The Bears were in control all day Tuesday.  Premarket was already pointing to a big gap lower and then CPI came in hot causing a double-down on the selling.  SPY gapped down 1.27%, DIA opened 0.80% lower, and QQQ gapped down a whopping 1.84%.  At that point, we saw a divergence with SPY and DIA following through to the downside until about 10:10 a.m. From there, SPY and DIA bounced with a modest but steady rally until 11:35 a.m.  Meanwhile, QQQ rallied back about halfway up its gap by 10:45 a.m.  Then, from those respective points, all three major index ETFs sold off steadily until 3:30 p.m.  However, all three also rallied the last 30 minutes of the day popping into the close.  This action gave us a black-body, long-legged Doji in the SPY, a white-body Spinning Top in the QQQ, and a black-bodied, large Hammer-type candle in the DIA.

On the day, all 10 sectors were in the red as Basic Materials (-2.78%) was out in front leading the way lower while Consumer Defensive (-1.30%) and Energy (-1.36%) held up better than the rest.  Meanwhile, the SPY lost 1.38%, the DIA lost 1.36%, and QQQ lost 1.56%.  VXX spiked 7.05% to close at 15.33 and T2122 plummeted all the way back into oversold territory at 11.76. 10-year bond yields spiked massively to 4.324% and Oil (WTI) gained 1.18% to close at $77.82 per barrel.  So, Tuesday was the most bearish day since the last day of January. With that said, both SPY and QQQ did close back up above their trendlines dating back to late-October lows.  All this happened on a little higher-than-normal volume in all three.

The major economic news released Tuesday was limited but included Jan. Core CPI, which came in hot at +0.4% (compared to a +0.3% forecast and the December +0.3% reading).  This amounted to +3.9% on a Year-on-Year basis (versus a +3.7% forecast and the December +3.9% value).  These led to a January CPI of +0.3% (compared to a +0.2% forecast and a +0.2% December reading).  Annualized, that meant a +3.1% CPI reading (versus a +2.9% forecast but still down from December’s +3.4% value).  Then, after the close, Weekly API Crude Oil Stocks showed a huge (much higher-than-expected) inventory build of 8.520 million barrels (compared to a forecast of +2.600 million barrels and the prior week’s +0.674 million barrels).

In Fed Futures news, after the CPI data, Fed Fund Futures showed a 91.5% probability of no rate change in March (3-20-24).  Meanwhile, 8.5% of rate bets are looking for a quarter-point cut at the March FOMC meeting.  However, for the May 1 meeting, only 28.6% expect rates to remain where they are now.  At the same time, 65.5% expect rates to fall a quarter-point and 5.8% expect rates to fall a full half percent by then.  For the mid-June FOMC meeting, 24.4% of futures traders expect Fed Funds Rates to remain at 5.25-5.50%.  However, 60.1% expect that rate to have fallen a quarter of a percent, 14.6% see rates down a half percent by that point, and just less than 1% expect that rates will have fallen three-quarters of a percent by June 12.  Finally, by the July 31 meeting, there are NO futures bets expecting rates to still be where they are now.  13.8% expect rates to have fallen a quarter percent, 44.6% predict a 0.50% reduction, 34.5% foresee three-quarters of a percent reduction at that point, 6.8% of the futures see a full percent reduction then, and 0.4% actually expect the Fed Funds rate to be down 1.25% by that point.

After the close, ABNB, ALSN, BFAM, DVA, WIRE, ENTG, EQT, GDDY, GXO, HE, IOSP, INVH, LYFT, MCY, MGM, REZI, HOOD, RUSHA, SEB, SSNC, MODG, WCN, and ZG all reported beats on both the revenue and earnings lines.  At the same time, AKAM, AIG, CART, MRC, and WELL all missed on revenue while beating on earnings.   On the other side, PRI beat on revenue but missed on earnings.  Unfortunately, QDEL and IAC missed on both the top and bottom lines.  It is worth noting that ALAM, ALSN, DVA, and WCN raised their forward guidance.  However, ENTG, QDEL, and MODG lowered their guidance.

In stock news, just two days after they broadcasted the most widely-watched Super Bowl of all time, (and the company announced record ad revenue) PARA announced it was laying off 800 employees (3% of workforce).  At the same time, ACN announced an agreement to acquire Insight Sourcing (supply chain consultancy) for an undisclosed sum.  Later, BA said its January delivery was only 27 jets (down 29% from January 2023).  BA also said orders were down, booking just three orders (the least since 2019) and they had order cancellations.  This comes amidst the company’s massive quality/production problems.  At the same time, the Wall Street Journal reported Tuesday that MSFT’s AI copilot is getting mixed reviews from users.  Some of the complaints included mistaken of completely fabricated results in Excel and Word.  Later, flight attendants at ALK authorized a strike with union members already picketing at airports in the US, UK, and Guam.  Elsewhere, DIS subsidiary ESPN reportedly has agreed to a six-year extension of their College Football Playoff exclusive broadcast rights valued at $7.8 billion ($1.3 bill per year).  At the same time, AMZN filed a report with the SEC announcing that founder Bezos had concluded another $2.08 billion sale of AMZN stock.  After the close, WELL said it had entered into a definitive agreement to acquire 25 properties for a total of $969 million.  (The projects total 3,900 housing units.)  At the same time, TSLA’s Chinese competitor BYD announced it is opening a factory in Mexico to better serve US markets with lower-priced electric vehicles compared to TSLA and US competitors.  Also after the close, the Wall Street Journal reported that WMT is in talks to buy VZIO (display screen and TV maker).  Reportedly, WMT would use the acquisition to greatly expand in-store display screens to bolster its ad sales to brands like KHC, PG, and many, many others.  Reportedly, WMT’s offer is 30% higher than VZIO’s Monday close.

In stock legal, governmental, and regulatory news, a German court found that TSLA violated German union leadership election rules.  The only immediate sanction is that TSLA can’t hold an election for “work council” leadership immediately (when mostly just management employees have been hired).  Later, the FDA warned of two online vendors selling unapproved and misbranded versions of the active ingredients in NVO’s and LLY’s blockbuster weight loss drugs.  (LLY recently sued medical spas and clinics for selling drugs purported to be the same as the prescription versions.)  At the same time, AAPL (iMessage) and MSFT (Bing search engine) won exclusion from EU Tech rules covering “gatekeeper” platforms.  This gives those products cost and distribution advantages over competing products from GOOGL, META, and others.  Later, Mexican antitrust regulators said an investigation has preliminarily determined that AMZN and MELI (which together control more than 85% of online transactions in the country) are violating antitrust regulations.  The report said the two present “practically insurmountable barriers” to competitors.  At the same time, CPB moved closer to approval of its acquisition of SOVO by certifying FTC compliance requests for the deal.  This leads to a 30-day waiting period (ending March 11), after which the deal can be finalized.  Later, Reuters reported that the CA Air Resources Board had rejected an STLA bid to have rival’s emissions deals with the state voided.  (The rivals involved, whose emissions deals with the state will stand are HMC, VLKAF, VLVLY, and F.)  At the same time, Reuters reported that a US federal judge set an October 2026 trial date for the FTC (and 17 states) antitrust lawsuit against AMZN.

Note that the Chinese markets were closed for Lunar New Year and will stay closed all week as well.  The rest of Asia was mixed but leaned to the red side,  South Korea (-1.10%), Australia (-0.74%), and Japan (-0.69%) led the region lower.  In Europe, we see a completely different story with green across the board at midday.  (This was likely helped by the release of UK inflation data showing prices holding in place in January.)  The CAC (+0.63%), DAX (+0.40%), and FTSE (+0.93%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a gap higher to start the day.  DIA implies a +0.25% open, the SPY is implying a +0.49% open, and the QQQ implies a +0.65% open as of this hour.  At the same time, 10-year bond yields are down to 4.304% and Oil (WTI) is up a quarter percent to $78.07 per barrel in early trading.

The major economic news scheduled for Wednesday is limited to EIA Crude Oil Inventories (10:30 a.m.).  The major earnings reports scheduled for before the open include AVTR, AVNT, GOLD, BGC, CAE, CRL, CHEF, CME, CNHI, DBD, ES, GNRC, GPN, IQV, KHC, LAD, LPX, MLM, NHYDY, OC, PSN, R, SITE, SAH, SUN, TMHC, WAB, and WMB.  Then, after the close, ALB, ATUS, AWK, AR, APP, ACGL, CF, CC, CSCO, CW, ET, EQIX, HLF, HUBS, KGC, MTW, MFC, OXY, PTEN, CNXN, ROL, SON, SUM, TWLO, TYL, VTR, and WFG report.

In economic news later this week, on Wednesday EIA Crude Oil Inventories are reported.  On Thursday, we get Initial Weekly Jobless Claims, Weekly Continuing Jobless Claims, Jan. Core Retail Sales, Jan. Retail Sales, Jan. Import Price Index, Jan. Export Price Index, NY Empire State Mfg. Index, Jan. Industrial Production, Dec. Business Inventories, Dec. Retail Inventories, the Fed Balance Sheet, and Fed member Bostic speaks.  Finally, on Friday, Jan. Building Permits, Jan. Housing Starts, Jan. Core PPI, Jan. PPI, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, Michigan 5-Year Inflation Expectations, and Fed member Daly speaks.

In terms of earnings reports later this week, Thursday, HOUS, ARCH, CBRE, CVE, CRBG, CROX, DE, DNB, EPAM, GTX, GPC, GEO, HBI, H, NSIT, KELYA, KNF, LH, LECO, DNOW, OGN, PBF, PENN, RS, RPRX, SABR, SN, SO, SPTN, STLA, SLVM, TRGP, USFD, VNT, WEN, WST, YETI, ZBRA, AEM, AL, LNT, AMN, AMAT, BIO, BE, ED, DLR, DASH, DKNG, DBX, GLOB, IR, LBTYA, MERC, OPEN, ROKU, TXRH, TOST, TTD, and TROX report.  Finally, on Friday, we hear from ACDVF, AXL, CNK, POR, PPL, TRP, THS, and VMC.

In political news, the Senate passed the $95.3 billion foreign aid package (giving support to Ukraine, Israel, and Taiwan) after having removed the border/immigration provisions the GOP wanted and then decided needed to be removed to preserve the political issue. The bill passed in the Senate by a super-majority of 70-29.  However, Speaker of the House Johnson immediately said he won’t bring the measure to a vote (saying this is because it does not include the border provisions that he and his caucus refused just last week).  Analysts do say there are enough votes in the House to overrule the Speaker’s refusal to bring the bill to a vote, meant to preserve the US position in the world. However, timing will be an issue. Meanwhile, the House did vote to charge (impeach) DHS Sec. Mayorkas by a 214-213 vote. (Four members were out for medical reasons and the rest of the seats were vacant…one flipping toward Dems later Tuesday night.) This political stunt is very likely to be dismissed by a simple majority vote in the Senate.  (Even if a Senate trial were to take place, there is zero chance of the MAGA types gaining a two-thirds vote to actually impeach. However, again, that was never the idea (getting something done).  Instead, the GOP idea is just to have this impeachment as an issue to talk about for three weeks while the Senate is adjourned.)  Meanwhile, we have March 1 and March 8 deadlines for a government shutdown because the House has not found time to do their work from last September.

In stock wild ride news, LYFT had an incredible wild ride Tuesday. It reported after the bell and was up almost 64% in post-market trading on the news. It did settle back down to end up only gaining 13.39%. So, that was definitely a roller coaster. So far in pre-market, LYFT is up another 6.5%.

So far this morning, AVTR, AVNT, CRL, CME, CNHI, GPN, IQV, LPX, NATL, OC, PSN, R, SITE, SONY, TMHC, and WMB all reported beats on both the revenue and earnings lines.  At the same time, GOLD, KHC, LAD, and MLM missed on revenue while beating on earnings.  On the other side, SAH, SUN, and WAB all beat on revenue while missing on earnings. There are no reports of missed on both lines yet today.  It is worth noting that GPN, MLM, SONY, and WMB lowered guidance. However, PSN, raised its forward guidance.

With that background, it looks like the Bulls are trying to reclaim some ground at least in the premarket. All three major index ETFs opened the early session higher and are putting in white body and decisive (still inside day) candles compared to Tuesday’s action. The SPY and QQQ also have both climbed back above their respective T-lines (8ema) this morning. The trend still remains Bullish with only DIA have broken its uptrend (and that break was not yesterday). In terms of extension, none of the three is too far from their 8ema yet. However, T2122 is now well into the oversold area. So, at least a bounce is in order soon, but that does not have to mean today. In addition, there is enough slack for either the Bulls or Bears to push today of they find the energy. Once again, as I’ve been saying for months, keep an eye on those 10 huge tech stocks. If they walk in lock-step, whatever direction they decide to go is very likely to call the tune for the rest of the market. (On Tuesday they walked down and set the tone for everything else.) So far in this early session, they are green across the board.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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 markets opened flat on Monday.  SPY opened dead flat, DIA opened down 0.08%, and QQQ opened down 0.03%.  From there, all three major index ETFs ground to the side in a tight range for an hour.  Then all three rallied modestly for 60 minutes before grinding sideways again for two hours.  At that point, all three sold off for 90 minutes (with QQQ giving the steepest selling) only to end the day with another hour of sideways drift in a tight range.  This action gave us new all-time highs in all three with DIA also giving us a new all-time high close.  However, all three had large upper wicks.  The DIA printed a Bullish Engulfing, QQQ printed a Bearish Harami, and SPY gave us a Shooting Star without the gap up.  With that said, to me, the biggest thing to take note of were those large upper wicks and far less than average volume in all three of the major index ETFs.

On the day, nine of the 10 sectors were in the green as Energy (+1.16%) and Utilities (+1.14%) led the way higher while Technology (-0.19%) was the only sector lagging in the red.  Meanwhile, the SPY lost 0.04%, the DIA gained 0.36%, and QQQ lost 0.39%.  VXX gained 2.14% to close at 14.32 and T2122 spiked into the top end of overbought territory at 96.60.  10-year bond yields rose a bit to 4.179% and Oil (WTI) was flat at +0.13% to close at $76.94 per barrel.  So, Monday was a dead day in the market with long periods of flat trading and offsetting rises and declines.  There were warning signs of exhaustion in the rally with very low volumes and those high wicks.  However, an argument can be made that traders were just waiting on the CPI data.

The major economic news released Monday was limited to NY Fed 1-Year Consumer Inflation Expectations, which came in flat from January at 3.00%.  Later, the January Federal Budget Balance came in much better than expected at -$22 billion (compared to a -$39.3 billion forecast and December’s massive -$129.0 billion). 

In Fed news, Atlanta Fed President Bostic said Monday afternoon that he anticipates that inflation will be near “the low twos” by the end of 2024.  Bostic continued, “With that outlook, I really see the first move (rate cut) coming sometime in the summer.”

