On Tuesday, markets opened just on the red side of flat again (down 0.18% in the SPY, down 0.15% in the DIA, and down 0.01% in the QQQ).  However, after the tepid open, the bears stepped in to drive a strong selloff that reached the lows of the day at about 11:30 am in all three major indices.  From that point, the rest of the day was a sideways meander with a modest bullish trend.  This action gave us black-bodied candles with large lower wicks in the SPY, DIA, and QQQ.  The QQQ retested and held above its T-line (8ema) while the two large-cap indices closed just below their 8emas.  It also does not take too much imagination to see all three major indices as an Evening Star-type candle.

On the day, all 10 sectors were in the red with Energy (-4.17%) leading the way lower while Basic Materials (-0.40%) held up better than the other sectors.  At the same time, the SPY lost 1.12%, DIA lost 1.02%, and QQQ lost 0.87%.  VXX climbed 4.43% to 38.89 and T2122 dropped down well into the oversold territory to 11.11.  10-year bond yields plummeted again to 3.435% while Oil (WTI) plunged 5.34% to $71.62 per barrel.  So, to summarize, Tuesday was the bears’ day ahead of today’s Fed decision.  This all happened on a little shy of the average volume in all three major indices.     

In economic news, March Factory Orders came in below expectation at +0.9% (versus a forecast of +1.1% but much better than the February reading of -1.1%).  At the same time, the labor market remained strong as March JOLTs Job Openings came in lower than anticipated at 9.590 million (compared to a forecast of 9.775 million and a February value of 9.974 million).  So, Factory activity continues to grow but at a slow pace, while the labor market is slowly tightening, with 400k fewer openings in March than in Feb.  After the close, the API Weekly Crude Oil Stock Report showed a much larger than expected oil inventory drawdown of 3.939-million-barrels (versus a forecast of a 1.000-million-barrel drawdown but still much less than the prior week’s 6.083-million-barrel drawdown.

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In stock news, regional banks took a beating again Tuesday with PACW closing down 27.78%, WAL down 15.12%, and even much larger USB down 7.01% and TFC down 7.61%. Elsewhere, electric vehicle maker MULN announced that has received a 1,000-truck order ($63 million) with first deliveries scheduled to begin in August.  At the same time, Reuters reported the US will announce another $300 million military aid package for Ukraine as soon as today.  The new package will include air-launched rockets, 155mm shells (both made by GD), HIMARS missiles (from LMT), TOW missiles (from RTX) as well as other miscellaneous munitions.  After the close, PNC bank said it can offer $15 billion of its short-term commercial paper (very liquid and generally secure) to calm market worries over liquidity.  This announcement was made even after the bank reported a rise in deposits and profits during Q1.  Finally, despite a blowout success in its quarterly report Tuesday night, F announced it is cutting the price of the Mustang Mach-E again as the price war with TSLA continues.

In stock legal and regulatory news, VMW lost the retrial of its patent infringement case filed by Densify and will pay $84.5 million in the verdict.  (This is much less than the original verdict of $237 million from 2020 which was thrown out on appeal.) Elsewhere, the US SEC will vote today on whether to adopt new rules increasing transparency from the advisors to hedge and private-equity funds. Meanwhile, after the close, AMGN sued NVS for patent infringement over drugs AMGN has sold $5.6 billion of and NVS has now proposed launching generic versions.  At the same time, the White House has summoned the CEOs of GOOGL and MSFT (as well as others) to a Thursday meeting to discuss AI issues and potential regulation.  In bankruptcy news, CNNWQ received court approval to raise $2.26 billion as part of its exit from bankruptcy.  Finally, the US Dept. of Transportation announced Tuesday that it will not extend the July 1 deadline for plane 5G retrofits as had been requested by airlines.  And Airline industry group said this may cause airline operational disruptions during the peak summer travel season.

After the close, F, SBUX, AMD, MUSA, AIZ, CZR, CLX, CWH, AFG, WELL, THG, AXTA, WU, CHK, RNR, LFUS, CRK, JKHY, BFAM, MTW, HY, and UIS all reported beats on both the revenue and earnings lines.  Meanwhile, OKE, ANDE, EIX, AMCR, UNM, YUMC, UFPI, ENLC, EXPI, MTCH, and CLW missed on revenue while beating on the earnings line.  On the other side, PRU, LUMN, VOYA, HLF, SPG, MCY, EXR, and GPOR beat on revenue while missing on earnings.  Unfortunately, ET, SMCI, BXC, and ASH missed on both the top and bottom lines.  It is worth noting that AMCR, MTCH, and ASH lowered their forward guidance.  However, CLX, SMCI, LFUS, JKHY, and PAYC all raised their forward guidance.  (It is also worth noting that F had 62% upside surprise, YUMC had a 61% upside surprise, AIZ had a 55% upside surprise, CZR had a 50% upside surprise, SWH had a whopping 169% upside surprise, THG had an 86% upside surprise, and BFAM had a 44% upside surprise on earnings.)

Overnight, Asian markets were mixed but mostly red.  Hong Kong (-1.18%), New Zealand (-1.08%), and Australia (-0.96%) led the region lower.  Meanwhile, in Europe, the bourses lean heavily to the green side with only three spots of red on the board at midday.  The CAC (+0.68%), DAX (+0.82%), and FTSE (+0.22%) are leading the region higher in early afternoon trade.  In the US, as of 7:30 am, the Futures are pointing toward a modestly green start to the day.  The DIA implies a +0.11% open, the SPY is implying a +0.15% open, and the QQQ implies a +0.24% open at this hour.  At the same time, 10-year bond yields are down to 3.407% and Oil (WTI) is plummeting again (by 3.07% this time) to $69.47/barrel in early trading.

