Stocks gapped higher the better part of a percent on Monday after news that President Biden said he is now reconsidering the previous administration’s tariffs on Chinese goods.  After some waffling the first hour, the bulls then stepped in to take us to the highs at mid-day.  The afternoon was spent seesawing sideways not too far from the highs of the day. The SPY and DIA both tested their T-lines (and are still testing at the moment) with the QQQ still having work to do to get to that test.  This action gave us gap-up, white candles with wicks on both ends, but larger wicks on the bottom of the SPY and QQQ.  On the day, SPY gained 1.87%, DIA gained 2.05%, and QQQ gained 1.66%.  All of this happened on low trading volume.  The VXX fell to 24.06 and T2122 climbed to not far outside of the overbought territory (70.09) even though we entered the day well oversold.  So, to the extent this was a relief rally, Mr. Market has now gotten at least some relief.  10-year bond yields rose to 2.866% and Oil (WTI) fell to $110.62/barrel.

As mentioned, President Biden’s statement that he is revisiting Chinese tariffs helped stocks. In particular, big bank stocks across the board shot higher on the news. It is worth noting that JPM CEO Dimon told World Economic Forum (Davos) attendees that he only sees inflation and recession as “big storm clouds in the distance” at this point, continuing to say they may dissipate as the Fed gives more clarity on when the hikes will reach a neutral point. The banks leading the charge Monday included JPM, C, BAC, and WFC who led the way for the DIA and SPY.

After the close, ZM, HEI, and SKY all reported beats on both the revenue and earnings lines.  At the same time, NDSN missed on revenue while beating earnings estimates.   However, AAP reported missing on both lines. ZM was up as much as 21% after-hours after issuing strong guidance on top of their earnings beat. 

SNAP Case Study | Actual Trade

In other stock news, at the end of the day, the National Labor Relations Board ruled there was merit in the claim that ATVI illegally threatened union organizers using the guise of a broad company social media policy that conflicted with employee rights.  This comes hours before the union vote begins for ATVI subsidiary Raven Software.  All of this is happening while the ATVI buyout by MSFT remains not yet closed.  Elsewhere, the CEO of SNAP send an email to all employees after the close telling them that the company will miss its own targets for both revenue and earnings in the current quarter.  SNAP stock plummeted 31% in after-hours trading following that email.  The company also filed a K-8 form reporting the same to the market.

Monday evening, Bloomberg reported that for the third week in a row, insiders have increased the buying of their own company’s stock.  Last week, 897 insiders across 381 companies, bought over $324 million of their company’s stock.  The week prior, we saw 584 insiders across 288 companies buying $188 million of stock.  Insider buys are often part of a scheduled buying plan.  However, last week’s numbers compare to only 190 insiders across 107 companies buying $43 million one year ago.  So, this may be an indication that insiders think markets are oversold, regardless of whether they fall in the short-term or not.

On the Russian invasion story, a Russian diplomat in Switzerland resigned over his country’s 3-month invasion and occupation of Ukraine.  In Ukraine, the first Russian soldier convicted of war crimes was sentenced to life in prison for murdering a civilian.  The European Economic Commission President von der Leyen told World Economic Forum (Davos) participants that Russia was waging war with food as the UK told Sky News UK that it was exploring all options to get 25 million tons of wheat out of Ukraine.  She went on to say that sanctions are hurting Russia and she hopes for agreement on Russian oil sanctions within days.  On the other side of the world, the leaders of the US, Japan, India, and Australia are in 4-way talks over security and sanctions against Russia.  The 3 more western nations are pressuring India to pivot more toward the West and further isolate Russia.  This includes military purchases (where tens of billions is now spent in Russia that might go to western firms like RTX, GD, NOC, LMT, BA, etc.

Overnight, Asian markets were red across the board with China leading the way lower.  Shenzhen (-3.34%), Shanghai (-2.41%), and Hong Kong (-1.75%) paced the losses.  In Europe, stocks are mixed, with the larger exchanges following Asia lower at mid-day.  The FTSE (-0.13%) lags, but the DAX (-0.63%) and CAC (-0.71%) are more typical of the losses across the major exchanges in early afternoon trading.  As of 7:30 am, US Futures are pointing toward a gap down to start the day.  The DIA implies a -0.54% open, the SPY is implying a -0.91% open, and the QQQ implies a -1.47% open at this hour.  10-year bond yields are off slightly to 2.821% and Oil (WTI) is up fractionally to $110.65/barrel in early trading.

The major economic news scheduled for release Tuesday is limited to Mfg. PMI and Services PMI (both at 9:45 am), and April New Home Sales (10 am).  However, Fed Chair Powell also is scheduled to speak at 12:20 pm.  The major earnings reports scheduled for release include ANF, AZO, BBY, CSIQ, DOLE, ESLT, NTES, WOOF, and RL before the open.  Then after the close, QFIN, A, CAL, INTU, JWN, TOL, and URBN report.

So far this morning NTES and AZO have reported beats on both lines.  At the same time, BBY and ESLT beat on revenue while missing on earnings.  On the other side, CSIQ and DOLE missed on revenue while beating on earnings.

The major economic news coming later this week includes April Durable Goods Orders, Crude Oil Inventories, and the May FOMC Minutes on Wednesday.  On Thursday we see Q1 GDP, Weekly Initial Jobless Claims, and April Pending Home Sales.  Finally, on Friday we get a Fed speaker (Bullard, twice), April Trade Goods Balance, April PCE Price Index, April Retail Inventories, April Personal Spending, and Michigan Consumer Sentiment.

The bears are not taking the bulls’ Monday move lightly and are looking to open markets lower today. With a chunk of over-extension taken off the board by yesterday’s action, those bears may have more strength than the bulls at least early. However, volatility and intraday whipsaw is likely to continue. The bulls have not capitulated in a crescendo of volume yet…so uncertainty and stubbornness remain. Remember that the trend is still to the downside, but the bulls seem to want to defend that bear market line for the S&P. So, be very careful about chasing gaps and remain nimble or hedged. Above all, don’t give in to FOMO and feel the need to chase a move or predict a reversal either way.

Trading is a job, not a lottery ticket. So, work the process. Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Also, remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. Keep in mind that nobody is right all the time. When you’re wrong, just admit it and take your loss. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss.

Ed

Swing Trade Ideas for your consideration and watchlist: SHEL, DRE, COP, C, JPM, ZIM, XLE, ARKK, DVN, OXY, UPST. 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.

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

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

Markets gapped about one percent higher on Friday, but this was a Bull Trap.  Right after the open, the selling started and the selloff continued until about 3 pm.  However, a massive rally (options expiration pinning) took us out well over halfway up those candles.  This gave us a black, Bearish Engulfing candle (barely) in the QQQ and just black indecisive candles with huge lower wicks in the SPY and DIA.  The late-day rally saved the SPY from joining the QQQ in Bear Market territory (down more than 20% from the high).  It also capped off the seventh consecutive week of declines across the market.  So, the bears may want to retest that Bear Market level this week.  And with that said, markets are still well oversold, giving the bulls some ammunition.  So, the Bulls may want to try a little relief rally as well.  On the day, SPY gained 0.04%, DIA lost 0.24%, and QQQ lost 0.31%.  The VXX fell a little over a percent to 25.05 and T2122 “climbed” to 8.28.  10-year bond yields fell to 2.79% as traders bought up bonds during the first 6 hours of the day and Oil (WTI) was up marginally to $112.70/barrel.

