In another roller-coaster day, the bears roared and the bulls got slaughtered.  Futures plummeted after the 9 pm speech and we woke to a 7% gap down.  Shortly after the open, this led to a halt.  After the restart, markets got a roller-coaster ride.  This lasted until shortly after 1 pm.  From there, the rest of the day was a jagged slide lower.  Just before the close, markets fell off a cliff, closing near the lows.  This left the SPY down 9.57%, the DIA down 10.06%, and the QQQ down 9.17% on the day, which was the worst performance since Black Monday in 1987.  As you’d expect, the VXX flew higher to end at 47.36, while Oil (WTI) closed down again to $30.90/barrel.  The 10-year bond yield also sold off near the close after being up in the afternoon.  It closed at 0.809%.  Interestingly, banks raised mortgage rates in an effort to curb refinancing.

The most shocking event of the day was that the Fed threw their full weight into the fight, but came up short.  Fed Chair Jerome Powell announced $1 trillion in additional easing through repo operations ($500 billion in 1-month and $500 billion in 3-month).  That raises total Fed QE efforts to $1.5 trillion overall.  However, that additional $1 trillion only bought markets a 6% mid-day gain that lasted 15 minutes. As soon as the euphoria wore off, markets sold off hard again for the rest of the day.

Meanwhile, the global headline virus numbers have risen to 137,700 confirmed cases and 5,080 deaths.  In Europe, Italy now has 15,100 cases with 1,020 deaths. Spain has 3,900 cases with 90 deaths, France has 2,900 cases with 61 deaths, Germany has 3,060 cases and 6 deaths.  In the middle east, Iran has 11,400 cases with 520 deaths.  In Asia, South Korea has 7,980 cases with 71 deaths and Japan has 700 cases with 19 deaths.  Perhaps the worst virus news of the day went under-reported.  A study that was published in the Journal Lancet (191 patients), found that people remained contagious a median of 20 days after diagnosis with the longest being 37 days.  This means that long after symptoms are gone and a 14-day quarantine expires, people can still spread the virus

In the US, 47 states (plus D.C.) have confirmed infections of the virus for a total of 1,762 cases and 41 deaths.  All major sporting events, concerts, conventions, etc. have been canceled and many states have banned any gathering of over 250-1,000 people (varies by locale).  Many more companies also laid-off workers without pay due to a loss of business. Shortages and hoarding have begun, although those instances are not completely out of hand now.

However, not all the virus news was bad.  In China, only 18 new cases (7 of which were travelers from abroad) and 11 new deaths were reported Thursday.  So, with as much as 80% of their workforce back to work, they are now reporting the peak of the epidemic is behind them.  While this is a very hopeful sign, we do have to remember that they had a good testing regime, had strictly-enforced quarantines, and a socially compliant population, which the US lacks (as of now).  Still, it is a positive sign.  

Overnight, Asian markets were down again across the board.  (Down hard in the case of Japan, which lost over 6%.)   However, Europe has gone the other direction with every bourse up strongly, including the 3 majors being up over 6% at this point in their day.  As of 7:30 am, U.S. futures are pointing to a large gap higher (4-5%), after having reached the 5% “limit up” circuit-breaker overnight.  So, instead of Mr. Hyde, the markets may give us Dr. Jeckyl today.

On Friday, the major economic news is limited to Feb. Import/Export Price Index (8:30 am) and Michigan Consumer Sentiment (10 am).  Once again, there are no major earnings reports on the day.

With the incredible volatility and heavy selling that has gone on this week, it will take a braver man than me to take positions into the weekend.  (And that’s true regardless of what happens Friday.)  The headline risk is on both sides, with the possibility of a stimulus package and/or more Fed actions on one side.  On the other side, there is a likelihood of large increases in the numbers of cases and deaths, as well as more weekend announcements from businesses.  There are also too many wildcards to count.  So, my advice is to get flat or at least delta-neutral going into the weekend. 

If you have to trade, trade small (nimble), fast, and lock in profits every chance you get. Remember, this won’t last forever and there will be another day.  Prepare for the eventual bottoming, but don’t expect a V-shape. Have a list of tickers you will look to buy and a price pattern where you’d be interested in buying.  Then wait on the trades to come to you.  Say it with me…  Don’t chase.  Don’t trade on emotion.  Don’t think you can predict turns.  Let price tell you when a trend and support are in place.

Ed

Sorry, but due to market volatility there will be no Swing Trade Ideas today. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

Well, that stimulus rally didn’t last long.  Wednesday started off with a 2.7% gap down and then we saw volatile follow-through the rest of the day.  However, at the end of the day we did see some short-covering or bulls stepping in to reduce the damage. Either way, the buyers came up short as at the close, the SPY was down 4.87%, the DIA down 5.84%, and the QQQ down 4.36%.  The VXX closed up over 13% to 38.66.  However, oddly the 10-year bond yield closed up to 0.85%.  Oil also closed down to $33.12/barrel (WTI) on the day.  As mentioned yesterday, we are now into a bear market, well more than 20% off the highs in all the major indices.

