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Great Earnings Galore But Futures Down

April 30, 2021 by Ed Carter

Markets gapped higher Thursday on the prior night’s earnings beats from AAPL and FB. Stocks the proceeded to fade the gap and spent the rest of the day working back toward to gap open. This left us with Hanging Man candles in all 3 major indices (white body on DIA and the other two black bodies). However, the SPY was at another all-time high close. On the day, SPY gained 0.62%, DIA gained 0.66%, and QQQ gained 0.36%. The VXX was essentially flat at 38.58 and T2122 fell ever so slightly to 91.05. 10-year bond yields rose to 1.636% and Oil (WTI) rose 1.69% to $64.92/barrel. Copper also reached a 10-year high.

After the close AMZN continued the trend for big tech by smashing expectations with a 44% sales increase for the quarter and earnings that beat estimates by 65% ($15.79 vs $9.54 est. per share). The online retail giant also said they forecast no fall-off in the pandemic-driven surge in sales. However, while TWTR did post slight beats on both lines, they rained on the parade somewhat by posting a miss on user numbers and lower than hoped forward guidance as well as not beating as big as the other big tech names.

Early Friday, the executive arm of the EU opened a new antitrust investigation of the AAPL App Store. This one is based on music platform SPOT complaining about the AAPL license agreements. The EU announced that “the mandatory use of Apple’s own in-app purchase mechanism for apps distributed through the store likely violates EU antitrust regulations.” This adds to AAPL’s antitrust problems with Epic Games having filed suit on the same grounds in the US.

Globally, the numbers rose to 151,240,576 confirmed cases and the confirmed deaths are now at 3,182,092 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is now at the all-time peak and with 829,052 new cases per day. Mortality, which lags, is also rising sharply again at 13,448 new deaths per day. France announced a 4-step process to end its lockdown with the first step starting on May 19 with a goal of the final lifting happening June 30. Japan reported its highest number of new cases since January as the country tries to prepare for the delayed Olympic games. Following in the steps of PFE, MRNA president said patients using their vaccine will also likely need a booster 9-12mo after completing the second dose. However, in more hopeful news, in India, the first shipments of foreign oxygen-related aid have arrived.

Overnight, Asian markets were red across the board. Hong Kong (-1.97%) and India (-1.77%) paced the losses. The same story seems to be taking shape in Europe so far today. Moves are generally modest, with the smallest moves coming from two of the big 3 exchanges with the FTSE (-0.17%) and DAX (+0.04%), which is the only green on the continent. The CAC (-0.35%) is closer to typical of all the other exchanges. As of 7:30am, US Futures are also pointing to a gap lower. The DIA is implying a -0.49% open, the SPY implying a -0.59% open, and the QQQ implying a -0.75% gap-down open.

The major economic news scheduled for Friday includes Mar. PCE Price Index, Q1 Employment Cost Index, and Mar. Personal Spending (all at 8:30 am), Chicago PMI (9:45 am), and Michigan Consumer Sentiment (10 am). Major earnings reports on the day include ABBV, ALXN, AON, AZN, AVNT, CRI, CHTR, CVX, CLX, CL, XOM, FNMA, GT, HRC, HUN, ITW, IMO, JELD, JCI, LHX, LAZ, LYB, NWL, PSX, PBI, POR, QSR, GWW, and before the open. Then after the close, WES reports.

Despite continued blowout earnings reports from the massive FAANG names, markets seem poised to follow the rest of the world lower on Friday. Maybe this is related to the month-end or weekend news cycle that both are nearly at hand. Regardless, this just reinforces the bulls have had breaking through the recent highs and running free. Yet, the bears still have no shock or major story to hand their hats on. With blowout earnings and increasing forecasts, future inflation seems to be their storyline…and history shows markets rising in infationary times. So, for now, the bears best case would seem to be for a pullback.

Respect those potential support and resistance levels, but don’t just assume they will hold either. Predicting is a sucker’s game. So, stick with the trend, but also avoid chasing trades you have missed and be nimble. Lock in your profits when you achieve your trade goals and maintain your discipline by following those trading rules. Don’t let your emotions get the better of you. Consistency is the key to long-term trading success.

Swing Trade Ideas for your consideration and watchlist: PM, XLE, AAPL, JPM, MDLZ, JNPR, AA. 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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Bulls Get Big Tech Tailwind Ahead of GDP

April 29, 2021 by Ed Carter

Markets basically treaded water all day in a tight range. There was a little volatility around the time of the Fed announcement but that quickly faded back to where it was beforehand. It seems like traders were more concerned about the post-market AAPL and FB reports than the foregone conclusion that the Fed would not change rates or their stance. The SPY closed as a Doji again very near all-time highs with the DIA and QQQ putting in small black candles. On the say, SPY gained 0.01%, DIA lost 0.39%, and QQQ lost 0.34%. The VXX was also flat at 38.88 and T2122 remains well into the overbought territory at 92.07. 10-year bond yields fell to 1.611% and Oil (WTI) rose 1.3% to $63.76/barrel.

After the close, FB beat on both the top and bottom line with a 48% rise in revenue but slightly fewer active users than expected. AAPL also announced another blowout quarter with a 54% increase in sales, a 42% profit margin, and in addition authorized a $90 billion share buyback plan. QCOM and F also both announced beats, with QCOM raising guidance on strong smartphone demand. However, F said the global chip shortage and a fire at a Japanese chip supplier will reduce the carmaker’s Q2 production by 50% and also expects that shortage to reduce earnings for the year by about $2.5 billion.

During the afternoon, the Fed raised their outlook for the economy and said inflation will pick up, but they remain unconcerned. However, they did not change rates, reiterated they have no plans to do so and said they will also not stop bond purchases at this time. In the evening, the President spoke before Congress, calling for passage of the Infrastructure plan and unveiling a new $1.8 trillion plan aimed at families, children and students. While neither is likely to pass as proposed, there is no way to look at trillions of dollars of spending that doesn’t consider it fiscal stimulus.

