CPI and FOMC Speakers Today

The week started with a small gap lower, but the bulls stepped in quickly to lead a slow and steady recovery to the highs by mid-afternoon.  However, the last 2 hours were a bit of a roller coaster ride that ended the day near where we closed Friday.  That said, the tech names helped the NASDAQ outperform Monday.  On the day the SPY was up 0.06%, the DIA down 0.44%, and the QQQ up 0.89%.  VXX fell more than expected to 32.70 and the T2122 also fell sharply to 72.11, once again outside of the overbought area.  The 10-year bond yield rose to 0.71% while Oil (WTI) was flat at $24.73/barrel.

In relief/political news, it was announced Monday that there is now a Republican co-sponsor and 2-3 Republican Senators "almost willing" to support a bill sending $500 billion in money to state and local governments.  Meanwhile, on the House side, they have pushed off any vote for another relief bill until at least Friday (perhaps waiting on the Senate).  Finally, Dr. Fauci (NIH) will be testifying to the Senate as Congress begins their oversight hearings of virus and relief programs. On top of that, the Fed will also start its corporate bond-buying program today by buying specific ETFs (that hold bonds downgraded during virus).  There was no word on which ETFs they will buy.

On the Virus front itself, the global headline numbers are 4,274,648 confirmed cases and 287,670 deaths.  In Asia, the uptick continues with clusters of new cases found in China (including Wuhan), South Korea, Japan, and Singapore.  The good news there is that the clusters are small-enough and testing/tracing capability large enough in those places that the “uptick” at least has the strong potential to be stopped before it becomes widespread.

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In the US, we have 1,385,893 confirmed cases and 81,796 deaths.  New York state announced that 3 of its rural regions are ready to open on Friday.  In the oil patch, pipeline company ETP said about 25% of US shale fields that had been shut down have now been turned back on at least in the Permian Basin. Meanwhile, in CA, TSLA reopened its Fremont plant in spite of County Health Department orders.  The Governor of CA said he was unaware but will look into the matter, but city and county law enforcement did not intervene.

Overnight, Asian markets were mixed, but mostly red for Tuesday.  Again, this was mostly on small moves (closer to flat), with the exceptions of Hong Kong and Australia, which were both down over a percent.  In Europe, markets are mixed so far, but on the green side, with only the FTSE (+0.96%) near a 1% move.  As of 7:30 am, US futures are on the green side of flat, now pointing to a 0.20% gap higher at the open. 

The major economic news for Tuesday includes Apr. CPI (8:30 am), FOMC Speakers (Harker and Quarles both at 10 am), 10-yr Bond Auction (1 pm), Apr. Budget Bal (2 pm), and FOMC Speaker (Mester at 5 pm).  However, among major companies, AGN, DUK, HMC, IR, MAC, and VSH also all report before the open.

The bulls still have control of the momentum.  However, resistance is close overhead and it seems like markets are showing some caution, perhaps due to fear about the speed or strength of the reopening.  Keep in mind that we are seeing volatility every day, with a lot of gaps and reversal action.  So, focus on the short-term chart in front of you.  Don’t chase and remain cautious about longer-term swing trades, unless you can take some short-term pain.  However, the trend is clearly bullish.

Ed

Trade Ideas for your consideration and watchlist today: MGNX, LXRX, MYGN, BECN, TLRY, JAZZ, FRPT, DISH, MUR, AMLP. Trade smart, take profits along the way and trade your plan. Also, don't forget to check for upcoming earnings. Finally, remember that the stocks/etfs 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.

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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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