During the day, the WHO finally declared coronavirus to be a global pandemic. (Insert Captain Obvious joke here.)  The President also met with Wall Street executives while his staff met with Oil lobbyists to discuss the crisis. However, in a sign of what really gets things done, shortly after we hit bear territory in all three major indices, the Fed announced it will pump an additional $25 billion/day ($175 billion/day total) into banks through the repo program. There was also then an announcement the President would be giving a national speech Wednesday evening.

In his speech, the President banned all travel from Europe for 30 days.  Of course, he did so after blaming those countries for some outbreaks in the US.  He also seemed to finally embrace the tone of the medical experts as he advised the elderly not to travel, Nursing Homes to stop all non-medical visits, and all people to adopt measures like social distancing, staying home when sick, and increasing hygiene practices. He then asked Congress for $50 billion in economic relief and to consider giving unspecified payroll tax relief.  In addition, he ordered the SBA to give low-interest loans to SMEs. He concluded in his typical style (and I’ll leave it at that). Whatever his style and the content, markets apparently expected more as both futures and Asian markets plunged immediately after the speech.

Meanwhile, the headline virus numbers have risen to 127,750 confirmed cases and 4,720 deaths globally.  In Italy, on top of a national travel quarantine and ban on public gatherings, their government has now closed all retail businesses except for groceries and pharmacies. This comes as the number of Italian cases rose to 12,500 with 830 deaths.  Germany’s Chancellor warned that up to 70% of all Germans (2,080 cases now) could contract the virus.  France saw a jump up to 2,300 cases, with Spain (2,280 cases) right behind.  Iran is in dire straits as well as they reached 10,100 known cases and 430 deaths.  South Korea is up to over 7,870 cases, but relatively few deaths at 66.  However, it is worth noting that GS also is now estimating that 80% of Chinese workers have returned to work, albeit with masks and taking extra precautions.  This came as China reported only 15 new cases.

Overnight, Asian markets were down hard again across the board.  Europe has followed suit with the major bourses down over 6% so far today.  As of 7:45 am, U.S. futures are pointing to a 5% gap lower, after having halted trade due to circuit breakers following the President’s speech.  

On Thursday, the major economic news is limited to Feb. Core PPI and Weekly Initial Jobless Claims (both at 8:30 am).  However, on the earnings front, DG reports before the open and ADBE, AVGO, GPS, ORCL, and ULTA report after the close.   

Markets around the world are plunging and being halted Thursday.  The President has had his say and that appears to not have been enough.  With this said, expect heavy volatility to continue.  It is likely something will happen that will jerk the market the other way on at least fleeting hope.  That is simply our human emotions in an uncertain environment.   

I’ve been saying for a long time now, ask yourself if you really need to be trying to swim this river of volatility?  I am not and I remind you that cash is a perfectly valid position.  You don’t need to trade every day to have a great year.  If you are trading now, get small (nimble), be very fast and stay focused.  This is not an easy market to trade.  As always, remember, you do not have to pick the bottom to make incredible returns on a market recovery.  Say it with me…Don’t chase.  Don’t trade on emotions.  Don’t think you can predict turns.

Ed

Sorry, but due to market volatility there will be no Swing Trade Ideas today. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

What a volatile day.  We saw a 3.7% gap open, followed by a roller-coaster day with a 5.5% range and it ended at the highs.  The White House did not have a rescue plan ready in the morning, but the President proposed a cut to payroll taxes through the election (per Bloomberg) later anyway.  Even with details scant, the markets still loved the idea that there was going to be a major stimulus package of some type. On that news, the SPY closed up 5.17%, the DIA up 4.92%, and the QQQ up 5.45%.  The VXX fell to 34.11 and the 10-year bond yield rose to 0.8%.  Oil rose to $34.36/barrel (WTI).

While we would hope to have broad American leadership, that’s not how politics work in the US, especially in an election year.  However, politically, this nebulous package headlined by a proposed Payroll Tax suspension was quite a savvy move by Republicans (or President Trump).  It gives Republicans a period where only their plan is in the news as doing something (even if it is not completed or changes along the way). It will also force Democrats to either defend blocking this plan (when completed and finally introduced) or to up the ante with a bigger plan of their own and defend even wider deficits.  Neither of those actions is likely to appeal to the middle-ground demographic.  Of course, Democrats could also just go along with whatever the Republicans finally hammer out and let the President crow about saving the day.  So I would say this was a well-played move.

However, think twice before you jump in bullish with both feet.  Don’t naively think Tuesday’s announcement means nothing but blue skies ahead.  Keep in mind that we still have no proven treatment, the virus continues to spread in the US, and nothing has even been proposed in Congress yet, let alone passed.  Even more importantly, most of the rescue plan specifics (or even outlines) are unannounced if they have even been fleshed out.  So, we are still likely to keep reading “they are considering” for various industries and measure for a while.  Just do not be surprised by a lot more volatility as some rescue package gets hammered out and makes its way to approval. 