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,983,695 confirmed cases and deaths are now at 588,337. The number of new cases has ticked lower again and are back down below the peak level from last summer to an average of 55,773 new cases per day. The same is true of deaths, which are trending down again, now at 727 per day. In an ominous sign, many parts of the country are now in an urgent rush to find patients for the vaccine they have to deliver. This has been true across the South for some time, but Philadelphia had to plead for patients Wednesday to avoid throwing away unused PFE vaccine and in Detroit the city has resorted to going door-to-door trying to get vaccine used before it expires. That “two alternate universes” point of reference seems as strong as ever (regardless of which one you reside in).

Globally, the numbers rose to 150,341,231 confirmed cases and the confirmed deaths are now at 3,166,947 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is now at the all-time peak and with 827,154 new cases per day. Mortality, which lags, is also rising sharply again at 13,200 new deaths per day. Turkey is starting a national lockdown today amidst a spike in infection rates. In the Philippines, Manilla extended their lockdown through mid-May. However, India remains the center of the pandemic storm with an eighth straight day of over 300,000 reported new cases…reported being the key word. Testing positivity rates are suggesting India may have over 500 million cases at the moment with the majority of hospitals in the country turning away patients for a lack of oxygen, beds, and medical staff.

Overnight, Asian markets were mostly green with South Korea (-0.23%) being the only red on the board. Hong Kong (+0.80%) and Thailand (+0.87%) led the gains on modest moves. In Europe, a similar situation is taking shape. Only the DAX (-0.50%) is in the red with the FTSE (+0.68%) and CAC (+0.43%) being more typical of the continent. As of 7:30 am, US Futures are pointing to a gap higher at the open. The DIA is implying a +0.37% open, the SPY implying a +0.68% open, and the QQQ implying a +1.04% gap higher at this point.

The major economic news scheduled for Thursday includes Q1 GDP and Weekly Jobless Claims (both at 8:30 am), Mar. Pending Home Sales (10 am), and 2 Fed speakers (Quarles at 11 am and Williams at 2 pm). Major earnings reports on the day include AOS, AGCO, ATI, ADS, AB, MO, AMT, AIT, BAX, BCE, BGCP, BLMN, BMY, BC, CG, CARR, CAT, CBRE, CHD, CTXS, CMS, CFX, CMCSA, COWN, DISH, DPZ, ERJ, EME, EEFT, FMX, FMCC, FCN, GNRC, GPI, HSY, ICE, IP, JHG, KBR, KDP, KHC, LH, LKQ, MDC, MMP, MKL, MA, MCD, MRK, MDP, TIGO, TAP, COOP, NEM, NOK, NOC, NVT, PH, PATK, PBF, PCG, PPC, PRG, RLGY, SPGI, SPGI, SNDR, SAH, SO, STM, SYNH, TROW, TMHC, TFX, TPX, TXT, TMO, VC, WAB, WST, WLTW, and XEL before the open. Then after the close, ACHC, AMZN, ATR, AJC, TEAM, BZH, BIO, BKCC, COLM, DVA, DLR, EMN, ENSG, ERIE, FSLR, FTNT, FTV, FBHS, GILD, GFF, THG, KMPR, KLAC, LPLA, MHK, NIO, RMD, SKYW, SWKS, SWN, TEX, TXRH, TWTR, X, VRTX, WDC, and INT report.

The flood of blowout results, and more suggested spending are giving the bulls a tailwind so far today. However, the GDP number may raise the fear of inflation later this morning. So, beware of volatility, but stay on the right side of the trend. There has been a ton of good news for bulls lately, even if markets remain extremely high (frothy to use Chair Powell’s word). There certainly has not been a shock or strong case for the bears lately for anything but a pullback at best.

As I’ve said before, predicting reversals is a game that few traders play successfully…and none of them do it successfully for long. So, stick with the trend, but also avoid chasing trades you have missed. Respect those potential support and resistance levels, but that doesn’t mean assuming they will hold. Just lock in your profits or be prepared to watch closely at those levels. As always, keep taking your goals off the table when you achieve them and maintain your discipline by following those trading rules. Don’t let your emotions get the better of you. Consistency is the key to long-term trading success.

Swing Trade Ideas for your consideration and watchlist: SENS, TLRY, RIDE, NKLA, QS, CRSP, SLV, NUE, VIAC, XLE, AI. 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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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 Plans • Private 2-Hour Coaching

Abundant Earnings and Fed News Today

April 28, 2021 by Ed Carter

Markets put in another flat small-range day on Tuesday with both large-dap indices printing Doji-like candles. However, that also means stocks remain very near the all-time highs as traders wait on direction from the flood of earnings and the Fed meeting on Wednesday. On the day, SPY lost 0.02%, DIA lost 0.01%, and QQQ lost 0.43%. The VXX also fell 2% to #9.01 and while it backed off a bit, T2122 remains well into the overbought territory at 88.46. 10-year bond yields jumped once again to 1.629% and Oil (WTI) also rose 2% to $63.22/barrel.

After the close, both MSFT and GOOG reported blowout quarters, beating estimates on both lines. MSFT reported the highest revenue growth since 2018 while GOOG reported revenue growth of 34% and also announced a new $50 billion stock buy-back plan. SBUX also reported same-store sales growth back at pre-pandemic levels as it raised its 2021 forecast and reported an earnings beat. The news was not all good for GOOG as two Senators (bi-partisan) on the anti-trust committee demanded information about a call GOOG had held with MTCH executives prior to the MTCH executives testifying (the letter reports GOOG may have attempted to influence another witness’ testimony).

In other stock news, AAPL has now implemented their default blocking of third-party tracking cookies on their devices. Given a reported extremely low adoption rate of “cohort tracking” alternatives, this means only AAPL and GOOG are now the only ones able to offer advertisers the deep tracking consumer data they covet. FB had obviously opposed the AAPL move since it has a huge customer-base it wanted data on to sell to advertisers. However, FB did announce an alternative way of targeting consumers on Tuesday when it introduced new Instagram features designed to match content makers serving specific audiences with specific advertisers. It’s unclear if this will suffice for advertisers or if FB ad revenue will suffer greatly.

