More Trade Wars and Fear

The bears controlled markets all day Monday (on the back of another Presidential tweet, as well as bad Mfg. PMI data).  As a result, we got the biggest down day in almost two months.  The SPY lost 0.85%, the DIA was down 0.98% and the QQQ lost 1.02%.  As you’d expect, the VXX rose 5.2%, but only to a still-low level of 17.  T2122 has fallen back to the edge of the oversold area at 19.38.  However, remember the market can remain oversold longer than we can stay solvent predicting a turn.

The big news for markets Tuesday will be Protectionism and Trade Wars.  After the close, the US administration threatened to put 100% tariffs on French products in response to French taxes on digital services.  (President Trump also attacked French President Macron verbally at the NATO summit.) The administration said it is also exploring doing the same to Austria, Italy, and Turkey for the same reason. 

This threatening and tariffs is a theme with the current administration and follows on the heels of the Sunday night tweet-based new tariffs on Argentina and Brazil steel and Aluminum.  Then this morning, the President announced that “it may be better” to wait until after the 2020 election to make a trade deal with China. (Partially acknowledging the reality that China is not in a particular hurry, he is not the one holding all the cards, and he is not going to dictate to another major economic power.) 

Favorite Charting Software

Futures took this trade war rhetoric badly and markets are likely to react all day. This is because there is no major economic news planned for Tuesday.  In addition, there are no major earnings reports before the open.  (CRM and WDAY both report after the close.)

Overnight, Asian markets were all in the red (except Shanghai).  In Europe, the major markets are mixed at this point.  As of 7:30 am, U.S. futures are all pointing to a gap down of about half a percent.

$50.00 discount with code: Privilege

So, trade/tariff fears are likely to drive markets in the absence of other news.  However, early Cyber Monday results may well add momentum one way or the other.  Regardless, the bulls have been very resilient for the last couple of months.  So, don’t get too carried away if markets are soft again Tuesday.    

Just remember that we are swing traders.  By definition, we need down-swings to set up an up-swing.  So, continue to look for the next opportunity setting up, lock-in profits, and trade your plan.  Remember that your job is to be prepared, make consistent gains and reduce risk, not to hit home runs every once in a while.

Ed

Swing Trade Ideas for your watchlist and consideration. VXX, FAZ, SPXU, Z, KR, CPB, JBHT, LEN, KLAC. Trade smart, take profits along the way and trade your plan. Also, do not forget to check for upcoming earnings. Stocks we mention and talk about are not recommendations to buy or sell.

SMS text alerts and reminders?👈

Check out our newest YouTube videos👈

🎯 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.

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.

Free YouTube Education  •  Subscription PlansPrivate 2-Hour Coaching

DISCLAIMER: Investing / Trading involves significant financial risk and is not suitable for everyone. No communication from Hit and Run Candlesticks Inc, its affiliates or representatives is not financial or trading advice. All information provided by Hit and Run Candlesticks Inc, its affiliates and representatives are intended for educational purposes only. You are advised to test any new trading approach before implementing it.  Past performance does not guarantee future results.  Terms of Service

Comments are closed.

click/touch to navigate
Skip to toolbar