Markets opened flat and then roller-coastered their way sideways (slightly bearish in the large-cap indices and slightly bullish in the QQQ).  This lasted all the way to 1:30 pm.  However, then Fed Chair Powell strolled to the mic and confirmed that we may get a smaller rate hike later this month.  That was all the bulls needed to hear and the market took off like a rocket the rest of the day, closing very near the highs on all three major indices.  This action gave us Morning Star signals in the SPY, DIA, and what could be seen as one in the QQQ if you squint and relax your Doji standards.  All 3 also crossed above their T-lines as well as breaking out of their recent pullbacks.

On the day, all ten sectors were in the green.  The Energy sector (+1.03%) lagged and the Technology sector (+4.85%) led the market higher.  Meanwhile, the SPY was up 3.06%, the DIA was up 2.27%, and the QQQ was up a whopping 4.54%.  The VXX fell by 3.68% to 14.92 and T2122 shot up into the overbought territory again at 92.43.  10-year bond yields fell to 3.633% and Oil (WTI) is up 2.98% to $80.54 per barrel.  So, Wednesday was a wait-and-see day until Powell spoke and then a moonshot after he started talking.

In economic news, ADP Nonfarm Payrolls increased 127k jobs, which was far below the +200k forecasted and even further below the October value or +239k.  However, Q3 GDP came in above expectation at +2.9% (compared to the forecast of +2.7%) and at the same time Q3 GDP Price Index came in above expectation at +4.3% (compared to the forecasted +4.1%).  At the same time, Oct. Goods Trade Balance came in well below the expected value at -99 billion (compared to -90.20 forecasted and -92.22 billion in September).  Meanwhile, Oct. Retail Inventories were higher better than was expected at  -0.4% (versus the -0.2% forecasted, but worse than the Sept. drawdown of -0.9%).  Later, the Chicago PMI came in far below expectation at 37.2 (compared to 47.0 forecasted and 45.2 in October).  October JOLTs were slightly above average at 10.334 million (versus 10.300 million forecasted but better than the previous periods 10.687 million).  In addition, October Pending Home Sales fell 4.6% which was better than the forecasted -5.0% and much better than the September value of -8.7%.  Still, the most unexpected number of the day was a huge drawdown in EIA Weekly Crude Oil Inventories of 12.580 million barrels (compared to an expected drawdown of 2.758 million barrels).

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In stock news, JNJ sued AMGN for infringing two of JNJ’s patents related to JNJ’s Stelara (which accounts for $9.1 billion in annual sales for JNJ).  Elsewhere, GM announced that its robotaxi division (Cruise) will have thousands of vehicles in service in 2023.  This includes service in San Francisco CA, Phoenix AZ, and Austin TX as well as “a large number of other markets.”  Meanwhile, the CEO of BHP told a Reuters conference that he expects the Chinese economy to grow in 2023 and for at least the next 20 years.  (China accounts for 50% of the world’s demand for raw materials.)  In other news, LH and CRL stocks both fell Wednesday after the US Dept. of Justice indicted their primary supplier of natural health products (in Cambodia) and both said an alternative supplier will be difficult to find.  In acquisition news, Reuters reported that GE, LHX, and TXT are all competing to acquire AJRD (after a previous acquisition by LMT was killed by regulators last February).  At the same time, CTVA announced it has acquired unlisted Stoller for $1.2 billion in cash.

In miscellaneous news, as mentioned above, the main story of the day was that Fed Chair Powell confirmed that smaller rate hikes are ahead and could start as soon as this month.  However, he also said it will be quite some time before inflation starts to come under control and policy could begin to become less restrictive.  In addition, in what might have been a “clap back” to Elon Musk (who earlier had said the Fed must cut rates immediately to avoid a severe recession), Powell also said “the Fed won’t crash the economy with interest rate hikes.”  Later, in a separate speech, Fed Governor Cook echoed those same thoughts.

In supply chain news, in a bipartisan vote, the US House of Representatives voted 290-137 to block a rail strike and mandate that the railroads must provide paid sick time for rail workers (which was the main sticking point in negotiations).  The measure must still pass the Senate and be signed, but President Biden supports this legislation.  The first date a strike could happen would be December 9.  Railroads impacted include UNP, CSX, NSC, KSU, and BRKA’s rail unit BNSF.

After the close, CRM, PVH, SNPS, SPLK, FIVE, LZB, PSTG, OKTA, and SNOW all reported beats on both the revenue and earnings lines.  However, VSCO missed on revenue while beating on earnings.  It is worth noting that CRM, SNPS, PSTG, OKTA, and SNOW all raised their forward guidance.  At the same time, PVH and LZB both lowered their own guidance.

Overnight, Asian markets green across the board, taking their lead from the US but in a more muted move.  Shenzhen (+1.40%), Australia (+0.96%), and Japan (+0.92%) led the region higher.  Meanwhile, in Europe, we see a similar picture taking shape at midday.  The FTSE (+0.08%), DAX (+0.75%), and CAC (+0.18%) lead by volume as many of the smaller exchanges are up more than one percent in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a start to the day just on the red side of flat.  The DIA implies a -0.16% open, the SPY is implying a -0.06% open, and the QQQ implies a -0.13% open at this hour.  10-year bond yields are falling again to 3.589% and Oil (WTI) is up another 1.3% to $81.60/barrel in early trading.

So far this morning, KR, TD, and GIII reported beats on both the top and bottom lines.  Meanwhile, DG, BMO, and CM beat on revenue while missing on earnings.  On the other side, PDCO missed on revenue while beating on earnings.  However, BIG and DBI both missed on the top and bottom lines. It is worth noting that KR raised its forward guidance in its report.

The major economic news events scheduled for Thursday include Oct. PCE Price Index, Oct. Personal Spending, and Weekly Initial Jobless Claims (all at 8:30 am), Nov. Mfg. PMI (9:45 am), Nov. ISM Mfg. PMI (10 am), and a Fed speaker (Bowman at 9:30 am).  The major earnings reports scheduled for the day include BMO, BIG, CM, DBI, DG, KR, PDCO, and TD before the open.  Then, after the close, MRVL, ULTA, and VEEV report. 

In economic news later this week, on Friday, we get Avg. Hourly Earnings, Nov. Nonfarm Payrolls, Nov. Unemployment Rate, and Nov. Participation Rate.  In earnings later this week, on Friday, we hear from CRBL and GCO.

In late-breaking news, China gave a hopeful signal to its own people and the rest of the global economy. The top Chinese Health Official said that its fight with covid-19 is entering a “new phase” as the Omicron variant becomes less deadly and vaccinations reaching more people. (Side note, the Chinese vaccines are ineffective against omicron, but whatever.) As a result “some infected people” in the most populated districts will be allowed to self-quarantine at home and “other easing” measures will follow. This would seem to be an attempt to placate the masses who publicly protested the “Zero Covid” policy and began calling for the end of President Xi. Regardless, if this does lead to easing, that will help bolster the Chinese GDP, global supply chains, and the global economic outlook (not to mention the profits of all the companies that sell into and are supplied from China).

With that background, it looks like markets want a breather after the frantic rally yesterday afternoon. This is a very normal thing and healthy for a rally. We also have more economic data coming this morning, including Jobless Claims, Personal Spending, and the PMIs. At this point, the DIA has taken out its near resistance and has room to run. However, the SPY and QQQ still have to deal with resistance levels from prior highs and lows as well as the long-term downtrend. So, be careful. A lot of buyer were “used up” in the rally and chase yesterday (which showed well above average volume for the first time in a long time) and it takes more than one day to get the broader public pouring back into the market. Also, note that we are extended both in terms of the T-line (8ema) and T2122. Just beware of buying into a pullback.

As always, be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: RIG, HD, NFLX, PANW, and NKE. 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

The major exchanges opened essentially flat on Tuesday and then undulated sideways until just before 11 am when the bears sold us off for 30 minutes. At that point, markets ground essentially sideways with a slightly bullish trend right into the close.  This action gave us Spinning Top candles in the large-cap indices, while the QQQ printed a bigger-bodied black candle with wicks on both ends (fat-bodied Spinning Top).  All three major indices also gave up their T-lines (8 ema) on the daily candle.  This all happened on very low volumes, with the DIA coming the closest to its average volume.

On the day, five of the ten sectors were in the green.  The Energy sector (+1.65%) and Basic Materials (+1.50%) were by far the biggest winners while the Utilities (-0.56%) and Technology (-0.53%) sectors were down the most. At the same time, the SPY was down 0.17%, the DIA was dead flat, and the QQQ was down 0.76%.  The VXX fell by 1.446% to 15.49 and T2122 climbed but remains in the mid-range at 59.52.  10-year bond yields have climbed a bit to 3.752% and Oil (WTI) is up 1.77% to $78.61 per barrel.  So, Tuesday has been an indecisive day that saw the pullback continue in the high-tech QQQ.

In economic news, Conference Board Consumer Confidence came in slightly above its forecasted value at 100.2 (compared to a 100.0 forecast). However, that value was still below the October reading of 102.2 (and actually the lowest level since July).  Reuters also reported Tuesday that three of the twelve Fed Regional Banks had wanted a smaller rate hike in November, but they were outvoted by the nine that voted for a 0.75% rate increase. However, none of the 12 had been in favor of a 1.00% or greater rate hike in November.  (The Fed Regional Banks do not set rate policy, but do vote on the discount rate which moves in tandem with the policy rate.)