After the close, ANET, SCI, WTS, and WM all reported beats on both the revenue and earnings lines.  Meanwhile, CAR, CDNS, GT, JHX, MEDP, and PFG all missed on revenue while beating on earnings.  Unfortunately, BHF and TSE missed on both the top and bottom lines.  It is worth noting that MEDP raised its forward guidance while PFG lowered guidance.

In stock news, GILD announced that it had reached an agreement to acquire CBAY for $32.50 per share.  (GILD expects the deal to close this quarter.)  Later, FANG said it had agreed to buy Endeavor Energy (private) for $26 billion in cash and stock.  The deal would make FANG the third-largest oil and gas producer in the Permian Basin (behind XOM and CVX).  At the same time, VINO announced it is starting a “strategic asset liquidation” plan.  The move is intended to head off what it says is a plan by other companies to drive down their stock price ahead of a takeover bid.   Later, MLM said it had agreed to acquire 20 operations in the Southeast US from Blue Water Industries for $2.05 billion.  Elsewhere, drivers from UBER, LYFT, DASH, and others announced Monday that they will go on strike on Valentine’s Day to demand fair pay.  Later, BB announced it had concluded 200 job cuts in Q4 and is targeting $100 million in added profit from cost savings (from unspecified means) in 2024.  At the same time, JBLU shares jumped 15% when reports stated that Carl Icahn had taken a 10% stake in the airline, saying that the stock was “undervalued.”

In stock legal, governmental, and regulatory news, on Monday a federal judge ordered Elon Musk to testify in the SEC probe of his takeover of Twitter (now X).  Later, KTOS was awarded a $877 million contract with the “Space Systems Command” (Space Force). At the same time, a federal judge ruled that WMT and ENR must face a lawsuit alleging they violated antitrust laws by conspiring to raise the prices of disposable batteries.  Later, the NHTSA said it had closed an investigation into F 2010 Fusion cars related to power steering issues.  At the same time, AWK filed an appeal contesting a December ruling.  The decision could change the management of water in CA’s Monterey County.  Later, in Germany, a ban went into effect against importing, making, or selling INTC server chips which had been found to violate the patent rights of R2 Semiconductors.  (This impacts INTC, DELL, HPQ, HPE, etc. who sell INTC server chips in Germany.)   At the same time, BRKB-owned Jazwares filed suit against BBW alleging that BBW based its new line of plush animals are knockoffs that infringe on its intellectual property rights.  Later, a federal judge blocked an OH law that prevented the access of children 16 and under to META’s Facebook, TikTok, GOOGL’s YouTube, and X without prior parental consent.  After the close, the Attorney General of KY filed suit against KR, claiming the company’s pharmacies contributed to the state’s opioid addiction crisis with more than 11% of all opioid pills in the state prescribed by the retailer. 

Note that the Chinese markets were closed for Lunar New Year and will stay closed all week as well.  Meanwhile, Japan (+2.89%), Malaysia (+1.26%), and South Korea (+1.12%) led the rest of the region higher.  In Europe, we see the opposite picture taking shape with all but two of the 15 bourses in the red.  The CAC (-0.46%), DAX (-0.57%), and FTSE (-0.30%) lead the region lower in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a gap lower to start the day (ahead of CPI).  The DIA implies a -0.20% open, the SPY is implying a -0.46% open, and the QQQ implies a -0.86% open at this hour.  At the same time, 10-year bond yields are back to 4.16% and Oil (WTI) is up 0.73% to $77.47 per barrel in early trading.

The major economic news scheduled for Tuesday is limited, but important with Jan. Core CPI and Jan. CPI (both at 8:30 a.m.), and Weekly API Crude Oil Stocks (4:30 p.m.).  The major earnings reports scheduled for before the open include AN, BIIB, BRKR, KO, DDOG, ECL, FELE, GFS, HAS, HRI, HWM, INCY, JHX, LCII, LDOS, MAR, TAP, MCO, QSR, SHOP, TRU, WSO, WCC, KLG, and ZTS.  Then, after the close, ABNB, AKAM, ALSN, AMX, AIG, BFAM, DVA, ENTG, EQT, GDDY, GXO, IAC, IOSP, CART, INVH, LYFT, MCY, MGM, MRC, NGD, PRI, QDEL, REZI, SSNC, MODG, WCN, WELL, and ZG report.

In economic news later this week, on Wednesday EIA Crude Oil Inventories are reported.  On Thursday, we get Initial Weekly Jobless Claims, Weekly Continuing Jobless Claims, Jan. Core Retail Sales, Jan. Retail Sales, Jan. Import Price Index, Jan. Export Price Index, NY Empire State Mfg. Index, Jan. Industrial Production, Dec. Business Inventories, Dec. Retail Inventories, the Fed Balance Sheet, and Fed member Bostic speaks.  Finally, on Friday, Jan. Building Permits, Jan. Housing Starts, Jan. Core PPI, Jan. PPI, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, Michigan 5-Year Inflation Expectations, and Fed member Daly speaks.

In terms of earnings reports later this week, on Wednesday, we hear from AVTR, AVNT, GOLD, BGC, CAE, CRL, CHEF, CME, CNHI, DBD, ES, GNRC, GPN, IQV, KHC, LAD, LPX, MLM, NHYDY, OC, PSN, R, SITE, SAH, SUN, TMHC, WAB, WMB, ALB, ATUS, AWK, AR, APP, ACGL, CF, CC, CSCO, CW, ET, EQIX, HLF, HUBS, KGC, MTW, MFC, OXY, PTEN, CNXN, ROL, SON, SUM, TWLO, TYL, VTR, and WFG.  On Thursday, HOUS, ARCH, CBRE, CVE, CRBG, CROX, DE, DNB, EPAM, GTX, GPC, GEO, HBI, H, NSIT, KELYA, KNF, LH, LECO, DNOW, OGN, PBF, PENN, RS, RPRX, SABR, SN, SO, SPTN, STLA, SLVM, TRGP, USFD, VNT, WEN, WST, YETI, ZBRA, AEM, AL, LNT, AMN, AMAT, BIO, BE, ED, DLR, DASH, DKNG, DBX, GLOB, IR, LBTYA, MERC, OPEN, ROKU, TXRH, TOST, TTD, and TROX report.  Finally, on Friday, we hear from ACDVF, AXL, CNK, POR, PPL, TRP, THS, and VMC.

In miscellaneous news, C told its bond trading customers to be cautious in their bets on the Fed’s rate easing.  The bank recommended trades take a hedged approach to such investments, warning we could see something akin to 1998 when the FOMC did a quick succession of cuts.  However, they warn traders to not be surprised if there is a rate hike in the mix. Elsewhere, Bitcoin closed above $50,000 for the first time in two years on Monday.  At the same time, a survey by BNPQY (BNP Paribas) found that hedge funds (in particular multi-strategy funds) are now returning just $0.41 to their clients for every $1.00 the fund makes.  This is reflecting a new trend where popular funds now have a blank check for expenses. Finally, the US Senate approved a $95 billion bill to provide aid to Ukraine, Israel, and Taiwan. (This is the same bill as a week ago but stripped of the border policy and appropriates that the GOP wants but that the MAGA types don’t want to pass so they can preserve the issue to run on in 2024.) The bill passed 70-29 with strong bipartisan support. However, the House GOP caucus is such a mess that passage in the House remains in serious doubt. (The MAGA types there have said they won’t pass aid without the border components, but killed the earlier bill that gave them what they wanted because their boss wants the issue more than a solution. So, they are in a “damned if you do and damned if you don’t” situation of their own making related to passage of the needed bill.)

So far this morning, AN, BRKR, KO, DDOG, GFS, HWM, LDOS, TAP, QSR, SHOP, and TRU all reported beats on both the revenue and earnings lines.  Meanwhile, MAR missed on revenue while beating on earnings.  On the other side, INCY, MCO, and ZTS beat on revenue while missing on earnings.  Unfortunately, BIIB, HAS, HRI, LCII, WSO, and WCC missed on both the top and bottom lines.  It is worth noting that DDOG, GFS, MAR, and MCO lowered their forward guidance.  (ECL, FELE, JHX, and KLG report at 8 a.m.)

With that background, it looks like the Bears are in control this morning, energized by those high wicks from Monday. Ahead of the CPI print, the Bears are pressing especially hard in the QQQ giving a gap lower to start the premarket and a large red-body candle that is now near a retest of its T-line (8ema) from above. Still, all three major index ETFs remain above their T-line (8ema). So, the Bulls still have control of the trend in both the long and short term. In terms of extension, none of the three is too far from their 8ema yet. However, T2122 is deep into that indicator’s overbought territory. This means the market still has slack to work with if either side of the market gains traction, but the Bears have more room to work with. As I have been saying for months, keep an eye on those 10 huge tech stocks. If they walk in lock-step, whatever direction they decide to go is very likely to call the tune for the rest of the market. And so far in this early session, they are all flashing bright red.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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 Bulls were in charge again on Friday.  SPY opened up 0.06%, DIA opened down 0.05%, and QQQ gapped up 0.27%.  At that point, the SPY and QQQ continued on slow, steady rally until 3 p.m. with some very modest profit-taking the last hour.  At the same time, DIA sold off slowly until noon, rallied slowly until 3 p.m. (just reaching the open level) and then took profits more strongly than the other indexes the last hour.  This action gave us large white-bodied candles with small upper wicks in the SPY and QQQ.  Meanwhile, DIA printed a black-bodied Doji candle.  SPY and QQQ printed yet another new all-time high and new all-time high close.  (SPY closed above 5000 for the first time.)  Again, this happened on very low volume in all three major index ETFs.

On the day, eight of the 10 sectors were in the green as Technology (+1.38%) again was well out in front leading the market higher. At the same time, Energy (-0.73%) and Consumer Defensive (-0.61%) were the only sectors in the red.  Meanwhile, the SPY gained 0.57%, the DIA lost 0.16%, and QQQ gained 0.98%.  VXX gained 0.72% to close at 14.02 and T2122 climbed again but remained in the mid-range (just outside of the overbought area) at 78.12.  10-year bond yields rose a bit to 4.173% and Oil (WTI) gained 0.42% to close at $76.54 per barrel.  So, the bulls ended the week again on its fourth higher close in the SPY.  However, that’s the least of the streaks. SPY, DIA, and QQQ are all on a five-week winning streak…and 14 out of 15 weeks closing higher.

There was no major economic news released on Friday.  However, the Bureau of Labor Statistics did revise downward the CPI data for December.  The new CPI data showed a +0.2% increase for December, down from the earlier +0.3% estimate.  However, at the same time, BLS revised the November number up from 0.1% to 0.2%.

In Fed news, Dallas Fed President Logan said Friday that risks are more balanced now and this gives the FOMC room to be patient on rate cuts.  Logan said that there had been “tremendous progress” on bringing down inflation, but she still wants to see more evidence before starting rate cuts.  She said, “The risks that I’m seeing in the economy are becoming more in balance, but I do think we need to take time here to continue to look at the data…I’m really not seeing any urgency to make any additional adjustments at this time.”

In stock news, ASTL (Canadian steelmaker) reported a significant “incident” at its north Casthouse blast furnace complex.  The incident affected 12 workers with at least five requiring medical treatment.  At the same time, STLA’s Chrysler brand announced it will unveil a new concept car on Tuesday that will be a “sustainable design” and be the basis for a fully electrified Chrysler future.  Later, BTTR announced it had acquired AIMFF in a move that positions it well for developing a weight-loss supplement for pets.  (This will compete with PFE who made a similar acquisition to move into the same segment.)  At the same time, ATR and BIIB announced a partnership to build digital health solutions for neurological diseases.  Later, DIS announced a new AI tool designed to match advertiser commercial messages to the mood created by specific program scenes.  At midday, ASML announced they are gearing up the production line for a new $350 million “High NA EUV” chipmaking machine.  The product will enable TSM, NVDA, INTC, and AMD to make new high-end, higher-density chips. At the same time, Reuters reported an exclusive the CSCO will announce a restructuring plan that will include laying off thousands of employees.  The report said a public announcement is likely to come at CSCO’s earnings call on Feb. 14.  Later, AXP announced that its 2023 restructuring-related costs amounted to $277 million.  Elsewhere, HUBB finalized its divestiture of its residential lighting unit to KWAC for an undisclosed sum.  At the same time, APLD announced it will take a revenue hit from the loss of revenue due to an ongoing power outage (since January 18) data center.  Then, on Saturday, Reuters reported that AMZN founder Bezos sold $2 billion worth of AMZN stock last week per regulatory filings.  (Bezos said a week ago that he would sell roughly 50 million shares by the end of January 2025.)  Later Saturday, TSLA announced temporary 2% – 2.3% price cuts on Model Y cars in the US (valid until Feb. 29).

In stock legal, governmental, and regulatory news, on Friday, the FDA granted “orphan drug” status to IRON’s DISC-3405 investigational therapy.  This grants the company development assistance, tax credits, fee waivers, and 7 years of market exclusivity. At the same time, the FAA accepted the propulsion system certification plan from JOBY.  This sets a clear path to commercial passenger use of JOBY’s electric air taxi vehicles.  Later, the FDA approved Phase 2 clinical trials of OKYO’s ocular investigational drug.  At the same time, a proposed class-action suit was filed against AMZN for allegedly violating consumer protection laws by steering consumers to higher-priced products by hiding lower-price options.  Later, the SEC announced Wall Street firms have agreed to pay $81 million in fines for record-keeping failure.  The violators include USB and OPY.  After the close, AAPL made a court filing indicating it plans to settle a lawsuit that alleged it had stolen trade secrets from startup Rivos.  (Just another in a long line of firms that AAPL has “allegedly” stolen technology from.)  Also after the close, Reuters reported that FAA Chief Whitaker and other top administrators of the agency will be in Seattle to meet with BA executives early this week.

Note that most Asian markets were closed for the Lunar New Year and will stay closed all week as well.  In Europe, the bourses are mostly green at midday with just four of the 15 in the red.  The CAC (+0.32%), DAX (+0.32%), and FTSE (-0.14%) lead the region on volume as usual in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a start to the week just on the red side of flat.  The DIA implies a -0.08% open, the SPY is implying a -0.02% open, and the QQQ implies a -0.01% open at this hour.  At the same time, 10-year bond yields are down a touch to 4.16% and Oil (WTI) is off 1.16% to $75.94 per barrel in early trading.

The major economic news scheduled for Monday is limited to NY Fed 1-Year Consumer Inflation Expectations (11 a.m.) and Jan. Federal Budget Balance.  However, we also hear from Fed member Kashkari (1 p.m.).  The major earnings reports scheduled for before the open are limited to TRMB. Then, after the close, ANET, CAR, BHF, CDNS, GT, MEDP, PFG, SCI, TSE, WTS, and WM report.