Meanwhile, the headline virus numbers have risen to 121,000 confirmed cases and 4,366 deaths globally.  In Italy, things got worse with a jump of 1,000 cases on the day, up to 10,200 cases and 631 deaths as of day-end Tuesday.  Iran is a similar situation with over 9,000 known cases and 354 deaths announced.  South Korea is up to over 7.755 cases, but relatively few deaths at 54.  Spain jumped to 2,100 cases, with France (1,800 cases) and Germany (1,600) not far behind.

In the US, 40 states (plus D.C.) have confirmed infections of the virus for a total of 1,040 cases, but “just” 29 deaths.  Cancellations, company orders to not travel, and orders to work from home continue to expand.  For example, Google told its 100,000 workers to just work from home until further notice.  Presidential candidates are even canceling rallies at this point.  Quarantines also continue to expand as New York state called out their National Guard to enforce a quarantine around an area with a cluster of cases (just North of NYC). 

Overnight, Asian markets down everywhere except India and Malaysia.  Japan down 2.27%.  Europe is mixed, but the major bourses are on the green side so far today.  As of 7:30 am, U.S. futures are pointing to a gap lower again across the board.  

On Wednesday, the major economic news is limited to Feb. Core CPI (8:30 am) and Crude Oil Inventories (10:30 am).  However, once again, there are no major earnings on tap for the day.   

The idea of a Payroll Tax cut seemed very promising to markets Tuesday. However, nothing is certain about this plan, what the market will think of the details (when they come out) or about the virus’s impacts.  So be careful.  Expect heavy volatility to continue as both uncertainty and human emotions will continue for weeks or months to come. 

Keep asking yourself if you really have an edge when trading in this environment?  If you are trading now, trade small (nimble), be quick and stay focused.  This is not a nonchalant trader’s market.  Remember, you do not have to pick the absolute bottom to make incredible returns on a market recovery.  Don’t chase.  Don’t trade on emotions.  Don’t think you can predict turns. I promise you there will be other trades in days to come.

Ed

Sorry, but due to market volatility there will be no Swing Trade Ideas today. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

Another Monday, another massive gap.  This one was a huge gap lower, which set off a trading circuit breaker.  That pause was followed by a very volatile and wide-ranging day.  At the close, the SPY was down 7.47%, the DIA down 7.87%, and the QQQ down 6.95%.  That made it the worst loss since the 2008 Financial crisis. As you’d expect, the VXX closed up 23.54% to end the day at 36.84.  The 10-year bond yield also fell to 0.318% (all-time low) during the day, but ended at 0.54% (all-time low close).  So, the bear market (yes bear market, because we’re over 20% off the highs) rollercoaster continues.

While coronavirus continues to be the driver, the immediate cause of carnage Monday was the plunge in oil prices.  This was due to the OPEC response to Russia’s refusal to cut production.  As a result, Oil got hammered hard, with WTI closing down 25.34% to $30.82/barrel.  One important thing to remember is that Russia could change its mind any time before the end of March when current production limits are set to expire.  This would not change the demand destruction caused by the virus.  However, it could reverse some or all of the price plunges based on a “market-share grab” price war.  So, just be aware of this upside risk

The headline virus numbers have risen to over 114,600 confirmed cases and 4,030 deaths globally.  In response, Italy has expanded its quarantine to their entire country.  Several other countries have imposed spot quarantines, outlawed large gatherings, and/or have ordered people with a cough to remain home.  At the same time, the daily number of new cases in China continues to fall.  Meanwhile, the WHO has said that recovery from the virus can take up to six weeks.

In the US, 35 states (plus D.C.) have confirmed infections of the virus for a total of 755 cases and 26 deaths.  Many thousands of others have been quarantined or have self-quarantined.  This includes 5 Congressmen (including President Trump’s newly named Chief of Staff).  However, all these numbers will climb as test kits become available more broadly. (On Monday, the CDC said just 75,000 test kits have been distributed in the US so far, and less than 1,600 tests have been processed.  However, HHS Sec. Azar directly contradicted this a couple hours later at an evening press conference, saying millions of tests have already been distributed in this country.)   

At this point, US markets have priced in a 72% chance of an additional three-quarter of a percent interest rate cut on or before March 18^th and another quarter percent cut in April.  Analysts are saying that markets expect even more rate cuts (beyond those two), as well as more QE and fiscal stimulus.  During the day Monday, the Fed addressed part of these expectations by announcing it will increase the money given banks for short-term funding (repo operations) by 50%, to $150 billion/day, through at least Thursday.  Then after the close, the President said he’ll meet with Republicans about a payroll tax cut and “very substantial relief” for impacted industries.  (Politics never wastes a crisis.)  These moves come just days after Treasury Secretary Mnuchin and Sr. Economic Advisor Kudlow told the press such measures were not needed on Friday.