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In stock news, the CEO of AMCX resigned less than 3 months after taking that job.  AMCX also announced that its previously announced 20% workforce reduction will continue as planned.  In EV news, RIDE announced that its first 500 electric trucks are now on their way to customers.  Meanwhile, the CEOs of both KR and ACI were grilled by the US Senate Judiciary Committee Antitrust Panel.  (The two had agreed to a $25 billion deal for KR to acquire ACI, resulting in a chain of nearly 5,000 stores after selling between 100 and 375 stores to offset antitrust concerns.)  Elsewhere, WMT was sued by an employee over its recent Virginia store shooting.  Across the pond, MA lost an appeal to a UK court ruling, where MA had asked the court to throw out the portion of liability that stemmed from claims of 3 million people who have died since the case was first brought.  The court ruled MA will have to face all the claims ($12+ billion total).

In miscellaneous news, ADBE Analytics confirmed Tuesday that Cyber Monday sales hit a record of $11.3 billion, $100 million higher than their Monday afternoon estimate.  This record came in 5.8% above the 2021 level based on data from 85% of the top 100 internet retailers in the US.  ADBE noted that much of that came in the electronics and toys categories.  Elsewhere, the US House of Representatives is planning a vote on Wednesday to block a rail strike (despite labor group objections).  In other government news, the TSA announced Tuesday that Thanksgiving Weekend travel saw the most people since before the pandemic with 24.6 million passengers over the weekend.  This suggests a strong year-end for travel companies.

After the close, HPE, INTU, WDAY, and CRWD all reported beats on both the revenue and earnings lines.  In the meantime, NTAP missed on the revenue line while beating on the earnings line.  It is worth noting that NTAP also lowered its forward guidance.

So far this morning, RY, BEKE, DOOO, DCI, TITN, and LESL all reported beats on the revenue and earnings lines.  Meanwhile, WOOF beat on revenue while missing on earnings.  On the other side, HRL and XPEV missed on revenue while beating on earnings.  It is worth noting that HRL, BEKE, XPEV, and LESL all lowered their forward guidance.  However, TITN raised its forward guidance.

Overnight, Asian markets leaned heavily to the green side again with only Japan (-0.21%) in the red.  Meanwhile, Hong Kong (+2.16%), South Korea (+1.61%), and Taiwan (+1.16%) led the region higher.  In Europe, we see a similar story taking shape at midday.  Only Greece (-0.27%) and Russia (-0.16%) are in the red while the FTSE (+0.75%), DAX (+0.40%), and CAC (+0.74%) lead that region higher in early afternoon trade. As of 7:30 am, US Futures are pointing toward a modestly green start to the day.  The DIA implies a +0.08% open, the SPY is implying a +0.21% open, and the QQQ implies a +0.39% open at this hour.  10-year bond yields are back down to 3.72% and Oil (WTI) is surging up 2.26% to $79.99/barrel in early trading.

The major economic news events scheduled for Wednesday include Nov. ADP Nonfarm Employment Change (8:15 am), Preliminary Q3 GDP, Preliminary Q3 GSP Price Index, Preliminary Oct. Trade Goods Balance, and Preliminary Oct. Retail Inventories (all at 8:30 am), Chicago PMI (9:45 am), Oct. JOLTs Job Openings and Oct. Pending Home Sales (both at 10 am), EIA Crude Oil Inventories (10:30 am), and Fed Beige Book (2 pm). Fed Chair Powell also speaks at 1:30 pm.  On the major earnings reports front, reports scheduled for the day include DOOO, DCI, HRL, BEKE, WOOF, RY, TITN, and XPEV before the open.  Then, after the close, FIVE, LZB, PSTG, PVH, CRM, SNOW, SPLK, SNPS, and VSCO report.

In economic news later this week, on Thursday, Weekly Initial Jobless Claims, Oct. PCE Price Index, Oct. Personal Spending, Mfg. PMI, ISM Mfg. PMI, and a Fed speaker (Bowman) report.  Finally, on Friday, we get Avg. Hourly Earnings, Nov. Nonfarm Payrolls, Nov. Unemployment Rate, and Nov. Participation Rate.

In earnings reports later this week, on Thursday, BMO, BIG, CM, DBI, DG, KR, PDCO, TD, MRVL, ULTA, and VEEV report.  Finally, on Friday, we hear from CRBL and GCO.

In late-breaking news, a Standard & Poors report found that TSLA lost market share in the US. TSLA now has 65% market share for registered electric vehicles (down from 71% last year and 79% in 2020). Elsewhere, US mortgage rates fell for the third straight week with the national average 30-year fixed mortgage rate dropping to 6.49% (down from 6.67% the week prior). This rate drop helped loan applications to increase 4% on the week, but they were still down 41% from one year ago. With that background, markets are waiting on the GDP revision and all the other data on the way today. Perhaps most importantly, Fed Chair Powell’s remarks will be closely watched this afternoon. And, of course, we have the November Payrolls data coming Friday.

With that said, the bullish trend in the DIA persists while the SPY and especially the QQQ have now turned into more of a sideways chop action. The question remains whether this is still just a normal pullback in the uptrend. All three major indices are below their T-lines (8ema), with the large-cap indices trying to retest that level in the premarket. So, there is no problem with extension, either in terms of that T-line or the T2122 indicator, which sits in the midrange. Be wary of chasing any knee-jerk reactions unless you are a very nimble (fast) trader. As always seems the case, more data (and over-reactions) are just around the corner.

As always, be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: BIDU, BOOT, UAN, RKT, NKE, KSS, KHC, and GSK. 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 Monday with the SPY opening down 0.80%, DIA opening down 0.50%, and QQQ opening down 0.72%.  At that point, we saw a momentary rally (that managed to close the gap in the QQQ) before the bears stepped back in to sell us off steadily to new lows on the day by the time the first hour was over. That downtrend has stayed in place all day until a rally in the last 15 minutes.  On the daily chart, the QQQ and SPY both failed to hold their T-lines (8ema) while the DIA is just barely fell through that level and may retest tomorrow. This action gave us black candles with upper wicks and small lower wicks in all 3 major indices.  You could also argue that the SPY printed something like an Evening Star signal.

On the day, all ten sectors were in the red.  The Consumer Defensive sector (-0.34%) lagged while the Basic Materials sector (-2.34%) led the way lower.  At the same time, the SPY was down 1.58%, the DIA was down 1.46%, and the QQQ was down 1.47%.  The VXX gained 3.69% to 15.72 and T2122 has dropped out of overbought territory to 45.79.  10-year bond yields have climbed a bit to 3.683% and Oil (WTI) is back up 0.49% to $76.65 per barrel.  So, overall, Monday was a pullback day on very low volume that did not break the trend and is coming into a potential support area in the DIA and QQQ.

In economic news, Fed uber-hawk Bullard (St. Louis Fed President) told an interview that the Fed will likely need to keep its benchmark rate above 5% into 2024 in order to tame inflation.  This was in answer to a question (which he did not correct or narrow) that asked how long he expects the Fed Funds Rate to remain in the 5%-7% range that one of his slides showed in past presentations.  For reference, the current rate is 4%, a full percent below the bottom of his previously implied range.  Bullard did not answer when asked if he would support a 75-basis-point hike in December, instead saying he would leave the “exact tactics” of reaching a high enough level to Fed Chair Powell.  At the same time (but different venue), NY Fed President Williams (a moderate hawk) told a crown that he thinks there is a path for unemployment to go to 4.5% (it was 3.7% in October).  He also said he expects the Fed to keep raising rates and keep them there for all of 2023.  However, Williams said his baseline case is that (outside of an outside shock) the US economy will not tip into a recession…but that global risk is certainly out there.

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In stock news, Reuters reported Monday that TSLA is developing a revised version of its “Model 3” in an attempt to reduce production costs while also boosting the appeal of that 5-year-old sedan.  TBLA surged Monday, closing up 43.48% (on a range greater than 36% after the gap) after the company announced it had signed an exclusive 30-year advertising deal with Yahoo, generating approximately $1 billion/year in revenue and with Yahoo taking a 25% stake in the company.  Elsewhere, USFD named Dave Fitman as its new CEO.  Meanwhile, Reuters reports that sources tell them that MSFT is willing to offer more concessions to the EU in a bid to save its $69 billion purchase of ATVI.  In the late afternoon, ADBE Analytics announced they expect “Cyber Monday” online sales to have reached $11.6 billion, which is an 8.5% increase over 2021.  After the close, GOOGL and IHRT agreed to pay a modest $9.4 million fine to settle deceptive advertising charges from the FTC related to 29,000 false radio endorsements used to promote the GOOGL Pixel 4 smartphone on IHRT airwaves.

In miscellaneous news, the CFTC reported Monday that the market’s “net short” position on the US Dollar as of the 7 days ended November 22 reached its largest level ($1.82 billion) since July 2021.  This was a massive increase over the paltry $10.5 million net short position the week prior. In possibly related news, the Dollar fell sharply in the afternoon Monday after a huge morning spike (forming an Eiffel Tower pattern) that was the result of a flight to safety over China protest concerns.  Elsewhere, late in the day Monday, the Fed released remarks made by Vice Chair Brainard in which she said the War in Ukraine and global supply chain shocks (covid) could herald a shift to a more volatile inflation era…which would force central banks to tighten monetary policy, even more than currently, to guard against explosive inflation events.