In economic news later this week, on Tuesday we get Jan. Core CPI, Jan. CPI, and Weekly API Crude Oil Stocks.  Then, Wednesday EIA Crude Oil Inventories are reported.  On Thursday, we get Initial Weekly Jobless Claims, Weekly Continuing Jobless Claims, Jan. Core Retail Sales, Jan. Retail Sales, Jan. Import Price Index, Jan. Export Price Index, NY Empire State Mfg. Index, Jan. Industrial Production, Dec. Business Inventories, Dec. Retail Inventories, the Fed Balance Sheet, and Fed member Bostic speaks.  Finally, on Friday, Jan. Building Permits, Jan. Housing Starts, Jan. Core PPI, Jan. PPI, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-Year Inflation Expectations, Michigan 5-Year Inflation Expectations, and Fed member Daly speaks.

In terms of earnings reports later this week, on Tuesday, AN, BIIB, BRKR, KO, DDOG, ECL, FELE, GFS, HAS, HRI, HWM, INCY, JHX, LCII, LDOS, MAR, TAP, MCO, QSR, SHOP, TRU, WSO, WCC, KLG, ZTS, ABNB, AKAM, ALSN, AMX, AIG, BFAM, DVA, ENTG, EQT, GDDY, GXO, IAC, IOSP, CART, INVH, LYFT, MCY, MGM, MRC, NGD, PRI, QDEL, REZI, SSNC, MODG, WCN, WELL, and ZG report.   Then Wednesday, we hear from AVTR, AVNT, GOLD, BGC, CAE, CRL, CHEF, CME, CNHI, DBD, ES, GNRC, GPN, IQV, KHC, LAD, LPX, MLM, NHYDY, OC, PSN, R, SITE, SAH, SUN, TMHC, WAB, WMB, ALB, ATUS, AWK, AR, APP, ACGL, CF, CC, CSCO, CW, ET, EQIX, HLF, HUBS, KGC, MTW, MFC, OXY, PTEN, CNXN, ROL, SON, SUM, TWLO, TYL, VTR, and WFG.  On Thursday, HOUS, ARCH, CBRE, CVE, CRBG, CROX, DE, DNB, EPAM, GTX, GPC, GEO, HBI, H, NSIT, KELYA, KNF, LH, LECO, DNOW, OGN, PBF, PENN, RS, RPRX, SABR, SN, SO, SPTN, STLA, SLVM, TRGP, USFD, VNT, WEN, WST, YETI, ZBRA, AEM, AL, LNT, AMN, AMAT, BIO, BE, ED, DLR, DASH, DKNG, DBX, GLOB, IR, LBTYA, MERC, OPEN, ROKU, TXRH, TOST, TTD, and TROX report.  Finally, on Friday, we hear from ACDVF, AXL, CNK, POR, PPL, TRP, THS, and VMC.

In miscellaneous news, climate researcher Michael Mann (University of PA) was awarded $1 million for libel and defamation by two right-wing, climate-denying writers.  It took Mann 12 years of legal work, but just like the defamation suit that FOX settled last year, it is another small step in favor of truth.  Elsewhere, Reuters reported Friday that Chinese banks issued a new all-time high record ($683.7 billion) in loans during January.  This was more than four times the amount loaned in December and came as the Chinese central bank provided more support measures to banks.  Meanwhile, in the US, the Washington Post reported that OpenAI CEO Altman is seeking $7 trillion in funding (yes, trillion) to begin creating and supplying the company’s own AI semiconductor chips.  This is a massive effort.  (For reference, “only” $527 billion worth of chips were sold globally in 2023, in total.)  In addition, this would create a direct competitor to the two main suppliers of chips to all AI users (NVDA and AMD).  Nonetheless, Altman is meeting with various Silicon Valley venture capitalists and had meetings with the UAE and Saudi Arabian sovereign funds last week.  He has also met with SoftBank (majority owners of ARM) and the world’s largest chipmaker TSM.  (It is worth keeping in mind that Altman has the backing of MSFT.)  The Washington Post reported Friday he was also in contact with the US government related to where to build semiconductor Fabs (factories). Finally, Bloomberg reports that the National Assn. for Business Economics survey released today found that 21% of economists feel the Fed policy is “too restrictive.” (It is worth noting that the survey was conducted just before the last FOMC meeting.) This is the most disagreement with the Fed policy from those economists since 2011.

In geopolitical news, on Friday Israeli PM Netanyahu ordered his military to prepare a plan to evacuate Rafah.  (Rafah is the Southernmost and largest city in the Gaza Strip that has not yet been occupied by Israeli ground troops.  It is also the main border crossing into Egypt through which the vast majority of humanitarian aid flows.)  The media speculates this is a precursor to seizing what is left of that city.  (Rafah is already under air and artillery attacks.)  This led to more Oil market fear of an expanded conflict. Then, on Saturday, Reuters reported that a US-led coalition) air defenses (including Kurdish forces, who suffered six dead in the incident) stopped a six-drone attack on a COP oil field in Syria.  The report claimed the attack came from an Iranian-backed militia in Syria. On Sunday, the Israeli PM told US morning news shows that his military was being very careful and that the ratio of dead civilians to dead Hamas fighters was 1-to-1. If that were somehow true (very, very unlikely) Hamas had a much larger militia than anyone had ever realized since a little over 28,000 Palestinians are confirmed dead and almost 68,000 injured.

With that background, it looks like the Bulls are rebounding slightly after the Bears started the premarket with a modest lead in their race. All three major index ETFs are printing small, white-body candles in the early session and are little changed from Friday’s close. All three also remain above their T-line (8ema). So, the Bulls remain in control of the trend in both the long and short term. In terms of extension, none of the three is too far from their 8ema yet and the T2122 indicator remains just outside of overbought territory at the top of its midrange. This means the market still has slack to work with if either side of the market gains traction. As I have been saying for months, keep an eye on those 10 huge tech stocks. If they walk in lock-step, whatever direction they decide to go is very likely to call the tune for the rest of the market.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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

Thursday was a sideways day from the start.  SPY opened “up” 0.01%, DIA gapped up 0.19%, and QQQ opened 0.05% higher.  From that point, SPY wandered back and forth across that “gap” for the rest of the day. At the same time, DIA sold off modestly back down across its gap by 10:15 a.m. and reached its lows at 11:30 a.m.  Then it started a modest rally crossing back up into the gap by 2 p.m. and slowly drifting back up toward its opening level.  Meanwhile, QQQ very slowly rallied after the open, reaching its highs at 11 a.m. and trading sideways in a tight range the rest of the day.  This gave us indecisive candles in all three major index ETFs.  Both SPY and QQQ printed white-bodied Spinning Top candles while DIA printed a long-legged Doji.  All three gave us yet another new all-time high close with QQQ and SPY also giving us new all-time highs.  This happened on a very low volume compared to the average.

On the day, six of the 10 sectors were in the green as Technology (+1.10%) again was well out in front leading the market higher. At the same time, Communications Services (-1.53%) was again by far the laggard sector.  Meanwhile, the SPY gained 0.04%, the DIA gained 0.18%, and QQQ gained 0.19%.  VXX fell by 0.57% to close at 13.92 and T2122 climbed but remained in the mid-range at 71.06.  10-year bond yields climbed to 4.156% and Oil (WTI) spiked 3.61% to close at $76.53 per barrel. So, again strong earnings led to optimism but there was no news to lead to a follow-through.  The bulls were not willing to put more money in at these high levels and the bears have gotten run over enough times that they aren’t going to be on reversal yet either.  (Hence, the very low volume.)  This led to a day of drift and micro moves that amounted to a nothing burger.

The major economic news released Thursday was limited to Weekly Initial Jobless Claims, which came in a bit below expectation at 218k (compared to a forecast of 221k and the prior week’s 227k).  At the same time, Weekly Continuing Jobless Claims also came in a bit below the anticipated level at 1,871k (versus a forecast of 1,878k and the prior week’s 1,894k).  Finally, after the close, the Fed Balance Sheet rose $1 billion on the week, coming in at $7.631 trillion (compared to $7.630 trillion last week).

In Fed news, Richmond Fed President Barkin said Thursday that he is skeptical of recent economic data, citing the difficulty of seasonal adjustments at the start of each year.  Barkin said, “The data has been remarkable across the board,” … “But I am always cautious about numbers around the turn of the year, there’s big seasonal adjustments…I am not sure I am going to take too much out of any one month.”  He went on to say the Fed should be patient in making rate changes.  Later, Boston Fed President Collins said she thinks the Fed will cut rates by three-quarters of a percent in 2024.  Collins told a radio interview Thursday, “I do expect that before the end of the year, it will be appropriate for us to carefully begin easing rates.”  She went on to echo other Fed members by saying she would need to see additional evidence before voting for rate cuts, but that inflation is clearly falling and the economy remains resilient.

In stock news, UL announced a $1.6 billion share buyback program Thursday.  Later, ICE (parent company of NYSE) said it saw strong growth in trading volumes, especially in energy and commodity markets last quarter.  ICE attributed part of the increased volume to an increase in market volatility (which usually leads to more volume as traders adjust positions).  At the same time, GOOGL rebranded its AI chatbot from Bard to Gemini on Thursday and launched it as a $19.99/mo. subscription service that comes with two terabytes of cloud storage (normally a $9.99/mo. offering).  (Gemini is intended to compete with MSFT’s co-pilot subscription available in MS Word and MS Excel.)  Later, Reuters reported that APO is negotiating for a minority stake in 2,000 SBUX locations across 13 countries in the Middle East, North Africa, and Central Asia.  The 30% stake is said to be valued between $4 billion and $5 billion.  At the same time, Reuters reported that DVN is in talks to acquire ERF to strengthen its positions in the Bakken (ND) and Marcellus (PA) shale fields.  Later, HSBC announced it had partnered with GOOGL and will provide financing to GOOGL-chosen climate technology firms that join GOOGL’s “Cloud-Ready Sustainability” program.  Elsewhere, VLKAF (Volkswagen) told Reuters that despite competitors like GM pulling back on EV plans, it is sticking with its plan to launch 25 electric vehicle models in North America by 2030.  However, the company hedged its bets by saying it is ready to adjust as the market shifts.  At the same time, BA announced it had received an order for 45 of its 787 jets from Thai Airways.  (No delivery dates were announced, but typically the lead time is several years.)  Later, Reuters reported that part of the reason TSLA is now considering layoffs is that TSLA trails both GM and F in “revenue per employee.”  GM generates over $1 million per employee, F generates $937,000, and TSLA makes just under $690,000 per employee.

In stock legal, governmental, and regulatory news, the FAA announced it has begun an investigation into two JBLU planes that collided on the tarmac in Boston Thursday.  (No injuries were reported.)  Later, AMZN and BMWYY (BMW) won a lawsuit in Spain against four sellers of counterfeit BMW merchandise sold through AMZN.  Elsewhere, Reuters reported that the CFTC has opened an investigation into GS and has sent the company subpoenas for information about fees charged for certain block trades in the futures market.  (GS paid $50 million in 2023 to settle three other CFTC cases.)  Later, the FAA formally mandated inspections of all 737 MAX airplanes looking for loose bolts on rudder control systems.  (This was a follow-up to BA itself “recommending” that its customers inspect those bolts after identifying quality control issues in December.)  At the same time, a US Senate Committee voted to boost funding of the FAA (so that it can increase the number of on-the-ground inspectors at BA and its suppliers like SPR) and also rejected the proposal to increase the pilot retirement age from 65 to 67.  Both of these positions are in line with FAA requests but are in opposition to House as well as airlines (AAL, DAL, LUV, and UAL) positions on the matters.  Later, a group of religious investors (the group represents $4 trillion in assets) sent a letter urging XOM to drop its lawsuit against climate activists.  At the same time, EU antitrust regulators have now set a March 13 deadline for whether to approve the CSCO $28 billion acquisition of SPLK.  Later, Reuters reported that UBER, DROOF, and other similar companies that use online workers reached a deal with EU lawmakers over the rights of gig workers.  The deal removes the matter from the national government’s purview in favor of collective bargaining and case law.  However, it also puts the burden of proof on the company in any dispute over whether a person is an employee or contractor.

After the close, AFRM, BYD, DXCM, EXPE, G, PEAK, ILMN, LEG, MHK, MSI, TEX, and TFII all reported beats on both the revenue and earnings lines.  Meanwhile, ATR, FE, FLO, NGL, and PINS missed on revenue while beating on earnings.  On the other side, TTWO beat on revenue while missing on earnings.  Unfortunately, CPRI and MTD missed on both the top and bottom lines.  It is worth noting that AFRM and MTD raised forward guidance.  However, G, LEG, MHK, and TTWO lowered guidance.

Note that Asian markets were closed for Lunar New Year and will stay closed all of next week as well.  In Europe, markets lean the green side at midday with 10 of the 15 bourses modestly in positive territory.  The CAC 9-0.15%), DAX (+0.05%), and FTSE (+0.02%) lead the region slightly higher in early afternoon trade.  In the US, as of 7:15 a.m., Futures are pointing toward a slightly green start to the day.  The DIA implies a +0.05% open, the SPY is implying a +0.13% open, and the QQQ implies a +0.31% open at this hour.  At the same time, 10-year bond yields have climbed to 4.172% and Oil (WTI) is down slightly to $76.23 per barrel in early trading.

There is no major economic news scheduled for Friday.  The major earnings reports scheduled for before the open include AMCX, CTLT, ENB, FTS, MGA, NWL, PEP, PAA, PAGP, and TIXT.  There are no earnings reports scheduled for after the close.  

So far this morning, AMCX and NWL reported beats on both the revenue and earnings lines.  Meanwhile, FTS, PEP, and TIXT missed on revenue while beating on earnings.  On the other side, MGA beat on revenue while missing on earnings.  Unfortunately, ENB and UI missed on both the top and bottom lines.  It is worth noting that NWL and TIXT lowered forward guidance.  However, also note that PEP raised its guidance.  

In miscellaneous news, Maersk said Thursday that there is too much container chipping capacity and this would impact their profits for 2024.  The shipping giant downplayed the impact of Red Sea disruptions (which cause longer shipping routes meaning more container ships are needed to maintain the same flow of trade).  The signal that this was a real warning was that the company also suspended its share buyback program.  Maersk is often seen as a barometer of global trade and therefore global GDP.  Elsewhere, the US Dept. of Transportation reported that driving in the US set a new yearly record in 2023 of 3.263 TRILLION miles driven.  (This was the first time a new record has been set since prior to COVID-19.)  Meanwhile, US trade data released earlier this week shows that Mexico exceeded China to become the largest trading partner of the US.  Mexican trade included $476 billion in imports and $323 billion in exports from the US for a total of $799 billion in 2023.  (US-China trade for 2023 was just $575 billion.)  Finally, Treasury Sec. Yellen told the Senate Banking Committee that she expects more commercial real estate stress, but that the problem is not a systemic banking risk.  Yellen said, “Valuations are falling. And so it’s obvious that there’s going to be stress and losses that are associated with this, … exposure of the largest banks is quite low, but there may be smaller banks that are stressed by these developments … I hope and believe that this will not end up being a systemic risk to the banking system.”