Overnight, Asian markets soared on the prospect of a massive US stimulus plan.  Japan was up 5.6% and the Hang Seng 2.45%.  Europe is following Asia and is up about 3% across the board so far today.  As of 7:30 am, U.S. futures are pointing to a gap higher of over 4% as of now (on top of having reversed futures that were lower prior to the President’s pre-announcement of meeting with only his party leaders.  Again Tuesday, there is no major economic news scheduled.  There are also no major earnings on tap for the day. 

Nothing fundamental has changed yet.  However, based on President Trump’s promise of a huge fiscal stimulus announcement, it looks like the gap is upward today.  Still, there remains the possibility of markets being disappointed if the stimulus package isn’t enough…or…if the Democrats balk at some feature of that rescue package (them having been excluded and all).  So be careful.  Expect heavy volatility to continue as uncertainty and human emotions still control markets. 

Keep asking if you really need have an edge trading in this high volatility environment?  If you are trading, be fast, focused, and nimble (small).  Trading is a business, and consistent, effective trading is the goal.  You do not have to pick the bottom to make incredible returns on a market recovery.  Don’t chase.  Don’t trade on emotions.  Don’t think you can predict turns.

Ed

Swing Trade Ideas for you watchlist and consideration: EVBG, WEC, KR, AWK, CPB, ZM, TDOC, ETSY. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

Gaps and volatility were the hallmarks of the week and Friday was no exception.   A 3.2% gap lower at the open was followed several swings that also amounted to a 3% intraday range for the day.  After this rollercoaster ride, stocks closed near the highs of the day.  However, the SPY still closed down 1.65%, the DIA down 1.00%, and the QQQ down 1.69%.  The VXX closed up almost 12% to finish at 29.82.

For the week, a very vide-ranging Doji was seen across indices with the SPY actually up 0.41%, the DIA up 1.69%, and the QQQ up 1.08%.  So, although it certainly didn’t feel like it, it was a green week.  The 10-year bond fell below 0.70% yield during the week and closed the week at a record-low close of 0.764%.  Crude oil was also down 8% on the week as the hope of supply-side intervention from Monday faded. 

As a result of Russia not cooperating on production cuts, Saudi Arabia has announced that it will hike its own output and UAE, as well as other OPEC members, are expected to follow suit.  With prices already down 30% on the year, and countries seeming to shift to a “market share grabbing strategy” CNBC reports that some analysts are predicting $20 oil is coming this Spring.  That would have major geopolitical impacts as well as huge implications for oil companies and especially US shale exploration and production names.

Obviously, coronavirus continues to dominate the news, markets, politics, and daily life pretty much around the globe.  Over the weekend, the headline virus numbers have risen to over 111,230 confirmed cases and 3,900 deaths globally.  In the US, 33 states have confirmed infections of the virus for a total of 565 cases and 22 deaths (numbers that more than doubled over the weekend).  However, these numbers will climb as testing kits are just now starting to become available more broadly. The most impacted states remain Washington, New York, and California. 

On Sunday, the head of the NIAID (HHS infectious disease dept.) said that “social distancing” needs to be prevalent in the US for at least the next 3 months.  However, he doesn’t feel strict quarantining as done in Wuhan would be publicly acceptable in the US.  He also reiterated that it will take at least 12-18 months before any vaccine is ready for distribution.  Finally, he said that overall, his sense of the US virus situation is not encouraging.

In the US markets, at this point traders have priced-in (65% probability) another three-quarter of a percent interest rate cut by on or before March 18^th.  If this did happen, it would take US interest rates to 0.25% and would mean we have seen a 1.25% rate cut in less than a month.  On Sunday night, the 10-yr Bond yield fell below half a percent to 0.34% at one point.  This was about the time that S&P Futures temporarily stopped trading because they had reached the 5% Limit Down rule level. 

Overnight, Oil prices plummeted, taking credit markets and then Asian stocks with them.  Markets were down over 5% in Japan and almost 7% in Australia for example.  Europe is also very deep in the red, down about 6-7% across the board so far today.  As of 7:30 am, U.S. futures are pointing to a gap lower of over 5% as of now.  There is no major economic news scheduled for Monday.  There are also no major earnings on tap for the day. 

Expect gaps, heavy volatility and circuit breakers today as uncertainty and human emotions still reign in the market.  Do you really need have an edge trading in that environment? Remember, cash is a valid position and the loss of a day, week or even a month of trading is a small price to pay to avoid being whipsawed to death.  Trading is a business, and consistent, effective trading is the goal.  Don’t chase.  Don’t trade on emotions.  Don’t think you can predict turns.

Ed

Sorry, no Trade Ideas for your watchlist and consideration today. Markets are simply too volatile. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

The market continued its recent volatile, bearish ride Thursday.  A strong gap down punished the bulls who chased into the prior day’s rally.  However, it was also an unpredictable ride intraday.  The buyers pushed markets up off the lows at the end of the day and left us with indecisive (wicks as long or longer than the body), black candles.  On the day, the SPY fell 3.32%, the DIA was down 3.48%, and the QQQ was down 3.04%.  The VXX jumped 16%, up to 26.68.  Meanwhile, 10-year bond yields also fell to as low as 0.90% and Oil fell to $45.98/barrel (West Texas Intermediate).