So far this morning, BNS and BILI reported beats on both the revenue and earnings lines.  Meanwhile, ESLT and HIBB reported misses on both the top and bottom lines.

Overnight, Asian markets leaned heavily to the green as Chinese protests eased.  Hong Kong (+5.24%), Shenzhen (+2.40%), and Shanghai (+2.31%) led the region higher while only Malaysia (-0.64%) and Japan (-0.48%) were in the red.  Meanwhile, in Europe, we see a similar, but more muted situation taking shape at midday.  The FTSE (+0.71%), DAX (+0.19%), and CAC (+0.26%) are leading the region higher with only 3 very modest red exchanges in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a modest green start to the day.  The DIA implies a +0.09% open, the SPY is implying a +0.31% open, and the QQQ implies a +0.50% open at this hour.  10-year bond yields have dropped again to 3.664% and Oil is up 2.4% to $79.11/barrel in early trading.

The major economic news events scheduled for Tuesday is limited to the Conf. Board Consumer Confidence report (10 am) and API Weekly Crude Oil Stocks report (4:30 pm).  On the major earnings reports front, reports scheduled for the day include BNS, BILI, CG, ESLT, and SJR before the open.  Then, after the close, CRWD, HPE, INTU, NTAP, and WDAY report. 

In economic news later this week, on Wednesday, Nov. ADP Nonfarm Employment Change, Q3 GDP, Q3 GSP Price Index, Oct. Trade Goods Balance, Retail Inventories, Chicago PMI, Oct. JOLTs Job Openings, Oct. Pending Home Sales, EIA Crude Oil Inventories, Fed Beige Book, and Fed Chair Powell speaks.  On Thursday, Weekly Initial Jobless Claims, Oct. PCE Price Index, Oct. Personal Spending, Mfg. PMI, ISM Mfg. PMI, and a Fed speaker (Bowman) report.  Finally, on Friday, we get Avg. Hourly Earnings, Nov. Nonfarm Payrolls, Nov. Unemployment Rate, and Nov. Participation Rate.

In earnings reports later this week, on Wednesday, we hear from DOOO, DCI, HRL, BEKE, WOOF, RY, TITN, XPEV, FIVE, LZB, PSTG, PVH, CRM, SNOW, SPLK, SNPS, and VSCO.  On Thursday, BMO, BIG, CM, DBI, DG, KR, PDCO, TD, MRVL, ULTA, and VEEV report.  Finally, on Friday, we hear from CRBL and GCO.

As mentioned above, Chinese stocks are leading a global rally after Beijing gave a muted and conciliatory reply to the mass “Zero Covid” policy protests. China said it will bolster vaccinations among senior citizens and that may allow some localized and non-public easing of restrictions. So, today may be setting up to be another “Turnaround Tuesday.” However, remember the data dump this week is back-weighted. So, there is likely to be some more “waiting on the next shoe to drop” as traders pause until we see the big reports from Wednesday to Friday. The Dollar continues its recent weakness again this morning and that should help commodity prices. So, overall we have some cautiously bullish conditions trying to take hold.

In the short term, markets are still just seeing a normal pullback in the uptrend. All three major indices seem to be retesting their T-lines (8ema) in the premarket. So, there is no problem with extension, either in terms of that T-line or the T2122 indicator, which sits in the midrange. Be wary of any unscheduled Fed speakers, but it would not be surprising to see another blah day (at least on volumes) as markets wait on the Wednesday GDP print or Friday morning’s Payrolls data.

As always, be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: BIDU, MPC, X, KSS, CMCSA, and KHC. 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

Friday was a dead day in markets as the SPY and DIA while QQQ gapped down half of a percent.  From there, the DIA had a half-hour rally before joining the other 2 major indices in grinding sideways in a very tight range into the early close at 1 pm.  This action gave us very low volume candles in all 3 major indices with small Spinning Top type candles in the SPY and QQQ along with a white-bodied candle in the DIA.  The QQQ and SPY were also Doji-Harami (inside day) candles.

On the day, seven of the ten sectors are in the green, with the Utilities sector (+0.70%) and Communications Services sector (+0.68%) leading the way higher while the Tech sector (-0.54%) lagging behind.  At the same time, the SPY lost 0.02%, the DIA gained 0.46%, and the QQQ lost 0.66%.  The VXX gained 0.53% to 15.16 and T2122 stayed in the overbought territory at 89.85.  10-year bond yields have fallen again to 3.691% and Oil (WTI) dropped to $76.28 per barrel.  So, overall, Friday was a nothing burger day after the Technology gap down and 30 minutes of action. 

In economic news, on Friday the National Retail Federation said they expect holiday sales to rise between 6% and 8% in the November-December period.  Obviously, this is a gain, but less than the +13.5% in 2021 and +9.3% in 2020.  Meanwhile, ADBE Analytics reported record online sales ($9.2 billion) on Black Friday, up 2.3% from the same day last year.  This followed a reportedly strong day of online sales on Thursday ($5.29 billion, which was up 2.9% from 2021).  ADBE also reported a 78% increase in “Buy Now, Pay Later” purchases versus the week prior.  Elsewhere, CNBC reported research from ad-tracking company Captify which said that WMT overtook AMZN as the most searched online store on Black Friday.  The research said that TGT and KSS also beat our AMZN, which it said dropped to fourth in terms of online deal searches on that one day.

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In stock news, Reuters reported Friday that AAPL’s biggest supplier (Foxconn) may have to reduce iPhone output by another 30% at its main China factory due to worker unrest.  As of now, Reuters says it will be impossible for Foxconn to resume production at least for another week, even after offering a $1,400 bonus for workers who would return. At the same time, sources reported that it is very possible AMZN will reach a deal with the EU Antitrust investigators by year-end, allowing the company to avoid the threatened fine amounting to 10% of global turnover.  Meanwhile, the FDA declined to approve a lung cancer drug from SPPI and the company announced it will cut 75% of its R&D workforce by year-end.  On Saturday, TROW (a major shareholder of NWSA) said it has strong reservations to Rupert Murdoch’s plan to reunite NWSA and FOX and will likely fight the recombination.

In miscellaneous news, China’s Central Bank announced that in addition to buying bonds, it will offer $162 billion in discounted loans to real estate developers to prop up its struggling real estate sector.  In other China news, there are ongoing mass protests in Shanghai (where the Foxconn AAPL plant is located) where literally thousands of protesters have shut down public transport and caused building and car fires in that major city.  As of Sunday night, police had maintained a heavy presence but had not cracked down as the plan was to let the protest fizzle on its own and then resume public transport gradually on Monday.  Elsewhere, the South Korean government threatened to break up a nationwide strike by truck drivers (who are seeking better pay and conditions).  In the car industry, F recalled 634,000 cars worldwide over cracked fuel injectors.  In other car news, TSLA opened its “Full Self-Driving” beta to anyone in North America, despite the repeated crashes and fatalities of people using that feature.  Finally, on Sunday, China reported that the profits of its Industrial Manufacturers were down 13.4% year-to-date through October (slightly worse than the 13.2% fall through September).

So far this morning, PDD beat (handily) on both lines, including almost double the expected earnings. However, HTHT beat on revenue while missing on earnings. HTHT also lowered its forward guidance.

Overnight, Asian markets were nearly red across the board.  Only India (+0.27%) managed to stay green while Hong Kong (-1.57%), Taiwan (-1.50%), and South Korea (-1.21%) led the region lower.  Meanwhile, in Europe, exchanges are all in the red at midday.  The FTSE (-0.38%) lags, while the DAX (-1.01%) and CAC (-1.04%) are typical of the region in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a gap lower to start the week.  The DIA implies a -0.53% open, the SPY is implying a -0.71% open, and the QQQ implies a -0.66% open at this hour.  10-year bond yields are down to 3.677% and Oil (WTI) is off 3.17% to $73.86/barrel on global demand fears.

The major economic news events scheduled for Monday are limited to two speakers from the Fed (Uber-hawk Bullard and slight-hawk Williams both speak at noon).  On the major earnings reports front, reports scheduled for the day include PDD and HTHT before the open.  Then, after the close, YY reports.

In economic news later this week, on Tuesday we get Conf. Board Consumer Confidence and API Weekly Crude Oil Stocks Report.  Then Wednesday, Nov. ADP Nonfarm Employment Change, Q3 GDP, Q3 GSP Price Index, Oct. Trade Goods Balance, Retail Inventories, Chicago PMI, Oct. JOLTs Job Openings, Oct. Pending Home Sales, EIA Crude Oil Inventories, Fed Beige Book, and Fed Chair Powell speaks.  On Thursday, Weekly Initial Jobless Claims, Oct. PCE Price Index, Oct. Personal Spending, Mfg. PMI, ISM Mfg. PMI, and a Fed speaker (Bowman) report.  Finally, on Friday, we get Avg. Hourly Earnings, Nov. Nonfarm Payrolls, Nov. Unemployment Rate, and Nov. Participation Rate.

