Markets closed out the week on a positive note.  SPY opened flat, DIA opened 0.14% higher, and QQQ opened down 0.10%.  From there, SPY and QQQ spend the day meandering sideways in a roller coaster of waves.  SPY spent almost the entire day on the positive side while QQQ wandered back-and-forth across its opening gap.  For its part, DIA rallied sharply the first 20 minutes, but then spent the rest of the day in a slow meander with a slight bullish trend.  This action gave us white-bodied candles in all three major index ETFs.  SPY printed a white candle with tiny wicks on each end.  At the same time, DIA printed a gap-up, larger white-bodied candle with tiny wicks on each end. Finally, QQQ gave us a white-bodied Spinning Top candle that retested its T-line (8ema) and passed the test.  This happened on well-above average volume in DIA as well as well-below average volume in SPY and QQQ.

On the day, nine of the 10 of the sectors were in the green as Industrials (+1.32%) led the way higher for the second day in a row.  This time, Utilities (-0.06%) was the only sector in the red and laggard.  Meanwhile, SPY gained 0.31%, DIA gained 0.95%, and QQQ gained 0.16%.  VXX dropped almost 4% to close at 45.76 and T2122 climbed even higher into the top of its overbought territory to close at 95.24.  At the same time, 10-Year bond yields fell slightly to 4.414% while Oil (WTI) popped another 1.65% to close at $71.24 per barrel.   So, Friday was basically a meander day where all three major index ETFs were bullish, but not decisively in rally mode. 

The major economic news scheduled for Friday included Preliminary November S&P Global Mfg. PMI, which met expectations at 48.4 (in-line with the 48.8 forecast and up just a bit from October’s 48.5 reading).  On the services side, Preliminary November S&P Global Services PMI was higher than expected at 57.0 (versus a 55.2 forecast and October’s 55.0 value).  Combined, this gave us a Preliminary November S&P Global Composite PMI of 55.3 (compared to October’s 54.1 number).  Later, Michigan Consumer Sentiment missed expectations at 71.8 (versus a forecast of 73.7 but up from the October 70.5 reading).  In terms of expectations, the Michigan Consumer Expectations were also lower than predicted at 76.9 (compared to a forecast of 78.5 but, again, up from October’s 74.1 value). Looking forward, the Michigan Consumer 1-Year Inflation Expectations were down a tick to 2.6% (in-line with a 2.6% forecast and down one tick from October’s 2.7% expectation).  Looking further out, the Michigan Consumer 5-Year Inflation Expectations were up and higher than anticipated at 3.2% (compared to a 3.1% forecast and October’s 3.0% reading).

Overnight, Asian markets were mixed, but leaned toward the green side.  India (+1.32%), South Korea (+1.32%), and Japan (+1.30%) led the seven gainers.  On the other side, Hong Kong (-0.41%) and Singapore (-0.39%) were the main losers among the five exchanges in red.  In Europe, the bourses are mostly green at midday with just three of the 14 in the red.  The CAC (+0.02%), DAX (+0.23%), and FTSE (+0.16%) lead the region higher in early afternoon trade.  In the US, as of 6:45 a.m., Futures are pointing toward a gap higher to start the week.  The DIA implies a +0.71% open, the SPY is implying a +0.53% open, and the QQQ implies a +0.59% open at this hour.  At the same time, 10-Year bond yields are down to 4.353% and Oil (WTI) is off by a third of a percent to $71.03 per barrel in early trading.

There is no major economic news scheduled for Monday. The major earnings reports scheduled for before the open are limited to BBWI.  Then, after the close, A, CENT, FLNC, SUPV, TBBB. WWD, and Z report. 

In economic news later this week, on Tuesday, we get November Conference Board Consumer Confidence, October New Home Sales, November FOMC Meeting Minutes, and the API Weekly Crude Oil Stocks report.  Then Wednesday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Preliminary Oct. Core Durable Goods Orders, Preliminary Oct. Durable Goods Orders, Preliminary Q3 GDP, Preliminary Q3 GDP Price Index, Preliminary Oct. Goods Trade Balance, Preliminary Oct. Retail Inventories, October Core PCE Price Index, October PCE Price Index, October Pending Home Sales, October Personal Spending, and Weekly EIA Crude Oil Inventories.  On Thursday, markets are closed for the Thanksgiving holiday.  Finally, on Friday we get Chicago PMI and markets close early at 1 p.m. for additional holiday time off.

In terms of earnings reports later this week, on Tuesday, we hear from ANF, ADI, BBY, BURL, DKS, HTHT, SJM, KSS, M, TITN, ADSK, CRWD, DELL, GES, HPQ, YY, JWN, NTNX, URBN, and WDAY. There are no reports of note Wednesday.  Again, Thursday there are no notable reports scheduled.  Finally, on Friday, MNSO reports.

So far this morning, BBWI reported beats on both the revenue and earnings lines.

With that background, it looks like the Bulls are in charge early in the premarket.  All three major index ETFs gapped higher and have followed through with small, white-body candles early in that premarket.  It is worth noting that DIA sits at a new all-time high in the early session.  All three are above their T-line (8ema). So, the short-term trend is now bullish.  Looking further out, the mid-term and longer-term trends also remain bullish.  In terms of extension, none of the major index ETFs are stretched from their T-lines, but the T2122 indicator is now back in the top end of overbought territory. So, the Bears may have a little more slack to work with today, but there is still room to run higher if the bulls find traction.  In terms of the 10 Big Dogs, nine of the 10 are in the green at this point of the early session morning.  TSLA (+2.05%) is leading the way higher while INTC (-0.29%) is the only big dog in the red at this point.  TSLA is also leading in terms of dollar-volume traded, sitting at 1.5 times as much traded than NVDA (+0.04%), which itself has traded 4.5 times as much as the next premarket volume leader.

As always, be deliberate and disciplined…but don’t be stubborn. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the Man in the Green Bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby, it’s a job. The gains are real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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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