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,927,091 confirmed cases and deaths are now at 587,384. The number of new cases has ticked lower again and are back down below the peak level from last summer to an average of 57,024 new cases per day. The same is true of deaths, which are trending down again, now at 722 per day. The CDC announced new masking guidelines on Tuesday, saying the fully vaccinated people can now hold small outdoor gatherings without masks. President Biden noted that 80% of seniors have had at least one shot, but more importantly, over two-thirds of them are fully vaccinated.

Globally, the numbers rose to 149,436,366 confirmed cases and the confirmed deaths are now at 3,151,717 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is now at the all-time peak and with 826,297 new cases per day. Mortality, which lags, is also rising sharply again at 13,028 new deaths per day. India has reported current testing is showing a 50% positivity rate. If this held for the whole population, this could mean as many as 600 million infected people. Regardless of the number, what is known is that the Indian hospital system has collapsed under the flood, turning away hundreds of patients a day in one city alone, with particular shortages of oxygen and breathing apparatuses. In the same region, Pakistan also recorded its highest number of daily deaths and Sri Lanka went into national lockdown amidst another record number of cases.

Overnight, Asian markets were mixed, leaning toward the green on mostly modest moves. South Korea (-1.09%) was the outlier with Shanghai (+0.42%), Hong Kong (+0.45%), and Australia (+0.44%) more typical. In Europe, markets were also leaning to the green side as the FTSE (+0.57%), DAX (+0.41%), and CAC (+0.64%) lead the way at mid-day. As of 7:30 am, US Futures are pointing to a flat open. The DIA is implying a -0.11% open, the SPY implying a +0.08% open, and the QQQ implying a -0.09% open at this hour, with a flood of earnings reports being mulled or still to come.

The major economic news scheduled for Wednesday includes Mar. Trade Balance and Mar. Retail Inventories (both at 8:30 am), Crude Oil Inventories (10:30 am), the FOMC Interest Rate Decision (2 pm), Fed Chair Press Conf. (2:30 pm), and President Biden will address a joint session of Congress (9 pm). Major earnings reports on the day include AER, APH, ADP, AVY, BA, BSX, BCO, EAT, GIG, CME, CSTM, DAN, DISCA, ETR, EVR, GRMN, GD, HES, HUM, IEX, IPG, MAS, MLCO, MCO, NSC, OSK, OC, PAG, BPOP, PPD, ROK, ROL, R, SNY, SC, SHOP, SLGN, SIRI, SPOT, SWK, TECK, TDY, TEVA, TKR, TNL, VRT, and YUM all report before the open. Then after the close, AFL, ALGN, ALSN, ATUS, AMED, NLY, AR, AAPL, ASGN, ASH, AVB, AVTR, AVT, AXS, BHE, CCS, CHX, CAKE, SMPR, CINF, CNO, FIX, CYH, CLR, EBAY, ECHO, ESI, EQIX, FB, F, GRUB, HOLX, IR, LOGI, MHO, MTH, MEOH, MGM, MOH, MUSA, MYRG, ORLY, OI, OPK, OVV, PSA, QCOM, RJF, RNR, SIGI, NOW, TTEK, TROX, TTMI, URI, VVV, WCN, WELL, and WERN report.

Another boatload of earnings and the Fed announcement are likely to inform market moves on Wednesday. So, we may well have another “wait and see” day of trading until at least mid-afternoon. Beware of volatility as we’ve seen chop recently. While the bulls still have the trend in their favor, they are struggling to break resistance the last few days.

Predicting reversals is a game damn few traders play successfully and none of them do it consistently for a long time. So, stick with the trend, but also avoid chasing trades you have missed. Respect support and resistance, but that does not mean assuming it will hold. Just lock in profits or be prepared to watch at those levels. As always, keep taking your goals off the table when you achieve them and maintain your discipline by following those trading rules. Don’t let your emotions get the better of you. Consistency is the key to long-term trading success.

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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 Plans • Private 2-Hour Coaching

Inflation Puts Fed in Focus As Meet Starts

April 27, 2021 by Ed Carter

Markets made a small gained on Monday in a tighter than average trading range. The large-caps printed indecisive candles with the QQQ being the most bullish of the bunch. On the day, SPY gained 0.20%, DIA lost 0.16%, and QQQ gained 0.66%. The VXX fell eight-tenths of a percent to 39.84 and T2122 remained well into overbought territory at 92.41. 10-year bond yields rose slightly to 1.567% and Oil (WTI) fell a third of a percent to $61.92.

Commodity prices are soaring with Corn futures hitting their highest price in at least 7 years Monday and Copper reaching a decade high. In unrelated news, Bloomberg reports oil refineries such as XOM, MRO, VLO, COP are now back to running at 2019 levels as they anticipate a normal summer demand curve and are stockpiling gasoline. In an interesting currency move, Russia sells more than half of its exports in Euro terms rather than in Dollar terms. This includes the bulk of their trade with China. This “de-dollarization” will definitely reduce the impacts of future US sanctions. However, the dollar still reigns supreme (ease of use) globally. So, full Russian conversion to a Euro-based export economy is not expected.

After the close, TSLA posted a beat on both the top and bottom lines. This includes a 74% increase in revenue from a year ago (but only beat by $100 million). LYFT also announced plans to sell its self-driving unit to Japanese carmaker Toyota for $550 million in cash (deal will also reduce LYFT operating expense by $100 million/year).

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,875,045 confirmed cases and deaths are now at 586,611. The number of new cases has ticked lower again and are back down below the peak level from last summer to an average of 58,300 new cases per day. The same is true of deaths, which are trending down again, now at 715 per day. The CDC announced Monday that the number of vaccinations done in the US fell for the second straight week, although 59% of Americans have received at least one shot. This is a major concern as the CDC reports surveys show over a quarter of Americans do not intend to get vaccinated and 73% of the unvaccinated would refuse the JNJ shot. Experts say herd immunity will require 70-85% of the population to be vaccinated. Still, Dr. Fauci (NIH) kept an upbeat outlook in his Monday press conference, saying we could reach a turning point in the pandemic within a few weeks…if we can maintain the recent rate of vaccinations.