In earnings reports later this week, on Tuesday, BNS, BILI, CG, ESLT, SJR, CRWD, HPE, INTU, NTAP, and WDAY report.  Then Wednesday, we hear from DOOO, DCI, HRL, BEKE, WOOF, RY, TITN, XPEV, FIVE, LZB, PSTG, PVH, CRM, SNOW, SPLK, SNPS, and VSCO.  On Thursday, BMO, BIG, CM, DBI, DG, KR, PDCO, TD, MRVL, ULTA, and VEEV report.  Finally, on Friday, we hear from CRBL and GCO.

As we come back from a long holiday weekend, there is not much cheer in the market. Surprisingly, mass protests in China (some openly calling for President Xi to resign) have not yet been crushed, but that seems to be what analysts and the people there expect. Between that situation, a very minor holiday sales pop in Europe (the UK reported +0.90% in its first measure of holiday sales), and modest sales increases in the US on Black Friday, we are left with a somber mood to start the week. As you can see above, we also have a big data week ahead, led by November Payrolls data on Friday. So, there is a lot of reason for caution by traders at this point. The Dollar is also showing significant weakness again this morning. (News that should help support commodity prices at the margins.) And we also have a couple of hawkish Fed speakers at noon today.

In the short term, markets are just seeing a normal pullback in the uptrend. Only the QQQ appears to even be retesting its T-line (8ema) in the premarket as that index continues to work on a Bullish Pennant pattern. There is no problem with extension, even though the T2122 indicator sits midway into the overbought territory. The risk at this point seems to mainly be news-driven this week. Be careful and don’t be surprised if most of the move comes after Wednesday’s GDP print and Friday morning’s Payrolls data.

As always, be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: STNG, QUOT, ARDX, TXG, EBAY, HUN, APP, PDD, AFRM, and VLDR. 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 up just over 0.50% across all three major indices on Tuesday.  At that point, we saw a modest pullback and recovery over the first 45 minutes in the SPY and DIA (fading the gap and then returning to the open level). The QQQ had a much bigger pullback, but then started a rally that led the rest of the market higher the rest of the day. This QQQ rally really slowed down at 11 am but continued slowly. Meanwhile, the large-cap indices experienced a couple of multi-hour sideways grinds in a tight range before stepping up again to a new level just to grind sideways again until 3 pm.  At 3 pm, all 3 of the major indices took another step higher before again the QQQ led the rest higher into the close. With that said, the SPY and DIA also broke out above their Bull Pennant downtrend lines.  This action gave us Doji gap-up white candles (some may call it a Best Friend signal) across the SPY, SIA, and QQQ.

On the day, all ten sectors are in the green, with the Energy sector (+2.98%) leading the way higher and the Consumer Defensive sector (+0.49%) lagging behind.  At the same time, the SPY has gained 1.32%, the DIA has gained 1.16%, and the QQQ has gained 1.44%.  The VXX was down 3.44% to 15.42 and T2122 has climbed back up into the overbought territory to 90.91.  10-year bond yields have fallen back down to 3.76% and Oil (WTI) is up 1.37% to $81.13 per barrel.  So, Tuesday was a mildly bullish day where the large caps were dragged higher by high-tech names, like NVDA, AMD, and ADBE.

In economic news, the API Weekly Crude Oil Stock Report showed more than twice the expected oil drawdown.  The report claimed a 4.8-million-barrel drawdown (versus the forecasted 2.2-million-barrel drawdown, but better than last week’s 5.835-million-barrel drawdown.  Meanwhile, in Fed speak, Cleveland Fed President Mester said that “We’re (FOMC) committed to using our tools to put inflation on a sustainable downward trajectory to 2%.”  She went on to say that wage increases are rising, but they are below inflation, suggesting they are not a key inflation driver. She also said inflation expectations remain stable but did not comment on the outlook for Fed policy.  Later, Kansas City Fed President George said that the ample US savings will be a buffer and could mean higher interest rates are needed to cool inflation. (In other words, as a country, we have too much savings, so we will feel the pain later and may keep spending longer, causing the Fed to need to keep hiking rates longer and higher to overcome that savings buffer in order to reduce spending.)

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In stock news, TEVA and ABBV announced they have finalized the terms of their settlement (worth more than $6.6 billion) to resolve thousands of lawsuits by state and local governments over marketing opioid painkillers.  The breakdown is approximately $4.25 billion paid by TEVA and 2.37 billion paid by ABBV.  However, final payout numbers will depend on how many state and local governments opt-in versus those who go on to court proceedings.  Later in the day, a META spokesman had to deny the persistent rumors that CEO Zuckerberg will be stepping down in 2023.  (Shares of META had been up close to 2% on the rumor and retreated after the rebuttal.)  At the same time, ZEN announced it has been taken private in a $10.2 billion deal which will pay shareholders $77.50/share.  Elsewhere, the SEC charged the GS Asset Mgmt. unit for failing to follow policies and procedures related to mutual funds that it had marketed as “ESG” investments. GS agreed to pay a $4 million penalty without admitting (or denying) the charges.  Meanwhile, HPQ announced after the close that it will be cutting 4,000-6,000 jobs between now and the end of 2025 and that it will incur a $1.0 billion charge related to restructuring costs with $0.6 billion of that coming in 2023.  (Implying 60% of those job cuts will happen next year.) Finally, COP announced it has taken a stake in the SRE Port Arthur LNG terminal.

In miscellaneous news, the White House said Tuesday that President Biden is directly involved in negotiations between railroads and unions after he had publicly said a rail shutdown was “unacceptable.”  This may be related to the CEO of UNP railroad being called to Washington and also called to testify before the Surface and Transport Board on December 13-14 to address the railroad’s substantial increase in the use of embargoes.  (An embargo is when a railroad fears rail network congestion and it temporarily embargoes or halts train movement until the company deems the congestion has cleared.  This causes delays in shipments without impacting the reported (or paid for) service levels, similar to a “force majeure” declaration in a contract.) During 2017, UNP had 5 embargoes but has declared over 1,000 so far in 2022.  Elsewhere, in Europe, EU countries are now close to announcing the cap price on Russian oil (maybe as soon as today).  In what I’m sure is unrelated news, the Russian company Gazprom again threatened to cut the gas supply to the single remaining pipeline (through Ukraine) that feeds Western Europe.  However, European (and especially German) natural gas stockpiles remain full and as of Tuesday, a German independent agency said the energy outlook for Germany had improved from just a couple of months ago. (This means the Russian threat may carry less weight.)

After the close, HPQ, BBAR, and JWN both reported beats on both the revenue and earnings lines.  In addition, ADSK met both revenue and earnings estimates.  At the same time, GES beat on revenue while missing on earnings.  However, VMW missed on both the revenue and earnings lines. It’s worth noting, ADSK and GES both lowered their forward guidance. So far this morning, DE beat (handily) on both lines.

Overnight, Asian markets were mostly green on modest moves.  Australia (+0.70%), Japan (+0.61%), and Hong Kong (+0.57%) led the region higher while only Shenzhen (-0.27%) and Singapore (-0.11%) were in the red.  Meanwhile, in Europe, exchanges are also mostly green on smaller moves at midday.  The FTSE (+0.31%), DAX (-0.17%), and CAC (-0.02%) are typical with most of the smaller exchanges modestly in the green in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a start to the day just on the green side of flat.  The DIA implies a +0.06% open, the SPY is implying a +0.16% open, and the QQQ implies a +0.24% open at this hour.  At the same time, 10-year bond yields are up slightly to 3.769% and Oil (WTI) is down almost 2% to $79.31/barrel in early trading.

The major economic news events scheduled for Wednesday, October Building Permits (8 am), October Durable Goods and Weekly Initial Jobless Claims (both at 8:30 am), Mfg. PMI and Services PMI (both at 9:45 am), Michigan Consumer Sentiment and Oct. New Home Sales (both at 10 am), EIA Weekly Crude Oil Inventories (10:30 am), and FOMC Meeting Minutes (2 pm) are reported.   Meanwhile, the major earnings reports scheduled for the day are limited to DE before the open.  Then, after the close, LU reports.

As you would expect on a holiday week, there will be no economic news on Thursday or Friday due to the Thanksgiving break. There are also no major earnings reports scheduled for Thursday or Friday.

There is a lot of economic data crammed into the schedule today due to the holiday-shortened week. Among other things, mortgage demand grew 2.2% last week as rates plummeted from 6.91% the prior week to 6.67% (6.61% at one point) for a 30-year fixed-rate loan last week. The Dollar is also showing a little weakness for the second day in a row. (News that should support commodity prices at the margins.) And while we are not supposed to get Fed speakers today, analysts are expecting to see the FOMC Minutes show strong support in the committee for higher terminal rates to really choke out inflation (which could be a bit of a disappointment to markets but has been signaled all week by Fed speakers). At the very least, the minutes are expected to tamp down bull hopes of a pause in hikes.

In the short term, the large-cap indices are working to break out of the recent consolidation (5-day) with the DIA already broken out and the SPY appearing to do so in the premarket. Even the lagging Q is breaking out of the top of its Pennant downtrend in premarket trading today. Extension from the T-line is not a problem yet but the T2122 indicator had climbed back into the overbought area. So, be careful. Also, do not be surprised if volume and moves die as the day goes on and markets seems to slowly drift one way or the other…especially in the late afternoon. Remember that this is the virtual Friday before a 4-day weekend for the majority of traders, with only a minority planning to return to their trading desk for a half-day on Friday. In short, this may be time better spent “sharpening your axe” than trying to chop up too many trees.