The major economic news events scheduled for Wednesday include the ADP Nonfarm Employment Change (8:15 am), Services PMI (9:45 am), April ISM Non-Mfg. PMI (10 am), EIA Crude Oil Inventories (10:30 am), FOMC Rate Decision and Fed Statement (both at 2 pm), and Fed Chair Press Conference (2:30 pm).  The major earnings reports scheduled for the day include ADNT, ALGT, AVNT, AVA, GOLD, BDC, BGCP, EAT, BIP, BLDR, BG, CDW, CHEF, CLH, SID, CVS, XRAY, DBD, DRVN, EMR, EL, EEFT, EXC, FTS, GRMN, GNRC, GFF, HBI, HZNP, INGR, JHG, KHC, LPX, MUR, NI, PSN, PSX, RXO, SMG, SBGI, SITE, SR, SPR, STLA, TKR, TT, TRMB, UTHR, VRSK, and YUM before the open.  Then, after the close, ALB, ALL, ATUS, AMED, ANSS, HOUS, APA, ATO, AVT, EQH, BHE, BKH, CPE, CENT, CENTA, CDAY, CHRD, CIVI, COKE, CTSH, CODI, CTVA, CCRN, CW, NVST, EQIX, ETSY, FG, FLT, FNF, ULCC, GIL, GL, HST, IR, IOSP, MRO, VAC, MMS, MELI, MET, MKSI, MOS, NFG, OPAD, PARR, PDCE, PSA, QGEN, QRVO, QCOM, QDEL, O, REZI, SIGI, SEDG, RUN, TWI, TTEC, TTMI, UGI, VSTO, WERN, WES, WMB, XPO, YELL, and Z report.    

In economic news later this week, on Thursday, we get March Imports, March Exports, March Trade Balance, Weekly Initial Jobless Claims, Preliminary Q1 Nonfarm Productivity, Preliminary Q1 Unit Labor Cost, the Fed Balance Sheet, and Bank Reserves with the Federal Reserve.  Finally, on Friday, April Average Hourly Earnings, April Nonfarm Payrolls, April Private Nonfarm Payrolls, April Participation Rate, and the April Unemployment Rate. 

In terms of earnings reports later this week, on Thursday, we hear from GOLF, ATI, AEP, BUD, APG, APTV, ARNC, ARW, BALL, BHC, BCE, BDX, BERY, BWA, BV, BRKR, CAH, CG, COMM, COP, CEG, DLX, DNB, EQNR, ES, RACE, FOCS, GTES, GPRE, DINO, HII, H, IBP, ICE, IRM, ITT, JLL, K, KTB, MMP, MLM, MDU, MRNA, MODV, NFE, NJR, NVO, DNOW, NRG, OPCH, OGN, PZZA, PARA, PH, PTON, PENN, PCG, PNW, PLTK, PPL, PRMW, PRVA, PWR, RCM, REGN, RCL, SABR, SBH, SRE, SHEL, FOUR, SWK, STWD, TRGP, TFX, TU, BLD, UPBD, VNT, W, WLK, WRK, XYL, ZTS, ATSG, LNT, AIG, COLD, AMN, AAPL, TEAM, BGS, BECN, BIO, SQ, BCC, BKNG, CNQ, CVNA, ED, CTRA, CWK, DASH, DKNG, DBX, ERJ, EOG, EXPE, FND, FTNT, GDDY, GT, LYV, LYFT, MTZ, MATX, MTD, MCHP, MNST, MSI, NCR, ZEUS, OTEX, OPEN, OEC, CNXN, PBA, POST, KWR, RRX, RGA, RKT, SEM, SHOP, TDS, TXRH, TSE, TPC, and USM.  Finally, on Friday, AES, AMC, AMCX, AEE, AXL, AMRX, BBU, BEPC, BEP, CLMT, CI, CNK, CNHI, D, ENB, EPAM, EVRG, FLR, FYBR, GLP, GTN, HUN, IEP, JCI, LSXMK, LSXMA, MGA, NMRK, OMI, PBF, PAA, PAGP, QRTEA, WBD, and BAP report. 

In miscellaneous news, fear of another potential pandemic (and potential threat to the poultry supply) is taking shape in the UK.  Thousands of dead wild birds litter England.  The problem is so bad the British government has warned dog walkers to keep their animals on leashes at all times to keep the dogs from eating birds or bird droppings.  The avian flu isn’t contained to the UK either as the USDA has reported at least 170 confirmed cases of mammals (mostly cats and dogs) picking up the disease in the US from this latest wave.  This comes after more than 60 million chickens and turkeys died or were culled to prevent the spread of the last wave in 2022. The good news is that dating back to 1997, there are less than 900 confirmed cases of humans contracting the earlier variants of the avian flu.

So far this morning, CVS, PSX, KHC, BLDR, EXC, EMR, TT, GOLD, FTS, NI, AVNT, GRMN, CLH, GNRC, TKR, EAT, XRAY, PSN, SR, VRSK, JHG, BDC, MUR, CHEF, DRVN, HSC, FDP, and QUAD have all reported beats on both the revenue and earnings lines. Meanwhile, CDW, BIP, INGR, SMG, LPX, TRMB, and UTHR all missed on revenue while beating on earnings.  On the other side, BG, EL, YUM, BLCO, SITE, EEFT, and ALE beat on revenue while missing on the earning line.  Unfortunately, SPR, HZNP, DBD, and AVA missed on both the top and bottom lines.  It is worth noting that CVS, BLDR, and TRMB lowered their forward guidance.  However, KHC, EMR, INGR, TKR, CHEF, and HSC all raised their forward guidance.

With that background, it looks like the large-cap indices are retesting their T-lines (8ema) in the premarket and the tech-heavy QQQ is pushing up away (a bit) from its own. We all know that today will be all about the Fed. So, don’t be surprised with either a dead market or chop going back and forth in an indecisive way right up to 2 pm. Over-extension from the T-lines is not a problem and while T2122 is well into the oversold territory, it is not extremely extended. Don’t get caught predicting the reaction to the FOMC. And, also remember that there tends to be a knee-jerk, followed by a re-reaction…and then an “on second thought” move the next morning when there is a Fed announcement. Be prepared.

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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 on the red side of flat, mostly gapping very mildly lower (down 0.13% in the SPY, up 0.02% in the DIA, and down 0.18% in the QQQ).  From that point, it was a whipsaw day that saw the bulls marginally in control in the morning and the bears marginally in control in the afternoon.  This action left us with indecisive candles in all the major indices.  The QQQ printed a DOJI Harami, the SPY printed a Gravestone Doji Harami, and the DIA printed a black-bodied Inverted Hammer-type candle.  All three remain above their T-lines (8ema) and nothing appreciable has changed in any of those charts. This all happened on less-than-average volume across the market. 

On the day, five of the 10 sectors were in the red with Energy (-0.84%) leading the way lower while Healthcare (+0.71%) held up better than the other sectors.  At the same time, the SPY lost 0.10%, DIA lost 0.18%, and QQQ lost 0.11%. VXX fell 1.64% to 37.24 and T2122 dropped back a little further into the mid-range at 65.55.  10-year bond yields spiked up to 3.57% while Oil (WTI) fell 1.41% to $75.70 per barrel.  So, to summarize, Monday was a nothing-burger of indecision as markets showed no ill effect from the failure of FRC (acquired by JPM) and seem to be waiting on the Fed or more earnings to move the needle.     