Globally, the numbers rose to 148,581,460 confirmed cases and the confirmed deaths are now at 3,136,635 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is now at the all-time peak and with 824,434 new cases per day. Mortality, which lags, is also rising sharply again at 12,884 new deaths per day. The White House confirmed Monday that the country will share the (unapproved in the US) AZN vaccine stockpile with poorer countries. In other cooperation, many countries have offered oxygen and equipment to India, but much of it will arrive too late for the immediate crisis in New Delhi and Mumbai. Meanwhile, in Europe, the EU has filed a lawsuit against AZN for breaching its contract on deliveries. Finally, Turkey has announced its strictest lockdown to date, but put off the start until Thursday.

Overnight, Asian markets were mixed, but mostly red on modest moves. Malaysia (-1.03%), and Japan (-0.46%) led the losses while India (+1.16%) and Shenzhen (+0.23%) paced the gains. In Europe, we see a similar picture with only Denmark (+1.39%) showing appreciable gains while the FTSE (-0.13%), DAX (-0.32%), and CAC (-0.15%) are much more typical at this point in the day. In the US, as of 7:30 am, US Futures are pointing to an open on the green side of flat. The DIA is implying a +0.07% open, the SPY implying at +0.11% open, and the QQQ implying a +0.14% open at this hour.

The major economic news scheduled for Tuesday is limited to Conf. Board Consumer Confidence (10 am). Major earnings reports on the day include MMM, ABB, ADM, ABG, BP, CNC, GLW, CEQP, DTE, EBIX, ECL, LLY, ENTG, FSV, FISV, GE, GPK, HAS, HUBB, IVZ, JBLU, LECO, MMC, NVS, PCAR, PII, PHM, RTX, ROP, ST, SHW, SYF, TRU, UBS, UPS, AND WM before the open. Then after the close, AMD, GOOGL, AMGN, ACGL, BXP, BYD, CHRW, COF, CHE, CB, EIX, EQR, FFIV, GOOG, ILMN, JNPR, MATX, MXIM, MSFT, MDLZ, MRC, NCR, NOV, OLN, OKE, PFG, RXN, SBUX, SYK, FTI, TER, TX, TFII, V, and YUMC report.

A boatload of earnings and the beginning of the Fed meeting that starts today are likely to drive markets Tuesday. While there are more rumbling on taxes (this time on breaks proposed to be given to lower income Americans), that is just talking points now and not a likely market driver. So, while the bulls have the momentum, we have to watch the resistance above that seemed to put up a fight yesterday.

Stay on the right side of the trend, do not predict reversals, but also avoid chasing trades you have missed. Continue to respect support and resistance, but that does not mean assuming it will hold. (Just lock in profits or be prepared to watch at those levels.) As always, keep taking your goals off the table when you achieve them and maintain your discipline by following those trading rules. Don’t let your emotions run away with you. As we know, consistency is the key to long-term trading success.

Swing Trade Ideas for your consideration and watchlist: WKHS, TLRY, FCEL, CGC, SOLO, PLUG, NKLA, SKLZ. 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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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 Plans • Private 2-Hour Coaching

China Inflation and Infrastructure Turn

April 26, 2021 by Ed Carter

Markets opened mostly flat and then put in a steady rally almost all day. However, a selloff the last 15 minutes showed profit-taking to end the week. Nonetheless, all 3 major averages put in strong white candles and created potential Fig Newton type patterns. On the day, SPY gained 1.08%, DIA gained 0.68%, and QQQ gained 1.26%. The VXX started with a 1-for-4 split to open at 41.36, but then sold off almost 4% to close at 40.17 and T2122 rose deeper into the overbought territory at 95.67. 10-year bond yield closed up slightly to 1.56% and Oil (WTI) gained 1% to $62.04/barrel.

US Markets may see China as a forerunner of what is to come in the US. That country has reported record growth in the 1^st quarter with a strong recovery underway. However, Sunday night Bloomberg also reported Chinese April factory inflation is running far ahead of analyst expectations based on surveys of 500 Chinese small and medium-sized enterprises. If US markets see that as an indication of the future for the US, the bulls may have a tough row to hoe.

Speaking of potential causes of future inflation, there was a twist in the Infrastructure plan plot on Sunday. Key Democratic Senator (a party rebel) Manchin praised the GOP $568 billion “counter-proposal” to the Democratic $2.25 trillion plan. However, on the same day, Republican Senator Graham told Fox News that GOP Senators were ready to back as much as $900 billion in a stimulus package. This could be additional evidence that some infrastructure improvement plan will get passed this time.

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,824,389 confirmed cases and deaths are now at 586,152. The number of new cases has ticked higher again and are back above the peak of last summer to an average of 57,208 new cases per day. However, deaths are just starting to plateau again, now at 724 per day. After the close Friday, the CDC lifted the pause on JNJ vaccine use, which will help with shortages. However, a drop in vaccine demand had already become more than a bit concerning and could become the primary obstacle to herd immunity as early as May according to Dr. Fauci (NIH).

Globally, the numbers rose to 147,874,851 confirmed cases and the confirmed deaths are now at 3,124,681 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is now at the all-time peak and with 818,823 new cases per day. Mortality, which lags, is also rising sharply again at 12,742 new deaths per day. The situation is India has become dire as the country broken the global record for new cases for the 5^th straight day. The world has started mobilizing to send oxygen and other aid to that country. However, in Europe, the UK and the Netherlands have further eased restrictions.

Overnight, Asian markets were mixed. Taiwan (+1.57%) and South Korea (+0.99%) led gainers while Shanghai (-0.95%) and Shenzhen (-0.89%) passed the losses. In Europe, markets are mixed, but lean green in modest trading so far today. The FTSE (+0.14%), DAX (-0.07%), and CAC (+0.15%) are indicative of the continent. Only Greece (+1.69%) has moved more than a percent so far today. As of 7:40 am, US Futures are pointing to a mixed and relatively flat open. The DIA is implying a +0.10% open, the SPY implying a -0.09% open, and the QQQ implying a -0.36% open.