In global-related news, Israel rejected the Hamas proposal (itself a response to earlier negotiations) for a “cease-fire and humanitarian aid in exchange for hostages” deal.  (This was the primary cause of the spike in oil prices Thursday as Israel, Hamas, and the Houthi rattled sabers after Israel’s announcement.) Later, Ukrainian President Zelenskyy replaced their Armed Forces chief in favor of the head of their ground forces.  In related news, after the GOP killed the combined Border-Ukraine-Israel-Taiwan package they had demanded, the US Senate pushed forward a smaller $95 billion aid bill just covering Ukraine and Israel aid. This came after the GOP caucus split and 17 of them voted with the Democratic majority to get past the high hurdle by a 67-32 vote. House action on this bill is completely uncertain since the House Speaker is one of the MAGA types (but also backed away on Thursday from his demand to split this into separate Israel and Ukraine aid bills so that they could vote down Ukraine aid to appease their party’s Russian-supporting candidate and wing) and MAGA lobbying and threats is what killed the broader Senate bill in the first place.

With that background, it looks like all three major index ETFs are looking to open a bit higher but in a pretty undecided manner. All three are giving us small, white-body candles in the premarket. All three also remain above their T-line (8ema). So, the Bulls remain in control of the trend in both the long and short term. In terms of extension, none of the three is too far from their 8ema yet and the T2122 indicator remains in its midrange. This means the market still has plenty of slack to work with if either side of the market gains traction. As I have been saying for months, keep an eye on those 10 huge tech stocks. If they walk in lock-step, whatever direction they decide to go is very likely to call the tune for the rest of the market. Finally, remember that it’s Friday. So, pay yourself and prepare your account for the weekend by lightening up, moving stops, and/or hedging.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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 rally was back on Wednesday across the market.  SPY gapped up 0.46%, DIA gapped up 0.33%, and QQQ gapped up 0.63%.  At that point, all three major index ETFs pulled back into the top of their gap area to bide time for half an hour.  Then all three rallied sharply for 30 minutes.  From there, all three drifted sideways within a fairly tight range the rest of the day.  This action gave us white-bodied candles with larger lower and smaller upper wicks.  SPY and QQQ could be said to have printed white-bodied Spinning Top candles while DIA gave us a White Doji-like candle.  All three printed new all-time high closes while SPY and QQQ also gave us new all-time highs.  This happened on less-than-average volume (especially in the DIA).

On the day, five of the 10 sectors were in the green as Technology (+1.25%) was way out front leading the market higher.  At the same time, Communications Services (-1.18%) lagged very far behind the other sectors.  Meanwhile, the SPY gained 0.83%, the DIA gained 0.41%, and QQQ gained 1.03%.  VXX fell slightly to close at 14.00 and T2122 dropped a bit but remained in the center of its mid-range to 51.95.  10-year bond yields climbed to 4.115% and Oil (WTI) rose 1.05% and close at $74.08 per barrel. So, once again strong earnings led to a pop at the open.  From that point, it felt like a game of “wait and see” with traders looking for the next news event on the horizon.

The major economic news released Wednesday included Dec. Exports, which were up to $258.20 billion (compared to November’s $254.30 billion value).   At the same time, Dec. Imports were also up to $320.40 billion (versus the Nov. $316.20 billion reading). This gave us a December Trade Balance of $62.20 billion, which was in line with the $62.20 billion forecast and the November $61.90 billion value.  Later, Weekly EIA Crude Oil Inventories showed a much higher build than expected at +5.520 million barrels (compared to the +1.700 million barrels forecast and the prior week’s +1.234 million barrels build).  Later, the Dec. Outstanding Consumer Credit number was dramatically lower than anticipated at $1.56 billion.  Compare this to a $14.90 billion forecast and the massive $23.48 billion November reading.  (However, remember that Consumer Credit numbers are often subject to big revisions.)

In Fed news, the NY Fed released a report showing that wealth inequality continues to grow.  The report covered the period from 1/1/19 to 9/30/23.  It showed white family’s net worth rose 28% over the period while the Hispanic family’s net worth increased 20%. However, black family net worth actually decreased by 1.5% over the period.  Elsewhere, Boston Fed President Collins said if the economy meets her expectations, the FOMC will be able to lower rates “at some point this year.”  Collins said, “The unexpected strength in recent GDP and labor market data exemplifies the ongoing resilience of demand, and highlights that the anticipated slowdown in activity may take some time.”  She continued, “I believe it will likely become appropriate to begin easing policy restraint later this year.” Collins also said that the Fed does not need to wait until the Fed’s 2% inflation target is met, saying she “totally agrees” that if they wait until then, “that’s waiting too long.”  Later, Fed Governor Kugler said she was optimistic that inflation will continue to decline.  She went on to agree with the recent statements of Fed Chair Powell, saying, “The job is not done yet.”  However, she also said, “March, May, June — every meeting from now until the end of the year and moving forward will be live (for rate cuts).”  Meanwhile, on CNBC, Minneapolis Fed President Kashkari said, “Sitting here today I would say two to three cuts would seem to be appropriate for me right now…that’s my gut based on the data we have so far.”

After the close, NLY, ARM, ASGN, CENTA, CENT, CPA, CXW, COTY, EHC, EFX, GL, MMS, MCK, MKSI, MOH, NWSA, OSCR, PYPL, SGU, STE, SLF, UVV, DIS, and WYNN all reported beats on both the revenue and earnings lines.  Meanwhile, ALL, BKH, ENS, EG, MAA, MUSA, ORLY, and RRX missed on revenue while beating on earnings. Unfortunately, NVST, FAF, FLT, MAT, and UHAL missed on both the top and bottom lines.  It is worth noting that ARM, MPWR, OSCR, and DIS raised their forward guidance. However, ENS, EFX, MAA, PYPL, and RRX lowered their guidance.

In stock news, PRU announced it has taken over the $4.9 billion pension risks of SHEL as part of its deal to manage the pension benefits.  At the same time, Bloomberg reported that only a single TSLA was sold in South Korea in January due to various safety concerns, high prices, and inadequate charging infrastructure. Later, FOX reported a 20% decline in revenue, citing a fall in political ad sales.  At the same time. MSFT announced it has launched its Microsoft 365 Copilot internally in an attempt to boost AI adoption by its programmers.  Later, MPWR announced it will acquire Axign (a Netherlands-based fabless semiconductor maker).  At the same time, DIS told CNBC it will be taking a $1.5 billion minority stake in Epic Games (Fortnite publisher).  Later, ADESY (Airbus) announced it delivered 30 jets in January (up 50% from the same month in 2023).  The company also recorded 31 jet orders during the month.  Elsewhere, BA said that the FAA investigation findings will likely cause delays in the production schedule of its 737 jets.  Later, SPXC announced the acquisition of Ingenia (a Canadian firm) for $300 million, which included acquired real estate.  Meanwhile, after the close, TSLA asked its managers to define which of their employees are critical to operations, stoking fears of layoffs to come.

In stock legal, governmental, and regulatory news, the FDA put a hold on trials of a GILD blood cancer drug, citing an increased risk of death in some previous studies.  Later, a German court ruled against INTC in a patent dispute with tiny CA-based R2 Semiconductors.  At the same time, GCI was ordered to pay $25 million in damages after losing a defamation lawsuit.  Later, GOOGL’s Waymo autonomous driving unit was hit with a notice of regulatory review by the CA Dept. of Motor Vehicles after one of its driverless cars hit a cyclist, on Tuesday, causing minor injuries.  At the same time, Reuters reported that MSFT is in negotiations with a trade group (CISPE), which does include AMZN which is a direct competitor, in an attempt to end the group’s complaint filed with the EU’s antitrust regulators over MSFT cloud computing licensing practices.  In other MSFT news, the FTC clammed MSFT on Wednesday for violating its promises by laying off 1,900 gaming employees after saying no such layoffs would happen when it was seeking approval for its acquisition of ATVI (which the agency is still appealing to block).  Later, a US court nullified EPA approval of certain agricultural weedkillers from BAYRY (Bayer) and BASFY (BASF) used on soybean and cotton crops.  Elsewhere, the NHTSA announced it had closed its investigation into 3 million vehicles from HYMTF (Hyundai) and Kia related to potential engine fires. The agency determined the companies had issued eight recalls that addressed the issues that had caused the fires prompting the investigation.  At the same time, META filed a challenge to an EU “supervisory fee” aimed at deferring the regulator’s costs for monitoring compliance with EU content laws.  The fee amounts to 0.05% of META’s global net income and the fee amount is related to a social media’s average monthly active users.  The fee also applies to GOOGL, AAPL, and other social network giants.  Meanwhile, AAPL won the dismissal of a shareholder lawsuit that alleged the company had overpaid CEO Cook by tens of millions of dollars.  After the close, CVS was fined $250k by the state of OH for understaffing the pharmacy of one of its stores risking employee safety, and causing extreme delays for patients seeking prescriptions.  (The case stems back to a 2021 investigation.)

Overnight, Asian markets were mixed but leaned toward the green.  Japan (+2.06%), Shenzhen (+1.29%), and Shanghai (+1.28%) led the region higher while Hong Kong (-1.27%), India (-0.95%), and Thailand (-0.82%) lagged.  In Europe, we see a similar mixed picture at midday with 5 of the 15 bourses in the red.  The CAC (+0.62%), DAX (+0.36%), and FTSE (+0.01%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a start just on the red side of flat.  The DIA implies a -0.01% open, the SPY is implying a -0.14% open, and the QQQ implies a -0.15% open at this hour.  At the same time, 10-year bond yields are up to 4.139% and Oil (WTI) is up another percent to $74.65 per barrel in early trading.

The major economic news scheduled for Thursday includes Weekly Initial Jobless Claims and Weekly Continuing Jobless Claims (both at 8:30 a.m.), WASDE Ag report (noon), and Fed Balance Sheet (4:30 p.m.).  The major earnings reports scheduled for before the open are include WMS, APO, MT, ARES, ARW, ABG, AXTA, BAX, BCE, BDC, BWA, CCJ, CX, CIGI, COP, DTE, DUK, GTES, HOG, HSY, HMC, NSP, ICE, IPG, ITT, K, KVUE, LNC, MAS, MDU, NFG, PATK, BTU, PM, RL, RXO, SPGI, SNA, SPB, SAVE, TROW, TPR, TPX, THC, TRI, TDG, UA, UAA, WMG, WEX, and ZBH. Then, after the close, AFRM, ATR, BYD, CPRI, BAP, DXCM, EXPE, FE, FLO, G, PEAK, ILMN, LEG, MTD, MHK, MSI, NGL, PINS, TTWO, TEX, and TFII report. 

In economic news later this week, on Friday there is no major news planned.

In terms of earnings reports later this week, on Friday, AMCX, CTLT, ENB, FTS, MGA, NWL, PEP, PAA, PAGP, and TIXT report.

So far this morning, WMS, APO, ARES, AXTA, BAX, BCE, BDC, CRARY, HOG, ICE, IPG, ITT, KIM, MAS, RNECY, SPB, TROW, TPR, THC, TDG, WEX, and ZBH all reported beats on both the revenue and earnings lines.  Meanwhile, ABG, CCJ, CIGI, and SPGI beat on revenue while missing on earnings.  On the other side, COP, DTE, GTES, HSY, KVUE, LNC, RXO, SNA, TRI, UA, and UAA all missed on revenue while beating on earnings.  Unfortunately, MT, BWA, DUK, PM, and TPX missed on both the top and bottom lines.  It is worth noting that WMS, CIGI, DT, MAS, TPR, TRI, and ZBH all raised their forward guidance.  However, BWA, HSY, KVUE, KIM, PM, and SPGI all lowered their guidance.

In miscellaneous news, the USDA released its latest forecast Wednesday, saying that it expects a plunge in crop prices (to multi-year lows) along with a surge in production costs. The result is that the agency expects enough of a drop in farm incomes to cause ripples across the broader economy.  Specifically, the USDA forecasts a 25.5% drop in net farm profits in 2024 after a drop in 2023 from the record high in 2022.  Elsewhere, Bloomberg reported that a former Citadel employee has said the fund was one of the clients MS had leaked upcoming trades to when it was punished for the practice.  The names of the recipients had been redacted as part of MS’s $249 million settlement to end the SEC investigation.  Meanwhile, in a surprise move, China replaced the head of its securities regulator in a move meant to help restore confidence in the markets.  (The man replaced had gained the nickname “the broker butcher” for cracking down on traders.)

With that background, it looks like all three major index ETFs are undecided in the premarket. All three are giving us small candles with DIA printing an early session white body and both SPY and QQQ giving us a small red body. None are far removed from Wednesday’s close and all three remain above their T-line (8ema). So, the Bulls remain in control of the trend in both the long and short term. In terms of extension, none of the three is too far from their 8ema yet and the T2122 indicator remains in the center of its midrange. This means the market has plenty of slack to work with if either side of the market gains traction. As I have been saying for a long time, keep an eye on those 10 huge tech stocks. On Wednesday it was META, NVDA, MSFT, AMD, and TSLA leading the pack. If they walk in lock-step, whatever direction they decide to go is very likely to call the tune for the rest of the market.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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

Tuesday saw stocks open slightly higher and then diverge with large-caps chopping sideways and QQQ selling off before starting its own chop to the side.  SPY gapped up 0.19%, DIA opened 0.09% higher, and QQQ gapped up 0.27%.  At that point, SPY meandered sideways, recrossing its gap several times.  Meanwhile, DIA chopped to the side above its open and QQQ immediately recrossed the gap up and sold off until 12:30 p.m. before meandering along the lows.  Then, during the last 30 minutes of the day, all three major index ETFs rallied.  This action gave us a white-bodied Spinning Top in the SPY, a large-bodied, white-bodied Bullish Harami in the DIA (that bounced up off its T-line), and a black-bodied Spinning Top in the QQQ (which also bounced up off its 8ema). 

On the day, nine of the 10 sectors were in the green as Healthcare (+1.30%) and Consumer Cyclical (+1.20%) led the way higher.  Meanwhile, on the other end of the spectrum, Communications Services (-0.22%) was the only sector that stayed in the red.  At the same time, the SPY gained 0.29%, the DIA gained 0.39%, and QQQ lost 0.20%.  VXX fell another 2.43% to close at 14.05 and T2122 spiked back up into the center of its mid-range to 55.74.  10-year bond yields dropped back down to 4.09% and Oil (WTI) rose 0.92% and close at $73.45 per barrel. So, good premarket earnings led to a nice start to the day.  However, from that point forward we mostly saw drift and indecision as traders wait for a more broad-based read on earnings season (or more news and/or Fed opinions).

The major economic news released Tuesday was limited to Weekly API Crude Oil Stocks, which showed a smaller-than-expected increase of 0.674 million barrels (compared to a forecasted build of 2.133 million barrels but better than the prior week’s 2.500-million-barrel drawdown).  Elsewhere, the EIA released its short-term Energy Outlook.  The report says it expects US electricity use to rise to records in both 2024 and 2025.  (The US used 3,994 billion kWh in 2023 with 2024 demand projected at 4,112 billion kWh and 2025 at 4,123 billion kWh). 

