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.
After a choppy Thursday with the market reacting to declining home sales futures markets were quickly lifted out the overnight doldrums with news of a pending trade deal. The story was very lacking in details but the
possible end of this trade war was enough to inspire the bulls to push for more
than a triple point gap up. A positive
close today will cap an extraordinary 9th straight week of market
gains.
Overhead resistance is certainly
still a factor and though I feel the fear of missing out just like everyone else
I will stick to my discipline and avoid chasing so late in the rally. I will also plan to use this mornings gap up
to take some profits where possible and reduce my weekend risk. My job is to advance my account and this late
in such an extraordinary run a Friday morning gap up is a gift I plan to take
to the bank.
On the Calendar
On the Earnings Calendar we get a little break today with less
than 50 companies reporting. Notable earnings
include, AN, COG, CHK, MGA, RY, RUTH, WPC
and W.
Action Plan
Another news report that the US and China are getting closer
on a trade deal quickly lifted the futures
out of negative overnight territory. Although
the report contained no information on the details or timing the bulls are
pushing a triple-digit gap up open this morning. As I mentioned yesterday a strong finish to
week would not be surprising to cap off a nine-week rally of more than 4200 Dow
points.
Though gapping up the indexes
will still be challenged by the price resistance just above so be careful not
chase this morning. As normal I plan to use
a Friday morning gap as an opportunity to take some profits and reduce weekend risk
if at all possible. This week we have
seen the bull ignore falling retail sales numbers and yesterdays decline in
home sales but I don’t believe that can continue forever. Stay disciplined on the job of protecting
your capital and advancing your account.
Have a great weekend everyone.
The FOMC stands aside, the US and China are said to be
outlining a trade deal, index trends are up, and
the bulls point to the 9th straight day of gains. A truly extraordinary bull run that is also in
the 9th straight week up without looking back. Oddly enough bonds continue to trend higher
and even gold and silver have printed significant gains at the same time.
In a run such as this, profits have been easy to come by but its also very easy to become complacent. Such a strong bull run can lull traders to sleep and forgetting about the hungry bears lying in wait for their opportunity to attack. The trends are clearly bullish so stay with the trend but make sure you’re not chasing stocks late in their rally and over-trading. Respect resistance levels and exercise caution as price challenges them and remember to take some profits to the bank.
On the Calendar
On the Earnings Calendar we have a big day with more than
225 companies reporting results. Among the
notable report are: BIDU, BCS, BYD, CZR, ED, CUBE, DLPH, DPZ, DBX, FSLR, FLR,
HL, HPE, HRL, KHC, MORN, NEM, RMAX, STMP, STOR, VER, WEN, WIN & ZG.
Action Plan
Eight straight days of rally and in the 9th
straight week of an extraordinary index rally and the bulls appear energized
to continue that winning streak this morning.
New overnight that US and China may now be outlining the details of a trade
deal have the futures once again pointing to a modest gap up at the open. Asian markets closed mixed but modestly
higher overall and European are currently mixed this morning as well.
Today we have very busy earnings
and economic calendars to keep us on our toes as we progress toward the
open. Yesterday the FOMC minutes
yesterday reinforced that the committee expects to take a wait and see approach
giving them more time to evaluate the economic impacts of past rate increases. As expected there was some price volatility
after the minutes released but ultimately the bulls remained solidly in control
as we push upward to test significant market resistance levels. At this time there is nothing in price action
in the index charts to suggest bearishness but we must respect the resistance
above and avoid chasing so late in the rally.
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.
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.
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
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.