As always, be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: APPS, VALE, EBAY, WFC, and MPC. 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 Monday, stocks opened basically flat (SPY and QQQ down modestly and DIA flat).  All 3 major indices then sold off modestly until 11 am.  We then saw a sideways grind in a very tight range un 12:30 pm.  We then saw a rally in all 3 major indices that died out at 1:45 pm and fell into a very modest and slow pullback, again in a tight range, all the way into the close.  This action is giving us very indecisive, black-bodied Spinning Top type candles in the 3 major indices.  The two large-cap indices held up after their retests of their T-lines, while the QQQ closed slightly back below its own 8ema.

On the day, six of the ten sectors are in the red, with Consumer Defensive sector (+0.67%) leading the four gainers and the Technology sector (-1.41%) lagging behind.  At the same time, the SPY fell 0.36%, the DIA fell 0.09%, and the QQQ fell 1.03%. The VXX was down 2.68% to 15.97 and T2122 fell back out of overbought territory to 75.57.  10-year bond yields have climbed back up to 3.833% and Oil (WTI) was down 0.42% to $79.74 per barrel.  So, overall Monday was an indecisive session as we wait on more earnings on Tuesday and then the holiday break.

In stock news, the G20 Financial Stability Board issued its report on the world’s most “systematically important banks,” which concluded that JPM remains the world’s most important bank to financial systems which means it remains the most in need of tight scrutiny to ensure it has a capital buffer.  BAC was on the list and moved into the bucket needing lesser scrutiny (due to improved capital reporting) where it joined C in that tier of scrutiny requirement.  Elsewhere, British Competition Regulator announced it is looking into the $61 billion acquisition of VMW by AVGO. In other M&A news, MRK announced it will acquire IMGO for $1.35 billion (at 107% premium on Friday’s closing price).  Meanwhile, DKNG shares plummeted Monday on news that the company was hacked and user accounts had been cashed out as part of the hack.  Elsewhere, TSLA shareholders have created an online petition urging the CEO (Elon Musk) to initiate a share buyback program to support the share price.  Among those leading this call are the third largest TSLA shareholder, Leo KoGuan.  Finally, Bloomberg reported that BYND has serious food safety issues, including noticeable listeria, mold, and other food safety red flags at its PA plant.  This was witnessed by 11 different occasions where the facility tested positive for Listeria within the 6 months ending Dec. 2021.

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In legal news and government news, a US Appeals Court has decertified a class action lawsuit that had found BA and LUV liable for covering up a fatal flaw in the BA 737 Max 8 plane design.  The court ruled that because the risk did not materialize (i.e. there was no crash) the risk never really existed, so plaintiffs lacked standing.  Elsewhere, the FAA proposed new rules to regulate vertical takeoff/landing Air Taxis in coming years.  At the moment, only DAL has invested significantly in that niche and the company is expecting significant urban demand in coming years and specifically the 2028 Olympics in Los Angeles.  Finally, the US Supreme Court has decided to hear a case brought by BF.A against a dog toy maker for their parody of the Jack Daniel’s “Old No. 7” trademark (the dog toy box had been labeled as “Old No. 2 on your Tennessee Carpet” and included alcohol descriptions of “43% Poo By Vol.”  (So, take heart, life can’t be all that bad if our highest court has time to hear and rule on this kind of thing.)

In Supply Chain news, the largest rail union has voted to reject the latest contract offer by railroads.  The sticking issue is paid sick time.  As a result, a potential national rail strike is back on the table for as soon as December 9.  A full strike would shutdown roughly 40% of US freight long-haul shipments (which exclude “last mile” deliveries).  The expected impact would be roughly $2 billion per day and the US would need an extra 460,000 semi-trucks to offset the tonnage this would stop.

After the close, DELL, SNEX, A, MMS, and ZM all reported beats on both the revenue and earnings lines.  Meanwhile, ZTO missed on revenue while beating on earnings. On the other side, URBN beat on revenue while missing on earnings.  Unfortunately, CENT and CENTA missed on both the top and bottom lines.  It is worth noting that ZM and CENT/CENTA lowered their forward guidance.

So far this morning, BBY, ADI, DY, CAL, and AMWD all reported beats on both the top and bottom lines.  In the meantime, MDT, VIPS, and CSIQ all missed on the revenue line while beating on earnings.  On the other side, BIDU and IQ beat on revenue while missing on the earnings line.  However, BURL missed on both the revenue and the earnings lines.  (DLTR and DKS reports come out later in premarket.)

Overnight, Asian markets were mixed.  Taiwan (+0.64%), Japan (+0.61%), and Australia (+0.59%) led the gainers while Hong Kong (-1.31%), Shenzhen (-1.18%), and South Korea (-0.59%) paced the losses.  Meanwhile, in Europe, stocks are mixed but lean toward the green side at midday.  The FTSE (+0.55%), DAX (-0.02%), and CAC (-0.17%) lead the region with a strong majority of the smaller exchanges in the green in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a start to the day modestly on the green side of flat. The DIA implies a +0.18% open, the SPY is implying a +0.16% open, and the QQQ implies a +0.03% open at this hour.  10-year bond yields are back down to 3.791% and Oil (WTI) is up 1.3% to $81.08/barrel in early trading.

The major economic news events scheduled for Tuesday include the API Weekly Oil Stock report (4:30 pm) as well as 3 Fed speakers (Mester at 11 am, George at 2:15 pm, and Bullard 2:45 pm).  Meanwhile, the major earnings reports scheduled for the day are ANF, AEO, AMWD, ADI, BIDU, BBY, BURL, CAL, CSIQ, CHS, DKS, DLTR, DY, IQ, MDT, VIPS, and WMG before the open.  Then, after the close, ADSK, GES, HPQ, and JWN report.

As you would expect on a holiday week, this week will be light on economic news.  On Wednesday, October Building Permits, October Durable Goods, Weekly Initial Jobless Claims, Mfg. PMI, Services PMI, Michigan Consumer Sentiment, October New Home Sales, EIA Weekly Crude Oil Inventories, and FOMC Meeting Minutes are reported.  Thursday and Friday have no economic news due to the holiday.

In earnings reports later this week, on Wednesday, DE and LU report.  There are no reports on Thursday or Friday due to the holiday.

As the holiday-shortened week grinds forward, the focus today will be trying to read through on the state of the consumer from the handful of retail reports that come out today. BBY beat on both lines and held its outlook as it was before. This comes after DELL beat on both lines last night. So, if that gives you some clue of electronics buyers’ mood, it seems things are as expected and not getting appreciably better or worse yet as we head into the holiday sales season. One thing that should be noted is that the US Dollar is down today, pulling back for the first time in four sessions and down against all major trading pairs. This will give a tailwind to commodities on at least a very short-term basis. Also bear in mind that we have several Fed speakers today. It is likely they will continue to spread the message that things are improving…but we should not expect a Fed pivot any time in the near future. (In other words, there will be a hike in December, it may be less than 0.75%, but it will be a hike and it won’t be the last one as the Fed continues to tighten toward its terminal rate goal that is still 1-3% higher, depending on whether you believe perma-hawk Bullard or others.)

In the short term, all 3 major indices can be seen to be in a Bullish Pennant pattern of one sort or another. The trend remains bullish, the T-line has held after multiple retests in the large-caps, and although it fell through the T-line yesterday, the QQQ looks ready to try to get back above that level this morning. So, over-extension is not a problem for the market today either. The probabilities are in the Bull’s favor in the near term as we grind toward the holiday break. Do not be surprised if volume and moves on strength die out as we get close to the Wednesday close. (Look to yesterday’s “dead market” periods as a guide.) In short, this may be time better spent “sharpening your axe” than trying to chop up too many trees.

As always, be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: BP, TSLA, AMC, CLF, BIDU, PSX, ETSY, and XOM. 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 diverged at the open again Friday as the SPY gapped up 0.87%, DIA gapped up 0.37%, and QQQ gapped up 1.10% to start the day. However, at that point, all 3 got back in-step and sold off the first 40 minutes with all 3 having recrossed their gaps by 10:10 am.  Then 3 major indices diverged again with QQQ continuing its selloff, DIA going sideways back and forth inside its morning gap in waves, and the SPY bouncing along on both sides of the Thursday close. This lasted until 3:30 pm, when a broad-based rally took all 3 indices back up a bit.  All this action is giving us black-bodied candles that retested and held the T-line in all 3 major indices.  The DIA was more of an indecisive Doji candle while the SPY was more of a Black Hammer, and the QQQ was just a black candle with a large lower wick.

On the day, seven of the ten sectors are in the green, with Utilities sector (+2.00%) leading the winners by a large margin while the Energy Sector (-0.67%) fared worst.  Meanwhile, the SPY gained 0.45%, the DIA gained +0.38%, and the QQQ was dead flat at day end.  The VXX fell 1.03% to 16.41 and T2122 climbed back into the low end of the overbought territory at 85.71.  10-year bond yields have climbed back up to 3.824% and Oil (WTI) plunged another 1.90% to $80.09 per barrel.  So, overall Friday was a gap-up day where that turned indecisive as the bulls could not follow through and the bears were able to fade the gap, but ultimately could not drive prices lower as the late-day rally turned markets modestly green.