In Fed news, Cleveland Fed President Mester said Tuesday that she is open to rate cuts if it is clear inflation is still slowing.  Mester said, “Monetary policy is in a good place from which to assess and respond” … “I don’t want to put a particular calendar date on it (rate cuts) – it really is dependent on the state of the economy.”  She added, “There’s no rush.”  Later, Philly Fed President Harker said that a soft landing was in sight for the US economy.  Harker said, “The data point to continued disinflation, to labor markets coming into better balance, and to resilient consumer spending — three elements necessary for us to stick to the soft landing we remain optimistic to achieve.”  He went on to say “real progress” is being made toward (getting back to) the Fed’s 2% target. 

After the close, AB, AFG, AMGN, AIZ, CSL, CMG, CINF, CRUS, CNO, EW, F, FTNT, IEX, JKHY, LUMN, OI, OMC, OXBC, SONO, SNEX, VLTO, VOYA, WFRD, WU, and YUMC all reported beats on both the revenue and earnings lines.  At the same time, ASTL, AMCR, EQH, CTSH, EXEL, and SNAP all missed on revenue while beating on the earnings lines.  On the other side, GILD, KD, PRU, QGEN, VSAT, and WERN all beat on revenue while missing on earnings.  Unfortunately, AMRK, DOX, ATO, PLUS, NBR, and VFC missed on both the top and bottom lines.  It is worth noting that PLUS and GILD lowered guidance.  However, JKHY, KD, and VLTO raised their forward guidance.

In stock news, USB announced it will resume share buybacks and plans to find $3 billion more in cost savings related to integrating its acquisition of CS.  (UBS says it now expects to save $13 billion total by the end of 2026 from the CS purchase.)  Later, the UAW announced that more than 50% of the workers at VLKAF (Volkswagen) TN plant have signed requests to join the union.  (UAW previously announced it will seek recognition once that number reaches 70%.)  At the same time, DD announced a new $1 billion stock buyback program and hiked its dividend by 6%.  Later, KSS stock jumped as hedge funds (major shareholders) urged the company to sell itself.  (KSS rejected a $64/share offer in 2022, holding out for a $70/share offer that never arrived.  KSS closed at $26.80 on Tuesday.)  At the same time, AMZN announced it will cut 115 jobs from its healthcare services unit (which has 400 employees).  Elsewhere, DIS (ESPN and ABC), FOX, and WBD announced a revolutionary sports-centric subscription streaming service to be launched in the fall of 2024.  This will target non-cable, sports fan subscribers.

In stock legal, governmental, and regulatory news, the NHTSA announced Tuesday that HMC will recall 750k 2020-2021 vehicles related to airbags that could deploy unintentionally during a minor collision. (This is not related to the widely-known Takata airbag recalls across many car makers.  Instead, this is related to a natural disaster at an HMC subcontractor causing it to change the materials used.)   Later, the NHTSA announced that GM is recalling more than 323k trucks for issues that may cause the tailgate to open while driving.  At the same time, the FAA said it would post inspectors at BA, saying BA’s current quality system “is not working.”  Elsewhere, the NTSB released its preliminary report into the mid-air loss of the BA 737 MAX 9 body panel.  The report says bolts were removed to repair a damaged door plug and the bolts were not reinstalled.  Similar missing bolts were found on numerous other 737 MAX 9s.  It also cited that the system allowing BA to certify the safety of their own planes when the company’s primary goal was increasing production rates was untenable.  At the same time, the US, UK, and France along with MSFT, GOOGL, and META signed a joint statement calling for more efforts to tackle cyber spying tools.  Elsewhere, the FDA said after the close Tuesday that it has found quality control lapses at CTLT, including “pest control” issues. (NVO announced Monday it is buying CTLT for $16.5 billion in order to expand production capacity for obesity drugs.)  Later, GOOGL agreed to pay $350 million to settle a shareholder lawsuit related to a security bug in the company’s now-defunct Google+ social media platform.  (The bug exposed users personal data.)  At the same time, a CA judge grilled GM Cruise unit officials over the coverup and then disclosure of the company’s pedestrian-dragging crash in October.  (Afterward, GM raised its offer to end the investigation by CA regulators, raising it to just $112,500.) Later, AAPL won a dismissal of a lawsuit by a Silicon Valley startup accusing AAPL of monopolizing the US heart-rate monitoring apps market via its app store.

Overnight, Asian markets were mostly green, again led by China.  Shenzhen (+2.93%), Shanghai (+1.44%), and South Korea (+1.30%) led the gainers with only two of the 12 exchanges in the red.  Meanwhile, in Europe, the bourses lean toward the red side with only four of 15 bourses in the green at midday.  The CAC (-0.25%), DAX (-0.32%), and FTSE (-0.41%) lead the region lower in early afternoon trade.  In the US, as of 7:30 a.m., Futures point toward a mixed and flat start to the day.  The DIA implies a -0.15% open, the SPY is implying a -0.04% open, and the QQQ implies a +0.07% open at this hour.  At the same time, 10-year bond yields are back up to 4.1333% and Oil (WTI) is up another 0.71% to $73.85 per barrel in early trading.

The major economic news scheduled for Wednesday includes Dec. Exports, Dec. Imports, and Dec. Trade Balance (all at 8:30 a.m.), Weekly EIA Crude Oil Inventories (10:30 a.m.), Dec. Consumer Credit (3 p.m.), and Fed member Bowman speaks (2 p.m.).  The major earnings reports scheduled for before the open include ADNT, BABA, ATS, ARCC, BERY, BAM, BG, CDW, CVS, EPC, EMR, EQNR, EEFT, FOXA, GPRE, GFF, HAIN, HLT, KMT, NBIX, NYT, OMF, PAG, PFGC, REYN, RBLX, SEE, TTMI, UBER, VSTS, VSH, XPO, and YUM.  Then, after the close, ALL, ARM, ASGN, BKH, CENTA, CENT, CPA, CXW, COTY, EHC, ENS, NVST, EFX, EG, FAF, FLT, GL, MAT, MMS, MCK, MAA, MKSI, MOH, MUSA, NWSA, ORLY, OSCR, PYPL, RRX, STE, SLF, SU, UHAL, DIS, and WYNN report. 

In economic news later this week, on Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, WASDE Ag report, and Fed Balance Sheet are reported.  Then Friday there is no major news planned.

In terms of earnings reports later this week, on Thursday, we hear from WMS, APO, MT, ARES, ARW, ABG, AXTA, BAX, BCE, BDC, BWA, CCJ, CX, CIGI, COP, DTE, DUK, GTES, HOG, HSY, HMC, NSP, ICE, IPG, ITT, K, KVUE, LNC, MAS, MDU, NFG, PATK, BTU, PM, RL, RXO, SPGI, SNA, SPB, SAVE, TROW, TPR, TPX, THC, TRI, TDG, UA, UAA, WMG, WEX, ZBH, AFRM, ATR, BYD, CPRI, BAP, DXCM, EXPE, FE, FLO, G, PEAK, ILMN, LEG, MTD, MHK, MSI, NGL, PINS, TTWO, TEX, and TFII.  Finally, on Friday, AMCX, CTLT, ENB, FTS, MGA, NWL, PEP, PAA, PAGP, and TIXT report.

So far this morning, ARCC, BAM, CG, CMRE, CVS, EPC, EMR, EEFT, HLT, OMF, RITM, UBER, VSH, and XPO all reported beats on both the revenue and earnings lines.  At the same time, ATS, ASAZY, BERY, EQNR, PAG, and PFGC all beat on the revenue line while missing on earnings.  On the other side, BG, CDW, HAIN, KMT, NBIX, NYT, and REYN missed on revenue while beating on earnings.  Unfortunately, ADNT, BABA, GPRE, and YUM missed on both the top and bottom lines.  It is worth noting that BG, CVS, HAIN, HLT, KMT, and VSH lowered forward guidance.  However, EMR raised its guidance. Finally, it is also well worth noting that even though BABA missed on both lines, the company increased its share buyback program by $25 billion.

In miscellaneous news, Reuters reported US stock buyback programs are speeding up, now well above the average of the past 12 earnings seasons.  Companies have announced an average of $6.9 billion of stock buybacks PER DAY in the first three weeks of the Q4 earnings season.  This is the highest level at this point since the record $8.2 billion per day at this point of the Q1 2023 reporting period.  Elsewhere, surprisingly strong demand resulted in $54 billion in 3-year treasury bonds sold, just ahead of the record-setting $42 billion 10-year bond sale.  At the same time, in a big move in foreign markets, both GS and MS endorsed having their clients move their higher-risk emerging markets money from China into India, designating it as a prime investment destination for the next decade.

With that background, it looks like all three major index ETFs are looking to open little changed from Tuesday’s close. DIA is giving us the largest (black) body in the premarket but remains above its T-line (8ema). QQQ is giving us the largest (white) body candle in the early session. And, for its part, SPY is giving us a white-bodied, indecisive candle so far this morning. All three remain above their T-line (8ema). So, the Bulls remain in control of the trend in both the long and short term. However, you would be hard-pressed to call the action of the last several days anything other than consolidation in the rally. In terms of extension, none of the three is far from their 8ema and the T2122 indicator is now back down in the center of its midrange. This means the market has plenty of slack to work with if either side of the market gains traction. As I have been saying for a long time, keep an eye on those 10 huge tech stocks. Whatever direction they decide to go is very likely to call the tune for the rest of the market.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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 opened the week a bit lower.  The SPY and DIA both opened 0.13% lower, and QQQ opened just on the red side of flat.  All three major index ETFs then followed through to the downside, reaching the lows of the day at 10:50 a.m.  At that point, all three reversed and rallied in divergent strengths. QQQ seeing the strongest rally, made it back into the opening gap by 12:40 p.m.  SPY made it back into its own gap at 2:35 p.m.  However, DIA’s shallow rally never got it back to the opening level.  All three of them had a modest selloff during the last hour of the day.  This action gave us black-bodied, Spinning Top Bear Harami candles in the SYP and QQQ.  Meanwhile, DIA printed a black-bodied candle with a good-sized lower wick.  DIA also retested its T-line (8ema) while closing back above while the other two major index ETFs did not even retest their own T-lines.

On the day, nine of the 10 sectors were in the red as Basic Materials (-2.12%) and Utilities (-1.96%) were way out in front leading the market lower.  On the other end of the performance spectrum, Healthcare (+0.27%) was the only sector that managed to stay in the green. At the same time, the SPY lost 0.36%, the DIA lost 0.73%, and QQQ lost 0.13%.  VXX fell almost 4% to close at 14.40 and T2122 plummeted back down into its oversold area to 12.25.  10-year bond yields spiked to 4.164% and Oil (WTI) also recovered to gain 0.77% and close at $72.85 per barrel.  So, great news, especially from META (+20.32%) and strong January Jobs data led to uncertainty and fear in the premarket and at the open.  However, at that point, the Bulls decided good news is good news and rallied all day until they took profits are the end of the session.

The major economic news released Monday included Jan. S&P Global Services PMI, which came in up but a bit below expectation at 52.5 (compared to a forecast of 52.9 and the December 51.4 reading.  At the same time, the S&P Global Composite PMI was also up but a bit below the expected value at 52.0 (versus a 52.3 forecast and a December reading of 50.9).  Later January ISM Non-Mfg. Employment was stronger than was predicted at 50.5 (compared to a 49.4 forecast and strongly higher from the Dec. value of 43.8).  The January ISM Non-Mfg. PMI was stronger than anticipated at 53.4 (versus a forecast of 52.0 and the December 50.5 reading).  The ISM Non-Mfg. Price Index was very hot at 64.0 (compared to the 56.5 forecast and even the 57.4 Dec. value). 

In Fed news, Fed Chair Powell sounded the same notes during his Sunday night 60 Minutes interview that he had the prior Wednesday.  Powell said it was unlikely the Fed would see enough evidence to begin rate cuts at its March meeting.  While not tying the Fed’s hands, this was a rare instance of the Fed specifically saying what is likely to happen (or not happen) at a meeting that is still six months away.  Later, Minneapolis Fed President Kashkari said that inflation is making “rapid progress” toward the Fed’s 2% target.  However, he also said that a resilient economy means the Fed has more time to study data before acting.  Kashkari said, “The implication of this is that…it gives the (Fed) time to assess upcoming economic data before starting to lower the federal funds rate, with less risk that too-tight policy is going to derail the economic recovery.”

After the close, ACM, AMKR, CBT, COHR, FN, ITUB, NXPI, PLTR, SPG, and SKY all reported beats on both the revenue and earnings lines.  At the same time, CHX and HI reported misses on revenue while beating on earnings.  On the other side, SSD beat on revenue while missing on earnings.  However, CCK, FMC, and VRTX missed on both the top and bottom lines.  It is worth noting that AMKR, CCK, and SPG lowered their forward guidance.  Meanwhile, COHR, and VTRX both raised their guidance.

In stock news, EL said it would cut 3% to 5% of its workforce (meaning 1,850 – 3,100 jobs) due to Chinese buyers backing off from higher-priced luxury goods in favor of low-margin alternatives.  At the same time, YNDX (widely known as Russia’s Google) announced a $5.21 billion deal to exit Russia by selling its Russian operation to a group of Kremlin-approved investors.  Later, politics reared its head in the Nippon Steel purchase of X for $15 billion as the ex-President said that, if elected, he would immediately block the deal.  This, theoretically could lead to a revival of a lesser offer from US-based (and Trump ally-backed) CLF.  At the same time, STLA CEO Elkmann denied that the company has any plans for a merger with any other car manufacturers (or specifically French-led PUGOY or Renault).  This denial came after an Italian newspaper said on Sunday was studying a merger between the companies.  Later, BA announced they had found “mis-drilled holes” in the fuselages of 50 of its 737 MAX planes that have not been delivered yet.  This is the latest quality issue for both the company and that product line.  Elsewhere, DOCU shares fell on Monday after reports indicated that acquisition talks with multiple hedge funds have stalled as the sides disagree on price.  At the same time, META’s internal Oversight Board has determined that an AI deep-fake video suggesting the President is a pedophile does not violate the company’s current content rules (and can remain online).  The group went on to say the company’s current rules are too narrow and incoherent related to AI-generated content.  Later, SNAP said it would cut 528 employees (10% of staff) as part of a cost-cutting measure.  At the same time, SAP said that it would stop buying TSLA vehicles.  Later, NSC said Monday that it completed a $1 billion improvement in its infrastructure during 2023.  At the same time, CMS announced it has reached a “definitive agreement” to sell its appliance service plan business to a private firm for an undisclosed amount. After hours, PINC announced a $1 billion share buyback program and a $400 million accelerated share repurchase transaction with BAC.  At the same time NTCO said it is considering splitting into two companies.  Later, NVS announced it will acquire MOR for $2.9 billion. 

