers last week or the open today could be a little
rough. The trend is still up but there
are several danger signs so stay focused on price. There may be nothing at all to worry about but
let’s have the bull prove that before taking
additional long risk.
My curiousness about how the markets would open as we enter
the 11th week of this market rally disappeared after the Presidential
tweet energized the bulls. About 10 minutes before the futures market opened
it was reported that the President would delay the Chinese tariff increase. As you might expect Asian markets rallied strongly
on that news last night and the bullish spread to European markets which are higher across the board this morning.
Following a trip point gap and run on Friday the US futures
point to yet another gap of nearly 150 points this morning. Although global economic stories continue to populate the news the bulls
appear to have no concern and there is even
some speculation that new market record highs are on the way. Though the trend is up please keep in mind there
are clues that the market is overbought as we test resistance levels. That certainly
does not mean that selling will soon begin but it does suggest we need to be
watchful and prepared in case the bull
stumbles.
On the Calendar
On the Earnings Calendar we have 130 companies reporting earnings
today. Notable reports, TWOU, AWR, APLE, CLDT, ETSY, LSI, MOS, OKE, PBPB, APTS, RCII,
SHAK, THC & VCYT.
Action Plan
About 20 minutes before the Futures
markets reopened yesterday I was checking the news and wondered how the markets would respond after ten weeks of rally and closing in the Friday tariff increase. That curiosity
went away when about 10 minutes before the futures
open the President tweeted he would delay hiking the China tariffs and
referenced the negotiations as
productive. As you might imagine when the
Asian markets began to open 2 hours later
they made significant gains on the
news. European
markets are currently higher and the US futures are suggesting about a 150
point gap higher this morning.
As we enter the 11th
week of this amazing rally there is now speculation that the market will reach
out for new record highs in the near future.
Although it seems a fruitless endeavor I will once again point out the significant
resistance levels just above and suggest caution as we rally to test them. We have another big week of earnings this
week and several very important economic reports for the market to digest as
well.