The major economic news scheduled for Monday is limited to Mar. Durable Goods Orders (8:30 am). Major earnings reports on the day include ACI, CHKP, LII, and OTIS before the open. Then after the close, AMP, AMKR, AXTA, BRO, CDNS, CNI, LU, MKSI, NXPI, OMF, PKG, RRC, SBAC, SSNC, TSLA, and UHS report.

Ahead of a big week of earnings, another Fed Meeting, and other major economic news, markets may be a little uncertain this week. The bulls have the longer-term momentum, but the last week was a choppy sideways slog. Looking at it more broadly, we are still very near the highs and still quite extended after the early April run. Fear remains very low, considering where we are and what we’ve seen the last week. So, trade accordingly.

Follow the trend, do not predict reversals, but also avoid chasing trades you have missed. Respect support and resistance. Keep taking your profits off the table when you can and maintain your discipline. Stay on the right side of the market trend and follow those trading rules. As we know, consistency is the key to long-term trading success.

Swing Trade Ideas for your consideration and watchlist: LAZR, VLDR, PLUG, FCEL, UAVS. 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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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 Plans • Private 2-Hour Coaching

Supreme Court Limits Watchdog Agencies

April 23, 2021 by Ed Carter

Markets opened flat on better than expected (lower) Weekly Jobless Claims. However, stocks spent the morning just on the res side of flat. Then about 1pm Bloomberg reported that President Biden is considering a capital gains tax hike on wealthy Americans. That led to an immediate selloff, reaching the lows of the day about 2pm. After that markets ground sideways again into the close. The led to Bearish Harami candles on all 3 major indices. On the day, SPY lost 0.91%, DIA lost 0.93%, and QQQ lost 1.21%. The VXX gained well over 6% to 10.47 and T2122 fell, but remains inside the overbought territory at 82.69. 10-year bond yields fell again to 1.543% and Oil (WTI) rose half a percent to $61.64/barrel.

The Bloomberg report said that the Biden proposal would raise Capital Gains tax to 43.4% for the wealthiest 0.03% of Americans with the rate being 39.6% for those earning more than $1 million per year. In other Washington news, the Senate GOP announced their own $568 billion Infrastructure plan to counter President Biden’s $2.3 trillion package. The plan came in a bit smaller than expected since GOP Senators have been talking with reporters about a $600-$800 billion plan in recent days. However, at least it is something since Senate Republicans have repeatedly killed infrastructure packages in the last couple of years. So, this announcement likely signals that some package will get passed this time. The obvious differences between the GOP and Democratic plans are that the Republic version does not contain money for elderly and disabled, manufacturing industry funds (“green” industries, research, and technology like chipmaking), affordable housing, and also includes about $70 billion less than the Democratic plan for the things that are covered.

In other news, the US Supreme Court has severely limited government agencies (FTC in the specific case) to extract economic relief for consumers or impose sanctions on businesses, even when fraudulent or monopolistic business practices are used. FB had filed a motion in favor of the eventual ruling saying the FTC has no power to force divestiture in its ongoing antitrust case related to their purchase of WhatsApp and Instagram despite findings of monopolistic actions. GOOG did not file in the case, but faces a similar FTC action related to their search and search advertising operations. The major telecom companies and ISPs also will benefit from this ruling.

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,669,121 confirmed cases and deaths are now at 584,226. The number of new cases has ticked higher again and are back above the peak of last summer to an average of 64,204 new cases per day. However, deaths are just starting to plateau again, now at 730 per day. Texas A&M University announced on Thursday that they have detected a new variant that shows signs of resistance to the mechanisms of existing vaccines. It also shows sign of being more contagious and causing more severe illness than the earlier variants. The rate of US vaccinations has also dropped with some states now having more supply of vaccine than demand for shots.

Globally, the numbers rose to 145,453,767 confirmed cases and the confirmed deaths are now at 3,088,267 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is now at the all-time peak and with 806,371 new cases per day. Mortality, which lags, is also rising sharply again at 12,196 new deaths per day. Pakistan called out its army to enforce restrictions and guidelines as the country has run low on oxygen supplies. Neighboring India is supplying hospitals with only two hours’ worth of oxygen at a time as supplies are still critical in the state containing New Delhi. In Germany, the government is pulling the “emergency brake” law and will lockdown most of the country again as of Saturday.

Overnight, Asian markets were mixed again, but leaned strongly to the green side. Taiwan (+1.19%) and Hong Kong (+1.12%) were the biggest gainers with Thailand (-0.93%) and Japan (-0.57%) leading the losses. However, in Europe, so far this morning markets are red across the board on modest moves. The FTSE (-0.52%), DAX (-0.38%), and CAC (-0.26%) are typical of the continent. As of 7:30 am, US Futures are pointing to an open on the green side of flat. The DIA is implying a +0.12% open, the SPY implying a +0.21% open, and the QQQ implying a +0.14% open at this point.

The major economic news scheduled for Friday includes Mfg. and Services PMI (both at 9:45 am) and Mar. New Home Sales (10 am). Major earnings reports on the day include AXP, ALV, HON, KMB, RF, and SLB before the open. There are no major earnings reports after the close.

The bears had their moment as the initial reaction to the Capital Gains tax for the extremely wealthy hit the news. However, the selloff was not dramatic in a broader sense and price remains right in the range of the slight pullback we have seen this week. So, looking at it more broadly, we are still very near the highs and only have seen a relief pullback. Certainly, no new trend has formed yet. Fear remains very low and the market is still extended, but bullish. So, trade accordingly..

Continue to fight the FOMO. Follow the trend, do not predict reversals, but also avoid chasing trades you have missed. Respect support and resistance. Keep taking your profits off the table when you can and maintain your discipline. Stay on the right side of the market trend and follow those trading rules. As we know, consistency is the key to long-term trading success.

