Infrastructure Plan On Tap Today

The indecisive chop continued Tuesday with a modest gap-down in the large-caps and a half percent gap-down in the QQQ.  After that, all three traded in a volatile range the remainder of the day.  It is worth noting that the markets did see a last-minute rally (most likely on the clearance of dark pool trades).  All 3 major indices were indecisive, printing Doji candles, but the downtrend remains in tact across those indices.  On the day, SPY lost 0.27%, DIA lost 0.25%, and QQQ lost 0.50%.  The VXX fell over 4% to 11.49 and T2122 remains in the mid-range at 52.54.  10-year bond yields backed off from overnight 14-month highs to close at 1.71% and Oil (WTI) fell almost 2% to $60.45/barrel.

After hours, it was announced that President Biden will lay out his infrastructure and economic plans on Wednesday.  As previously noted, the plan separates the health and child care portions of the Administration’s domestic policy.  So, it will focus on roads, bridges, railways, and waterways. However, it will also include modest "green" energy infrastructure proposals and probably most important for market sentiment, the tax proposals to pay for the plan.  This is expected to include an increase in corporate tax rates from 21% to 27%.

Also, after hours, the AMZN warehouse union vote in Alabama has now ended.  The National Labor Relations Board has begun reviewing the eligibility of the 5,800 votes and ballot counting is expected to begin early next week and last a few days.  Still, ballot objections, procedural, and legal challenges and are expected to last quite some time before a decision on the outcome of the vote is known. 

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 31,097,154 confirmed cases and deaths are now at 564,138.  The number of new cases has jumped higher again to an average of 65,012 new cases per day.  However, new deaths are mostly flat at 977 per day.  The CDC reported after the close that nearly 50% of US seniors are fully vaccinated now.  AR finally joined the rest of the nation and now all 50 states have announced schedules to open vaccinations to all adults.  However, at the same moment AR Gov. Hutchinson also lifted the statewide mask mandate.  Finally, early today PFE announced that its vaccine is 100% effective and well tolerated in kids 12-15 years of age.

Globally, the numbers rose to 128,932,176 confirmed cases and the confirmed deaths are now at 2,818,762 deaths.  The trends have reversed and are now trending toward trouble again as we saw a significant uptick today.  The world’s average new cases are rising again (about 10,000 per day) and are now at 564,934 per day.  Mortality, which lags, also ticked up, now at 9,790 new deaths per day.  Germany limited the AZN vaccine to people over the age of 60 on Tuesday over blood clot fears. New cases and hospitalizations are rising again in CA, leading to the Ontario Premier to tell people “don’t make plans for Easter.”

Overnight, Asian markets were nearly red across the board.  Malaysia (-2.22%), Indonesia (-1.42%), and India (-1.04%) led the losses, but all the major exchanges were also down just less than a percent.  The only exceptions were Australia (+0.78%) and New Zealand (+0.92%).  In Europe, we are seeing much more of a mixed bag so far today.  At this point, the majority of exchanges are modestly red or modestly green.  The exceptions are Denmark (+1.99%) and Spain (+1.59%).  However, FTSE (-0.22%), DAX (-0.02%), and DAD (-0.24%) are more typical.  As of 7:30 am, US Futures are pointing to a mixed, but modestly green open.  The large-caps are flat with the DIA implying a -0.10% open and the SPY implying a +0.07% open.  However, the QQQ is showing modest gains, implying a +0.56% open.

The major economic news scheduled for Wednesday is limited to ADP Nonfarm Employment (8:15 am), Chicago PMI (9:45 am), Feb. Pending Home Sales (10 am), and Crude Oil Inventories (10:30 am).  Major earnings reports for the day are limited to AYI and WBA before the open.  Then after the close, GES and MU report.

It was also reported that a slight drop in mortgage rates for the week did nothing to reverse the downtrend in financing activity, which will bleed through to banks and housing names. While there is not a lot of other economic data scheduled for today, the new infrastructure plan (and its payment mechanisms) announcement may have markets waiting on more direction. So, beware of volatility.

If you are trading in this choppy market, be sure to follow your rules, follow the market trend, respect both support and resistance, and don't chase the moves you missed. Consistency is the key to long-term trading success, not hitting massive winners once in a while. So, keep taking trade goals (profits) off the table when you can, stick to your rules, and maintain that discipline.

Ed

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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