Last week, TSLA had a terrible streak losing 14%.  However, you have to bear in mind, that the stock has lost 34% since it was revealed (well after the fact) that Musk had been selling off TSLA stock to raise money for his TWTR bid.  Among the problems facing the company are the lockdowns in China stalling production, the Chinese economic downturn hurting demand, massively increased competition from actual major carmakers, and, of course, the 3-ring circus of notoriety for the sake of itself that Musk feels the need to maintain at any cost.  On the Chinese front, TLSA has said it wants all staff to continue living in its Chinese factory until mid-June to minimize the risks of more shutdowns. In other stock news, Sunday night Bloomberg reported that AVGO is in talks to acquire VMW.

Recently, there has been considerable talk in the trading rooms about whether or not we’ve yet seen a bottom in the selloff.  On Sunday, the WSJ suggested the answer is no for now.  They reported that BAC says that 63% of their private client’s portfolios are still in stocks, much higher than when prior bottoms have been reached.  In addition, the VIX is currently at 29 and has reached a maximum of 34.75 in the last month.  Again, this is well below the 40+ it reached in the 2008, 2011, and March 2020 selloffs.  Finally, while most selloffs end in capitulation (extreme volume on at least one big down day), we have not seen any such action yet.  So, at the moment, both the chart and anecdotal evidence point to the bears still being in control.

SNAP Case Study | Actual Trade

Bloomberg reported over the weekend that Fed members have been telling them that a market selloff is exactly what they need.  The basic idea is that as the market falls, the normally “long-only” public loses money or at least feels worse.  In turn, this will cause the public (on average) to spend less and that lower demand helps to reduce inflation.  So, while the Fed increasing rates works on the supply side (making spending more expensive), a bear market works on the demand side, slowing the consumer’s urge to buy.  For that reason, Bloomberg says several anonymous Fed members have told them that any sort of Fed Put is the last thing they want to see.  Simply stated, any market bullishness would make their “job number one” (taming inflation) twice as hard.  KC Fed President George is expected to confirm this evening.

In climate-related news, the North Americans Electric Reliability Corporation (a non-profit regulatory authority) has warned that the entire Western US, most of the Upper Midwest, and parts of the East Coast are at high risk of blackouts this summer.  This is the result of the long-term drought in the West (now reducing hydroelectric production) and a newly forecast summer heatwave (worse than normal).  This electricity shortage may affect essentially every industry over at least the next 1-2 Quarters.  Climate has also put another hit on the Ag industry as unprecedented rain for months has caused the deterioration (flooding) of Canadian croplands as well as the inability to plant.  The Insurance Journal reports that only 4% of Manitoba croplands are planted, while the 5-year average at this point of the year would be over 50% planted.  Canola and wheat are the crops most impacted, which coincidentally are exactly the crops whose supply is also most impacted by the Russian invasion of Ukraine and the blockading of Odesa. As a result, all companies that use wheat and canola are at great risk of both supply problems and much higher input costs six months down the road.  Of course, consumers will also have to pay much higher prices for staple items like bread, pasta, cereals, battered food, etc.

On the Russian invasion story, Russia cut the flow of natural gas to Finland Saturday (after Finland refused to pay in Rubles).  Lithuania also stopped buying electricity from Russia.  On Sunday, Russian Trans. Minister Savelyev told state media that Western sanctions have effectively broken logistics within Russia.  On the ground, things are looking tough for the Ukrainians in the Luhansk region as Russia made gains around the town of Popasna and blew up the last resupply/retreat bridge for the Ukrainian Army in Severodonetsk / Lysychansk (a large petrochemical industry metroplex).  With no major new Western arms shipments expected until July and Russia getting tens of thousands of additional troops (freed up from Mariupol and returning from their Syrian drawdown), it is looking dire for Ukraine holding onto the Donbass.  Finally, much of the talk at Davos has been about implementing and offsetting Russian Oil sanctions. This included a speech from Ukrainian President Zelensky.

Overnight, Asian markets were mixed on modest moves.  Japan (+0.98%), Thailand (+0.76%), and New Zealand (+0.44%) led the gainers.  Meanwhile, Hong Kong (-1.19%), Singapore (-0.83%), and Malaysia (-0.43%) paced the losses.  This is despite a rally that came when President Biden told the Asian Economic meeting that he was going to revisit the former President’s Chinese tariffs.  (The President also misspoke, saying that the US Military would intervene to defend Taiwan from a Chinese attack.) In Europe, stocks lean heavily to the green side on Biden’s comments as well as more certainty from the ECB as ECB President Lagarde said they are likely to raise rates this summer and be out of negative rates by September.  At mid-day, the FTSE (+1.04%), DAX (+0.75%), and CAC (+0.35%) lead the way and are fairly typical of the continent.  Only Russia (-1.91%) and the FTSE MIB (-0.64%) are in the red in early afternoon trading.  As of 7:30 am, US Futures are pointing to another gap higher to start the day.  The DIA implies a +1.11% open, the SPY is implying a +1.21% open, and the QQQ implies a +1.05% open at this hour.  10-year bond yields are back up to 2.835% and Oil (WTI) is up 1% to $111.36/barrel in early trading.

The only major economic news scheduled for release Monday is a Fed speaker (George at 7 pm).  There are no major earnings reports scheduled before the open. However, AAP, HEI, NDSN, SKY, and ZM report after the close.

The major economic news coming later this week includes Mfg. PMI, Services PMI, and April New Home Sales on Tuesday.  Then on Wednesday, we get April Durable Goods Orders, Crude Oil Inventories, and the May FOMC Minutes.  On Thursday we see Q1 GDP, Weekly Initial Jobless Claims, and April Pending Home Sales.  Finally, on Friday we get a Fed speaker (Bullard, twice), April Trade Goods Balance, April PCE Price Index, April Retail Inventories, April Personal Spending, and Michigan Consumer Sentiment.

Major earnings reports coming later this week include ANF, AZO, BBY, CSIQ, DOLE, ESLT, NTES, WOOF, and RL on Tuesday.  Then Wednesday we get BMO, BNS, BAX, DKS, DY, UHAL, CHNG, DXC, ENS, GES, NVDA, SPLK, and WSM.  On Thursday, we hear from BABA, AMWD, BIDU, BURL, CM, DG, DLTR, GCO, IQ, M, MDT, AEO, ADSK, COST, DELL, FTCH, GPS, MRVL, ULTA, VMW, and WDAY.  Finally, Friday he see BIG, PDD, and SAFM.

The bulls look to be trying to leverage the late-day rally on Friday into a gap higher this morning. News that the US is reconsidering tariffs on Chinese goods is helping buoy spirits despite the head of the IMF saying they may need to reduce the 2022 global economic growth forecast again. In short, after seven weeks of losses and sitting in a very oversold state, the bulls feel the need to stretch their legs. As traders, we need to keep in mind that despite this fact, the trend is down and the probability of volatility is high. So, continue to be very careful about chasing gaps. Remember that Friday’s gap was a Bull Trap. Either way, that “bear market level” (down 20% from highs) in the area is close below in the S&P. So, remain nimble and hedged. Above all, don’t give in to FOMO and feel the need to chase a move or predict a reversal either way.

Trading is a job, not a lottery ticket. So, work the process. Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Also, remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. Keep in mind that nobody is right all the time. When you’re wrong, just admit it and take your loss. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss.

Ed

Swing Trade Ideas for your consideration and watchlist: No Trade Ideas Yet (Rick has Internet issues). 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.

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

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

Markets gapped down the better part of a percent on Thursday on fears over economic slowdown.  This led to the immediate start of an all-day, roller-coaster ride within a well-constructed range.  The bottom of this range for the SPY was not far from the Bear Market trip line (down 20% from highs).  So, we may be getting some support from traders at that level (about 383) for the broader market.  At any rate, this action left us with indecisive, Spinning Top type candles across all 3 major indices. On the day, SPY lost 0.63%, DIA lost 0.78%, and QQQ lost 0.57%.  The VXX fell almost 3% to 25.36 and T2122 “climbed” but still remains deep in the oversold area at 7.32.  10-year bond yields fell to 2.851% and Oil (WTI) gained 1.6% to $111.30/barrel.