As you know, coronavirus remains the main news story.  The headline virus numbers have risen to over 100,000 confirmed cases and over 3,350 deaths globally.  This includes over 15,000 cases outside China as the outbreaks in places like South Korea (6,600), Italy (3,900), Iran (4,750), Germany (550), France (425), Japan (360), and Spain (300) continue to expand.  However, in China itself, recovery is starting to get underway as it is estimated 60-65% of their workforce (nationally, but not uniformly) have returned to work this week.  As an example, 90% of Chinese Starbucks locations are open, albeit with reduced staff, hours, and reduced or eliminated seating areas.

In the US, virus cases now exist in 17 states, with 235 confirmed cases and the death toll has risen to 12.  These numbers are expected to grow as we start to see broader testing in the US.  (The Dept. of HHS expects to miss their goal of a million test kits distributed by the end of the week.  However, there are still hundreds of thousands of more tests available now than last week.)  Then again, maybe the spread of cases and deaths will just stop.  President Trump disputes C.D.C. and W.H.O. statistics.  He has a hunch that hundreds of thousands of cases simply recover on their own, without treatment, as those people just sit around or keep going to work, with only minor symptoms.

Despite his hunch, we continue to see real impacts with a parade of closures, cancelations, and warnings.  In addition, the US is starting to see certain shortages in some areas (i.e. face masks, hand sanitizer, toilet paper, and even some drugs).  For example, the largest grocery chain (KR) is now limiting the number of cleansers, sanitary items, cold, and flu-related products any one customer can purchase.  Meanwhile, in San Francisco, one of the infected cruise liners has been refused docking rights (with 2,500 passengers still on board) and is anchored off the coast as passenger testing and negotiations are underway to decide whether the ship can dock in that city.  On the bright side of the outbreak, it appears that money (including significant foreign money) is piling into the US real estate market, as a safe haven.  This point is reinforced by announcements that large banks are now reassigning significant parts of their staff to process loan applications faster. In China, the government has invoked “force majeure” for 4,900 companies, which invalidates contracts. (If a company had a Chinese supplier or customers, they may not now.)

Last night Jamie Dimon, CEO of JPM was hospitalized and had emergency heart surgery.  He has been temporarily replaced by the company’s Co-Presidents.  Also overnight, Asian markets were deeply red Friday.  Europe is even deeper in the red, down about 3.5% across the board so far today.  As of 7:30 am, U.S. futures are still volatile, but point to a gap lower of between 2.5% and 3.25% as of now.

Friday’s major news includes Avg. Hourly Earnings, Import/Exports, Feb. Nonfarm Payrolls, and Feb. Unemployment Rate (all at 8:30 am).  There will also be half a dozen Fed speakers throughout the day.  There are no major earnings reports scheduled. 

Another gap, heavy volatility, and uncertainty is likely to reign again Friday.  Even a two-day weekend represents a lot of headline risk with a global news story like COVID-19 underway.  We could see a major increase in the spread, some kind of coordinated economic response or who knows what before the opening bell Monday.  So, if you are trading at all, my advice is to be delta-neutral before the close today.  Remember, cash is a valid position.

As Warren Buffett says, the first rule of making big money in the market is not losing big money in the market.  In comparison, the loss of a day, week or even month of trading is a small price to pay to avoid being whipsawed to death.  Successful trading means good risk management.  Trading is a business, and consistent, effective trading is the goal.  Don’t chase.  Don’t trade on emotions.  And plan every trade.

Ed

Sorry, no Trade Ideas for your watchlist and consideration today. Friday is payday. Take some profits. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

My apologies upfront about today’s blog.  I’m under the weather today and not quite up to speed.

Wednesday saw a strong gap higher and an all-day rally as markets apparently liked the idea of Joe Biden winning Super-Tuesday.  The day closed very near the highs with the SPY up 4.20%, the DIA up 4.47%, and the QQQ up 4.17%.  The VXX fell back to 23.00, but obviously still elevated.

Coronavirus remains the main news outside of the election results. The headline virus numbers have risen to 96,300 confirmed cases and over 3,300 deaths globally.  This includes over 13,000 cases outside China as the outbreaks in places like South Korea (6,100), Italy (3,100), Iran (3,520), Japan (320), France (260), Germany (350), Spain (170), and the US (160) continue to expand.  In the US, cases exist in 14 states and the death toll has now risen to 11.  It is worth noting that Wuhan China is reporting an increase in relapse rates of previously cleared patients being re-admitted for symptoms and testing positive again. 

In terms of impact, the parade of closures, cancelations, and warnings continue.  Italy closed schools nationwide (following Japan’s example).  Health workers in the UK and Italy have now tested positive.  Italy will apply to the EU to suspend EU budget rules due to the costs of the outbreak.

Overnight, Asian markets were strongly green Thursday.  However, Europe is strongly red across the board so far today.  As of 7:30 am, U.S. futures are still volatile, but deeply red again, point to a gap lower of more than 2%.

