The bulls took charge from the start on Monday as markets gapped higher at the open and followed-through for the first hour. However, that was the end of the movement for the day as stocks ground sideways in a tight range the remainder of the day, but ended on a slight pullback in the range. This left us with gap-up candles in all 3 major indices, with the DIA failing to break out of the highs of the last couple weeks. On the day, SPY gained 1.02%, DIA gained 0.56%, and QQQ gained 1.68%. The VXX fell over 4% to 37.73 and T2122 inched closer to the overbought territory at 76.81. 10-year bond yields fell significantly to 1.603% and Oil (WTI) spiked 3.81% to $66/barrel.
Big tech led the way Monday as AMAT, TSLA, and NVDA each gained over four percent. However, the FATMAG stocks all did well with FB and GOOG both gaining over 2.6%, AMZN and AAPL both gaining over 1.3%, and MSFT gained 2.29% on the day. For its part, Bitcoin had another volatile day after dropping below $32,000 on Sunday night, it rebounded 20% Monday after Elon Must tweeted that he had been talking to Bitcoin miners and that they committed to coming up with planned renewable energy plans which he found potentially promising. Also aiding the surge was a JPM bullish call for the stock of the main crypto exchange COIN.
In business news, CNBC reported late Monday that AMZN is very near a deal to buy MGM for between $8 and $9 billion. The deal would add to the AMZN Video content catalog and increase the company’s ability to compete against NFLX, DIS, and the newly merged WarnerMedia and DISCA. Elsewhere, after hours, Bloomberg reported that SQ will soon offer checking and savings accounts in addition to its current merchant (card processing) services. This will add another competitor to the bank space now dominated by JPM, BAC, WFC, C, and USB.
Related to the virus, new US infections continue to fall. The totals rose to 33,922,937 confirmed cases and deaths are now at 604,416. Still, the number of new cases is falling again and is back down to an average of 25,189 new cases per day (the lowest number since June). Deaths are still falling more slowly, but are now down to 543 per day (the lowest number since July 2020). The TSA reported on Monday that air travel was nearly back to 2019 number last weekend with 1.8 million people flying versus a 2019 number of 2.1 million for the same weekend. PFE announced that the first shots of its proposed booster (which combines the covid vaccine with a streptococcus vaccine) were administered as its trial of 6-month post “full vaccination” has begun.
Globally, the numbers rose to 168,032,095 confirmed cases and the confirmed deaths are now at 3,488,576 deaths. The trends are better again as we have seen a slowing in the rate of increase now that India has passed its peaked. The world’s average new cases are falling quickly, but remain at 581,560 new cases per day. Mortality, which lags, is also falling but remains at 11,864 new deaths per day. The Summer Olympics took another hit on Monday as the US added Japan to its “Do not travel” travel advisory list. Meanwhile, Taiwan (the world’s largest exporter of microchips, including TSM) has extended it’s national lockdown by at least 3 more weeks. Since these measures prohibit any gatherings of more than 5 people and require masking at all times, it is reportedly impacting business operations.
Overnight, Asian markets were almost exclusively in the green. New Zealand (-0.87%) was the lone red, with Shanghai (+2.40%), Shenzhen (+2.34%), Hong Kong (+1.75%), and Taiwan (+1.58%) leading the bullish surge. In Europe, markets are slightly more mixed, but remain mostly in the green so far today. The 3 major exchanges FTSE (-0.08%), DAX (+0.74%), and CAC (+0.09%) set the tone as usual, with smaller exchanges tending to slightly larger moves. As f 7:30 am, US Futures are pointing to another positive open. The DIA is implying a +0.26% open, the SPY implying a +0.30% open, and the QQQ implying a +0.43% open.
The major economic news scheduled for Tuesday is limited to Conf. Board Consumer Confidence, April New Home Sales, and a Fed speaker (Quarles) (all at 10 am). Major earnings reports before the open include AZO, CBRL, DY, ESLT, and VSAT. Then after the close, A, INTU, JWN, TOL, and URBN report.
CNBC reports that part of the cryptocurrency's extreme volatility of late has been caused by large traders using 100-to-1 leverage. This has caused 20% to 30% swings in a day. However, so far this morning, the price of Bitcoin has stabilized. In stocks, the bulls seem to have the premarket momentum again today. However, with no new revelations driving the move, it remains a case of reopening expansion enthusiasm versus fear that overheating will cause the Fed to pump the breaks. As we approach the all-time highs again, there is still resistance overhead. Still, the short-term and long-term trends remain bullish although we seem to be later in the cycle.
Stick with the trend and respect support and resistance levels (but don't just assume they will hold). As always, keep locking in profits when you achieve your trade goals and maintain discipline by following your trading rules. Consistency is the key to long-term trading success. So, keep hitting singles and doubles rather than swinging for the fence.
Swing Trade Ideas for your consideration and watchlist: No trade ideas 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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