During the day, Weekly Jobless Claims were reported as slightly higher than expected. However, it was the Philly Fed Mfg. Index that drew the most concern as it came in at only +2.6 (+16.0 was forecast).  This means Manufacturing conditions are only slightly improving (anything above zero), less so than expected and far less so than last month (+17.6).  April Existing Home Sales also came in slightly lower than expected, which falls in line with rising interest rates.  KC Fed President George said “the rough week” in the market was not surprising and is just one of the ways tighter financial conditions will emerge as the Fed tightens policy.

SNAP Case Study | Actual Trade

After the close, DECK, FLO and PANW all reported beats on both the revenue and earnings lines.  After-hours, DECK was up as much as 16%, PANW was up as much as 12%, and FLO was up as much as 8% on the earnings news.  Meanwhile, CLZNY missed on revenue while beating on earnings.  However, AMAT, ROST, and VFC all missed on both lines.  After hours, AMAT was down as much as 8%, ROST was down 20%, and traded in a wide range up as much as 7% and down as much as 3% on the earnings news.

On the Russian invasion story, the EU has agreed to $19 billion in guaranteed short-term financing for Ukraine. Meanwhile, the Biden Administration approved another small ($100 mil) military aid package for Ukraine, that another 18 Howitzers.  In Congress, the $40 billion Ukraine aid package passed.  This aid bill includes $9 billion for replenishing US stockpiles of arms and munitions given to Ukraine. The main beneficiaries of that $9 billion will be RTX, LMT, GD, and NOC. Finland will also lose its main natural gas supply as of Saturday when Russia shuts down its supply following Finland’s refusal to pay for gas in Rubles. Finland is one of the few gas users to stand up to Putin as the Ruble hit a 7-year high on demand for that currency from gas buyers. Finally, Qatar has offered to sell LNG from its US-based plant to Germany starting in 2024.

President Biden is in South Korea today at the start of his Asian trip.  Many analysts are expecting North Korea to launch a missile or do a nuclear test in order to upstage the visit to South Korea today.  So, keep an eye out for that potentially market-moving news later today.

Overnight, Asian markets were green across the board with the minor exception of a flat Malaysia (-0.02%).  Hong Kong (+2.96%), India (+2.89%), Shenzhen (+1.82%), and South Korea (+1.81%) led the way.  However, most of the region was up more than a percent as China kept its one-year lending rate the same while cutting the 5-year rate by 15 basis points.  In Europe, we also see green across the board with the exception of Russia Overnight, Asian markets were green across the board with the minor exception of a flat Malaysia (-0.02%).  Hong Kong (+2.96%), India (+2.89%), Shenzhen (+1.82%), and South Korea (+1.81%) led the way.  However, most of the region was up more than a percent as China kept its one-year lending rate the same while cutting the 5-year rate by 15 basis points.  In Europe, we also see green across the board with the exception of Russia (-1.59%) at mid-day.  The FTSE (+1.95%), DAX (+1.96%), and CAC (+1.40%) lead the way, but gains of more than a percent are seen everywhere except Russia, Greece (+0.83%), and Switzerland (+0.53%) in early afternoon trading.  As of 7:30 am, US Futures are pointing toward a gap up to start the day at the end of a down week.  The DIA implies a +0.77% open, the SPY is implying a +0.95% open, and the QQQ implies a +1.30% open at this hour. 10-year bond yields are up slightly to 2.875% and Oil (WTI) is also fractionally higher to $112.45/barrel in early trading.

There is no major economic news scheduled for release Friday. Major earnings reports scheduled for the day include BAH, DE, and FL before the open. There are no reports scheduled for after the close.

So far this morning BAH and DE have reported beats on both lines.  At the same time, FL missed on revenue while beating on earnings. 

As we appear to be heading for a seventh straight week of losses (which would be the longest market losing streak since the dotcom bubble burst), Mr. Market seems to be trying to gap into a green day. Bear in mind that this is option expiration Friday and GS estimates $460 billion of single-stock options, as well as $855 billion in S&P-tied derivatives, will all expire. The point is, we may well see some volatility and/or pinning related to all those options expiring today. We also have a coming weekend new cycle to consider. So, continue to be very careful. The short and mid-term trends are bearish, the mid-term move is getting a bit long in the tooth. Plus in the short-term (as shown by T2122), we are oversold and have the potential support of a “bear market level” (down 20% from highs) in the area. So, remain nimble and hedged. Above all, don’t give in to FOMO and feel the need to chase a move or predict a reversal either way.

Trading is a job, not a lottery ticket. So, work the process. Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Also, remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. Keep in mind that nobody is right all the time. When you’re wrong, just admit it and take your loss. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss.

Ed

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.

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

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

Stocks gapped down over a percent on Wednesday as fear of Fed hawkishness and inconclusive news from major retailers on consumer spending led to uncertainty.  The bad news for any bulls was that this led into a strong selloff that lasted the entire rest of the day in all 3 major indices.  Only a bounce the last 5 minutes of the day prevented us from going out on the lows.  This left us with big, ugly black gap-down candles in all 3 major indices and nearing the breakout of a Dreaded-h pattern in all 3.  On the day, SPY lost 4.03% (worst day since June 2020), DIA lost 3.53%, and QQQ lost a whopping 4.91%.  The VXX rose 5.24% to 26.09 and T2122 dropped back deep into the oversold territory at 5.08.  10-year bond yields dropped back to 2.884% and Oil (WTI) fell 2.8% to $109.25/barrel.

During the day, April Building Permits and Housing starts both came in below forecast.  This falls in line with spiking mortgage rates that have seen declines in mortgage applications in recent weeks and may be a sign of the housing market bidding wars slowing.  However, the big miss of the day was current crude oil inventories, which came in 4.7 million barrels lower than expected (-3.394 mil actual vs +1.383 mil est.).  After hours, the CEO of UAA announced he will be stepping down as of June 1. 

SNAP Case Study | Actual Trade

On the Russian invasion story, China is now in talks with Russia to buy a huge amount of Russian oil to fill their strategic oil reserves.  Even at a steep discount to market price, this would be a huge financial boost to Russian coffers.  However, Russian GDP growth missed expectations during Q1. Russian GDP came in at +3.5% (versus +3.7% that was forecast), down from the +4% during Q4.  Since almost all of this drop-off came during the last month of the quarter, we can see the impacts of sanctions…even with soaring energy prices to boost numbers.

In addition to reporting earnings this morning, KSS also slashed forward guidance on both sales and profits. This came as the company said it expects to have received the last of the expected buyout offers in the next few weeks. There are known bids from FRG, another from SPG (who wants to combine KSS with former JCPenney), as well as a separate private equity group. It is unknown who the additional bidder(s) may be that the company is waiting for in the next few weeks.

Overnight, Asian markets were mostly in the red.  Only Shenzhen (+0.38%) and Shanghai (+0.36%) managed gains while India (-2.65%), Hong Kong (-2.54%), and Japan (-1.89%) paced the losses.  In Europe, we see red across the board at mid-day.  The FTSE (-2.36%), DAX (-2.10%), and CAC (-1.75%) lead the way and are typical of the region in early afternoon trading.  As of 7:30 am, US Futures are pointing toward a second straight significant gap lower.  The DIA implies a -1.12% open, the SPY is implying a -1.15% open, and the QQQ implies a -1.23% open at this hour.  10-year bond yields are down strongly to 2.839% and Oil (WTI) is off 1.77% to $107.65/barrel in early trading.