In stock legal, governmental, and regulatory news, a bill being floated in the US House targets Chinese biotech firm Wuxi Apptec by forbidding federally-funded drugmakers from dealing with the company (among others).  The mere anticipation of a potential bill has caused a major selloff of the chares of that company.  However, that company is also partners with several western pharma companies, such as PFE, AZN, and GSK.  These western companies have not yet taken a hit but are at risk. Later, Reuters reported that the US Dept. of Justice has opened a probe into the ADM accounting practices based on an SEC inquiry.  At the same time, the US Dept. of Transportation has begun investigations after videos emerged over the weekend showing human drivers wearing AAPL Vision Pro headsets (and gesturing with both hands) while also driving their TSLA vehicles.  Later, a US federal judge set a date of September 9 date for a jury trial in the US DoJ (and a coalition of states) antitrust suit against GOOGL.  At the same time, FNB agreed to pay a $13.5 million settlement with the US Dept. of Justice and the state of NC over charges of redline discrimination.  Elsewhere, RIO is facing criminal worker safety charges after an employee was seriously injured at a Canadian mine. The charges allege RIO failed to implement and maintain reasonable safety practices and procedures.  At the same time, the FAA urged Congress NOT to increase the airline pilot mandatory retirement age prior to the agency conducting more research.  (DAL, AAL, and LUV are among the airlines pushing for this increase.)  In other FAA news, the agency said that 94% of the BA 737 MAX 9 planes have now been inspected and returned to service following the January mid-air emergency.  After the close, the European Medicines Agency granted RARE’s GTX-102 therapy the PRIME (Priority Medicine) status.  At the same time, WBD won a dismissal of a class action brought by the OH Attorney General claiming concealed negative financial information prior to the company’s 2022 merger with T.  Meanwhile, a US appeals court found that BAYRY (Bayer) is not shielded from lawsuits claiming the company’s Roundup weedkiller caused cancer. (BAYRY had claimed federal regulator approval of the product shielded it from lawsuits over product safety.)  At the same time, Reuters reported that RTX was served subpoenas by the SEC related to 2023 disclosures over the use of powdered metals in engines made by its Pratt and Whitney subsidiary.

Overnight, Asian markets were mixed but leaned toward the green side led by a huge Chinese rebound.  Shenzhen (+6.22%) Hong Kong (+4.04%), and Shanghai (+3.23%) led the region higher with only four of the 12 exchanges in the red.  In Europe, things are even more green at midday with only four of 15 bourses in the red.  The CAC (+0.26%), DAX (-0.07%), and FTSE (+0.54%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a start just on the red side of flat.  The DIA implies a -0.14% open, the SPY is implying a -0.08% open, and the QQQ implies a -0.05% open at this hour.  At the same time, 10-year bonds are unchanged at 4.164% and Oil (WTI) is up six-tenths of a percent to $73.22 per barrel in early trading.

The major economic news scheduled for Tuesday is limited to member Weekly API Crude Oil Stocks (4:30 p.m.) and Fed Mester speaks (noon).  The major earnings reports scheduled for before the open are include AGCO, ALFVY, AME, ARMK, ARCB, BP, CARR, CNC, CHKP, CEIX, CMI, DD, LLY, ENR, FSV, FI, ULCC, IT, GRHC, HTZ, INGR, J, KKR, LEA, LIN, NJR, NVT, PNM, SCSC, ST, SPR, SPOT, TM, WAT, WTW, and XYL. Then, after the close, AMRK, ASTL, AB, AMCR, DOX, AFG, AMGN, AIZ, ATO, EQH, CSL, CMG, CINF, CRUS, CNO, CTSH, EW, PLUS, EXEL, F, FTNT, GILD, IEX, JKHY, KD, LUMN, MASI, NBR, OI, OMC, PRU, QGEN, SNAP, SONO, SNEX, VLTO, VFC, VSAT, WFRD, WERN, WU, and YUMC report.

In economic news later this week, on Wednesday we get Dec. Exports, Dec. Imports, Dec. Trade Balance, Weekly EIA Crude Oil Inventories, Dec. Consumer Credit, and Fed member Bowman speaks.  On Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, WASDE Ag report, and Fed Balance Sheet are reported.  Then Friday there is no major news planned.

In terms of earnings reports later this week, on Wednesday, ADNT, BABA, ATS, ARCC, BERY, BAM, BG, CDW, CVS, EPC, EMR, EQNR, EEFT, FOXA, GPRE, GFF, HAIN, HLT, KMT, NBIX, NYT, OMF, PAG, PFGC, REYN, RBLX, SEE, TTMI, UBER, VSTS, VSH, XPO, YUM, ALL, ARM, ASGN, BKH, CENTA, CENT, CPA, CXW, COTY, EHC, ENS, NVST, EFX, EG, FAF, FLT, GL, MAT, MMS, MCK, MAA, MKSI, MOH, MUSA, NWSA, ORLY, OSCR, PYPL, RRX, STE, SLF, SU, UHAL, DIS, and WYNN report.  On Thursday, we hear from WMS, APO, MT, ARES, ARW, ABG, AXTA, BAX, BCE, BDC, BWA, CCJ, CX, CIGI, COP, DTE, DUK, GTES, HOG, HSY, HMC, NSP, ICE, IPG, ITT, K, KVUE, LNC, MAS, MDU, NFG, PATK, BTU, PM, RL, RXO, SPGI, SNA, SPB, SAVE, TROW, TPR, TPX, THC, TRI, TDG, UA, UAA, WMG, WEX, ZBH, AFRM, ATR, BYD, CPRI, BAP, DXCM, EXPE, FE, FLO, G, PEAK, ILMN, LEG, MTD, MHK, MSI, NGL, PINS, TTWO, TEX, and TFII.  Finally, on Friday, AMCX, CTLT, ENB, FTS, MGA, NWL, PEP, PAA, PAGP, and TIXT report.

So far this morning, ARMK, CNC, CHKP, CEIX, LLY, ENR, FI, GEHC, J, KKR, LIN, MLI, WAT, WTW, and XYL all reported beats on both the revenue and earnings lines.  At the same time, AME, ARCB, CARR, DD, ULCC, IT, INGR, NVT, and PNM missed on revenue while beating on earnings. On the other side, LEA and ST beat on revenue while missing on earnings.  Unfortunately, ALFVY, BP, NJR, and SPOT missed on both the top and bottom lines.  It is worth noting that DD, ST, and SPOT lowered their forward guidance.  However, NJR raised its forward guidance.

In Global news, on Monday, China’s securities regulator said it would tighten scrutiny of margin financing and short selling to stabilize their stock markets. The group also said it would be providing new guidelines to brokers, giving investors more time to answer margin calls.  At the same time, Chinese brokers who buy mainland shares for their offshore units were forbidden from reducing their positions.  Some hedge funds were banned from placing sell orders completely while others were just barred from cutting stock positions in their leveraged market-neutral funds.  These were the primary reasons behind Tuesday’s massive rebound rally. At the same time, in Germany, the government unveiled a $17 billion plan to subsidize the conversion of natural gas power plants to hydrogen fuel to supplement the country’s intermittent renewable power generation program. Over the longer term, this could impact both US LNG exports to Europe and the leverage Russia holds over European energy demands. Finally, despite missing on both the top and bottom lines, BP helped UK stocks rally when it announced it will buy back $3.5 billion of its stock during the first half of 2024.

With that background, it looks like all three major index ETFs are looking to open little changed from Monday’s close. DIA is giving us the smallest body (true Doji) but is retesting its T-line in the early session. Meanwhile, SPY is printing another inside-day type Spinning Top in the premarket. QQQ is giving us the largest (black) candle body in the early session but again is little changed from Monday’s closing price. All three remain above their T-line (8ema). So, the Bulls remain in control of the trend in both the long and short term. However, we are also in a consolidation of the rally at the very least. In terms of extension, none of the three is far from their 8ema. However, T2122 is now back down in it oversold region. This means the market has slack to work with to run in either direction, but the bulls may have a little more room to work. With that said, it is worth noting that the market can stay oversold longer than we can stay solvent predicting reversals too early. So, be careful and follow the trend.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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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The Bulls were in charge all day Friday with the exception of some profit-taking at the end of the session. SPY opened up just 0.09%, DIA gapped down 0.31%, and QQQ gapped up 0.41% after great big tech earnings (AMZN and META) and strong January Payrolls data.  Then from the open, markets rallied steadily all day long until a selloff in the last 45 minutes, especially the last 5 minutes of the day on the dark pool data.  This action gave us large white-bodied candles in all three major index ETFs, with an upper wick.  All three printed new all-time highs and new all-time high closes.  Obviously, all three are above their T-line (8ema).  This happened on slightly above-average volume in the QQQ, SPY was just a tad less-than-average volume, and DIA had less-than-average volume.

On the day, six of the 10 sectors were in the red as Technology (+1.51%) was by far the leading sector dragging the market higher.  On the other end of performance, Communications Services (-2.44%) was by far the lagging sector in the rally.   At the same time, the SPY gained 1.02%, the DIA gained 0.33%, and QQQ gained 1.73%.  VXX was just on the red side of flat to close at 14.99 and T2122 dropped back further toward the center of its mid-range to 56.95.  10-year bond yields climbed to 4.026% and Oil (WTI) fell 2.30% to close at $72.12 per barrel.  So, great news, especially from META (+20.32%) and strong January Jobs data led to uncertainty and fear in the premarket and at the open.  However, at that point, the Bulls decided good news is good news and rallied all day until they took profits are the end of the session.

The major economic news released Friday included Jan. Avg. Hourly Earnings, which came in twice as strong as expected at +0.6% on a month-on-month basis (compared to a forecast of +0.3% and December’s +0.4%).  On a year-on-year basis that was +4.5% (versus a forecast of +4.1% and a December value of +4.3%).  So, given inflation is down, Americans saw real wage growth again in January. At the same time, January Nonfarm Payrolls nearly doubled what was predicted at +353k (compared to the forecast of +187k and even stronger than the December +333k reading).  This was true of the Jan. Private Nonfarm Payrolls as well which were up 317k (versus a +155k forecast and a December reading of +278k).  So, the economy continues to create jobs at a massive rate, laughing in the face of the recession predictors.  The January Participation Rate remained steady at 62.5% (a tick lower than the forecast of 62.6% but in line with December’s 62.5%).  This all led to a slightly better than anticipated Jan. Unemployment Rate of 3.7% (versus a forecast of 3.8% but in line with the Dec. 3.7% value). It is worth noting that this is two consecutive years that the unemployment rate has been less than 4%.  (This is something the US has not seen in more than 50 years.) 

Later, December Factory Orders rose but were a tick lower than expected at +0.2% (compared to the +0.3% forecast and far lower than the massive December +2.6% reading).  At the same time, Michigan Consumer Sentiment was also stronger than expected at 79.0 (versus a 78.8 forecast and much higher than December’s 69.7).  Michigan Consumer Expectations also was stronger than predicted at 77.1 (above the forecast of 75.9 and far above the Dec. 69.7).  Michigan 1-year Inflation Expectations were flat at 2.9% (compared to a 2.9% forecast but down from the previous 3.1% expectation).  Finally, Michigan 5-year Inflation Expectations also stayed flat at 2.9% (which was a tick higher than the 2.8% forecast but in line with the prior month’s 2.9%).  Overall, the only possible way to spin that data as not good would be to say that this may, in theory, give the Fed pause about a March rate cut.  (However, the Fed already told us that on Wednesday.)  So, job growth is still incredible, real wages are growing, and consumers have strong current sentiments and expectations.

In Fed news, Fed Governor Bowman said Friday that inflation is falling and she expects it to decline further.  However, she also said there are some worries about upward price pressures.  She warned against cutting rates too soon.  Specifically, Bowman said, “My baseline outlook is that inflation will decline further with the policy rate held at the current level.”  She noted the declines in inflation are “encouraging.”  However, she said, “I will remain cautious in my approach to considering future changes in the stance of policy.”   Later, Chicago Fed President Goolsbee told PBS “The economy still feels strong…the headline numbers (today) were almost breath-taking…and this is in the context that inflation has been coming in better than expected as well…so it is quite positive on both sides.”

In stock news, Reuters reported that Jeff Bezos will be selling 50 million shares of AMZN by January 31, 2025.  At the same time, the UAW announced that more than 30% of HYMTF (Hyundai Motors) AL plant employees have signed cards seeking to join the union.  (At 70%, the UAW would seek recognition and the plant would become a union shop.)  Later, AAPL’s $3,500 Vision Pro “mixed reality” headset hit Apple stores on Friday.  This was the company’s first new product in seven years.  However, it will be a tough sell at its high price, plus weighing 1.4 pounds (without battery) and is being marketed like a computer you wear on your head all day.  Friday marked a milestone with META’s great report leading to the largest single-day gain in market cap ever as it gained more than $205 billion.  (The prior record holders were AAPL and AMZN both at +$190 billion in a single day in 2022.)

In stock legal, governmental, and regulatory news, on Friday, the NHTSA upgraded their probe of power steering problems on 2023 TSLA cars. This is another step toward a potential recall.  At the same time, BLKB agreed to a settlement with the FTC related to a data breach, agreeing to internal policy and procedure changes.  No fine was levied.  Meanwhile, the UK antitrust agency launched an investigation into the $14 billion VOD acquisition of CKHUF.  Later, in other TSLA news, the company agreed to pay a $1.5 million fine to settle a lawsuit brought by 25 CA counties for mishandling, purposefully mislabeling, and disposing of hazardous waste in landfills in those counties.  At the same time, a US appeals court announced it would hear arguments in June related to the JBLU and SAVE appeal hoping to overturn a lower court (and FTC) blocking their $3.8 billion merger.  Elsewhere, a federal judge certified a class action lawsuit against AAPL as customers allege the company has monopolized the iPhone app market by banning purchases of apps from anywhere other than the Apple app store.  The suit will cover anyone who has spent $10 or more in the AAPL app store.  (This follows after AAPL agreed to stop this policy in Europe due to EU legal requirements.)

Overnight, Asian markets were strongly in the red.  Singapore (-1.43%), Shenzhen (-1.13%), and Shanghai (-1.02%) led that region lower.  Only Japan (+0.54%) and Taiwan (+0.20%) were able to hold onto green territory.  Meanwhile, in Europe, 12 of the 15 bourses are in the green at midday.  The CAC (+0.13%), DAX (+0.28%), and FTSE (+0.53%) are leading the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a modestly down start to the day.  The DIA implies a -0.16% open, the SPY is implying a -0.22% open, and the QQQ implies a -0.15% open at this hour.  At the same time, 10-year bond yields are up to 4.092% and Oil (WTI) is down 0.94% to $71.60 per barrel in early trading.