In stock news, CVNA announced Friday they are cutting another 1,500 jobs (another 8% of the workforce) after cutting 2,500 earlier in the fall.  In other Auto industry news, EVGO announced a deal to become the preferred EV charging partner of Subaru with buyers of some of Subaru’s EV offerings receiving a $400 credit to use EVGO fast charging stations nationwide in the US.  Elsewhere, HON agreed to pay $1.3 billion to end asbestos-related lawsuit claims against a former business unit.  On Saturday, TSLA recalled 321,000 cars over rear light problems.  Finally, in a shocker, the CEO of DIS (Chapek) was ousted Sunday night and replaced with former DIS CEO, Bob Iger. Iger returns to the job after a 3-year hiatus.

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In miscellaneous news, the CFTC reports the that US Dollar is in a “net short” position for the first time since July 2021.  Former Theranos CEO Elizabeth Holmes was sentenced to 11 years in prison Friday after the close for her defrauding of investors.  In economic news from Friday, the October Existing Home Sales came in a bit higher than expected at 4.43 million (compared to the forecasted value of 4.38 million, but worse than the September value of 4.71 million).  In China-related news, the bull’s hopes that China was pivoting from its “Zero Covid” policy evaporated over the weekend as the city was rumored to be a test case for loosening instead closed schools, locked down universities and ordered its residents to stay at home for 5 days. So, no loosening yet.

In Ecological news, the COP27 conference reached a deal to pay the poor countries for all the environmental damage caused by climate change due to the industrialized nations’ emissions.  However, no more progress was made on getting the industrialized nations (especially the US and China) to actually meet their previously agreed commitments to reduce emissions.

So far this morning, J and SJM both beat on the revenue and earnings lines. 

Overnight, Asian markets leaned heavily to the downside, but on mostly modest moves.  Hong Kong (-1.87%) was by far the biggest loser while South Korea (-1.02%), and India (-0.88%) rounded out the biggest red numbers.  On the upside, only Japan (+0.16%), and Thailand (+0.09%) managed to stay green on the day.  Meanwhile, in Europe, we see a similar picture taking shape at midday.  The FTSE (-0.05%), DAX (-0.67%), and CAC (-0.20%) are typical of the region in early afternoon trade, with only 2 small exchanges managing to stay modestly green so far.  As of 7:30 am, US Futures are pointing toward a red start to the day.  The DIA implies a -0.25% open, the SPY is implying a -0.57% open, and the QQQ implies a -0.82% open at this hour.  At the same time, 10-year bond yields are up to 3.831% and Oil (WTI) is off eight-tenths of a percent to $79.40/barrel in early trading.

There are no major economic news events scheduled for Monday. The major earnings reports scheduled for the day are FUTU, SJM, J, and NIU before the open.  Then, after the close, A, CENTA, CENT, DELL, MMS, SNEX, URBN, ZM, and ZTO report.

As you would expect on a holiday week, this week will be light on economic news.  On Tuesday we get the API Weekly Oil Stock report as well as 3 Fed speakers (Mester, George, and Bullard).  Then Wednesday, October Building Permits, October Durable Goods, Weekly Initial Jobless Claims, Mfg. PMI, Services PMI, Michigan Consumer Sentiment, October New Home Sales, EIA Weekly Crude Oil Inventories, and FOMC Meeting Minutes are reported.  Thursday and Friday have no economic news due to the holiday.

In earnings reports later this week, on Tuesday, we hear from ANF, AEO, AMWD, ADI, BIDU, BBY, BURL, CAL, CSIQ, CHS, DKS, DLTR, DY, IQ, MDT, VIPS, WMG, ADSK, GES, HPQ, and JWN.  Then on Wednesday, DE and LU report.  There are no reports on Thursday or Friday due to the holiday.

The shortened holiday week is shaping up to be light on news and lighter on earnings than in recent weeks. Still, we will get some more retail and miscellaneous earnings reports (mostly Tuesday). In the short term, the trend remains bullish and over-extension has been addressed with last week’s pullback and hold to the T-line and support. With this background, what we know for sure is that the probabilities in the near term lie in the Bull’s favor. However, continue to be cautious about chasing. Finally, expect the volume to lighten up as we get closer to the holiday (and we can expect Friday’s half-day to be a dead market).

As always, be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: GRWG, DDD, AAPL, NKE, FSM, TSLA, NOK 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

Again or still…for the second day in a row. However you say it, it’s the same story as Thursday.

Markets gapped down strongly Thursday after Wednesday’s Hawkish Fed statements.  The SPY opened down 1.27%, DIA gapped down 1.00%, and QQQ jumped down 1.59% at the open.  However, from that point, the bulls started a slow, wavy, rally that took us to the highs of the day about 1:20 pm. At that point, a slow, steady selloff started that took us back down into the morning gap, before rallying hard the last 30 minutes. During the session, price tested and held the T-line (8ema) in all 3 indices (SPY, DIA, and QQQ).  This action gave us gap-down white candles with upper wicks in all 3 major indices.

On the day, eight of the ten sectors are in the red, with the Utilities sector (-1.53%) leading the losses while the Communications Services (+0.16%) and Consumer Defensive (+0.14%) sectors held up the best.  Meanwhile, the SPY lost 0.31%, the DIA was flat at +0.01%, and the QQQ lost 0.22%.  The VXX fell 0.96% to 16.58 and T2122 dropped back into the center of the mid-range at 56.25.  10-year bond yields have climbed to 3.769% and Oil (WTI) plunged 4.26% to $81.94 per barrel.  So, overall Thursday was a gap-down day where the bulls immediately rejected the gap as the bulls and bears then fought to an overall standstill by day’s end.

In economic news, October Building Permits came in above the forecast at a number of 1.526 million (compared to 1.512 million expected, but still below the September value of 1.564 million).  October Housing Starts also beat the forecasted value, coming in at 1.425 million (compared to the forecasted 1.410 million, but again still below the 1.488 million in September).  Weekly Initial Jobless Claims also beat expectations, coming in at 222k (compared to a forecasted 225k and last week’s value of 226k).  However, the November Philly Fed Mfg. Index came in far below expectations at -19.4 (compared to the forecasted -6.2 and October’s value of -8.7).  In other economic news, Bloomberg reported that US mortgage rates saw the biggest drop in over 41 years this week, with the US avg. 30-year, fixed-rate mortgage dropping to 6.61% (lowest level in two months).  In Fed news, Fed speakers gave us more hawkish comments Thursday.  St. Louis Fed Pres. Bullard said that the rate hikes, so far, have only had limited effects on inflation.  He suggested rates will have to be hiked further than expected to effectively bring down inflation.  While he did not say how high, he used a chart that showed a range of 5%-7% (and we are currently between 3.75% and 4%).  Later, Minneapolis Fed President Kashkari said he wants to be sure inflation has stopped climbing before he would support stopping interest rate hikes, and “it’s an open question how far we have to go with the interest rate (hikes).”

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In stock news, Reuters reported that HAS is looking to sell its TV production business unit eOne.  Meanwhile, the FAA said it does not expect to certify the BA “737 Max 7” plane this year.  This means the plane will need to be reworked to meet new cockpit safety alert standards that come into effect on December 27.  However, BA is still seeking a waiver from those safety standards from Congress, but no progress has been reported on that front yet.  Elsewhere, GM subsidiary Brightdrop said it expects to reach $1 billion in revenue.  Also on Thursday, workers at 100 SBUX stores held a 1-day walkout to protest “illegal retaliation against workers who tried to organize unions.”  Elsewhere, after hours, DNUT settled US Dept. of Labor charges that it failed to pay overtime to several hundred workers by paying a $1.19 million fine.  Finally, AMZN CEO Jassy said the company would continue cutting jobs into 2023, but did not detail the additional cuts.

In energy news, the EIA said on Thursday that in October, Heating Oil costs for US households were 65% more than in the same month of 2021. In part, this was due to the US importing 38% less distillate fuel than it has in recent years as well as by a fire that has taken the largest East Coast distillate refinery (in Philadelphia) offline permanently.  In other energy news, the cause of Thursday’s selloff in oil is being attributed to bad covid news out of China.  The Chinese new case total has risen to the highest level since April with the majority of new cases coming from the heavy manufacturing region of Guangzhou.  However, the hawkish talk from Fed members also stoked fear of a rate-hike-induced economic slowdown in the US, which did not help oil prices.

After the close, AMAT, ROST, GPS, POST, UGI, KEYS, PANW, WWD, and STNE all reported beats on both the revenue and earnings lines.  Meanwhile, WSM beat on the revenue line while missing on the earnings line.  Unfortunately, FTCH missed on both the top and bottom lines.  It is worth noting that ROST, KEYS, and PANW raised their forward guidance.  However, GPS, UGI, WWD, and STNE all lowered their forward guidance.

So far this morning, JD and FL have both reported beats on the revenue and earnings lines.  However, SPB reported misses on both the top and bottom lines.