In economic news, April Manufacturing PMI came in below expectation at 50.2 (versus a forecast of 50.4 but still above the March reading of 49.2).  (Anything above 50 indicates economic expansion.)  Later, April ISM Manufacturing PMI came in above expectation at 47.1 (compared to a forecast of 46.8 and a March value of 46.3).  April ISM Manufacturing Employment was well above the anticipated level at 50.2 (versus a forecast of 47.9 and a March level of 46.9).  Finally, April ISM Manufacturing Prices came in well above what was expected at 53.2 (compared to a forecast of 49.0 and a March reading of 49.2).

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In stock news, RIDE warned of potential bankruptcy after Foxconn (one of the electric automaker’s largest investors) alleged RIDE has breached the agreement between the two companies.  This puts $170 million in funding for RIDE at jeopardy.  Elsewhere, AAL pilots have authorized the union to call a strike (96% of pilots voted and 99% of those voted in favor of a strike authorization). No strike date is set as this is negotiation leverage, not imminent action.  Later, after the close, Bloomberg reported that IBM has paused hiring with plans to replace up to 7,800 jobs (30% of its non-customer-facing jobs) with AI in coming years.  At the same time, Reuters reports that MS will cut 3,000 jobs in Q2.  Meanwhile, Reuters reported that META is looking to raise $8.5 billion in a 5-part bond offering.  (META raised $10 billion using the same mechanism in 2022.)  Finally, overnight, TSLA hiked prices on Model 3 and Model Y cars (in the US, China, Canada, and Japan only) in what seems to be a plea for help by either the CEO or senior management.  This minuscule $250 hike in price (on a $40k to $47k original price) and coming after price cuts earlier in the year make it seem like they are flailing around looking for a pricing strategy.

In stock legal and regulatory news, Reuters reported Monday that the EPA may delay a decision on giving eRIN credits to Electric Vehicle makers under a renewable fuel program.  The reason for the delay is that the House GOP wants to file a legal challenge on behalf of the fossil-based Energy industry, as they claim those credits were intended only for biofuel (ethanol and biodiesel) manufacturers.  This delay will impact TSLA most heavily, but all other electric vehicle makers as well, who will not get the credits they were expecting since the fall.  In other EV news, FSR received certification from EU regulators and will begin delivering its “Ocean” electric SUVs on Friday.  Meanwhile, a US federal judge gave F a win.  He ruled that while Versata Software had proven that F stole their trade secrets in breach of their agreement, the defendant had not provided enough evidence of the damages suffered to justify a lower court jury award of $105 million. Instead, the judge ordered F to pay a massively-reduced $3 million.

LEG, TEX, ANET, FLS, SBAC, AL, SGRY, WWD, INVH, KMT, and VICI all reported beats on both the revenue and earnings lines.  Meanwhile, SON, FMC, and SCI all missed on revenue while beating on earnings.  On the other side, CYH, RE, OGS, CNO, and RIG all beat on revenue while missing on earnings.  Unfortunately, FANG missed on both the top and bottom lines.  It is worth noting that SYK, NXPI, SFM, TEX, SBAC, SGRY, and WWD all raised their forward guidance.  However, AMKR lowered its forward guidance. 

Overnight, Asian markets leaned heavily toward the green side.  Shanghai (+1.14%), Shenzhen (+1.09%), and South Korea (+0.91%) led the region higher with Australia (-0.92%) showing any appreciable loss.  In Europe, the bourses are mostly in the red on moderate moves at midday.  The CAC (-0.41%), DAX (-0.19%), and FTSE (-0.01%) lead the region lower with three minor bourses modestly in the green in early afternoon trade.  As of 7 am, US Futures are pointing toward a slightly red start to the day.  The DIA implies a -0.22% open, the SPY is implying a -0.19% open, and the QQQ implies a flat -0.03% open at this hour.  Meanwhile, 10-year bond yields are back down to 3.536% and Oil (WTI) is off another seven-tenths of a percent to $75.16/barrel in early trading.

The major economic news events scheduled for Tuesday are limited to March Factory Orders and March JOLTs Job Openings (both at 10 am), and API Weekly Crude Oil Stocks (4:30 pm).  The major earnings reports scheduled for the day include ADT, AER, AGCO, ARLP, ABC, AME, BP, BR, CX, CQP, LNG, CIGI, CEIX, CEQP, CMI, DORM, DD, ETN, ECL, EPD, ESAB, EXPD, FELE, IT, GVA, GPK, HWM, HSBC, IDXX, IHRT, ITW, INCY, NSIT, LDOS, MDC, MPC, MAR, TAP, MLPX, MD, PFE, PEG, QSR, SEE, SUN, SYY, TROW, TRI, TRN, UBER, ZBRA, and ZBH before the open.  Then, after the close, AMD, AMCR, AFG, ANDE, ASH, AIZ, AXTA, BXC, BFAM, CZR, CRC, CWH, CHK, CLW, CLX, EIX, ET, ENLC, EQX, EXPI, F, THG, HLF, JKHYLFUS, LUMN, MTW, MTCH, MCY, MUSA, OKE, PGR, PRU, RNR, SPG, SBUX, SMCI, UNM, VOYA, WELL, WU, and YUM report.   

In economic news later this week, on Wednesday, the ADP Nonfarm Employment Change, Services PMI, April ISM Non-Mfg. PMI, EIA Crude Oil Inventories, FOMC Rate Decision, FOMC Statement, and Fed Chair Press Conference all happen.  Thursday, we get March Imports, March Exports, March Trade Balance, Weekly Initial Jobless Claims, Preliminary Q1 Nonfarm Productivity, Preliminary Q1 Unit Labor Cost, the Fed Balance Sheet, and Bank Reserves with the Federal Reserve.  Finally, on Friday, April Average Hourly Earnings, April Nonfarm Payrolls, April Private Nonfarm Payrolls, April Participation Rate, and the April Unemployment Rate. 