The major economic news scheduled for Monday includes Jan. S&P Global Services PMI and S&P Global Composite PMI (both at 9:45 a.m.), Jan. ISM Mfg. Employment and Fed member Bostic speaks at 2 p.m.  The major earnings reports scheduled for before the open include AMG, APD, ALGT, CAT, CNA, EL, IDXX, MCD, ON, TKR, and TSN.  Then, after the close, ACM, AMKR, CBT, CHX, COHR, CCK, FN, FMC, HI, ITUB, NXPI, PLTR, SPG, SSD, SKY, and VRTX report.

In economic news later this week, on Tuesday Fed member Mester speaks and Weekly API Crude Oil Stocks are reported.  Then Wednesday we get Dec. Exports, Dec. Imports, Dec. Trade Balance, Weekly EIA Crude Oil Inventories, Dec. Consumer Credit, and Fed member Bowman speaks.  On Thursday, Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, WASDE Ag report, and Fed Balance Sheet are reported.  Then Friday there is no major news planned.

In terms of earnings reports later this week, on Tuesday we hear from AGCO, ALFVY, AME, ARMK, ARCB, BP, CARR, CNC, CHKP, CEIX, CMI, DD, LLY, ENR, FSV, FI, ULCC, IT, GRHC, HTZ, INGR, J, KKR, LEA, LIN, NJR, NVT, PNM, SCSC, ST, SPR, SPOT, TM, WAT, WTW, XYL, AMRK, ASTL, AB, AMCR, DOX, AFG, AMGN, AIZ, ATO, EQH, CSL, CMG, CINF, CRUS, CNO, CTSH, EW, PLUS, EXEL, F, FTNT, GILD, IEX, JKHY, KD, LUMN, MASI, NBR, OI, OMC, PRU, QGEN, SNAP, SONO, SNEX, VLTO, VFC, VSAT, WFRD, WERN, WU, and YUMC.  Then Wednesday, ADNT, BABA, ATS, ARCC, BERY, BAM, BG, CDW, CVS, EPC, EMR, EQNR, EEFT, FOXA, GPRE, GFF, HAIN, HLT, KMT, NBIX, NYT, OMF, PAG, PFGC, REYN, RBLX, SEE, TTMI, UBER, VSTS, VSH, XPO, YUM, ALL, ARM, ASGN, BKH, CENTA, CENT, CPA, CXW, COTY, EHC, ENS, NVST, EFX, EG, FAF, FLT, GL, MAT, MMS, MCK, MAA, MKSI, MOH, MUSA, NWSA, ORLY, OSCR, PYPL, RRX, STE, SLF, SU, UHAL, DIS, and WYNN report.  On Thursday, we hear from WMS, APO, MT, ARES, ARW, ABG, AXTA, BAX, BCE, BDC, BWA, CCJ, CX, CIGI, COP, DTE, DUK, GTES, HOG, HSY, HMC, NSP, ICE, IPG, ITT, K, KVUE, LNC, MAS, MDU, NFG, PATK, BTU, PM, RL, RXO, SPGI, SNA, SPB, SAVE, TROW, TPR, TPX, THC, TRI, TDG, UA, UAA, WMG, WEX, ZBH, AFRM, ATR, BYD, CPRI, BAP, DXCM, EXPE, FE, FLO, G, PEAK, ILMN, LEG, MTD, MHK, MSI, NGL, PINS, TTWO, TEX, and TFII.  Finally, on Friday, AMCX, CTLT, ENB, FTS, MGA, NWL, PEP, PAA, PAGP, and TIXT report.

In miscellaneous news, Reuters reported Friday that so far, about 80% of Q4 earnings reports have beat analyst expectations.  (For reference, 76% of S&P 500 companies have beat analyst expectations on average in the last four quarters.)  Overall, S&P 500 earnings are now expected to increase 7.8% in Q4 relative to the same quarter in 2022.  (This is up from a +6.4% estimate as of Thursday and the +4.7% estimate at the beginning of January.)   Elsewhere, even as Congress is deadlocked and unable to pass any of the budget proposed early in 2023, the White House announced President Biden will release his proposed budget for 2024 on March 11.  (Assuming there are no more continuing resolutions to push things down the road, this will be 3 days after the current CRs from 2023 expire.)

In global news, the UN Food and Agriculture Organization said food prices fell to near a 3-year low in January. The report noted, “Global wheat export prices declined in January driven by strong competition among exporters and the arrival of recently harvested supplies in the southern hemisphere countries.”  Elsewhere, the US began a series of airstrikes against Iranian-backed militias in Syria and Iraq on Friday.  These strikes went beyond just the militias and also targeted Iranian Quds Force personnel and facilities.  (Quds force is part of the Iranian Revolutionary Guard.) The Pentagon said it conducted 125 strikes (both missile and aircraft-launched bombings) on 85 command and control targets across 7 unique locations.  The Pentagon spokesman made a point of telling the media this was just the beginning of the reprisals and would continue at the times and places of the US’s choosing.  On Saturday, a second day of strikes were launched at additional targets in both Iraq and Syria as well as 30 Houthi targets in Yemen. 40 militants were reported killed on Saturday.  On Sunday the airstrikes on the Houthi continued.

So far this morning, CAN, EL, IDXX, L, and TKR reported beats on both the revenue and earnings lines.  Meanwhile, AMG, CAT, and MCD all missed on revenue while at the same time beating on earnings.  Unfortunately, APD missed on both the top and bottom lines.  It is worth noting that both APD and TKR lowered their forward guidance.  For what it is worth, MCD claimed the Israel – Hamas war was a key to their revenue miss, citing boycotts in Arab countries (who feel MCD supporting attacks on Palestine) as a cause of its revenue miss.

With that background, it looks like all three major index ETFs are giving us indecisive (Doji-like), white-bodied, inside-day-type candles not far below the Friday close. QQQ looks the strongest so far. All three remain above their T-line (8ema). So, the Bulls remain in control of the trend in both the longer term and short-term. In terms of extension, none of the three is too far stretched from the 8ema. T2122 is also still in the center of its mid-range. This means the market has slack to work with to run in either direction if either the Bulls or Bear can gain enough momentum to do it.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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

Thursday was a bit of a roller coaster ride with the Bulls getting the best of the deal.  SPY gapped up 0.35%, DIA opened flat at +0.01%, and QQQ gapped up 0.44%.  At that point, all three major index ETFs ran that roller coaster up and then back down, bottoming out at about 11:15 a.m.  (DIA had crossed below the prior close by then, but SPY and QQQ were still in the top part of their opening gap.)  From there, all three began a steady and at times briefly volatile rally the entire rest of the day. SPY and DIA both closed on their highs, while QQQ closed just 31 cents short of its high.  SPY and QQQ joined DIA by crossing back above their T-line (8ema).  This action left all three as large, white-bodied candles.  The DIA printed a Bullish Harami after bouncing up off its T-line. This happened on just less-than-average volume in the three index ETFs.

On the day, all 10 sectors were in the green as Consumer Defensive (+2.05%), Basic Materials (+2.05%) and Utilities (+1.96%) led the way higher.  On the other end of performance, Financial Services (+0.03%) barely participated in the rally.  At the same time, the SPY gained 1.31%, the DIA gained 0.98%, and QQQ gained 1.18%.  VXX lost just 0.79% to close at 15.01 and T2122 climbed into the top half of its mid-range to 68.72.  10-year bond yields dropped again to 3.88% and Oil (WTI) fell 2.45% to close at $73.99 per barrel.  So, mostly good earnings and good economic data led us to a gap higher.  After some volatility, the Bulls stepped in to lead a rally most of the day with traders taking prices out on the highs.

The major economic news released Thursday included Weekly Initial Jobless Claims, which came in higher than expected at 224k (compared to a forecast of 213k and the prior week’s 215k reading).  At the same time, Weekly Continuing Jobless Claims also came in a bit hot at 1,898k (versus the forecast of 1,840k and the previous week’s 1,828k value).  Meanwhile, Q4 Unit Labor Costs grew far less than predicted at +0.5% (compared to a forecast of +1.3% but still higher than Q3’s decline of 1.1%).  This led to a Q4 Nonfarm Productivity gain much higher than anticipated at +3.2% (versus a forecast of +2.4% but again far less than Q3’s +4.9% increase).  Later, the January S&P Global Mfg. PMI was stronger than expected at 50.7 (compared to the 50.3 forecast and the prior month’s downwardly revised 47.9 reading).  Then at 10 a.m., Dec. Construction Spending also came in much stronger than predicted at +0.9% (versus a forecast of +0.5% but in line with November’s +0.9%).  At the same time, ISM reported January Mfg. Employment was slightly above expectations at 47.1 (versus a 47.0 forecast and down from the previous month’s 47.5 reading).  January ISM Mfg. PMI came in well above predictions at 49.1 (compared to the 47.2 forecast and 47.1 prior month).  However, the January ISM Mfg. Price Index came in very hot at 52.9 (versus a 46.0 forecast and a 45.2 prior month index).  Finally, after the close, the Fed Balance Sheet came down significantly to $7.630 trillion versus the prior week’s $7.677 trillion (which was a $47 billion decline).

After the close, AMZN, AAPL, TEAM, CLX, DECK, DXC, EMN, ENSG, HIG, HOLX, HLI, KMPR, LPLA, META, MTX, NOV, OTEX, POST, RGA, and X all reported beat on both the revenue and earnings lines.  Meanwhile, HUBG, MCHP, SKX, and SKYW missed on revenue while beating on earnings.  Unfortunately, COLM and GEN missed on both the top and bottom lines.  It is worth noting that TEAM, CLX, DECK, ENSG, META, and POST all raised their forward guidance. However, COLM, DXC, MCHP, and SKX lowered guidance.

In stock news, BLBD announced a $60 million stock buyback program.  Later, during its conference call, MRK said it is in the market for acquisitions of up to $15 billion to prepare for the revenue decline of its Keytruda (the top-selling prescription drug, with $25 billion in sales in 2023).  Keytruda goes off-patent at the end of the decade and is expected to top out at $30 billion per year by 2026.  At the same time, META announced it will be deploying an in-house designed custom chip in its data centers (to reduce META’s dependence on NVDA chips) to support its push into AI.  For reference, recently CEO Zuckerberg said it will have 350,000 of NVDA’s “H100” GPUs in place by the end of the year.  H100’s sell for $29,000.  Later, BECN announced it had acquired private Roofer’s Supply for an unspecified sum to greatly expand its presence in the Southeast US.  Meanwhile, JPM, BAC, JEF, and DB are in talks to provide $8 billion in financing for DOCU to take itself private through a leveraged buyout.  At the same time, one day after a Delaware judge threw out Elon Musk’s $56 billion pay package, Musk said he would hold a shareholder vote on moving TSLA’s state of incorporation from DE to much more compliant TX. Elsewhere, CSX announced it reached an agreement with four more groups of workers and will extend paid sick leave to employees represented by those unions.  Later, WCN announced they had completed the acquisition of Canadian firm Secure Energy Services for roughly $1.4 billion.  At the same time, INGR announced it had sold its South Korean unit for $294 million.  Later, the Wall Street Journal reported that INTC will delay its $20 billion fab project in OH, citing a slowdown in chip orders.  The OH facilities are now not expected to finish construction until late 2026.

In stock legal, governmental, and regulatory news, the EU said Thursday that it has begun looking into how big tech companies (GOOGL, AMZN, META, BABA, VOD, TSLA, and AAPL) have moved into the financial services sector.  This is a joint look by the EU’s banking, insurance, and securities regulators and is based on concern that big tech will increase instability in those sectors across Europe.  Later, a Federal Appeals Court dismissed an appeal by investors which accused the world’s 10 largest banks (BAC, BCS, BNPQY, C, GS, JPM, MS, NWG, and UBS…CS was also a defendant but was acquired by UBS) of antitrust violations for rigging prices in the US Treasury market.  Later, the White House said it had sent out opening offers in the first-ever price negotiations to the manufacturers of 10 high-cost drugs (including BMY, PFE, JNJ, and MRK).  At the same time, a coalition of labor groups filed a lawsuit seeking to block an MA state ballot initiative saying that ride-share and delivery drivers would be treated as contractors instead of employees in the state.  UBER, LYFT, DASH, and CART all were part of the drive to get the initiative on the ballot, but the suit alleges that the petitions gathered by the industry groups covered several different and vaguely worded proposals (such as limiting a company’s liability for accidents) that were worded to confuse petition signers.  Elsewhere, the FDA granted CABA “orphan drug status” for its investigational therapy for myositis.  This status grants them tax credits waived fees, and 7-years of exclusive marketing rights for the drug.  At the same time, the FDA gave clearance to HOLX for its AI-based cervical cancer screening system.  After the close, a federal appeals court threw out a $366.2 million verdict against FDX for racial bias.  (In an odd ruling, the appeals court said it found sufficient evidence to support the plaintiff’s claims but reduced the pain and suffering award by 75% to 248k and said she was not entitled to any of the $365 million in punitive damages.  In essence, saying FDX was indeed guilty but the company should not be forced to pay for firing an employee that reported racial discrimination.  The basis of the ruling was that the plaintiff had not proven the company did it with malice toward her specifically as opposed to anybody that reports racial discrimination.)

So far this morning, ABBV, BSAC, BMY, BBU, BEP, CBOE, CHD, CI, REGN, and SAIA have all reported beats to both the revenue and earnings lines.  At the same time, AON, CHTR, and LYB beat on revenue while missing on earnings.  On the other side, CVX and XOM missed on revenue while beating on earnings.  There were no reported misses on both the top and bottom lines.  It is worth noting that BMY also raised its forward guidance.

Overnight, Asian markets leaned toward the green side with only the three Chinese exchanges in the red while the other nine were green.  Shenzhen (-2.24%) and Shanghai (-1.46%) were the only significant losers while South Korea (+2.87%) Australia (+1.47%), Thailand (+1.18%), and Singapore (+1.17%) paced the gainers.  In Europe, only Russia (-0.01%) is very marginally red while the other 14 exchanges are well into the green at midday.  The CAC (+0.68%), DAX (+0.85%), and FTSE (+0.50%) lead the region higher in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a mixed but green start to the day.  The DIA implies a +0.11% open, the SPY is implying a +0.67% open, and the QQQ implies a +1.13% open at this hour.  At the same time, 10-year bond yields are up very slightly to 3.884% and Oil (WTI) is just on the red side of flat at $73.74 per gallon in early trading.

The major economic news scheduled for Friday include Jan. Avg. Hourly Earnings, Jan. Nonfarm Payrolls, Jan. Private Nonfarm Payrolls, Jan. Participation Rate, and Jan. Unemployment Rate (all at 8:30 a.m.), Dec. Factory Orders, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-year Inflation Expectations, and Michigan 5-year Inflation Expectations (all at 10 a.m.).  The major earnings reports scheduled for before the open are include ABBV, AON, BSAC, BMY, BBU, BEPC, BEP, CBOE, CHTR, CVX, CHD, CI, XOM, IMO, LYB, REGN, SAIA, and GWW.  There are no earnings scheduled for after the close.