The major economic news scheduled for release Thursday includes Weekly Jobless Claims and Philly Fed Mfg. Index (both at 8:30 am), and April Existing Home Sales (10 am).  Major earnings reports scheduled for the day include WMS, BJ, KSS, and VIPS before the open.  Then, after the close, AMAT, DECK, FLO, PANW, ROST, and VFC report.

So far this morning SQM, BJ, EXP, and MBT have reported beats on both lines.  At the same time, KSS and WMS both reported beating the estimates on revenue but missing on the bottom line.  On the other side, VIPS missed on revenue while beating on earnings.  Finally, PLCE missed on both revenue and earnings.

After Wednesday’s rout in the market, fear has spread. The signal of this is bond yields dropping as investors stash money n bonds, bidding up their price (and thus push down yields). The bond market has also seen much more volatility in the last few days as skittishness has now infected bond markets as well. The proximate cause most talking heads point to is concern over economic slowdown (not inflation). Whether those analysts are right or not, when you add geopolitical risk to the mix, markets are just plain uncertain and nervous. So, continue to be very careful. The short and mid-term trends are bearish, the mid-term move is getting a bit long in the tooth. Plus in the short-term (as shown by T2122), we are oversold and have the potential support of a “bear market level” (down 20% from highs) in the area. So, remain nimble and hedged. Above all, don’t give in to FOMO and feel the need to chase a move or predict a reversal either way.

Trading is a job, not a lottery ticket. So, work the process. Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Also, remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. Keep in mind that nobody is right all the time. When you’re wrong, just admit it and take your loss. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss.

Ed

Swing Trade Ideas for your consideration and watchlist: MO, ADM, MOS, SLB, NTR, RBLX, BTI, AMD. 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.

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

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

Markets gapped strongly higher at the open Tuesday on good sales numbers from WMT and HD.  However, they immediately began fading the gap in all 3 major indices.  The lows were reached just before 11 am only to see a long, slow rally take over. Price had climbed back to the open level about 1 pm only to print another whipsaw between 2 pm and 3 pm before running up to new highs late.  This has left us with indecisive, gap-up, Spinning Top or even Hangman candles in all 3 of those averages.  The good news for bulls is that those 3 were able to pass a retest of their T-lines (8ema).  The bad news is that the downtrend line has not yet been reached and there is still a lot of resistance above.  On the day, SPY gained 2.04%, DIA gained 1.30%, and QQQ gained 2.59%.  The VXX rose slightly to 24.79 and T2122 climbed up above the mid-point to 67.14.  10-year bond yields rose sharply to 2.984% and Oil (WTI) fell 2% to $111.86/barrel.

During the day, April Retail sales came in as expected (+0.9%) but the Core Retail Sales beat expectations (+0.6% vs +0.4% est.).  This was offset by larger than expected builds in March Retail Inventories.  However, April Industrial Production also came in above expectations at +6.4%.  Then in a Wall Street Journal interview, Fed Chair Powell said he’ll continue to back rate increases until “we see inflation coming down in a clear and convincing way,” even if that meant moving past levels broadly seen as “neutral.”  He said that this policy might come at the expense of increasing the unemployment rate past the current 3.6%.  This is the most hawkish Powell we’ve ever heard. However, overall he said he sees the most likely paths to lead to a “softish landing” for the economy.

SNAP Case Study | Actual Trade

In stock news Tuesday, C jumped 7.59% on news of Warren Buffett taking a $3 billion position in the stock. All the semiconductor stocks climbed with AMD spiking 8.73% after catching an upgrade from Piper Sandler.  Meanwhile, MU surged 5.69% and NVDA surged 5.29%, as QCOM ran up 4.31%, and INTC climbed 3.06%.  However, despite the strong Tech gains, the top-performing sectors were Basic Materials and Consumer Cyclicals (both up 3.14% as sectors).  After the close, KEYS reported a beat on both the revenue and earnings lines.  Also, for the second day in a row, a major corporation faced shareholder rejection of its executive compensation plan.  This time, after-hours it was announced that JPM shareholders rejected CEO Jamie Dimon’s bonus ($52.6 million in stock options) by more than a 2-to-1 margin.

On the Russian invasion story, the leaders of Finland and Sweden are submitting their country’s NATO membership applications today in a meeting with NATO Sec. Gen. Stoltenberg.  The leaders of both nations with then visit the White House to meet President Biden on Thursday.  Elsewhere, Bloomberg reported last night that the US State Dept. would not extend the sanctions carve-out that allowed Russia to pay bond debt in dollars when it expires on May 25^th.  This greatly raises the chance of Russian default when the next payments are due May 27^th. Finally, President Biden is preparing a $500 million military aid package (money they can spend on US-made arms) for India.  This is intended to start weaning India off of buying arms from Russia.

Weekly mortgage demand for new home purchases fell 12% week-on-week and was down 15% from one year ago.  Refinancing applications also continue to nose dive, falling another 10% week-on-week.  This came as 30-year, fixed-rate interest levels fell slightly from 5.53% to 5.49%.  Clearly, people still remember the 3% rate from the start of the year and have a hard time swallowing 5.49%.

Overnight, Asian markets mixed but leaned heavily to the green side.  Taiwan (+1.50%), New Zealand (+1.08%), and Australia (+0.99%) led the gains, but increases were widespread.  Only Shanghai (-0.25%), and Shenzhen (-0.20%) had appreciable losses.  In Europe, markets are more evenly mixed at mid-day.  The FTSE (-0.11%), DAX (+0.02%), and CAC (-0.18%) lead the region as always with Russia (+2.03%) as an outlier.  As of 7:30 am, US Futures are pointing toward a down start to the day.  The DIA implies a -0.44% open, the SPY is implying a -0.60% open, and the QQQ implies a -0.83% open at this hour.  10-year bond yields are back up to 3.001% and Oil (WTI) is up 1.1% to $113.64/barrel in early trading.

The major economic news scheduled for release Wednesday are limited to April Building Permits and April Housing Starts (both at 8:30 am), and Crude Oil Inventories (10:30 am).  Major earnings reports scheduled for the day include ADI, ARCO, LOW, TGT, TJX, and ZIM before the open.  Then, after the close, BBWI, SQM, CSCO, CPRT, and SNPS report.

So far this morning ADI and ZIM have reported beats on both lines.  At the same time, TGT reported beating the estimates on revenue but missing on the bottom line.  On the other side, LOW missed on revenue while beating on earnings.  TGT shares were down 23% in premarket trading on the earnings miss, punished the same as WMT (which lost 11.38% Tuesday) for higher-than-expected costs.  LOW was down 3% in premarket on a revenue miss that the company blamed on cooler weather (despite rival HD beating sales estimate just yesterday).

Inflation, how it will be fought, and how that will impact markets is the main topic on trader’s minds today. As Fed Chair sounded quite hawkish Tuesday and the UK printed 9% April inflation overnight, Mr. Market is scared. It could also be traders thinking it’s time to take profits on this relief rally after gaining 4% in the SPY over the last 4 days. Add geopolitical risk to the mix and there is uncertainty in the air. Either way, we need to remember the trend is still bearish and there is a lot of resistance above. We have not made a low, high, higher-low, and higher-high yet. So be very careful chasing long positions. That said, the bearish move is long in the tooth as well and near the potential support of a 20% fall to bear levels. So, remain nimble and hedged. Above all, don’t give in to FOMO -OR- feel the need to predict a reversal either way.

Trading is a job, not a lottery ticket. So, work the process. Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Also, remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. Keep in mind that nobody is right all the time. When you’re wrong, just admit it and take your loss. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss.

Ed

Swing Trade Ideas for your consideration and watchlist: SLB, MOS, LLY, KO, PSA, GILD, ZC, JPM, IVR, LYFT DAL, AXP, ABNB, SHOP, MSTR, BBBY. 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.