Thursday’s major news includes Weekly Initial Jobless Claims and Q4 Nonfarm Productivity (both 8:30 am), Jan Factory Orders (10 am) and a trio of Fed speakers.  Major earnings reports are limited to KR before the open and COO, COST, and HRB after the close.

Gap and volatility continue to be the buzzwords. You need to keep asking…Is there really a good reason for you to be trading markets that are more wide-ranging, more volatile, and less consistent than they have been in literally years?  Are you chasing the “action,” reacting to emotion, or scrambling to somehow get back to even?  If so, think twice.  That is probably not a river you should be swimming across.  Trading is a business, cash is a valid position, and consistent, effective trading is the goal.  This day, this week or even this month will not make the difference between a successful trading year (let alone lifetime) either way.  Good trading is good risk management.  The bottom line continues to be…be careful.

Ed

Swing Trade Ideas for your watchlist and consideration: SNDL, GBT, ADBE, TNDM, TZA, SQQQ, SPXU, SDOW, SOXS. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

Tuesday was another roller-coaster day for markets.  We sold off at the open but rallied massively for 5 minutes on the news that the Fed cut rates.  However, that very short-lived and the rest of the day was a jagged and volatile bearish move.  The day closed with the SPY down 2.86%, the DIA down 2.89%, and the QQQ down 3.21%.  The good news is that markets did close off their lows.  The VXX was also volatile but closed up almost 11% to 24.45.  Shortly after the rate cut, the 10-year Bond yield fell to another all-time low of less than one percent (0.906%).

There was an emergency conference call between G7 Finance Ministers during the premarket.  However, this resulted only in a statement that they would support global markets against the impacts of coronavirus as appropriate.  There was no mention of specific actions or timing in the message.  This lack of action by the G7 (many of which already have negative or zero interest rates, and thus limited responses available) may have forced the Fed’s hand in the face of pressure to do something.  Either way, the Fed did announce an emergency half percent rate cut just two weeks before their next meeting.

While that rate cut was fully expected by markets in two weeks, the urgency of action and Chairman Powell’s statement led to fear as he said we might see forecasted growth cut in half this year. Perhaps worse, many economists, pundits, and traders have questioned if rate cuts will have any real impact.  The critics say this move does nothing to impact the core issues of supply chain disruptions, and both customers as well as workers staying home.  In short, the problem simply isn’t that high-interest rates are inhibiting economic activity.  So, they label this move as nothing but a transparent stock market circuit-breaker, which failed.  To top this off, the President then immediately demanded further rate cuts and Quantitative Easing.  (Trump wants the U.S. to have the lowest interest rates and the easiest money in the world.)  Something about this picture did not strike markets as good news.  So, the rest of the day was a volatile, but strongly bearish selloff. 

In virus-specific news, there was a significant development as the global mortality rate has climbed from 2% up to 3.4%.  The headline virus numbers have risen to 93,500 confirmed cases and over 3,200 deaths globally.  This includes over 13,000 cases outside China as the outbreaks in places like South Korea (5,600), Italy (2,500), Iran (2,400), Japan (300), France (215), Germany (200), Spain (170), and the US (130) continue to expand.  In the US, cases exist in 14 states and the death toll has now risen to nine.  The Dept. of HHS also said they are working to resolve issues with inaccurate originally-distributed test kits and get 75,000 new (presumably good) kits distributed.

In terms of business impact, every day a host of companies are banning travel, canceling events, closing facilities, warning customers of delays, cutting guidance, and/or suggesting workers telecommute.  On Tuesday, that included GOOG, F, the US Federal Government (Seattle), AMZN, INTC, CSCO, CRM, V, among others. Japan also announced they are hoping to hold the Olympics as scheduled, but may delay them as far as year-end. It is also worth noting that markets STILL have fully priced in three more Fed rate cuts this year. So, the expectation seems to be that much more pain is to come as well as much more help.

Overnight, Asian markets were volatile and mixed Wednesday.  Europe is green across the board, so far, maybe responding to yesterday’s Fed rate cuts.  Maybe the U.S. markets are reacting to Super-Tuesday results or just following Europe. Either way, as of 7:30 am, U.S. futures are pointing to another big gap. This one a gap higher of about 2.5%.

Wednesday’s major news includes Feb. ADP Nonfarm Employment (8:15 am), Feb. Composite PMI and Feb. Services PMI (both at 9:45 am), Feb. ISM Non-Mfg. PMI (10 am), Weekly Crude Oil Inventories (10:30 am), Fed Beige Book (2 pm), and a Fed speaker.  Major earnings reports are limited BFB, CPB, and DLTR before the open and SPLK after the close.

As volatility continues, markets swung back to bearish for the 8^th time in the last 9 days on Tuesday.  With gaps and ATR both at their largest since 2018, this is not a market for new traders or anyone who is not very fast and attentive.  With that said, now that the Fed has fired one of its few remaining bullets, markets expecting more, and no action on the fiscal side or across the G7, the odds seem to stack up as more bearish than bullish in the near-term.  But, will markets trade on news or expectations?  I certainly can’t (and won’t) handicap that race. 