It is worth noting that the huge beats by AMZN and META are leading to the global rally we are seeing this morning. Despite the company’s job cuts in 2023, the company delivered better-than-expected profits, its first-ever quarterly dividend, and it announced a $50 billion stock buyback program. However, this is tempered somewhat by AAPL, which beat but is worrying markets because it reported slowing iPhone sales in China (which represents 20% of company sales). There is also renewed angst over regional banks after NYCB was down another 11% Thursday on top of Wednesday’s record 38% plunge.

In miscellaneous news, JPM said Thursday that January saw a record for the US issuance of institutional leveraged loans.  This happened as falling borrowing costs enticed many companies to borrow.  $140.1 billion net was borrowed for the month, including $51.4 billion in refinancing with the rest made up of new debt.  Elsewhere, IBKR reported an increase in trading activity in January, up 11% from 2023 and up 12% from December.  Margin loan balances also increased 12% over January 2023 to $44.3 billion.  Meanwhile, the US House of Representatives has scheduled a vote on a bill aimed at overturning the Biden Administration pause in LNG project approvals until a climate impact study is completed. However, this is a political stunt by the GOP since the bill stands virtually no chance of approval in the Senate.

In geopolitical news, the EU agreed on a deal to provide Ukraine with $54 billion in financial aid after Hungarian Putin-puppet Orban finally agreed.  In the announcement, the EU shamed the US saying they hope their example encourages the US to do its fair share of supporting democracy by backing Ukraine.

With that background, it looks like we are headed to a strong start to the day (ahead of January Jobs data). Both SPY and DIA gapped up in the premarket and are at new all-time highs. putting in white body candles after the start of the early session. QQQ made the biggest premarket gap up but has not reached its all-time high yet (although it is not far away) and it has put in an indecisive Doji candle since then in the early session. All three major index ETFs are above their T-line (8ema). So, the Bulls remain in control of the trend in the longer term and short-term. In terms of extension, none of the three is too far stretched from the 8ema. T2122 is also still in its mid-range. This means the market has room to run in either direction if the Bulls or Bear can gain enough momentum to do it. Also, continue to keep an eye on those Tech Big Dogs. If those 7-10 stocks lead in one direction, it’s nearly impossible for the rest of the market to do anything but follow given their trading volumes. Finally, remember that its Friday. So, pay yourself and prepare your account for the weekend.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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

Wednesday was a bearish day with gaps lower after GOOGL, MSFT, and AMD all beat but disappointed the market. SPY gapped down 0.44%, QQQ gapped down 1.05% and DIA was the exception that proves the rule opening 0.17% higher.  At that point, SPY and QQQ sold off for an hour before trading sideways until 2 p.m.  Meanwhile, DIA just meandered sideways after the open crossing and recrossing the opening gap until 2 p.m.  When the Fed announced no rate cut we saw a modest knee-jerk lower in all three major index ETFs.  However, this more than recovered by 2:30 p.m.  Then when Chair Powell said the FOMC is not ready to cut rates yet and implied doubt about a March start to cuts, all three sold off hard until 3 p.m. and then drifted lower into the close.  This action gave us an Evening Star that crossed down the T-line (8ema) in the SPY.  At the same time, DIA gave us a Bearish Engulfing candle but did not cross below its T-line.  QQQ moved the most, gapping down through its T-line and giving us a large black candle with only an upper wick.

On the day, all 10 sectors were in the red as Technology (-2.42%) was way out in front leading the way lower.  At the same time, the defensive plays Healthcare (-0.34%) and Utilities (-0.43%) holding up better than the other sectors.  Meanwhile, the SPY lost 1.63%, DIA lost 0.81%, and QQQ lost 1.96%.  Meanwhile, VXX popped up 5.07% to close at 15.13 and T2122 dropped all the way down through its mid-range to end just above oversold territory at 22.05.  10-year bond yields plummeted to 3.912% and Oil (WTI) dropped 2.61% to close at $75.79 per barrel.  So, markets started lower on future (not current) earnings worries among the big tech names.  Then we trod water for most of the day.  Even the Fed announcement was basically a non-event since it was very widely anticipated.  However, Fed Chair Powell’s words shocked traders with fear we won’t get a March rate cut, and that flushed the market the rest of the day.  This all happened on above-average volume in the SPY and DIA as well as well-above-average volume in the QQQ.

The major economic news released Wednesday included January ADP Nonfarm Employment Change, which came in well below expectations at +107k (compares to a forecast of +145k and well below the prior reading of +158k).  Later, Q4 Employment Cost Index also came in below predictions at +0.9% (versus a forecast of +1.0% and the Q3 reading of +1.1%).  Later on, January Chicago PMI also came in a bit light at 46.0 (compared to the 48.0 forecast and the prior 47.2 value).  Then EIA Weekly Crude Oil Inventories showed an inventory build of 1.234 million barrels (versus a forecasted drawdown of 0.217 million barrels and far higher than the previous week’s 9.233-million-barrel drawdown.

In Fed news, the FOMC held the Fed Funds target rate steady at 5.25% – 5.50%.  It also removed language saying it was willing to keep increasing rates but also language that indicated inflation was headed back toward its 2% inflation goal.  In addition, the statement added language indicating it is not yet ready to cut rates.  The statement said, “The Committee does not expect it will be appropriate to reduce the target range until it has gained greater confidence that inflation is moving sustainably toward 2 percent.”  More importantly, Fed Chair Powell commented on this, saying, “I don’t think it’s likely that the committee will reach a level of confidence by the March meeting (to lower rates…but that’s to be seen.”  Powell also said, “Inflation has eased over the past year, but remains elevated.”  He went on, “The Fed’s interest rate target is likely at its peak for this tightening cycle” …and “the Fed will likely cut rates at some point this year.”  Finally, Powell said, “we are not declaring victory, we think we still have a way to go.”

After the close, ALGN, AVB, AXS, CCS, CMPR, CTVA, CACC, FLEX, MTH, MEOH, NXT, PTC, QRVO, QCOM, SEIC, SIGI, and TTEK all reported beats on both the revenue and earnings lines.  At the same time, BHE, BOOT, THG, and UGI all missed on revenue while beating on earnings.  On the other side, MET beat on revenue while missing on earnings.  Unfortunately, AFL, BV, CHRW, LSTR, and VSTO all missed on both the top and bottom lines.  It is worth noting that BOOT, CTVA, FLEX, and LSTR lowered forward guidance.  However, CCS, NXT, QRVO, and TTEK raised their own guidance.

In stock news, NVAX announced it will lay off 12% of its workforce (about 240 people) in a cost-cutting move for the cash-strapped biotech.  At the same time, Reuters side that Byron Allen had submitted a $30 billion offer to buy PARA, including both debt and equity.  (This came hours after Bloomberg had reported the offer was $14.3 billion for the outstanding shares.)  Later, META CEO Zuckerberg apologized to parents (for the damage social media has done) after Senators of both parties dragged the CEOs of META, SNAP, AAPL, X (Twitter), TikTok, GOOGL, and others over the coals for a lack of monitoring, age restriction, and parental reporting of inappropriate social media content and targeting of children.  (Coincidentally, I’m sure, many of the companies subpoenaed instituted new policies covering overuse by children as well as various content age restrictions within the last week.)  At the same time, financial stocks took a hit Wednesday as NYCB cut its dividend after posting a surprise loss.  (NYCB closed down 37.67% on the news.)  Later, CI announced it had sold its Medicare business unit to HCSG for $3.3 billion. Elsewhere, ADM closed its acquisition of flavor company Fuerst Day Lawson.  Later, TSLA announced it will buy equipment to expand its NV factory to produce Lithium batteries from its Chinese supplier CATL (a controversial partner that has F under attack for partnering with in MI).  TSLA says the move will reduce its costs for batteries.

In stock legal, governmental, and regulatory news, EBAY agreed to pay $59 million and upgrade its compliance measure to settle US Dept. of Justice charges that the company sold pill-making equipment to criminals making counterfeit drugs.  Later, BA was sued by shareholders alleging the company prioritized short-term profit over safety, and misled them about the company’s commitment to making safe aircraft.  At the same time, a group of 25 CA counties sued TSLA alleging the company mishandled hazardous waste at its facilities in that state. (The core allegation is that TSLA regularly mislabel hazardous waste and sends it to landfills in those 25 counties.)  The law being cited calls for civil penalties of $70k per day per violation.  Later, the US Dept. of Health and Human Services announced 2025 reimbursement rates for Medicare Advantage programs that show a total increase of 3.7%.  At the same time, a US District Judge dismissed DIS’s lawsuit against FL Governor DeSantis and members of his appointed state board.  In the dismissal, the judge ruled DIA lacked standing to sue the governor or state Sec. of Commerce.  Elsewhere, the FAA said its previously announced comprehensive audit of BA production will include all elements of production at fuselage supplier SPR.

Overnight, Asian markets were evenly mixed with five exchanges in the red, six in the green, and one remains unchanged.  Australia (-1.20%) was by far the biggest loser (by half of a percent) while South Korea (+1.82%) was by far the biggest gainer (by more than one percent).  Meanwhile, in Europe, we also see a mixed board at midday.  The CAC (-0.69%), DAX (-0.09%), and FTSE (+0.45%) lead the mixed region in early afternoon trade.  In the US, as of 7:30 a.m., Futures are pointing toward a green start to the day.  The DIA implies a +0.11% open, the SPY is implying a +0.40% open, and QQQ implies a +0.57% open at this hour.  At the same time, 10-year bond yields are up a bit to 3.944% and Oil (WTI) is up nine-tenths of a percent to $76.52 per barrel in early trading.

The major economic news scheduled for Thursday includes Weekly Initial Jobless Claims, Weekly Continuing Jobless Claims, Q4 Nonfarm Productivity, and Q4 Unit Labor Costs (all at 8:30 a.m.), S&P Global Mfg. PMI (9:45 a.m.), Dec. Construction Spending, Jan. ISM Mfg. Employment, Jan. ISM Mfg. PMI, Jan. ISM Mfg. Price Index (all at 10 a.m.), and Fed Balance Sheet (4:30 p.m.).  The major earnings reports scheduled for before the open are include FLWS, ATI, MO, ATKR, BALL, BDX, BR, BIP, BC, CAH, CMS, DLX, DOV, ETN, EPD, RACE, HON, HII, ITW, IP, JHG, KEX, LANC, LAZ, MKL, MRK, PH, PTON, PBI, DGX, RVTY, RCI, RCL, SBH, SNY, SNDR, SIRI, SR, SWK, TSCO, TT, WNC, WEC, and WRK.  Then, after the close, AMZN, AAPL, TEAM, CLX, COLM, DECK, DXC, EMN, GEN, HIG, HOLX, HLI, HUBG, KMPR, LPLA, META, MCHP, MTX, NOV, OTEX, POST, RGA, SKX, SKYW, and X report.

In economic news later this week, on Friday, Jan Avg. Hourly Earnings, Jan. Nonfarm Payrolls, Jan. Private Nonfarm Payrolls, Jan. Participation Rate, Jan. Unemployment Rate, Dec. Factory Orders, Michigan Consumer Sentiment, Michigan Consumer Expectations, Michigan 1-year Inflation Expectations, and Michigan 5-year Inflation Expectations are reported.

In terms of earnings reports later this week, on Friday, ABBV, AON, BSAC, BMY, BBU, BEPC, BEP, CBOE, CHTR, CVX, CHD, CI, XOM, IMO, LYB, REGN, SAIA, and GWW report.

So far this morning, MO, ATKR, BR, BIP, CAH, ETN, EPD, RACE, HII, KEX, LAZ, MRK, PTON, PBI, DGX, RVTY, SBH, SHEL, SKFRY, and SR all reported beats to both the revenue and earnings lines.  At the same time, FLWS, BALL, BDX, CMS, DLX, DOV, FCFS, HON, IP, RCL, SIRI, SWK, TAK, TT, WNC, and WEC all missed on revenue while beating on earnings.  On the other side, GOOS beat on revenue while missing on earnings.  Unfortunately, BC, ING, SNY, and WRK missed on both the top and bottom lines.  It is worth noting that BC, DOV, and DGX lowered forward guidance.  However, CAH, MRK, and RCL raised their guidance.

In miscellaneous news, CENTCOM announced Wednesday that the US had destroyed a Houthi surface-to-air missile that presented an imminent threat to US aircraft. Later, a US Destroyer intercepted a Houthi anti-ship missing in the Gulf of Aden. Meanwhile, the US carried out airstrikes against “a number of Houthi drone sites.” So, the Red Sea and Suez Canal remain to be hotspots as the Israeli invasion of Gaza continues. At the same time, the US House of Representatives is set to vote on a bipartisan package of tax breaks for businesses (making R&D and capital expenses and capital investments deductible through at least 2025).  However, the measure would require a two-thirds majority to pass.  The bill also modestly increases Child Tax Credits for low-income taxpayers. 

In China news, FBI Director Wray warned a House Select Committee Wednesday that “China’s hackers are positioning on American infrastructure in preparation to wreak havoc and cause real-world harm to American citizens and communities, if or when China decides the time has come to strike.”  Wray said that Chinese government-backed hackers are targeting things like water treatment plants, transportation, electrical infrastructure, as well as oil/natural gas pipelines.  Elsewhere, Bloomberg reported Wednesday evening that China is now openly engaged in a massive banking system overhaul.  Reportedly, Beijing is merging hundreds of rural lenders into giant regional banks.  This process has been slowly and quietly going on in the background since 2022.  However, the process has greatly accelerated in the last month as the country seeks to tackle the $7 trillion credit risk amidst a Chinese real estate collapse.  (For reference on scope, China is said to have between 1.5 and 3 BILLION unoccupied housing units nationally. This is because the government has a strong record of seizing bank deposits.  So, for years or decades, ordinary Chinese people have banded together to invest their savings in investment properties as a way to save with less risk of confiscation.  This resulted in a huge glut of unused, non-producing, and unsaleable housing…leading to massive numbers of loan defaults.)

With that background, it looks like (at least ahead of the economic data dump) we are getting a modestly bullish rethink of the Fed. All three major index ETFs opened the premarket higher and are putting in small, white-bodied candles so far in the early session. SPY is retesting its T-line (8ema) and all three are showing inside candles (Bullish Harami type) for the premarket. DIA remains above its T-line and QQQ is still below and not yet retesting. None of the three have broken their uptrend lines, but all three are close to the trend. So, the Bulls remain in control of the trend in the longer term but after yesterday’s candle, the very short-term trend has to be bearish. In terms of extension, none of the three is too far stretched from the 8ema. T2122 has also fallen but remains outside of its oversold range. This means the market has room to run in either direction if the Bulls or Bear can gain enough momentum to do it. Also, continue to keep an eye on those Tech Big Dogs. Once again yesterday it was those stocks that led markets lower. If those 7-10 stocks lead in one direction, it’s nearly impossible for the rest of the market to do anything but follow given their trading volumes.

As always, be deliberate and disciplined…but don’t be stubborn. 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 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 gains are 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

🎯 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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