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

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

Monday started with a small gap lower as we got bad Chinese economic data and the NY Empire State Mfg. Index missed estimates.  After that, we saw a roller-coaster ride with a slightly bullish trend until 3 pm.  From that point, stocks slid the rest of the day.  This action allowed all 3 major indices to retest their T-Line and fail again.  However, DIA held out to barely print a second straight green day as markets fight with their downtrends.  This left us with indecisive, Doji or Spinning Top candles in all 3 major indices.  On the day, SPY lost 0.37%, DIA gained 0.18%, and QQQ lost 1.16%.  The VXX fell almost 5% to 24.69 and T2122 climbed again, but remains below the mid-point at 35.11.  10-year bond yields fell on the day to 2.886% and Oil (WTI) rose 3.3% to $114.16/barrel.

Monday, Bloomberg reported Elon Musk has floated the idea of buying TWTR at a lower price than approved by the board.  This came the same day that he and TWTR CEO Agrawal went back and forth on whether or not there are many fake accounts on the platform.  The stock took an 8.18% loss on the day and in the process gave back more than all the gains made since Musk’s position purchase was made public.  Then early this morning Musk said that TWTR must prove its claims of 5% or fewer “bot accounts” for the purchase to proceed at all. TWTR was down as much as another 4% in after-hours trading.

Cryptocurrencies continue to have massive issues as another “stablecoin” (DEI) lost its peg to the US Dollar, falling below 70 cents.  The algorithm selling Bitcoin and NFTs in an attempt to maintain the peg simply could not keep up.  As with Luna (which is now of no value), this puts pressure on Bitcoin and cryptocurrencies in general on a reputation basis as well as direct selling to maintain the peg.  However, Bitcoin, rallied late in the day to regain the $30,000 level after falling to $29,000 during the day.  In related news, COIN reported that people holding their crypto wallets at COIN are to be treated as “unsecured creditors” in the event of bankruptcy.  This means if the COIN exchange files for bankruptcy, people holding accounts will be paid last in the disbursement of assets.  COIN plummeted another 9% on the day and is down 53% since May 4^th.

SNAP Case Study | Actual Trade

After the close, TME missed on revenue while beating on earnings.  On the other side, TTWO and AE both beat on revenue while missing on earnings.  In other stock news, after-hours, INTC announced that shareholders have rejected the company’s top executive pay packages by almost a two-to-one margin.  The vote is not binding on the board, but is a clear sign that shareholders are watching company performance.  In other compensation news, MSFT announced it will nearly double its employee compensation budget as well as increase the stock options given to some classes of employees by 25%.  This was all a major effort to retain staff in a very competitive job market.

On the baby formula story, ABT reached a deal with the FDA to restart their Sturgis MI plant (which the FDA shut down in February).  This increases the largest baby formula maker’s capacity by at least one-third.  Elsewhere, Nestle (a global baby formula maker with smaller US presence) is flying large supplies of formula to the US today while Reckitt Benckiser (UK formula maker) is also boosting production by 30% and shipping more to the US in order to capture market share and alleviate the US shortage.

Economic news later this week includes April Building Permits, April Housing Starts, and Crude Oil Inventories on Wednesday.  Then Thursday we see Weekly Jobless Claims, Philly Fed Mfg. Index, and April Existing Home Sales.  There is no major news scheduled for Friday.

Overnight, Asian markets leaned heavily to the green side on encouraging Covid news out of China.  Hong Kong (+3.27%) and India (+2.63%) were outliers, but Shenzhen (+1.23%), Taiwan (+0.98%), and South Korea (+0.92%) led the way higher.  In Europe, we see green across the board at mid-day with Tech stocks leading the way.  The FTSE (+0.96%), DAX (+1.53%), and CAC (+1.38%) lead the way as usual in early afternoon trading.  As of 7:30 am, US Futures are pointing to a large gap higher at the start of the day.  The DIA implies a +1.43% open, the SPY is implying a +1.67% open, and the QQQ implies a +2.01% open at this hour.  10-year bond yields are back up to 2.919% and Oil (WTI) is up another 0.67% to $114.95/barrel in early trading.

The major economic news scheduled for release on Tuesday includes April Retail Sales (8:30 am), April Industrial Production (9:15 am), Mar. Business Inventories and Mar. Retail Inventories (both at 10 am), and a few Fed speakers (Bullard at 8 am, Harker at 9:15 am, Chair Powell at 2 pm, and Mester at 2:30 pm).  Major earnings reports scheduled for the day include AER, HD, JD, SE, and WMT before the open.  Then, after the close, KEYS reports.

So far this morning HD, JD, SE, AER, HUYA, and IMBBY all reported beats on both lines.  At the same time, WMT and VOD reported beating the estimates on revenue but missing on the bottom line.  Finally, MARUY has reported misses on both lines.  It is worth noting that HD raised guidance for the rest of the year after record Q1 sales.  HD was up 3% in premarket trading. The WMT miss was unusual and attributed higher costs which included “overstaffing,” which raises the fear of layoffs in a job market where just yesterday the company announced a new incentive program to increase hiring among college graduates. WMT is down 5% in premarket trading.

Coming off weeks of losses, the bulls seem to be latching on to good Covid news from China (implying some improvement of supply chain issues and increasing Chinese demand) as well as the strong HD earnings and forecast. The fact that WMT also beat on revenue (despite a bad earnings miss) may also give hope that the consumer is not tapped out yet. However, inflation, geopolitical risk, and the cryptocurrency meltdown still also weigh on Mr. Market’s mind. So, be damn careful about chasing into the gap higher. Caution remains the smart play. Remember the trend is still to the downside, despite the last couple of candles. Also bear in mind that those bullish candles failed a test of the T-line twice now. This does not mean they will always fail, it just suggests there remains a lot of resistance overhead. Remain nimble and hedged. Above all, don’t give in to FOMO -OR- feel the need to predict a reversal.

Trading is a job, not a lottery ticket. So, work the process. Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Also, remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. Keep in mind that nobody is right all the time. When you’re wrong, just admit it and take your loss. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss.

Ed

Swing Trade Ideas for your consideration and watchlist: MMAT, EPAM, WDC, GILD, IBM, MMM, HAL, XLE, DOW. 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.

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

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

On Friday, stocks gapped up 1% – 1.5% in the major indices and then followed through to the highs of the day just after noon.  Then the afternoon saw a roller-coaster ride that ended on an upswing, but not at the highs.  This left us with gap-up, white candles that failed a test of the down-trending T-line (8ema) in all three major indices and the small-cap IWM.  On the day, SPY gained 2.34%, DIA gained 1.45%, and QQQ gained 3.71%.  The VXX fell more than 3.5% to 25.97 and T2122 climbed out of the oversold territory to 25.97.  10-year bond yields closed up to 2.937% and Oil jumped 4% to $110.38/barrel.  On the week, all the major indices printed gap-down, indecisive, long-legged Spinning Top candles.

Part of the reason for Friday’s rally was the Fed removing some uncertainty from the market.  FOMC Chair Powell said on Thursday that larger rate hikes are off the table for now, but the Fed will be hiking rates half of a percent at each of the next two Fed meetings (June 15 and July 27).  Elsewhere, it was revealed that top tax officials from the US, UK, Canada, Australia, and the Netherlands met in London Friday to discuss 50 potential crypto-based tax crimes.  These crimes include a $1 billion Ponzi scheme carried out cross-border using an unspecified cryptocurrency as well as NFTs.

Meme stock trading came back into vogue last week.  Some examples include GMA closing up almost 10% on a 10% gap up Monday and trading in a 12.5% range over the week.  AMC closed down 14.17% while trading in a 45% range during the week.  BBBY closed down more than 20% and traded in a 35% range during the week.  BB closed up about 4% after trading in a 25% range during the week.  Finally, HOOD closed up 5.63% after trading in a 41% range over the week.