Traders need to keep asking themselves…”Is there really a good reason to be trading markets that are more wide-ranging, more gappy, and less consistent than they have been in years?”  Are you chasing the “action,” reacting to emotion, or scrambling to somehow get back to even?  If so, you probably don’t have a good reason to be trying to swim that raging river.  Trading is a business and consistent, effective trading is the goal.  This day, week or even month will not make the difference between the success or failure of your trading year (let alone lifetime).  Good trading is good risk management. Remember that.

Ed

Swing Trade Ideas for your watchlist and consideration: SMG, RP, GNRC, ENPH, CLX, MSCI, ETSY, ZAYO, AYX, SEDG, GLD. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

Monday saw heavy pre-market volatility, a gap higher and an instant selloff.  However, after the first half-hour, the bulls stampeded the rest of the day buying everything hard on the expectation of large and near-immediate rate cuts by the Fed.  The result was a massive rally day where the SPY closed up 4.33%, the DIA up 4.90%, and the QQQ up 5.16%.  The VXX too was volatile but closed down 3.42% to 22.03.

While coronavirus is the main story, markets have now jumped past the impact to assuming potential rate cuts, QE, G7-coordinated easing, and maybe US tax cuts will erase the economic impact companies are and will experience.  For example, JPM reported they believe the Fed will cut half a percent in March and another quarter percent in April.  This fits with current markets that have 100% priced in a 50-basis-point cut this month and the betting is 70% on the side of a second cut in April.  Still, economists are saying that the rate cuts might make it seem like the government is doing something, but are unlikely to actually help the actual economy. (The belief is the lags are too long in the economy and we are already at incredibly low rates.) So, while markets are expecting these things, nothing concrete has actually happened yet.  Therefore, the question is “Can and will the Fed really cut as fast and as much as markets expect?”

The headline virus numbers have risen to 92,100 confirmed cases and over 3,150 deaths globally.  This includes over 10,000 cases outside China as the outbreaks in places like South Korea (5,200), Italy (2,100), Iran (2,400), Japan (270), France (200), Germany (170), Spain (120), and the US (105) continue to expand.  In the US, cases exist in 14 states and the death toll has now risen to six. 

Asian markets were volatile and mixed Tuesday (China up, Japan down).  However, Europe is following the US example from Monday.  They are strongly green across the board at this point.  As of 7:30 am, U.S. futures are mixed and flat with traders apparently waiting on the results of the G7 conference call today.

The only major scheduled economic news for Tuesday is a Fed speaker in the afternoon.  However, expect some statement following the G7 Economic Leader Conference Call.  That will probably be the true economic news driver today.  Major earnings reports are limited to AZO, KSS, and TGT before the open.  After the close, HPE, JWN, and ROST all report.

Markets have already latched on to expectations of the Fed (and G7) saving the day and of the virus impacts being lower than forecast on earnings.  Monday’s rally was very impressive.  However, it’s worth noting that we were down 11-12% the prior week.  So, a rebound was due anyway.  We also have to bear in mind that regardless of what the market expects, nothing has actually been done yet that will change economic realities.  We rallied on hope alone Monday. It is easy to see that it would not take much disappointment to tip things back into “sell, sell, sell” mode.  The bottom line is, be careful.

If you are a fast trader and you make good money in those markets, this might be your time.  If that’s the case, then go for it. However, the question remains the same.  “Do I really want to be trading in these conditions?  Do I have an advantage in this kind of market?”  Hopefully, an announcement from the G7 and Fed can clear these questions up.  However, I won’t be front-running those decisions/announcements. As always, I’m going to urge you not to chase, not to revenge trade, and not to pick bottoms or tops.  Trading is a business, cash is a valid position, and consistent, effective trading is the goal.

Ed

Swing Trade Ideas for your watchlist and consideration: CLX, BIIB, ENPH, BMRN, FLO, S, DXCM, NUAN, ALKS, TDOC, TPC, GTT. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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

Friday saw another day of wild swings as markets gapped lower and gyrated back and forth on every scrap of news.  Among those drivers were a whole bunch of rumor, conjecture, misinterpretation, and some pure lies.  What was real is that the bulls believed something positive as they ended the day on a rally.  At the close, we had white-body candles and losses were a bit pared.  The SPY ended down 0.42%, the DIA down 1.14%, and the QQQ up 0.08%.  This closed out the worst week since the financial crisis of 2008, as for the week the SPY was down 11.16%, the DIA down 12.14%, and the QQQ down 10.63%.  The 10-year bond yield fell to 1.12% (and fell further over the weekend).

Coronavirus remained the main story.  The headline numbers have risen to 90,000 confirmed cases and over 3,000 deaths globally.  The outbreaks in places like South Korea (4,300), all 27 EU States (2,100), Iran (1,500), and the US continue to expand. This includes the first two deaths in the US.  However, not all the news related to the virus is bad.

