Earnings Start As JNJ and BA Take Unrelated Hits

Monday saw a mixed but modest open followed by some trending the first hour.  After that, the rest of the day was a sideways grind in a narrow range that closed near the highs. This left us with strong white candles in both of the large-cap indices and a Doji in the QQQ.  All 3 indices closed at yet another new all-time high close.  On the day, SPY gained 0.37%, DIA gained 0.37%, and QQQ gained 0.39%.  The VXX lost two-thirds of a percent to 29.23 and T2122 remains in the overbought territory at 85.92.  10-year bond yields rose to 1.37% and Oil (WTI) fell half a percent to $74.14/barrel.

During the day, the NY Fed released its June consumer survey.  The survey found the median expectation of inflation for the next 12 months had jumped to 4.8%, the highest reading in the history of the survey.  The survey also found consumers expect that unemployment will fall over the same time. Given this survey's results, June CPI numbers are expected to come in hot this morning.

Also during the day, TSLA CEO Elon Musk testified in a shareholder lawsuit over the company’s purchase of SolarCity.  The suit alleges the purchase amounted to a bailout that came at the expense of TSLA shareholders.  Other TSLA board members had already settled their portion of the liability for $60 million.  However, Musk refused.  Early in his testimony Musk said he did not see a financial gain from the purchase, but it was part of his 2006 “master plan.”

Late in the day, the FDA announced a new warning will be added to the JNJ covid vaccine.  The warning will inform the public that the vaccine has been linked to a rare, but serious, autoimmune disorder. However, regulators emphasized that the risk is tiny (100 cases found out of 12.8 million doses administered).  JNJ stock fell sharply intraday on the news, but still ended flat on the day.

Overnight, Asian markets were mostly strongly green.  Japan (+2.25%) and Shenzhen (+2.14%) were major outliers to the upside mixed.  Nonetheless, the region was green with Taiwan (+0.87%), South Korea (+0.89%), and Australia (+0.83%) being typical. In Europe, we see a divergence.  The 3 major bourses are all red.  However, the entire rest of the continent is green at this point in the day.  The FTSE (-0.61%), DAX (-0.10%), and CAC (-0.33%) all seem to be waiting on a cue from the US.  As of 7:30 am, US Futures are mixed.  The DIA is implying a -0.43% open, the SPY implying a -0.23% open, and the QQQ implying a +0.20% open.

Major economic news scheduled for Tuesday is limited to June CPI (8:30 am), Jun Federal Budget Balance (2 pm), and two Fed speakers (Bostic at noon and Bostic at 2:30).  The major earnings reports scheduled for the day include CAG, FAST, FRC, GS, JPM, and PEP before the open.  Then, after the close, AMX reports. 

Early this morning, both GS and JPM posted strong beats for Q2. GS reported especially strong numbers based on banking around a very strong IPO market. BA also halted deliveries of its "787 Dreamliner" jets again when another flaw was found. This is the second halt to deliveries of the wide-body plane in the last year, with the previous stoppage lasting 5 months. Finally, France fined GOOG $593 million in a "news copyright" case where France found GOOG did not negotiate in good faith with the original publishers of news stories it reused.

Markets are still sitting at all-time highs, look extended, and at least the Nasdaq showed signs of indecision Monday. A little rest or even a small pullback should not be unexpected. However, the odds still favor sticking with the trend...and the trend remains strongly bullish. Focus on your open positions first, don't chase new ones, and remain nimble. Keep following your trading rules, taking your profits, moving your stops, and maintaining your discipline. "Your" is the key word. It is all about your decisions. So act mindfully and with intention...don't just react emotionally. Consistency remains the key to long-term success.


Swing Trade Ideas for your consideration and watchlist: No Tickers today. You can find Rick's review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers 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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