Swing Trade Ideas for your consideration and watchlist: KKR, SKLZ, SLV, NKLA, VXX. 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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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 Plans • Private 2-Hour Coaching

PreMarket Waiting on Jobless Claims

April 22, 2021 by Ed Carter

Markets opened up just on the South side of flat and the bulls were in-charge the rest of the day on a slow, protracted rally that closed near the highs. This reversed the 2-day losing streak and left us with Bullish Engulfing candles in the SPY, DIA, and QQQ. On the day, the SPY and DIA both gained 0.92% and the QQQ gained 0.86%. The VXX fell over 5% to 9.84 and T2122 shot back up well into the overbought territory at 92.89. 10-year bond yields fell again to 1.554% and Oil (WTI) fell over 2.5% to $61.08/barrel.

In follow-up to the Archegos fund over-leverage collapse, Credit Suisse (one of the major lenders allowing Archegos to lever up) reported a $275 million loss for the quarter and expects to take another $650 million hit next quarter from the same event. In related news, the SEC has begun an investigation of US funds regarding leverage disclosures and both the House and Senate Banking Committees have begun research into large US banks that fund such derivative leverage. This will include testimony from the CEOs of JPM, BAC, C, WFC, GS, and MS in late May.

Commodity prices are spiking recently. Interestingly, not so much for commodity input prices. For example, raw wood (logs) have not gone up, but cut lumber prices have gone through the roof. Regardless, so far this earnings season, most of the major companies reporting have been saying they now have “pricing power.” (Meaning they feel public expectations are going to allow them to increase prices to improve profits in quarters to come.) This includes KO, PG, CLX, etc. CNBC had a couple of analysts on air last night saying they expect AMZN will also have that pricing power and is likely to raise prices to increase profit soon. If they do so, that trend will almost immediately be followed by WMT, TGT, and other retailers.

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,602,051 confirmed cases and deaths are now at 583,330. The number of new cases has ticked higher again and are back above the peak of last summer to an average of 65,239 new cases per day. However, deaths are just starting to plateau again, now at 736 per day. The White House announced that we have now exceeded 200 million vaccination jabs given accounting for more than 51.5% of adults having one jab. In fact, the CDC says 26% of the entire population is now fully vaccinated.

Globally, the numbers rose to 144,561,695 confirmed cases and the confirmed deaths are now at 3,074,781 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and are now at an all-time peak and with 799,520 new cases per day. Mortality, which lags, is also rising sharply again at 12,258 new deaths per day. India reported a new record number of cases (surpassing the worst day in the US) with nearly 315,000 new cases.

Overnight, Asian markets were mixed be mostly green. Japan (+2.38%) was an outlier to the upside, but most exchanges in the region reported modest gains. Exceptions included Thailand (-0.75%), Taiwan (-0.61%), and Shanghai (-0.23%). In Europe, so far today, with the exception of Russia just on the red side of flat, markets are green across the board. The FTSE (+0.07%) is flat, while the DAX (+0.44%) and CAC (+0.63%) are up as of mid-day. At 7:30 am, US Futures are pointing to an open on the red side of flat, albeit before the Weekly Jobless Claims are released.

The only major economic news scheduled for Thursday are those Weekly Jobless Claims (8:30 am) and Mar. Existing Home Sales (10 am). Major earnings reports on the day include ALK, ALLE, AAL, AEP, T, BIIB, BX, CLF, DHI, DHR, DOW, FAF, FCX, GPC, HCA, HBAN, IQV, NUE, ODFL, ORI, PNR, POOL, DGX, RS, SAP, SNA, SON, LUV, TAL, TSCO, TPH, UNP, VLO, and WSO all before the open. Then after the close, CSL, CE, FE, INTC, MAT, STX, AKX, SNAP, and SIVB report.

Even with the bulls stepping back into the market Wednesday, there has not been a lot of energy in markets this week. Markets are back to approaching the recent all-time highs and are extended again on a modest move. So, just as I warned of getting all-in on the short side yesterday, I think we need to be careful getting giddy on the long side today. Fear remains extremely low in an extended market. So, the risk of a more significant and abrupt relief pullback remains.

Remember, you don’t have to jump in or jump out. Maybe dipping a toe or starting small is a more reasonable approach to this market at this point. Fight the FOMO. Follow the trend, do not predict reversals, but also avoid chasing trades you have missed. Respect support and resistance. Keep taking your profits off the table when you can and maintain your discipline. Stay on the right side of the market trend and follow those trading rules. As we know, consistency is the key to long-term trading success.

Swing Trade Ideas for your consideration and watchlist: FSR, GLW, HPQ, LULU. 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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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 Plans • Private 2-Hour Coaching

NFLX Subscriber Miss = ReOpening Shift?

April 21, 2021 by Ed Carter

Markets gapped down slightly on Tuesday and then followed-through most of the morning before grinding sideways in a tight range the rest of the day. This left us with a black Spinning Top indecisive candle in all 3 major indices on a so-far mild pullback of just over one percent. On the day, SPY lost 0.70%, DIA lost 0.77%, and QQQ lost 0.73%. VXX gained two percent on the day to 10.40 and T2122 fell a bit to 44.30, still in the midrange. 10-year bond yields fell significantly again to 1.562% and Oil (WTI) dropped 1.2% to $62.61/barrel.

After hours, NFLX reported a huge miss on subscriber numbers for Q1, despite a 24% gain in revenue and a strong beat on earnings. AAL also announced plans to begin hiring pilots again as travel continues to pick up. These both may be bellwethers of a market shift into reopening plays. Earlier in the afternoon, AAPL said they will begin enforcing the iPhone privacy changes FB has been fighting as of next week. This morning, GS has upgraded NCLH on the expectation of a resumption in cruises later this year.

New mortgage demand jumped almost 9% as rates fell to almost a two-month low. This was the first increase in mortgage applications since February. Refinance applications jumped 10%, but remained 23% lower than one year ago.