On a positive note, the trend in new cases in China continues to go down (fewer new cases found).  In fact, on Sunday China announced they officially had more cases who had survived and been released than cases still requiring medical care.  This is a great trend change in the world’s second-largest economy.  It also points to a theoretical two or three-month course for the virus within a strictly quarantined and controlled population.  So, an optimist might be able to extrapolate this into something like a one to two quarter hit for economies and then it’s just a question of what shape the recovery graph takes.

This weekend, the President blamed the media and Democrats for a hoax that led to the market losses.  However, he also condemned the Fed for not having given the US the lowest rates in the world long ago and then “hoped” the Fed step in to save markets immediately.  This raises the question, from a market standpoint, how worried should we really be?  So, let’s put some context on the economic impact of the virus.

China’s manufacturing PMI was reported Saturday.  It fell to an all-time low of 35.7 for February, down from 50 in January and far below expectations.  (A private version of this number based in Taiwan and covering small-medium businesses, reported 40.3.)  As an example, last week, two major Chinese electronics manufacturers, Foxconn (Apple’s main supplier for Macs and iPhones) and Compal (Acer, Dell, HP, and Toshiba’s main supplier) told their major customers they were only back to 30-35% of their normal production capacity.  This is 3 weeks behind their normal post-Lunar New Year holiday ramp-up and is also a MUCH slower speed ramp-up than a normal year.  From a different angle, across the entire country, only about 55%-60% of China’s trucking capacity has resumed work, but that number is almost zero in the quarantined areas. Disease testing checkpoints and disinfection activities are also slowing the transportation of goods.

Outside of China, global tanker and bulk freighter demand is down 70% since the first of the year as of last week.  In addition, the American Assn. of Port Authorities are now forecasting a drop of 10%-20% in cargo volume year-on-year between 2019 and 2020.  (That is a massive range for a forecast, but also a huge decline if true.)  In South Korea, one of Samsung’s electronic flash memory factories has been shut for two weeks.  In Europe, NIKE just closed their EU headquarters.

The point is that in a global economy of just-in-time entities, (where inventory buffers have been systematically reduced for decades in the name of cost savings), supply disruption is a huge problem.  Not just in China, but anyplace in the world that sources anything from China, South Korea, etc.  In a sense, the more “modern” and profitable a business has been, the worse they will feel the impacts of a supply disruption.  The good news is that many industries have replaced inventories with the ability to be more agile (ramp up and down faster).  So, is coronavirus the end of the world…no.  Is it the end of revenue growth and significant profits for at least a few months or even a couple of quarters for many businesses…undoubtedly.   

With that all said, Asian markets were volatile but took another beating Monday, ending deeply in the red again.  Europe is also once again down sharply across the board at this point.  As of 7:45 am, U.S. futures are pointing to a half to three-quarters of a  percent gap lower, but continue to be very volatile whipping back and forth.

In terms of major economic news, Monday’s slate is limited to Feb. Mfg. PMI (9:45 am) and ISM Mfg. PMI (10 am).  Major earnings are also limited, with only EVRG, JD, and XRAY reporting (all before the open).

The market freefall slowed Friday as bulls jumped at various signs of hope. However, massive volatility continued.  The only thing that really changed over the weekend was a couple of days off to reassess how we should really respond as a trader at this point.  This morning we still see a lot of volatility in the future, but they seem to be looking to start the week lower again. 

The question you need to answer is “do I really want or need to be trading in these conditions?”  Is this volatility and fast-moving market something that is in your favor?  If not, step away from broker platform and do something else.  Don’t let your emotions lead you into mistakes.  Keep repeating the mantra: no chasing….no revenge trading…no bottom/top picking.  Trading is a business, cash is a valid position, and consistent, effective trading is the goal.

Ed

Sorry but due to futures volatility there are no trade ideas for today. Trade smart, take profits along the way and trade your plan. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/etfs we mention and talk about in the trading room are not recommendations to buy or sell.

🎯 Mike Probst: Rick, Got CTL off the scanner today. Already up 30%. Love it.

🎯 Dick Carp: the scanner paid for the year with HES-thank you

🎯 Arnoldo Bolanos: LTA scanner really works $$, thanks Ed.

🎯 Bob S: LTA is incredible…. I use it … would not trade without it

🎯 Malcolm .: Posted in room 2, @Rick… I used the LTA Scanner to go through hundreds of stocks this weekend and picked out three to trade:  PYPL, TGT, and ZS.   Quality patterns and with my trading, up 24%, 7% and 12%…. this program is gold.

🎯 Friday 6/21/19  (10:09 am) Aaron B: Today, my account is at +190% since January. Thanks, RWO HRC Flash Malcolm Thomas Steve Ed Bob S Bob C Mike P and everyone that contributes every day. I love our job.

Hit and Run Candlesticks / Road To Wealth Youtube videos

Disclosure: We do not act on all trades we mention, and not all mentions acted on the day of the mention. All trades we mention are for your consideration only.

Free YouTube Education  •  Subscription Plans • Private 2-Hour Coaching

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