Overnight, Asian markets were mixed on modest moves.  New Zealand (+0.76%) was by far the largest gainer while Shanghai (-0.58%), Singapore (-0.42%), and Shenzhen (-0.37%) paced the losses.  Meanwhile, in Europe, with the exception of Russia (-0.65%), the entire region is in the green at midday.  The FTSE (+0.92%), DAX (+1.00%), and CAC (+1.20%) are leading a broad-based rally in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a green start to the day.  The DIA implies a +0.56% open, the SPY is implying a +0.76% open, and the QQQ implies a +0.93% open at this hour.  10-year bond yields are moving higher at 3.799% and Oil (WTI) is off fractionally to $81.37/barrel.

The major economic news events scheduled for Friday, are limited to October Existing Home Sales are reported at 10 am.  It is also important to note that today is Options Expiration Friday and Bloomberg reports we have $2 Trillion of options expiring today. The major earnings reports scheduled for the day are FL, JD, and SPB before the open.  However, there are no major reports scheduled for after the close.

The retail industry continues to show strong earnings, implying that consumers (at least last quarter) had not yet rolled over into recession mode. However, hawkish Fed comments (especially from the most hawkish, Bullard) are telling markets not to get ahead of themselves. (Bullard implied that the end of hikes may not come until 2% higher than analysts and Fed futures have priced in. If that were to happen, it is not yet priced into markets.) So, once again, beauty and the market outlook is in the eye of the beholder. There is something to hang your hat on regardless of how you feel about market direction in the longer term.

However, in the short term, there is no question that the trend is bullish and we have seen a healthy pullback to rest in the upward move. All 3 major indices tested and held the T-line yesterday. So, extension is no problem at all (either in terms of the T-line or T2122). In addition, we held support levels in all 3 major indices. With this background, what we know for sure is that the probabilities in the near term lie in the Bull’s favor. With that said, continue to be cautious about chasing and remember it is Friday (time to get paid and “get ready for the weekend news cycle” day). This is also Options Expiration Friday, with Bloomberg reporting more than $2 Trillion in options ending at the close (really Saturday, but effectively at the close). So, we could always see some kind of price action where somebody tries to pin the price in or out of the money depending on their option position. Just be aware if there is a large open interest near price.

As always, be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to keep the “Legend of the man in the green bathrobe” in mind. In a winning situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! There is absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

Markets diverged a bit at the open Wednesday as QQQ gapped down 0.80%, SPY gapped down 0.40%, and DIA gapped down just 0.20%.  From there, the SPY and QQQ ran sideways in waves within a not-too-large range below the open all day while the DIA did the same back and forth back across the prior close level all day.  This action gave us smaller candles today, with the SPY and QQQ printing black-bodied Spinning Top candles while the DIA printed a white-bodied Inverted Hammer-type candle. This action relieved extension from the T-line (8ema) as well. 

On the day, nine of ten sectors were in the red, with the Technology sector (-2.24%) leading the losses while the Utility sector (+0.47%) held up best.  Meanwhile, the SPY lost 0.76%, the DIA gained 0.04%, and the QQQ lost 1.36%.  The VXX fell 2,67% to 16.74 and T2122 dropped back into the mid-range at 67.57.  10-year bond yields fell down to 3.692% and Oil (WTI) fell 1.82% to $85.34 per barrel.  So, overall Wednesday was a rest day where we saw a modest pullback in the bullish trend.

In economic news, October Import Price Index fell by 0.2% (compared to a drop of 0.4% that was forecast and the September drop of 1.1%).  On the other side, October Export Price Index fell 0.3% (compared to a forecast drop of 0.4% and the September drop of 1.5%).  Meanwhile, October Retail Sales grew by 1.3% (much more strongly than the forecast +1.0% and the September dead flat value at +0.0%).  Later, October Industrial Production grew 3.28% showing some slowing compared to the September 4.96% growth.  Elsewhere, September Business Inventories grew less than expected at +0.4% (compared to +0.5% forecasted and the August +0.9% growth).  At the same time, September Retail Inventories fell 0.1% which was exactly what was forecasted and better than the August growth of 0.6%.  Finally, EIA Weekly Crude Oil Inventories followed the API move by having a 5.400-million-barrel drawdown (compared to an expected 440k barrel drawdown and last week’s 3.925-million-barrel build in stocks).

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In stock news, UAL said Wednesday that they expect the busiest travel day since the start of Covid-19 over the Thanksgiving weekend.  They forecast a 12% increase in passengers over the holiday weekend compared to 2021.  Meanwhile, COST says it has reached a deal with activist investors to cut its greenhouse emissions to new meet a new target by the end of next year.  70% of COST shareholders voted in favor of a resolution for COST to cut emissions back in January.  At the same time, a Washington state court has ruled that the $4 billion dividend payment by ACI, scheduled to be paid today will remain on hold pending the close of the KR buyout.  Reuters reports that regulators have said they received “good access” to Chinese firms’ financial records during their 7-week audit in Hong Kong.  BABA and YUMC were among the 200 companies whose records were audited in hope of saving the US listings for those companies.  Elsewhere, TSLA reported 2 new fatal car crashes involving their self-driving systems on Model 3 cars to the NHTSA Wednesday.

In miscellaneous news, despite constant talk of heavy inflation, Coffee prices have been collapsing recently, due in part to great weather in Brazil.   Coffee futures fell from $239 at the end of August to $158 (per 237,000 pounds of beans) currently. This represents a 34% drop in 2.5 months.  Elsewhere, three environmental groups sued the state of LA over its issuing of a permitting exemption to an LNG Terminal run by an unlisted firm.  However, this terminal would impact several listed companies such as KMI, ATO, and XOM.  Finally, in Fed news, San Francisco Fed President Daly said that “a pause is off the table” while Fed Governor Waller said the Fed “has a ways to go” on rate hikes and we will still need increases into next year (although he added that data is making him more comfortable with a 0.50% increase in December).

After the close, CSCO, BBWI, HP, and HI all beat on both the top and bottom lines.  At the same time, NVDA and CPRT beat on revenue while missing on earnings.  On the other side, CPA missed on revenue while beating on earnings. 

So far this morning, BABA, SIEGY, M, KSS, BJ, NTES, and FORTY all posted beats on both the revenue and earnings lines.  Meanwhile, DOLE, BV, and WB all missed on revenue while beating on earnings.  On the other side, PLCE beat on revenue while missing on earnings.  It’s worth noting that BJ and M both raised their forward guidance while KSS removed its forward guidance altogether, citing a volatile retail environment.

Overnight, Asian markets were mostly in the red on modest moves.  South Korea (-1.39%) and Hong Kong (-1.15%) led the region lower while Singapore (+0.61%), Australia (+0.19%), and Malaysia (+0.06%) were the only three exchanges that managed to stay green.  In Europe, exchanges are red across the board as of midday.  The FTSE (-0.53%), DAX (-0.05%), and CAC (-0.71%) are typical of the region with a couple of the smaller exchanges managing to be down more than one percent in early afternoon trading.  As of 7:30 am, US Futures are pointing toward a down start to the day.  The DIA implies a -0.60% open, the SPY is implying a -0.67% open, and the QQQ implies a -0.63% open at this hour.  10-year bond yields are back up to 3.721% and Oil (WTI) is off 1.79% to $84.06/barrel in early trading.

The major economic news events scheduled for Thursday, we get October Building Permits, October Housing Starts, Weekly Initial Jobless Claims, and Philly Fed Mfg. Index (all at 8:30 am).  We also have a few Fed speakers (Bullard at 8 am, Bowman at 9:15 am, and Mester at 9:40 am).  The major earnings reports scheduled for the day are BABA, BJ, BV, DOLE, KSS, M, NTES, and WB before the open.  Then, after the close, AMAT, FTCH, GPS, KEYS, PANW, POST, ROST, WSM and WWD report.

In economic news later this week, on Friday, October Existing Home Sales are reported.  Meanwhile, in earnings reports later this week, on Friday, we hear from FL, JD, and SPB.

With retail earnings continuing to show strong consumers (last quarter) and some expectations (HD, LOW, WMT, M, BJ) for this quarter, and Hawkish Fed members telling the market not to expect a pause in rate hikes, we get ready for another day in the market. Traders seem cautiously pessimistic in the Premarket. At any rate, retail earnings have shown that there is a clear split between strong management teams (WMT, M, BJ, etc.) and the weak ones TGT (which was punished yesterday).

With this background, what we know for sure is that the trend is bullish continues and it looks like stocks are going to retest the T-line today in all 3 major indices. So, over-extension is no problem at all today. We are also now coming back down into a potential support level for the SPY, DIA, and QQQ. So, continue to be cautious if you are thinking of chasing a move (bearish or bullish).

Be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when the price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to remember the “Legend of the man in the green bathrobe“…in that situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! And there is absolutely no reason to keep raising your bet (risk) just because you’ve had a win. Finally, keep in mind that trading is not a hobby. It’s a job. The money is real. So, you have to treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: VALE, CSCO, TLT, DIS, INTC, AAPL, EGHT, AFRM, NAIL, NTR. 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.