In terms of earnings reports later this week, on Wednesday, ADNT, ALGT, AVNT, AVA, GOLD, BDC, BGCP, EAT, BIP, BLDR, BG, CDW, CHEF, CLH, SID, CVS, XRAY, DBD, DRVN, EMR, EL, EEFT, EXC, FTS, GRMN, GNRC, GFF, HBI, HZNP, INGR, JHG, KHC, LPX, MUR, NI, PSN, PSX, RXO, SMG, SBGI, SITE, SR, SPR, STLA, TKR, TT, TRMB, UTHR, VRSK, YUM, ALB, ALL, ATUS, AMED, ANSS, HOUS, APA, ATO, AVT, EQH, BHE, BKH, CPE, CENT, CENTA, CDAY, CHRD, CIVI, COKE, CTSH, CODI, CTVA, CCRN, CW, NVST, EQIX, ETSY, FG, FLT, FNF, ULCC, GIL, GL, HST, IR, IOSP, MRO, VAC, MMS, MELI, MET, MKSI, MOS, NFG, OPAD, PARR, PDCE, PSA, QGEN, QRVO, QCOM, QDEL, O, REZI, SIGI, SEDG, RUN, TWI, TTEC, TTMI, UGI, VSTO, WERN, WES, WMB, XPO, YELL, and Z report.  On Thursday, we hear from GOLF, ATI, AEP, BUD, APG, APTV, ARNC, ARW, BALL, BHC, BCE, BDX, BERY, BWA, BV, BRKR, CAH, CG, COMM, COP, CEG, DLX, DNB, EQNR, ES, RACE, FOCS, GTES, GPRE, DINO, HII, H, IBP, ICE, IRM, ITT, JLL, K, KTB, MMP, MLM, MDU, MRNA, MODV, NFE, NJR, NVO, DNOW, NRG, OPCH, OGN, PZZA, PARA, PH, PTON, PENN, PCG, PNW, PLTK, PPL, PRMW, PRVA, PWR, RCM, REGN, RCL, SABR, SBH, SRE, SHEL, FOUR, SWK, STWD, TRGP, TFX, TU, BLD, UPBD, VNT, W, WLK, WRK, XYL, ZTS, ATSG, LNT, AIG, COLD, AMN, AAPL, TEAM, BGS, BECN, BIO, SQ, BCC, BKNG, CNQ, CVNA, ED, CTRA, CWK, DASH, DKNG, DBX, ERJ, EOG, EXPE, FND, FTNT, GDDY, GT, LYV, LYFT, MTZ, MATX, MTD, MCHP, MNST, MSI, NCR, ZEUS, OTEX, OPEN, OEC, CNXN, PBA, POST, KWR, RRX, RGA, RKT, SEM, SHOP, TDS, TXRH, TSE, TPC, and USM.  Finally, on Friday, AES, AMC, AMCX, AEE, AXL, AMRX, BBU, BEPC, BEP, CLMT, CI, CNK, CNHI, D, ENB, EPAM, EVRG, FLR, FYBR, GLP, GTN, HUN, IEP, JCI, LSXMK, LSXMA, MGA, NMRK, OMI, PBF, PAA, PAGP, QRTEA, WBD, and BAP report.  

In miscellaneous news, on Monday the US Treasury Department warned that the government could run out of cash by June 1 without a debt limit increase.  In response, the President called the Majority and Minority leaders of both Houses of Congress, inviting them to a May 9 meeting to talk about the debt ceiling and federal spending.  In other news, after JPM acquired FRC on Sunday night, CEO Jamie Dimon reversed his recent warnings and said the “banking crisis” may be over for now.  He went on to point out that many regional banks have posted good first-quarter results.  Dimon’s rival, CEO of C, Jane Fraser agreed saying the US banking system is “the envy of the world” (which, to be fair, is not the same thing as saying it is in great shape).

So far this morning, ABC, PFE, ETN, DD, UBER, GPK, ZBH, AME, QSR, ZBRA, MDC, IDXX, MAR, MPLX, TROW, TRI, MD, and IT have all reported beats on both the revenue and earnings lines.  At the same time, BP, MPC, and EPD missed on revenue while beating on earnings.  On the other side, LDOS, and TRN both beat on revenue while missing on earnings.  Unfortunately, GVA missed on both the top and bottom lines.  (There are many others reporting later this morning.)  It is worth noting that ABC, ETN, and IT have raised their forward guidance.  Meanwhile, DD and ZBRA have both lowered guidance.

With that background and with the possible exception of DIA, it looks like the market is looking to open flat again today as we wait on the Fed decision and the digestion of a flood of earnings. All three major indices are above their 3ema, T-line (8ema), and 17ema…all of which are also trending higher. SPY and DIA continue to face a resistance level right near the Friday close. However, immediate resistance for QQQ is less than obvious. Over-extension is not a problem in any of the major indices. With so much in the air, it is quite possible that a good part of at least today and Wednesday will be spent in “wait and see” mode. The Fedwatch tool tells us that confidence in a 0.25% rate hike by the Fed is even stronger than yesterday, up to 91% probability. The other 9% probability is for “no hike.” Beyond this week, futures still currently see little (32% on the largest probability and that for a quarter-point hike in June) chance of an additional increase this year and most are actually still betting on rate decreases sometime in the Fall. (That would be against what the Fed has repeatedly said, but that is what the Fed Fund Futures tell us.)

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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

After a small gap lower to get the session started (gapping down 0.23% in the SPY, down 0.33% in the DIA, and down just 0.07% in the QQQ at the open) the Bulls had another day in charge on Friday.  From that open, with the sole exception of a 30-minute pullback at 10:30, all three major indices saw a slow, steady rally all day long and went out on their highs.  This took the SPY and DIA to just above (still in a retest) the mid-April highs and left the QQQ a new high not seen since August 2022.  This action gave us large, white Marubozu (Shaved Head) candles in the SPY and DIA.  The QQQ had a small lower wick and not quite as large candle, but still a strong showing for the Bulls.

On the day, eight of the 10 sectors were in the green with Energy (+1.79%) by far out in front of the rest and Communications Services (-0.24%) lagging behind the other sectors.  At the same time, the SPY gained 0.85%, DIA gained 0.84%, and QQQ gained 0.69%. VXX fell 4% to 37.82 and T2122 climbed up to the top of the mid-range, just outside of the overbought territory at 78.77.  10-year bond yields fell to 3.433% while Oil (WTI) gain 2.50% to $76.63 per barrel.  So, slowing inflation and generally good earnings trumped everything else on the last trading day of April despite fears for the future of FRC (a regional bank).  This all happened on average volume in all three major indices.      