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On the Russian invasion story, Russia took action against Finland, stopping the supply of electricity (20% of the country’s power supply) and also stopping the flow of natural gas (used to generate another 6% of the country’s power) after the Finn government announced it will ask parliament to approve an application for NATO membership.  On Sunday, Sweden followed suit, with PM Andersson saying the country will now work toward NATO membership.  (This raises the question of how Russia will react. Will they cut off gas flows to Europe as they did to Finland?) Early Monday, MCD said it will sell its closed Russian stores rather than ever try to reopen.  From Russia’s standpoint, this raises the specter of whether the 1,000 companies which closed operations in its country will ever reopen. Elsewhere, India has banned wheat exports in anticipation of a global shortage due to Ukraine being unable to ship grain and droughts worldwide.  This is not a huge fear for the US (other than price hikes being ensured). However, Asia, Africa, and to a lesser extent parts of Europe need to worry about food shortages coming.

Energy markets and stocks/ETFs may face more turmoil this week.  In Europe, nat. gas prices were up 10% last week after the shutdown of one-third of the Russian Natural gas flow.  This week the EU is expected to unveil its $195 billion Euro plan to completely stop importing Russian oil and gas by 2027.  The plan is expected to include deals with Egypt, Israel, and Nigeria for natural gas to replace the current Russian supply as a stop-gap.  Elsewhere this week, many of the major US retailers will be reporting this week.  So, there may be guidance or at least a read-through on the outlook for consumers as markets gauge a potential economic slowdown.

Economic news later this week includes April Retail Sales, April Industrial Production, Mar. Business Inventories, Mar. Retail Inventories, and a couple Fed speakers on Tuesday.  On Wednesday we get April Building Permits, April Housing Starts, and Crude Oil Inventories.  Then Thursday we see Weekly Jobless Claims, Philly Fed Mfg. Index, and April Existing Home Sales.  There is no major news scheduled for Friday.

Overnight, Asian markets were mixed in very modes moves (by recent standards).  Singapore (+0.82%), Japan (+0.45%), and Taiwan (+0.43%) led the gains.  Meanwhile, Shenzhen (-0.59%), Shanghai (-0.34%), and South Korea (-0.29%) paced the losses.  In Europe, we see a similar story taking shape at mid-day.  Notable exceptions are Russia (+2.25%) and Denmark (+1.65%).  However, the FTSE (+0.05%), DAX (-0.53%), and CAC (-0.29%) lead the way as usual.  As of 7:30 am, US Futures are pointing toward a slightly negative start to the day.  The DIA implies a -0.14% open, the SPY is implying a -0.34% open, and the QQQ implies a -0.48% open at this hour.  10-year bond yields are down a bit to 2.913% and Oil (WTI) is also down almost 1% to $109.42/barrel.

The major economic news scheduled for release on Monday is limited to NY Empire State Mfg. Index (8:30 am) and a Fed speaker (Williams at 8:55 am).  Major earnings reports scheduled for the day are limited to TSEM and WEBR before the open.  Then, after the close, TTWO and TME report.

So far this morning TSEM reported beats on both lines.  Meanwhile, WIX has reported beating the estimates on revenue but missed on the bottom line.  Finally, MARUY has reported misses on both lines.

Notable earnings reports later in the week include WMT, HD, SE, AER, and KEYS on Tuesday.  Then on Wednesday, we get reports from LOW, TGT, CL, ADI, ARCO, CSCO, SNPS, CPRT, BBWI, and SQM.  On Thursday we hear from VIPS, KSS, BJ, CAE, WMS, AMAT, ROST, VFC, FLO, PANW, and DECK.  Finally, on Friday we see numbers from DE, FL, and BAH.

Coming off a very volatile week and working on 7 straight weeks of losses in the DIA (6 straight in both the SPY and QQQ), markets sit at the edge of bear market territory. Premarkets seem to suggest a wait-and-see feeling this morning, perhaps waiting on the retailer reports coming this week to give a read-through to whether the consumer is tapped out or not. Inflation, geopolitical risk, and cryptocurrency meltdowns also weigh on Mr. Market’s mind. So, caution remains the smart play. Remember the trend is still to the downside, despite Friday’s nice candles. Also bear in mind that those bullish candles failed a test of the T-line. This does not mean they will always fail, it just suggests there remains a lot of resistance overhead. Remain nimble and hedged. Above all, don’t give in to FOMO -OR- feel the need to predict a reversal.

Trading is a job, not a lottery ticket. So, work the process. Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Also, remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. Keep in mind that nobody is right all the time. When you’re wrong, just admit it and take your loss. As they say, the best time to have taken a $500 loss is when you are now staring at a $1,500 loss.

Ed

Swing Trade Ideas for your consideration and watchlist: EPAM, KO, CVX, GILD, CLX, WDC, OXY, VTRS. 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.

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

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

Markets gapped down Thursday as PPI came in as expected, +0.5%, which was way down from last month’s +1.6%.  The Core PPI (stripping out volatile food and energy) came in lower than expected (+0.4% vs +0.6% forecast).  After the gap down, stocks rallied to the highs of the day at 11am when a reversal and strong, sustained selloff took markets to the lows at 3pm.  However, the day ended on strong rally off the lows to end the day basically flat.  This left us with indecisive, long-legged Spinning Top candles in all 3 major indices.  On the Day, SPY lost 0.09%, DIA lost 0.25%, and QQQ lost 0.21%.  The VXX fell to 26.93 and T2122 climbed a bit, but stayed deeply in the oversold territory to 1.60.  10-year bond yields fell to 2.873% and Oil (WTI) rose 1.13% to $106.90/barrel.  Consumer Cyclicals (+1.63%) and Healthcare (+1.50%) led on the day with Utilities (-0.79%) and Basic Materials (-0.60%) pacing the losses.

During the day Fed Chair Powell was reconfirmed for a second term.  In other market-related news, the cryptocurrency story refused to go away today with the supposedly-stablecoin LUNA losing 97.48% of its value (dropping to $0.03 in value). Ethereum also lost 8.7% and Bitcoin remained relatively stable, down 2%, but hitting $26,000 before closing at $29,400 (down from $41,500 less than a month ago).  Treasury Sec. Yellen told reporters the recent volatility and decoupling of so-called pegged stablecoins is a clear example of why the government should be regulating that market.

Meme stock mania made a comeback Thursday with AMC trading in a 29% range to close up 8% on the day.  In addition, GME traded in a 30% range, was halted multiple times for excess volatility, and closed up 10.13%.  TLRY also 9.36% on a relatively stable 14% range while BBBY traded in a 17% range to close up only 1.95%.  HOOD also spiked 5% on the day, but this might also have been on leaks related to the after-hours story that a cryptocurrency exchange CEO is buying a 7.6% stake in HOOD.  This caused the stock to spike +41% in after-hours trading.

SNAP Case Study | Actual Trade

After the close, MSI, EDR, and PAM all reported beats on both revenue and earnings.  Meanwhile, HLI missed on revenue while beating on earnings.  On the other side, TOST, COMP, and VZIO beat on revenue while missing on earnings.  US Senator Paul has killed the effort to fast-track the aid package to Ukraine.  He is demanding a special Inspector General to oversea all spending from the package.  He refused to allow it to be voted on as an amendment, instead insisting it must be part of the main bill.  This will delay passage by several days despite strong bipartisan support.