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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 (+1.50% in the SPY, +0.82% in the DIA, and a whopping +2.48% in the QQQ) after PPI and the NY Fed Mfg. Index both came in much better than expected (from a market perspective). From there, all 3 major indices waffled sideways in a fairly tight range until just before noon.  At that point, a slow selloff took us slowly to the lows of the day (as of then) at about 1 pm.  Then at 1:10 pm, 2 missiles (presumed Russian and likely intended for Ukraine) struck a Polish village a few kilometers inside Poland, killing 2 Polish civilians.  Poland called an emergency National Security Council meeting to talk about their response. This caused a strong and immediate selloff across all 3 major indices as traders feared escalation of the war to involve NATO.  This hard selloff recrossed the morning gap and reached the lows of the day by 2 pm when a bounce kicked in that regained about two-thirds of the losses seen in the afternoon by 3:30 pm and then ground sideways into the close. 

On the day, this action is giving us gap-up, black-bodied Spinning Top type candles across all 3 major indices.  (With a little larger body in the QQQ.)  Nine of ten sectors were in the green, led by the Technology sector (+2.57%) while Communications Services (-0.73%) lagged.  At the same time, the SPY gained 0.85%, the DIA gained 0.13%, and the QQQ gained 1.38%.  The VXX rallied 1.3% to 17.20 and T2122 spiked back up into the overbought territory at 91.70.  10-year bond yields fell down to 3.777% and Oil (WTI) spiked 1.21% to $86.91 per barrel.  So, overall Tuesday was a volatile day punctuated by premarket economic news (which is taken as good by the market under the assumption it will cause the Fed to ease up) and bad afternoon geopolitical news (which the market briefly took as bad under fear of war expanding in Europe).

In economic news, the NY Empire State Manufacturing Index came in at +4.50, which was significantly higher than the forecasted value of -5.00 and very much improved from the October reading of -9.10.  This positive value indicates improving business conditions.  At the same time, October PPI came in at +8.0% (year-on-year) which, like CPI last week, was well below the forecasted value of +8.3% and much better than the September reading of +8.4%.  More importantly, the Core PPI (stripping out energy and food) was up just +6.7%, a full half percent below the forecast of +7.2% and much lower than the September value of +7.1%.  Again, this indicates the growth of inflation is easing by a considerable amount, which led traders to believe the Fed may reduce the size of the rate hike it does in December.  In the afternoon, the Fed reported that US Household Debt rose at the fastest pace in 15 years during Q3 (+$351 billion). This increase was mostly due to credit card usage and mortgage balances.

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In energy news, TRP announced after the close that it has declared Force Majeure and will be required to reduce the volume of oil shipped through the Keystone pipeline (that ships oil to the Midwestern US) due to recent severe weather events.  No details were given on the amount of the reduction or the duration of the slowdown.  However, industry analysts said the reduction was about 7% of the normal 622,000 barrels per day volume.  The API reported after the close that US oil inventories dropped much more than expected last week (a 5.8 million barrel drawdown, compared to a forecast 400k barrel drawdown).  However, gasoline inventories rose by 1.7 million barrels and distillate stocks increased 850k barrels.

In stock news, activist investors TCI Fund publicly urged GOOGL to cut headcount to lower losses at the company’s Waymo self-driving unit after noting that this unit had increased headcount 20% per year since 2017.   Elsewhere, AN announced Tuesday that it has acquired a 6.1% stake in automotive digital marketplace TRUE.  Meanwhile, Jim Farley, CEO of F, said the company will need to bring much more work in-house (eliminating the need for many suppliers) in order to preserve jobs.  The underlying problem for the F workforce is that it takes 40% less labor to build an electric vehicle and the underlying problem for F is that paying profit to suppliers reduces margins in comparison to TSLA (which makes most of its own parts).  In regulatory news, the SEC has delayed its decision on whether to approve an Ark21 (spot Bitcoin) ETF until Jan. 27.  In the late afternoon, Reuters reported that CG is in talks trying to form a partnership to acquire HPN for between $8-$10 billion.  Finally, in legal news, INTC was hit with a $949 million judgment by a Texas court Tuesday for infringing the patents of Softbank subsidiary VLSI.  Earlier in the day, it was reported that GS paid $12 million to a former partner over the charge of creating a “toxic workplace for women” including vulgar remarks by the CEO.  The settlement took place two years ago but was hidden by a nondisclosure agreement.

In miscellaneous news, the New York Fed announced it is starting a 12-week pilot project for the “digital dollar.”  The pilot will include participation by C, MA, and WFC among other financial institutions.  Elsewhere, Consumer Reports ranked TSLA worst out of 24 brands of electric vehicles in terms of reliability in the US.  In currency news, the missile strikes in Poland caused very volatile Forex trading Tuesday.  The Euro was down dramatically against all pair partners and the USD swung wildly against the Yen and British Pound.  Finally, in Supply Chain news, the Port of Los Angeles reports that October volumes at the busiest US seaport fell to the lowest level since 2009.  The imports were down 28% from a year earlier and empty container handling fell more than 25% during the month.

After the close, AAP reported a beat on revenue while missing on earnings.  The company also lowered its forward guidance.  Meanwhile, GSM reported misses on both the top and bottom lines.  So far this morning, LOW, ARCO, and ZIM have reported beats on both the revenue and earnings lines.  Meanwhile, TGT beat on the revenue line while missing on earnings.  On the other side, TJX missed on revenue while beating on earnings.  It is worth noting that LOW raised its forward guidance and ZIM lowered its own forward guidance.

Overnight, Asian markets were mostly in the red on mostly modest moves while the second day of the G-20 summit continued in that region.  Shenzhen (-1.02%), Thailand (-0.58%), and Hong Kong (-0.47%) led the way lower. Meanwhile, only Japan (+0.14%) and India (+0.03%) managed to hang on to green territory.  In Europe, we see a very similar picture taking shape at midday.  After it was decided the missiles in Poland were likely caused by Ukrainian Air Defense misses (trying to shoot down Russian missile attacks), things have settled a bit.  The FTSE (-0.03%), DAX (-0.95%), and CAC (-0.48%) are typical of the region.  However, a couple of the smaller exchanges are down more than 1% in early afternoon trade.  As of 7:30 am, US Futures are now pointing toward an open just on the red side of flat.  The DIA implies a -0.08% open, the SPY is implying a -0.11% open, and the QQQ implies a -0.19% open at this hour.  At the same time, 10-year bond yields are down to 3.768% and Oil (WTI) is off just a fraction at $86.77/barrel in early trading.

The major economic news events scheduled for Wednesday include October Retail Sales and October Import/Export Price Indexes (both at 8:30 am), October Industrial Production (9:15 am), September Business Inventories and Sept. Retail Inventories (both at 10 am), and EIA Weekly Crude Oil Inventories (10:30 am).  We also have a Fed speaker (Williams at 9:50 am).  The major earnings reports scheduled for the day are ARCO, LOW, TGT, TCEHY, TJX, and ZIM before the open. Then, after the close, BBWI, CSCO, CPA, HP, HI, NVDA, and SONO report.

In economic news later this week, on Thursday, we get October Building Permits, October Housing Starts, Weekly Initial Jobless Claims, and Philly Fed Mfg. Index.  Finally, on Friday, October Existing Home Sales are reported.

In earnings reports later this week, on Thursday, we hear from BABA, BJ, BV, DOLE, KSS, M, NTES, WB, AMAT, FTCH, GPS, KEYS, PANW, POST, ROST, WSM, and WWD report.  Finally, Friday, we hear from FL, JD, and SPB.

With yesterday afternoon’s immediate threat (expanding war in Europe) mostly lessened, US markets turn back toward earnings and the economy. This morning, TGT warned it sees a weak holiday coming this year, but this is likely due to it having large inventories that will need to be discounted heavily in order to be sold. On the other hand, just like competitor HD, LOW raised its Q4 guidance saying that it expects a strong Q4. (Maybe more of Santa’s gifts are coming from the hardware store this year.) Also, yesterday we saw more evidence that inflation may be slowing (which could mean the pace of hikes by the Fed also eases up…and the market would love that). At any rate, tensions have eased a bit and retail earnings up to this moment are mixed at worst.

With this background, what we know for sure is that the trend is bullish and yesterday’s pullback did not break the recent range, let alone the trend. However, it did lessen extension from the T-line (8ema) just a bit. We also know that price moves in a lightning bolt, zig-zag pattern. And, once again, our zig is still in need of a zag if we are going to sustain a bullish move higher. Can Mr. Market overcome that need, sure…but only in the short-term. So, even if the bulls rule the day, don’t expect this to be a vertical rally. Normal rallies need pullbacks and there are also a lot of bears out there that still believe Q1 and Q2 will be terrible and the market should fall more to account for this fact. In addition, we still have more retail name (lesser ones) reports coming later this week. So, caution is still warranted, but so far it is looking like the consumer may still hold up (at least through year-end).

So, continue to be deliberate and disciplined…but don’t be stubborn. Remember it’s 100 times more important to avoid big mistakes than it is to pick big winners. If you have a loss, admit you were wrong and take that loss before it gets out of hand. And when price does move in your direction, always move your stops in your favor and take a little profit off the table. You have to remember the “Legend of the man in the green bathrobe“…in that situation, it is NOT HOUSE MONEY you’re betting, it’s YOUR MONEY! And there is absolutely no reason to keep raising your bet (risk) just because you’ve had a win. Finally, keep in mind that trading is not a hobby. It’s a job. The money is real. So, you have to treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

Swing Trade Ideas for your consideration and watchlist: PLUG, EL, GOLD, META, SBLK, VALE, and GFI. 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.

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