In economic news, March PCE Price Index (the Fed’s preferred measure of inflation) showed a slower-than-expected increase in prices at +0.1% month-on-month (compared to a forecast of +0.3% and the February reading of +0.3%).  On an annualized basis, that brought the reading down to 4.2% from a 5.0% reading just one month earlier and a 5.3% reading at the end of February.  While you could say the glass is half empty by noting inflation is still far above 2%, it is undeniable that there has been a strong and steady decline in this inflation metric since July 2022.  And it’s quite likely that the trend is what all but the Fed ultra-hawks will latch onto.  However, in other inflation-relation economic news, the Q1 Employment Cost Index came in above expectation at 1.2% (versus a forecast and previous value of 1.1%).  (This may be a preliminary reading, it was not marked and I am unsure.)  Later in the day, Chicago PMI came in above the anticipated level at 48.6 (compared to a forecast of 43.5 and the March reading of 43.8).  Finally, the Michigan Consumer Sentiment remained where it was expected at 63.5 (versus the forecast and prior value which were both also 63.5).

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In stock news, on Friday, MBGAF (Daimler) announced a $650 million joint venture with NEE and BLK to develop and operate a nationwide network of public charging stations and hydrogen fueling stations in the US.  Elsewhere, the US Dept. of Defense awarded a $7.8 billion contract modification to LMT for building 126 F-35 aircraft.  In the oil business, the big names are rolling in cash with XOM having $32.6 billion on hand and CVX having more than $15 billion of cash.  The two differ on what to do, as the CEO of XOM said Friday he is happy to hold a large surplus for the next downturn although he is not averse to a particularly good acquisition. On the other side, the CEO of CVX said he did not intend to sit on $15 billion in cash because it is economically inefficient.  Wall Street is pushing both to again increase buybacks and dividends rather than spend cash on acquisitions.

In stock legal and regulatory news, an Inspector General report released Friday said that FAA Engineers recommended the grounding of 737 MAX planes (BA’s best-selling jet at the time) very soon after the second major crash in March 2019.  However, FAA officials in Washington delayed the grounding despite analysis that told them there was a 25% chance of another crash within 60 days.  The grounding was eventually forced and lasted 20 months. On Saturday, the Wall Street Journal reported US regulators had asked big banks for their “best and final bid” to acquire FRC.  The report said that JPM and PNC have expressed interest and BAC and a few others are also considering making a bid.  Bids are due Sunday and immediate action is expected.  So, by the time this blog comes out, the FDIC seizure, receivership, and transfer of ownership may well have already happened.  Meanwhile, the US FDA voted to allow the restricted use of an experimental prostate cancer drug from AZN.  Elsewhere, ENR and WMT were sued by consumers and other retailers in three proposed class action lawsuits.  The suits allege the two companies conspired to raise disposable battery prices and keep WMT as the cheapest battery offering.  (If any retailer offered a lower price than WMT, the company would be cut off from ENR battery supply.)  Finally, on Friday, the state of CA approved new rules that will require all new medium and heavy-duty trucks in the state to be zero emission in 2036.  The rules also require existing fleets of semis, buses, garbage trucks, government fleets, etc. to be transitioned by 2039.

In banking news, as expected, late Sunday the FDIC seized FRC and then immediately sold the company to JPM.  JPM beat out bids from PNC and CFG (BAC and USB were invited but did not bid).  The process will cost the FDIC $13 billion (compared to $20 billion from the SIVB failure) and JPM has paid $10.6 billion.  In the purchase, JPM acquired $92 billion in deposits, is taking on $173 billion in loans, and about $30 billion in securities.  JPM also gains 84 branches (which will be open today). 

Overnight, Asian markets were mostly in the green.  Shanghai (+1.14%), Shenzhen (+1.09%), and Taiwan (+1.09%) led the gainers.  Meanwhile, in Europe, we see a similar picture taking shape at midday.  Six of the bourses are in the red while nine are in the green.  The DAX (+0.77%), CAC (+0.10%), and FTSE (+0.50%) are leading the region higher in early afternoon trade.  In the US, as of 7:30 am, Futures are pointing toward a flat start to the day.  The DIA implies a +0.01% open, the SPY is implying a -0.02% open, and the QQQ implies a -0.05% open at this hour.  Meanwhile, 10-year bond yields at up to 3.458% and Oil (WTI) is down 2% to $75.25/barrel in early trading.

The major economic news events scheduled for Monday are limited to April Mfg. PMI (9:45 am) and April ISM Manufacturing PMI (10 am). Major earnings reports scheduled for the day include AMG, CHKP, CAN, BEN, GPN, KBR, NCLH, ON, PK, and WEC before the open.  Then, after the close, AMKR, ANET, CAR, CF, CNO, CYH, CVI, FANG, RE, FLS, FMC, HOLX, INVH, KMT, LEG, MGM, NXPI, OGS, RYI, SBAC, SCI, SON, SFM, SYK, SGRY, TEX, RIG, VRTX, VIVI, and WWD report.   

In economic news later this week, on Tuesday we get March Factory Orders, March JOLTs Job Openings, and API Weekly Crude Oil Stocks.  Then Wednesday, the ADP Nonfarm Employment Change, Services PMI, April ISM Non-Mfg. PMI, EIA Crude Oil Inventories, FOMC Rate Decision, FOMC Statement, and Fed Chair Press Conference all happen.  Thursday, we get March Imports, March Exports, March Trade Balance, Weekly Initial Jobless Claims, Preliminary Q1 Nonfarm Productivity, Preliminary Q1 Unit Labor Cost, the Fed Balance Sheet, and Bank Reserves with the Federal Reserve.  Finally, on Friday, April Average Hourly Earnings, April Nonfarm Payrolls, April Private Nonfarm Payrolls, April Participation Rate, and the April Unemployment Rate.   