This morning, Elon Musk says his purchase of TWTR is “temporarily on hold.”   The reason for this pause is an audit to verify that less than 5% of TWTR accounts are not real people but actually fake/bot users.  TWTR has also frozen hiring and has rescinded job offers previously made until the deal closes.  TWTR stock is plummeting in premarket trading, down 14% at time of this writing.  Elsewhere, Bloomberg reports that Fed Chair Powell reiterated that the FOMC will hike rates by half a percent at each of its next two meetings.  He also said that whether or not the economy goes into recession is outside of the Fed’s control.  Finally, the Terra project has stopped processing block chain transaction for the second time in less than a day.  This came as the company scrambled to find a way to reconstitute their network in the face of Luna having dropped to practically zero.  Binance has already suspended trading of that crypto.

Overnight, Asian markets leaned heavily to the green side.  Japan (+2.64%), Hong Kong (+2.68%), and South Korea (+2.12%) led the gainers with only 3 exchanges just barely in the red.  In Europe, stocks are following Asia with all but 2 exchanges well into the green at mid-day.  The FTSE (+1.56%), DAX (+1.35%), and CAC (+1.53%) lead the way with only Belgium and Denmark slightly in the red in early afternoon trading.  As of 7:30 am, US Futures are pointing toward a strong gap higher to start the day.  The DIA implies a +0.75% open, he SPY implies a +1.09% open, and the QQQ implies a +1.66% open at this hour.  10-year bond yields are back up to 2.904% and Oil (WTI) is up 1.7% to $107.96/barrel in early trading.

The major economic news scheduled for release on Friday is limited to Apr. Imports/Exports (8:30 am), Michigan Consumer Sentiment (10 am), and a couple of Fed speakers (Kashkari at 11 am an Mester at noon).  Major earnings reports scheduled for the day are limited to HMC before the open.  There are no major earnings reports after the close.

So far this morning HMC reported beats on both lines.  Meanwhile, DWAHY, ISUZY, and TRYIY missed on revenue while beating on earnings.  On the other side, KDDIY, GASNY, OJIPY, BPIRY, and AACAY have reported beating the estimates on revenue but missed on the bottom line.  Finally, SMFG, MARUY, RKUNY, ATASY, PBSFY, and AHKSY have reported misses on both lines.

Premarkets seem to be gapping strongly in favor of the bulls this morning as markets try to prevent the SPY from slipping into a bear market (down 20% from its recent high). However, remember that the last two gaps higher were “bull traps” that were met with strong selloffs. So, don’t go chasing gaps, especially gaps against the trend. Regardless of the action today, it seems very unlikely that any of the major indices can avoid yet another down week. Inflation, geopolitical risk, and cryptocurrency meltdowns are also on Mr. Market’s mind. So, caution remains the smart play. Remain nimble, hedged, and small (if not flat) as we head into the weekend. There is certainly no need to panic or experience FOMO. If you want to trade this market, unless you are a daytrader, the smart move is to stick with the downtrend. The bears still have all the momentum.

Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. You also don’t need to be in the market all the time. If this isn’t a market condition you thrive in, then get out of the way. It will settle out at some point and it’s far better to wait and have money for the right market condition than to force trades now and be busted when things do turn. Keep in mind that nobody is right all the time. If you’re wrong, just admit it and take your loss. Focus on your process and enjoy yourself.

Ed

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.

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

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

On Wednesday CPI came in hotter than expected (but still better than last month) and as a result premarkets pulled back, giving us a small gap down at the open.  From there, the QQQ led the other indices into an all-day selloff that closed near the lows in all 3 major indices.  This gave us big, ugly black candles and new 52-week lows in all three.  On the day, SPY lost 1.61%, DIA lost 1.02%, and QQQ lost 2.99%.  The VXX diverged from expectations by only rising a fraction to 27.28 and T2122 fell even more deeply into the oversold territory at 0.81.  10-year bond yields fell to 2.93% and Oil (WTI) spiked 5.4% to $105.18/barrel after having lost 10% in the prior couple of sessions.

As mentioned, the April Consumer Price Index showed an 8.3% increase (year on year), which was higher than the 8.1% expected, but still less than March’s 8.5%.  Analysts say this indicates we are at peak inflation and could see it slacking off later this year.  However, the Core CPI number (which strips out volatile food and energy impacts) was up 0.6% in April which was much higher than the 0.4% expected. While markets are still pricing in “just” a half-percent hike in June, the potential for a three-quarter percent hike seems back in the cards as the Fed’s favorite inflation measure (Core CPI) came in well above expectations.

After the close, FUJIY, STE, and DOX reported beats on both revenue and earnings.  Meanwhile, CPNG missed on revenue while beating on earnings.  Finally, DIS, VIV, and OPHLY reported misses on both lines.  With that said, DIS did beat significantly on Disney+ subscription estimates.

SNAP Case Study | Actual Trade

Cryptocurrency volatility is off the charts again, even by crypto standards.  Bitcoin was down almost 11% this morning before recovering some 8% of that loss.  This comes as COIN had to explain the risk of bankruptcy to their users after $200 billion of wealth has been wiped out by selloffs over just the last 24 hours.  At the same time Project Terra (Luna and UST stablecoins) continue to decouple from their supposed peg to the US Dollar.  At one point Wednesday, UST was trading at less than 30 cents while Luna has lost 97% of its value in the last day.

On the Russian invasion story, the Russian Foreign Ministry told the US Ambassador in Moscow that Russian-controlled portions of Ukraine will be requesting annexation by Russia.  Meanwhile, Italian PM Draghi said that Italy European companies can pay for their gas in Rubles without breaching sanctions, in direct conflict with EU guidance on the matter.  The other developments were diplomatic, with Russia warning of nuclear war if the West continues to send arms to Ukraine and train their military, Finland moving very close to requesting NATO membership, and the UK signing a security guarantee with/for Sweden.

Overnight, Asian markets were red across the board.  Taiwan (-2.43%), Hong Kong (-2.24%), and India (-2.22%) led the way lower.  However, the only exchanges to avoid a 1% loss were Shanghai (-0.12%) and Shenzhen (-0.13%).  In Europe we see the same picture taking shape at mid-day.  The FTSE (-2.04%), DAX (-1.97%), and CAC (-2.13%) are leading the way lower as disruption to natural gas supplies, disagreement over caving to Russian demands for Rubles, and inflation are the main fears of the day.  As of 7:30 am, US Futures are pointing toward a down start to the day ahead of the morning data.  The DIA implies a -0.36% open, the SPY implies a -0.50% open, and the QQQ implies a -0.95% open at this hour.  10-year bond yields are down again to 2.841% and Oil (WTI) is off 1.3% to $104.35/barrel in early trading.

The major economic news scheduled for release on Thursday include Apr. PPI and Weekly Initial Jobless Claims (both at 8:30 am), the WASDE Report (noon), and a Fed speaker (Daly at 3 pm).  Major earnings reports scheduled for the day include BAM, DDS, KELYA, NICE, PRMW, TPR, USFD, and WE before the open.  Then after the close, AQN, COMP, EDR, MSI, TOST, and VZIO report.

So far this morning BAM, TOELY, SFTBF, SOMLY, UTZ, TPR, WE, and CIXX have reported beats on both revenue and earnings.  Meanwhile, SFTBY, NSANY, CSIOY, YPF, and HIMX all missed on revenue while beating on earnings.  On the other side, NTTYY, SSMXY, and ALIZY have reported beating the estimates on revenue but missed on the bottom line.  Finally, SIEGY, TEF, KUBTY, SSDOY, KNBWY, BOUYY, FUJHY, STBFY, TAST, TINLY, and GHG have reported misses on both lines.

Premarkets continue to be red this morning with PPI and Jobless Claims coming before the bell. Geopolitical and cryptocurrency risks are also on Mr. Market’s mind. However, we have another few weeks before the next Fed hike and the betting has not changed in the last week. Most futures traders expect a half-point hike. So, we have time to adjust and no major changes are expected. Again, no need to panic or experience FOMO. If you want to trade this market, unless you are a daytrader, the smart move is to stick with the downtrend. The bears still have all the momentum.

Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. You also don’t need to be in the market all the time. If this isn’t a market condition you thrive in, then get out of the way. It will settle out at some point and it’s far better to wait and have money the market condition you prefer than to force trades now and be busted when things do turn. Keep in mind that nobody is right all the time. If you’re wrong, just admit it and take your loss. Focus on your process and enjoy yourself.

Ed

Swing Trade Ideas for your consideration and watchlist: BTU, VET, SWN, TECK, TCOM, MOS, ABC, HAL, APA, SLB, KWEB, AIZ, L, ANTM, KR. 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.

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

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

Stocks gapped up 1.5% Tuesday in what appeared to be a relief rally in the making.  However, it was a Bull Trap that the Bears sprung immediately leading to a steady selloff that lasted all morning, more than filling the gap before flattening out near the lows by lunchtime. Still, the whipsaw was not done. So, stocks reversed and a strong rally kicked in about 12:30 pm, followed by another selloff, and then another rally, etc.  This action gave us indecisive, big wick, black candles that both printed new 52-week lows and look to be ending in the green in the QQQ and SPY.  The technology and healthcare sectors led on the day with Utilities lagging. On the day, SPY was up 0.23%, DIA closed down 0.26%, and QQQ rose 1.21%.  The VXX fell 3.4% to 27.05 and T2122 remained deeply oversold at 1.33.  10-year bond yields fell but then rebounded to close just below 3% at 2.993% and Oil (WTI) fell 3.45% to $99.56/barrel. 

After the close, OXY, GFS, FNF, HRB, RXT, GO, ALC, SCSC, DAR, and ADV all reported beats on both revenue and earnings.  Meanwhile, ELY missed on revenue while beating on earnings.  On the other side, WELL reported beating the estimates on revenue but missed on the bottom line.  Finally, EA, COIN, RBLX, WYNN, YELL, RKT, OSCR, GSM and DBD reported misses on both lines.

Cryptocurrency markets are in turmoil as twice in the last 2 days a major “stablecoin” has decoupled from its supposed dollar pegging.  The idea behind a stablecoin is that a computer algorithm maintains a 1:1 peg to the dollar by buying/destroying digital assets.  (This would be like the dollar under the gold standard, but with a computer printing/burning dollars in an attempt to maintain the dollar-gold exchange rate.)  The first to decouple was Luna, which dove more than 80% in value.  Then UST dropped as far as to 31 cents and is now trading at 50 cents on the dollar.  Both stablecoin are part of the same project Terra.  Terra creator Do Kwon (who has also amassed billions of dollars’ worth of bitcoin) said Tuesday he is close to announcing a plan to recover and return to a 1:1 dollar peg. The moral of the story is that stablecoins aren’t.

SNAP Case Study | Actual Trade

On the Russian invasion story, Finland’s Foreign Minister Haavisto said his country is now just days away from applying for NATO membership.  Meanwhile, the war may be expanding as Belarus moved their special forces to the border of Ukraine claiming that the US and its allies are increasing their presence on that country’s border.  Ukraine said that it will turn off natural gap pipelines from Russia to Europe as Russia’s forces have disrupted operations at several facilities.  This pipeline accounts for a third of Russian gas exports to Europe and this may well reduce supplies for EU countries.

The economic news coming later this week includes Apr. PPI, Weekly Initial Jobless Claims, the WASDE Report, and a Fed speaker on Thursday.  Then on Friday, we see Apr. Imports/Exports, Michigan Consumer Sentiment, and a couple more Fed speakers.

The talk in financial markets seems to be all expecting a Fed “overshoot.” In other words, they are assuming that inflation has now peaked and the Fed is behind the curve, tightening into a slowing economy. That would lead to a so-called hard landing. This is all just US-focused, but there are and will be impacts on global markets from the Russian aggression and Western responses with the CIA reporting Putin is preparing for a very long-term conflict. For example, food prices will be raised when the supply of grain is reduced a significant amount. And oil prices cannot help but be impacted as the West is at least nominally banning Russian oil while Saudi Arabia and the UAE are warning about a lack of capacity to expand production to offset those reductions. My point is that markets tend to front-run the economy by 3-9 months and it is impossible to forecast something when the future environment is not known. So, watching the chart is much better than predicting the market in months-long positions.

Overnight, Asian markets were mixed again but on more muted moves than earlier this week.  Shenzhen (+1.80%), Hong Kong (+0.97%), and Shanghai (+0.75%) led the gains while Thailand (-0.58%), India (-0.45%), and Taiwan (-0.35%) paced the losses.  This came as Chinese Consumer Prices rose by 2.1% in April, the fastest increase since November.  Meanwhile, in Europe, markets are mostly in the green despite a spike in natural gas prices on the Russian pipeline news.  The FTSE (+1.11%), DAX (+1.29%), and CAC (+1.94%) are leading the region higher in early afternoon trading.  As of 7:30 am, US Futures are pointing toward a gap up to start the day once again.  The DIA implies a +0.86% open, the SPY is implying a +1.13% open, and the QQQ implies a +1.48% open ahead of key inflation data.  10-year bond yields are down again to 2.93% and Oil (WTI) is up almost 3.5% to $103.22/barrel in early trading.

The major economic news scheduled for release on Wednesday includes Apr. CPI (8:30 am), Crude Oil Inventories (10:30 am), 10-year Bond Auction (1 pm), and Apr. Fed. Budget Balance (2 pm).  There is also another Fed speaker (Bostic at noon).  Major earnings reports scheduled for the day include ICL, NOMD, PFGC, PRGO, SLVM, TM, WEN, and WWW before the open.  Then after the close, DOX, APP, CPA, CPNG, PAAS, STE, and DIS report.

So far this morning WWW, OCPNY, and ICL have reported beats on both revenue and earnings.  Meanwhile, NOMD, ADRNY, PCRFY, BRTHY, and EC all missed on revenue while beating on earnings.  On the other side, BRDCY, SGIOY, AJINY, MNBEY, and PRGO have reported beating the estimates on revenue but missed on the bottom line.  Finally, TM, TAK, FUJIY, AGESY, SMTOY, ATC, and WEN have reported misses on both lines.

Premarkets are up significantly and most analysts are saying that they expect the April CPI to show that inflation has now peaked (expecting an +8.1% print versus last month’s +8.5% number). This means that the risk this morning is on the downside as an unexpectedly hot print could reverse overnight gains and shock markets. Either way, there is no reason to panic and chase the open Futures are backing off earlier highs. Regardless of the number, the Fed is still very likely to raise rates by half a percent in June and it would take a significant shock one way or the other to move them off that amount of hike. This means that markets will still have several weeks to adjust before the Fed regardless of today’s number. Again, no need to panic or experience FOMO. So, once again the question is whether the implied gap up is a “dead cat” bounce or the beginnings of a reversal. The smart money remains in the “relief rally at best, bull trap at worst” camp given the strong bear trend and current over-extension. So, if you are bound to go long in this move, be very cautious and extremely nimble. The bears still have all the momentum.

Stick with your trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. Remember that the first rule of making big money in the market is to not lose big money in the market. So, don’t be stubborn, and protect yourself from yourself. You also don’t need to be in the market all the time. If this isn’t a market condition you thrive in, then get out of the way. It will settle out at some point and it’s far better to wait and have money the market condition you prefer than to force trades now and be busted when things do turn. Keep in mind that nobody is right all the time. If you’re wrong, just admit it and take your loss. Focus on your process and enjoy yourself.

Ed

Swing Trade Ideas for your consideration and watchlist: VMD, NXPI, OXY, MCK, WDC, HPQ, ABC, EPAM, JPM, MRK, VLO, VZ, CHRW, GSK, EXPD, PVH. 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.

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

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