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,536,470 confirmed cases and deaths are now at 582,456. The number of new cases has ticked higher again and are back above the peak of last summer to an average of 67,151 new cases per day. However, deaths are just starting to plateau again, now at 747 per day. All Americans 16 and older are eligible for vaccination as of Monday. In bad news for JNJ on the PR front, as both the CDC and CNBC reported that the company lied to the public when it claimed that the competing vaccines from PFE and MRNA also have caused clotting issues. JNJ cited a study from Brown University, the lead author of which told CNBC there was no such finding or any problems whatsoever were found for any vaccines other than the one from JNJ.

Globally, the numbers rose to 143,663,051 confirmed cases and the confirmed deaths are now at 3,060,651 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is very near the all-time peak and are now at 789,158 per day. Mortality, which lags, is also rising sharply again at 12,196 new deaths per day. The WHO announced that the world has had more cases this week than any previous week since the beginning of the pandemic. Nonetheless, the Netherlands announced easing restrictions on April 28. JNJ vaccine shipments will resume in the EU, Norway, and Iceland after completion of the European clotting investigation. Meanwhile, in India the situation is getting desperate as the country reported another new high number of cases, hospitals are over capacity and the state containing Mumbai reported at least 22 deaths of people waiting for oxygen as supplies have been depleted.

Overnight, Asian markets were nearly red across the board. The only green in the region was Shenzhen (+0.35%). However, Japan (-2.03%), Hong Kong (-1.76%), and South Korea (-1.52%) were more representative. In Europe, markets are mixed, but lean to the green side so far in the day. Russia (-1.02%) leads the losses, but the FTSE (+0.46%), DAX (+0.24%), and CAC (+0.71%) are more typical of the continent at mid-day. As of 7:30 am, US Futures are pointing to a flat open. The DIA is implying a +0.04% open, the SPY implying a +0.02% open, and the QQQ implying a -0.14% open.

The only major economic news scheduled for Wednesday is Crude Oil Inventories at 10:30 am. Major earnings reports on the day include ANTM, ASML, BKR, ERIC, FHN, HAL, KNX, LAD, NDAQ, NEE, NVR, RCI, TEL, and VZ before the open. Then after the close, CACI, CP, CMG, CCI, EFX, KMI, LRCX, LSTR, LVS, PLXS, RHI, RUSHA, SNBR, STC, UFPI, VMI, and WHR report.

Despite the mild (controlled?) pullback of the last two days, the bears do not seem to have overpowering momentum. This feels like a normal relief pullback in a rally. Certainly the market has been extended on its strong run since the tail-end of March. However, there is a possibile support level just below and if the uptrend has been broken, it was a tightly-drawn trendline for sure. And we definitely have not bult a downtrend (which requires lower highs and lower lows). So, unless you are sure we are now in a bear trend, you might think twice before getting all-in on the short side.

Remember, cash is a valid position. We don’t have to trade every day or week for that matter. Make sure we have a trend and follow it. Do not predict reversals, but also avoid chasing trades you have missed. Respect support and resistance. Keep taking your profits off the table when you can and maintain your discipline. Stay on the right side of the market trend and follow those trading rules. As we know, consistency is the key to long-term trading success.

Swing Trade Ideas for your consideration and watchlist: GDX, BTG, SSRM, KGC, NUGT. 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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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 Plans • Private 2-Hour Coaching

TSLA Trouble, KO Beats On Strong Demand

April 19, 2021 by Ed Carter

Markets made a small gap higher at the open Friday and then ground sideways in a flat session to end the week. That left all 3 major indices in indecisive Doji candles, but also closing at new all-time high closes. On the day, QQQ gained 0.12%, SPY gained 0.33%, and DIA gained 0.41%. VXX fell a bit again to 9.81 and T2122 rose slightly further into the overbought territory at 88.82. 10-year bond yields fell again to 1.59% and Oil (WTI) fell half a percent to $63.07/barrel.

On Friday TSM released its annual report saying that trade tensions may well make the global chip shortage worse. Taiwan (particularly TSM) is already stuck between Chinese and American blacklists. However, the company warns that new protectionist measures in the works by both sides are making key chip-making equipment (such as from AMAT) harder to get and is hampering the company’s ability to increase capacity. This report came just days after two Republican members of Congress urged the US to mitigate the risk of using Taiwanese companies as suppliers of technology. TSM is the leading producer of chips in the world, supplying AAPL, AMD, NVDA, Samsung, and many other technology market leaders.

On Saturday the Consumer Product Safety Commission issued an “urgent warning” to consumers that they should stop using the PTON treadmill. PTON responded by saying there is no reason to stop using their machine if safety instructions have been followed. Then Sunday, a TSLA crashed in TX (killing two) apparently operating under the TSLA “Full Self-Driving” autopilot mode (with nobody in the driver’s seat. In better stock news, KO beat on both lines during pre-market and said demand has returned to pre-pandemic levels.

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,404,463 confirmed cases and deaths are now at 581,061. The number of new cases has ticked higher again and are back above the peak of last summer to an average of 68,151 new cases per day. However, deaths are just starting to plateau again, now at 738 per day. The CDC said Sunday that more than half of US adults have received at least one Covdi-19 vaccination dose and one-third of adults are now fully vaccinated. In addition, Dr. Fauci said Sunday he expects a decision on the JNJ vaccine to be made by Friday and he expects the vaccine to go back into use, with a warning label. However, the bad news is that US demand for vaccination is waning.

Globally, the numbers rose to 142,102,302 confirmed cases and the confirmed deaths are now at 3,035,109 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is very near the all-time peak and are now at 760,528 per day. Mortality, which lags, is also rising sharply again at 11,864 new deaths per day. Monday marked the 5th straight day of a record high for new cases in India. In Europe, PFE/BNTX have agreed to supply an extra 100 million does to the EU, including an extra 50 million during Q2 (bringing the Q2 total to 240 million and the grand total to 600 million).