In terms of earnings reports later this week, on Tuesday, we hear from ADT, AER, AGCO, ARLP, ABC, AME, BP, BR, CX, CQP, LNG, CIGI, CEIX, CEQP, CMI, DORM, DD, ETN, ECL, EPD, ESAB, EXPD, FELE, IT, GVA, GPK, HWM, HSBC, IDXX, IHRT, ITW, INCY, NSIT, LDOS, MDC, MPC, MAR, TAP, MLPX, MD, PFE, PEG, QSR, SEE, SUN, SYY, TROW, TRI, TRN, UBER, ZBRA, ZBH, AMD, AMCR, AFG, ANDE, ASH, AIZ, AXTA, BXC, BFAM, CZR, CRC, CWH, CHK, CLW, CLX, EIX, ET, ENLC, EQX, EXPI, F, THG, HLF, JKHYLFUS, LUMN, MTW, MTCH, MCY, MUSA, OKE, PGR, PRU, RNR, SPG, SBUX, SMCI, UNM, VOYA, WELL, WU, and YUM.  Then Wednesday, ADNT, ALGT, AVNT, AVA, GOLD, BDC, BGCP, EAT, BIP, BLDR, BG, CDW, CHEF, CLH, SID, CVS, XRAY, DBD, DRVN, EMR, EL, EEFT, EXC, FTS, GRMN, GNRC, GFF, HBI, HZNP, INGR, JHG, KHC, LPX, MUR, NI, PSN, PSX, RXO, SMG, SBGI, SITE, SR, SPR, STLA, TKR, TT, TRMB, UTHR, VRSK, YUM, ALB, ALL, ATUS, AMED, ANSS, HOUS, APA, ATO, AVT, EQH, BHE, BKH, CPE, CENT, CENTA, CDAY, CHRD, CIVI, COKE, CTSH, CODI, CTVA, CCRN, CW, NVST, EQIX, ETSY, FG, FLT, FNF, ULCC, GIL, GL, HST, IR, IOSP, MRO, VAC, MMS, MELI, MET, MKSI, MOS, NFG, OPAD, PARR, PDCE, PSA, QGEN, QRVO, QCOM, QDEL, O, REZI, SIGI, SEDG, RUN, TWI, TTEC, TTMI, UGI, VSTO, WERN, WES, WMB, XPO, YELL, and Z report.  On Thursday, we hear from GOLF, ATI, AEP, BUD, APG, APTV, ARNC, ARW, BALL, BHC, BCE, BDX, BERY, BWA, BV, BRKR, CAH, CG, COMM, COP, CEG, DLX, DNB, EQNR, ES, RACE, FOCS, GTES, GPRE, DINO, HII, H, IBP, ICE, IRM, ITT, JLL, K, KTB, MMP, MLM, MDU, MRNA, MODV, NFE, NJR, NVO, DNOW, NRG, OPCH, OGN, PZZA, PARA, PH, PTON, PENN, PCG, PNW, PLTK, PPL, PRMW, PRVA, PWR, RCM, REGN, RCL, SABR, SBH, SRE, SHEL, FOUR, SWK, STWD, TRGP, TFX, TU, BLD, UPBD, VNT, W, WLK, WRK, XYL, ZTS, ATSG, LNT, AIG, COLD, AMN, AAPL, TEAM, BGS, BECN, BIO, SQ, BCC, BKNG, CNQ, CVNA, ED, CTRA, CWK, DASH, DKNG, DBX, ERJ, EOG, EXPE, FND, FTNT, GDDY, GT, LYV, LYFT, MTZ, MATX, MTD, MCHP, MNST, MSI, NCR, ZEUS, OTEX, OPEN, OEC, CNXN, PBA, POST, KWR, RRX, RGA, RKT, SEM, SHOP, TDS, TXRH, TSE, TPC, and USM.  Finally, on Friday, AES, AMC, AMCX, AEE, AXL, AMRX, BBU, BEPC, BEP, CLMT, CI, CNK, CNHI, D, ENB, EPAM, EVRG, FLR, FYBR, GLP, GTN, HUN, IEP, JCI, LSXMK, LSXMA, MGA, NMRK, OMI, PBF, PAA, PAGP, QRTEA, WBD and BAP report.   

So far this morning, WEC, GPN, KBR, CHKP, NCLH, PK, SOFI, L, and LKNCY all reported beats to both the revenue and earnings lines.  Meanwhile, AMG missed on revenue while beating on earnings.  Unfortunately, CAN missed on both the top and bottom lines.  It is worth noting that GPN raised its forward guidance.

With that background, it looks like the market is looking to open just on the red side of flat. All three major indices are above their 3ema, T-line (8ema), and 17ema…all of which are also trending higher. SPY and DIA are dealing with a resistance level right near the Friday close. However, immediate resistance for QQQ is less than obvious. Over-extension is not yet a problem in any of the major indices. Moreover, with the Fed decision on its way Wednesday and a ton of earnings this week, it is quite possible that a good part of the next five days will be in “wait and see” mode. The Fedwatch tool tells us that confidence in a 0.25% rate hike by the Fed remains high at an 86+% probability. The other 14% probability is for “no hike.” Beyond next week, futures currently see little (28% on the largest probability month) chance of an additional increase this year and most are actually still betting on rate decreases sometime in the Fall. (That would be against what the Fed has repeatedly said, but that is what the Fed Fund Futures tell us.)

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

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

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

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

Thursday belonged to the Bulls as we opened higher (gapping up 0.57% in the SPY, up 0.37% in the DIA, and up 1.27% in the QQQ).  After that, a long, steady rally kicked in, carrying all three major indices to new highs all day long.  This action gave us gap-up, large white-bodied candles in the DIA, SPY, and QQQ.  In fact, all three indices printed their largest gains in months as all three major indices also crossed back above their T-line (8ema).  In fact, if you were a little loose with the definitions, you could even say the SPY and DIA printed Morning Star signals while the QQQ printed a Bull Kicker signal.  However, again this happened on less-than-average volume.

On the day, all 10 sectors were in the green with Consumer Cyclical (+2.27%) leading the way higher and Energy (+0.28%) lagging behind the other sectors.  At the same time, the SPY gained 1.99%, DIA gained 1.58%, and QQQ gained 2.72%.  VXX fell 4.34% to 39.43 and T2122 popped out of the oversold territory and into the mid-range at 59.12.  10-year bond yields rose to 3.526 while Oil (WTI) gain 0.61% to $74.77 per barrel.  So, the cumulative effect of strong earnings, especially in the big tech names, overcame fear over regional banks and recession…at least for a day.      

