Stocks gapped down strongly as pre-market economic data led to major inflation fears.  They then ground sideways until the FOMC and Chair Powell hit the perfect tone, by saying the economy is getting stronger (+6.5% for the year) and prices will rise in the short-term due to the stimulus, but the Fed sees no inflation and does not foresee any reason to raise rates or tighten policy through at least 2023. Markets exploded more than a full percent higher on that news and then took profits during the last hour. This gave us Bullish Engulfing signals in the QQQ and SPY as well as new all-time high closes in the two large-cap indices.  On the day, SPY gained 0.34%, DIA gained 0.58%, and QQQ gained 0.41%.  The VXX fell over 4% to 12.59 and T2122 jumped back to 90.91.  10-year bond yields spiked to 1.646% and Oil (WTI) fell almost half a percent to $64.53/barrel.

In government-related news, the IRS announced they are moving the 2020 Tax filing deadline back from April 15 to May 17.  In addition, unspecified Wall St. execs, private equity CEOs, major corporations, and the Chamber of Commerce have held talks with President Biden on ways to pay for a major infrastructure improvement bill.  Tax increases, usage fees, public-private partnerships were reportedly the leading ideas discussed according to sources cited by Bloomberg.  Finally, the House has officially rolled out the pork barrel as GOP Representatives joined Democrats in allowing (for the first time since 2011) specific set-asides in all bills.  While this opens the way to more bipartisan legislation, it also greatly increases the likelihood of pork (vote-buying across parties).

In other news, MS became the first major bank to allow clients access to Bitcoin.  In addition, DIS formally announced that Disneyland would reopen on April 30.  Finally, leaks suggest AAPL will announce new high-end iPads as soon as April, this is an unusual move since the company typically puts out new products in the fall.  The timing may be a response to the reported decrease in iPhone sales.  The good news for AAPL fans is that iPads use mobile processors that are much more available than computer silicon now.

Related to the virus, US infections are starting to plateau at a level above the Fall level after a month and a half of steep and steady decline in new cases. The totals have risen to 30,294,798 confirmed cases and deaths have now passed half a million at 550,649 deaths. As mentioned, the number of new cases rose slightly to an average of 55,595 new cases per day.  Deaths fell slightly also to 1,173 per day.  Generally, the country is trending well, but an increasing number of states are seeing an increase in cases (UK variant and CA state variants) the health professionals have been warning about.  The count is now 16 states with increasing cases.   

Globally, the numbers rose to 121,938,903 confirmed cases and the confirmed deaths are now at 2,694,903 deaths.  The trends have been good, but we saw a significant uptick today.  The world’s average new cases have risen again to 448,126 per day.  Mortality, which lags, was flat, now at 8,583 new deaths per day.  Turkey saw its highest number of new cases in months and Brazil the highest number of new cases ever yesterday.  The US is considering sending some AZN vaccine to Mexico (since it isn’t even approved yet for use in this country).

Overnight, Asian markets were mixed but mostly green.  Hong Kong (+1.28%), Shenzhen (+1.12%), and Japan (+1.01%) led the way among major exchanges.  India (-1.11%) and Australia (-0.73%) paced the losers.  In Europe, we see a similar pattern so far today.  The DAX (+1.07%) is an outlier to the upside, the CAC (+0.09%) is flat, and the FTSE (-0.23%) is typical of the exchanges showing losses mid-day.  As of 7:30 am, US Futures are pointing negative.  The DIA (+0.06%) s flat, but the SPY (-0.47%) and QQQ (-1.23%) are pointing to gaps down in front of the Jobless Claims number.

The major economic news for Thursday is limited to Weekly Initial Jobless Claims and Philly Fed Mfg. Index (both at 8:30 am). Major earnings reports before the open include CAN, CSIQ, CMC, DG, GIII, WOOF, SIG, and WB before the open.  Then after the close, LX, NKE, and OCDX report.

The Fed did the most any trader could ask on Wednesday. However, markets have had a night to reconsider the “we’re doing well and not taking our foot off the gas” statement. The specter of inflation still looms and bond yields are showing no sign of softening. So, don’t be surprised that we see a snap-back from yesterday afternoon’s rally. However, that too may be very short-lived. Expect volatility, but the bulls are still in control of the trend.

Consistency is the key to long-term trading success. Keep taking your trade goals (profits) off the table when you can, stick to your rules, and maintain discipline. As always, follow the trend, respect support and resistance, and don’t chase the moves you missed. Another trade will be along any minute.

Ed

Swing Trade Ideas for your consideration and watchlist: WF, BLDR, AG, BB, WPM, FANG, PFE, MARA, GM, RIOT. 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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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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