Overnight, Asian markets were mostly green with India (-1.77%), Indonesia (-0.55%), and Malaysia (-0.50%) being the only red. Shenzhen (+2.89%), Thailand (+1.68%), and Shanghai (+1.49%) led the gainers. In Europe, markets are mixed on mostly modest moves so far today. Greece (-2.02%) is a dramatic outlier. However, the FTSE (+0.19%), DAX (-0.04%, and CAC (+0.41%) are typical of the continent. As of 7:40 am, US Futures are pointing to a red open. The DIA is implying a -0.24% open, the SPY implying a -0.26% open, and the QQQ implying a -0.33% open.

There is no major economic news scheduled for Monday. Major earnings reports on the day include KO, MTB, and PLD before the open. Then after the close, CCK, IBM, STLD, UAL, and ZION all report.

The bulls continue to refuse to be denied. Even with bad news for tech darling TSLA over the weekend, it does not seem like the bears have much traction as earnings continue to be blowout positive so far this quarter. On average 85% of the companies that have reported have beat estimates…and are beating by an average of 22%. So, think long and hard before you fight the trend. However, also be leery about this kind of bull run lasting too much longer without relief. Long runs without down days or pullbacks aren’t normal.

Follow the trend, don’t predict reversals, but also avoid chasing trades you have missed. Respect support and resistance. Keep taking your profits off the table when you can and maintain your discipline. Stay on the right side of the market trend and follow those trading rules. As we know, consistency is the key to long-term trading success. Also, remember this is Friday, so prepare for the weekend news cycle, and don’t forget to pay yourself.

Swing Trade Ideas for your consideration and watchlist: No trade ideas for Monday, but Rick will be back home Monday. 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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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 Plans • Private 2-Hour Coaching

Chinese and US Economies Both Red Hot

April 16, 2021 by Ed Carter

Markets gapped higher on blowout March Retail Sales and lower than expected new Jobless Claims. Then we saw a rally the first 90 minutes of the day before grinding sideways in a tight range the rest of the day in all 3 major indices, all closing very near the highs. All 3 indices also closed at new all-time highs. On the day, SPY gained 1.08%, DIA gained 0.86%, and QQQ gained 1.51%. VXX fell another 3.30% to 9.97 and T2122 fell a little, but remains just inside the overbought territory at 82.53. 10-year bond yields fell sharply on the day to 1.569% and Oil (WTI) gained a third of a percent to $63.35/barrel.

On a very small sample size, so far this earnings season companies are far above consensus estimates. Of the 34 that have reported as of day-end Thursday, 88% have beat estimates…and beat them by an average of 22%. Overseas Friday, China has announced that its GDP grew 18.3% in Q1. This may help put the recent Chinese clamp-down on bank lending into context. (Which may correlate to US market fears over Fed action as our own economy is also growing very fast.)

In miscellaneous news, In Thursday’s retail sales report, every segment of retail is now above pre-pandemic sales levels with the lone exception of restaurants. The NFL also picked CZR, DKNG, and Fanduel as their sports-betting partners in a 5-year deal worth about $1 billion. Airlines companies have said they are expecting massive domestic travel rebounds, but DAL, UAL, and AAL are still bearish on international traffic (especially to Europe) returning to pre-pandemic levels this year.

Related to the virus, US infections are rising again after plateauing at a level above the fall level. The totals have risen to 32,224,139 confirmed cases and deaths are now at 578,993. The number of new cases has ticked higher again and are back above the peak of last summer to an average of 71,919 new cases per day. However, deaths are just starting to plateau again, now at 727 per day. There was a lot of bad news on the vaccine front Thursday. During the day, it was made public that the CEO of PFE had told CNBC on April 1 that it is likely people will need a booster shot within 12 months of being fully vaccinated. At the same event the CEO of JNJ had told CNBC that people may well need to be vaccinated against covid annually. CNBC did not say why this news was kept quiet for two weeks afterwards. The CDC also disclosed that 5,800 who had been vaccinated contracted the virus anyway with about 7% of those infected requiring hospitalization and 74 dying. Paired with fear over blood clots and general ignorance/skepticism about vaccines, this does not bode well for a virus that is quick to evolve (mutate). In skepticism front, over 14 million doses have piled up unused, mainly in Southern states such as MS, TN, AR, AL, GA, LA, and MO.

Globally, the numbers rose to 139,809,244 confirmed cases and the confirmed deaths are now at 3,002,313 deaths. The trends have reversed and are now trending toward trouble again as we have seen significant upticks recently. The world’s average new cases continue to rise and is very near the all-time peak and are now at 736,804 per day. Mortality, which lags, is also rising sharply again at 11,592 new deaths per day. The WHO said today that the global infection rate is nearing the all-time high again. In South America, Brazil continues to have a new record number of deaths daily and Columbia has locked-down its 5 largest cities again. In Asia, India again had a record number of new cases amidst a religious pilgrimage festival. Other countries in the region reporting surges are Indonesia, the Philippines, Malaysia, and Cambodia (all of which have instituted some kind of restrictions).

Overnight, Asian markets were green across the board on incredibly strong growth numbers out of China. However, interestingly, the increases in exchanges were moderate with Hong Kong (+0.81%) being by far the largest gainer. In Europe, markets are mostly green on more diverse trading. The CAC (+0.35%), FTSE (+0.50%), and DAX (+0.94%) are typical of the spread across the exchanges of the continent. As of 7:30 am, US Futures are pointing to an open on the green side of flat. The DIA is implying a gain of 0.16%, the SPY implying a gain of 0.10%, and the QQQ implying a gain of 0.03%..

The major economic news scheduled for Friday is limited to Mar. Building Permits, Mar. Housing Starts (both at 8:30 am) and Michigan Consumer Sentiment (10 am). The major earnings reports on the day include ALLY, BK, CFG, KSU, MS, PNC, and STT before the open. There are no earnings reports scheduled for after the close.

The bulls just refuse to be denied it seems. For example, the DIA has not seen a significant black candle this month. So, don’t fight the trend. With the strong news out of China and a lack of much data or reports in the US today, the bears are not likely to have much energy. However, also be leery about this kind of bull run lasting too much longer without relief. Long runs without down days or pullbacks isn’t normal.

Swing Trade Ideas for your consideration and watchlist: No trade ideas for Friday, but Rick will be back home Monday. 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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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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