In economic news, Preliminary Q1 GDP came in far short of expectations at +1.1% (compared to a forecast of +2.0% and a Q4 GDP of +2.6%).  In addition, the GDP Price Index (Preliminary) came in hotter than expected at +4.0% (versus a forecast of +3.7% and a Q4 value of +3.9%).  This tells us that the +1.1% GDP number is actually artificially high due to inflation.  If you are a “glass half empty” kind of person, you’d say that means we’re heading into stagflation…inflation is higher than expected and growth is smaller than expected.  However, personally, I choose to look at this as the Fed is going to see GDP growth slowing quickly and believe that they have done enough to ease inflation with the rest just being a matter of time.  At the same time, Weekly Initial Jobless Claims came in below expectations at 230k (compared to a forecast of 248k and the prior week’s 246k reading).  Then after the close, the Fed reported its Balance Sheet had shrunk slightly from $8.593 trillion to $8.563 trillion.  The Reserve Balances of Banks with the Fed also shrunk from $3.165 trillion to $3.132 trillion.

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In stock news, LYFT said Thursday that it will lay off “about” 1,072 employees (26% of its workforce) in the first step of new CEO Risher’s cost-cutting program.  At midday, JNJ announced it will indemnify its newly-formed consumer health unit Kenvue of all costs and liability related to talc litigation in the US and Canada.  (As reported here in previous days, JNJ intends to IPO Kenvue while retaining vast majority ownership.)  Elsewhere, HMC announced it is investing about $3 billion in a partnership formed with another Japanese company to produce batteries for electric vehicles and homes.  In an unrelated announcement, HMC announced $2.7 million in funding for environmental and conservation education initiatives in the US.  Meanwhile, Reuters reports that META has merged its advertising, business messaging, and commerce departments into one division as part of the broader cost-cutting program.  There was no word on any related staff reductions yet.  Executives at large drugmakers told Reuters Thursday that they are searching for acquisition and ramping up research spending as their future profit pipelines are drying up (current drugs will face patent sundown).  The companies cited are MRK, AZN, ABBV, LLY, and BMY.  Finally, the USDA reported that flooding in the upper Midwest (due to record winter snowfalls that are now melting) will wreak havoc on the Mississippi River.  This will halt barge traffic for weeks to come.  (60% of US grain exports and a similar percentage of US fertilizer shipments normally use that waterway in their supply chain.  This will cause shippers to find alternate, more costly transportation such as rail and trucking.

In stock legal and regulatory news, MA reported that it is under investigation by the US Dept. of Justice related to its practices on US debit cards and its competition against other payment networks for those accounts.  (V revealed a similar probe in January.)  Meanwhile, a US Appeals Court ruled in favor of META, rejecting the appeal of states Attorneys General who had sought to revive an antitrust case against the social media giant.  The court stated the reason for the ruling was that the states had waited too long to file suit.  Finally, when pushed on the matter of FRC, both the White House and Treasury Sec. Yellen told reporters that they, the FDIC, Fed, and state bank regulators in several states are keeping a close eye on the bank’s finances.  Even after repeated questions, both the White House Press Sec. and Treasury Sec. Yellen did not offer an opinion on whether FRC depositors of amounts greater than $250,000 should be covered in the event of a bank run.  However, they did say they have a track record of acting swiftly and decisively on such matters.

After the close, AMZN, HTHIY, MDLZ, X, WY, MHK, RSG, AJG, SKX, CC, GFL, RMD, ATR, SKYW, ALSN, DXCM, PINS, ACA, BZH, PEAK, MTX, EHC, ERIE, and AEM reported beats on both the revenue and earnings lines. Meanwhile, TMUS, INT, HIG, AMGN, EMN, LPLA, HUBG, CINF, DLR, SM, and SNAP missed on revenue while beating on earnings.  On the other side, INTC, DNZOY, COF, GILD, LHX, PFG, FE, ATVI, SSNC, COLM, SAM, SGEN, and SSB all beat on revenue while missing on earnings.  Unfortunately, OLN, CSL, and FLSR missed on both the top and bottom lines.  It is worth noting that MDLZ, SKX, ATR, and ALSN all raised their forward guidance.  However, INTC and HUBG both lowered their forward guidance.  Finally, it is worth noting that INTC reported the largest quarterly loss in company history.

Overnight, Asian markets leaned heavily to the green side.  Japan (+1.40%), Shanghai (+1.14%), Taiwan (+1.09%), and Shenzhen (+1.09%) led the region higher.  In Europe, the bourses are mostly in the red in late-morning trade.  The CAC (-0.62%), DAX (-0.19%), and FTSE (-0.22%) are leading the region modestly lower going into lunch.  In the US, as of 6:45 am, Futures are pointing toward a modestly red start to the day. The DIA implies a -0.29% open, the SPY is implying a -0.31% open, and the QQQ implies a -0.26% open at this hour.  At the same time, 10-year bond yields are back down to 3.481% as money seeks safe harbor and Oil (WTI) is up just less than four-tenths of a percent to $75.02/barrel in very early trading.

The major economic news events scheduled for Q1 Employment Cost Index, March PCE Price Index, and March Personal Spending (all at 8:30 am), Chicago PMI (9:45 am), and Michigan Consumer Sentiment (10 am).  Major earnings reports scheduled for the day include AON, ARCB, ARES, AVTR, BLMN, CCJ, GTLS, CHTR, CVX, CL, DAN, XOM, FMX, GNTX, IMO, JKS, LAZ, LYB, NYCB, NWL, NHYDY, NVT, POR, SAIA, and TRP before the open.  There are no reports scheduled for after the close.   

So far this morning, XOM, CVX, SONY, MBGAF (Daimler), KMTUY (Komatsu), ELUXY (Electrolux), CRI, BBVA, CL, TRP, BLMN, POR, and NVT all reported beats on the revenue and earnings lines.  Meanwhile, LYB, GTLS, and CCJ missed on revenue while beating on earnings.  On the other side, AON, NWL, ARES, CHTR, and APELY beat on revenue while missing on earnings.  Unfortunately, ARCB and LAZ missed on both the top and bottom lines.

With that background, it looks like the large caps are going back to test their T-lines (8ema) as support early this morning. If the Bulls are going to follow through on Thursday’s strong candles, they’ll need to work for it after AMZN reported a blowout quarter but then put a damper on the party by warning about cloud services growth. That combined with INTC getting slaughtered (worst quarterly loss ever) has the big tech names (long the market leaders) feeling a little blu (make that red) this morning. However, that is tempered a bit by yet another record quarterly profit from XOM. Over-extension is not a problem based on either the T-line or the T2122 indicator. Interestingly, the Fedwatch tool tells us that confidence in a 0.25% rate hike by the Fed next week has resurged since yesterday morning. We are now back up to an 85% probability of that, with the other 15% probability being “no hike.” Beyond next week, markets see very little (21%) chance of an additional increase this year and most are actually betting on rate decreases sometime in the Fall. (That would be against what the Fed has repeatedly said, but that is what the Fed Fund Futures tell us.) Right now, the Bulls have work to do (resistance to overcome) but the ball is in their court. Finally, don’t forget it’s Friday. Get your account ready for the weekend news cycle.

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

Markets diverged at the open on Wednesday, as SPY gapped up 0.15%, DIA opened 0.07% higher but QQQ gapped up 1.13% on the strong tech earnings from Tuesday night.  All three major indices then ground sideways for 30 minutes.  Then the whipsaw began.  All three made a 15-minute selloff followed by a rally for an hour and 40 minutes, reaching the highs of the day at about 12:10 and then a protracted selloff that took us to the lows of the day at 3:50 pm before bouncing the last 10 minutes.  This action gave us large, black-bodied candles again but this time with larger upper wicks and smaller lower wicks. And, once again, this happened on less-than-average volume in the SPY, DIA, and QQQ.

On the day, eight of the 10 sectors were in the red with Utilities (-2.06%) leading the way lower and Technology (+0.40%) holding up better than the other sectors.  This is very odd on a down day in the market.  At the same time, the SPY lost 0.42%, DIA lost 0.71%, and QQQ gained 0.58%.  VXX fell 2.5% to 41.22 and T2122 dropped further into the oversold territory at 7.96.  10-year bond yields rose to 3.441% (again, odd for a day when the large-cap indices fell) while Oil (WTI) plummeted another 3.62% to $74.30 per barrel.  So, fear over regional banks (based apparently exclusively on FRC Q1 deposit withdrawals) overrode generally strong earnings by major companies.  The market just seems skittish, perhaps waiting on the Fed’s favorite inflation index PCE Price Index on Friday (ahead of the FOMC meeting next week).     

In economic news, March Durable Goods orders increased far more than expected at +3.2% month-on-month (compared to a forecast of +0.7% and the February reading of -1.2%).  At the same time, the Preliminary March Goods Trade Balance showed a lower-than-expected deficit at -$84.60 billion (versus the forecast of -$89.00 billion and well better than the February value of -$91.99 billion).  In addition, the Preliminary March Retail Inventories grew more than expected at +0.4% (compared to a forecast of +0.1% and a February reading of -0.1%).  Later in the day, the EIA Weekly Crude Oil Inventories reported a much greater-than-expected drawdown of 5.054-million-barrels (versus a forecast for a 1.486-million-barrel drawdown and even more than the prior week’s 4.581-million-barrel inventory reduction).  As with the API report numbers on Tuesday evening, this was the fourth drawdown in the last five weeks.

SNAP Case Study | Actual Trade

In stock news, early Wednesday, the UK officially blocked the MSFT purchase of ATVI.  This caused ATVI to gap down 9% and end the day down 11.45%. Later, STLA offered 33,500 US employees (2,500 salaried and 31,000 hourly) voluntary buyout packages.  At the same time, a Jefferies analyst reported that LOW is revamping its stores in an attempt to focus on rural America.  The refresh is apparently aimed at imitating TSCO.  Elsewhere, Reuters reported that TSN told employees Wednesday it is planning to eliminate 10% of corporate jobs (about 600) and 15% of executive roles.  Just before the close, it was reported that US bank regulators are considering downgrading their assessment of FRC.  This would potentially limit FRC’s ability to borrow from the Fed.  This comes after the FDIC has given the bank weeks to reach private deals to shore up its finances but FRC has been unable to reach such deals.  Meanwhile, after the close, the CEO of BMY stepped down and it was announced he will be replaced with current COO Boerner on November 1.  (BMY reports Thursday.)

In stock legal and regulatory news, an NRLB Administrative Judge ruled Wednesday that TSLA supervisors had broken US Labor Law by ordering employees at a Florida TSLA Service Center not to discuss pay, working conditions, or other complaints with higher-level management.  A “cease and desist” order was immediately filed with any fines to be determined later in the process. Elsewhere, DIS filed a federal lawsuit against Florida Governor DeSantis over his effort to exert control over DIS theme parks in that state. (DeSantis had his hand-picked board vote to throw out a long-term legal contract DIS signed with the prior board, outsmarting the Governor’s effort to take control of the board and punish DIS for speaking out against his cultural agenda.)  Later, UBER won when a panel of US Circuit Court of Appeals judges ruled that UBER drivers are not exempt from a law requiring them to take legal disputes to private arbitration rather than join class-action lawsuits.  (This means UBER drivers around the country cannot join a class-action suit brought charging that they were misclassified as contractors and are due overtime pay and work-related expense reimbursement.)

After the close, META, PXD, AFL, WM, PPC, ORLY, MKL, EBAY, KLAC, LSTR, RHI, NOW, WCN, CACI, CLS, NOV, EW, MTH, TNET, MEOH, AB, MAT, CCS, ALGN, NLY, TROX, PLXS, FIX, TER, IEX, ROKU, ENSG, CMPR, NLY, MYRG, ACHC, AVB, ROL, HELE, EQT, TDOC, SUI, BMRN, WSC, PTC, GGG, SLM, MAA, TYL, CHDN, COLB, FBIN, KALU, MORN, and NEU all reported beats on both the revenue and earnings lines.  Meanwhile, MOH, ACGL, ICLR, AXS, SAVE, STC, ESI, and SNBR all missed on revenue while beating on earnings.  On the other side, RJF, URI, AR, CHE, OII, and AWK all beat on revenue while missing on earnings.  Unfortunately, CHRW, TA, CP, and ASGN all missed on both the top and bottom lines.  It is worth noting that CACI, ALGN, and TER raised their forward guidance.  However, IEX lowered its guidance.

Overnight, Asian markets were mixed.  Thailand (-0.82%), Singapore (-0.36%), and Australia (-0.32%) paced the losses while Shanghai (+0.67%), India (+0.57%), and Hong Kong (+0.42%) led the gainers.  Meanwhile, in Europe, we see a similar picture taking shape at midday.  The CAC (+0.30%), DAX (+0.09%), and FTSE (-0.02%) lead the region on volume and market cap while the smaller exchanges have made larger moves.  In the US, as of 7:30 am, Futures are pointing toward a gap higher to start the day.  The DIA implies a +0.47% open, the SPY is implying a +0.61% open, and the QQQ implies a +0.93% open at this hour.  At the same time, 10-year bond yields are up slightly to 3.454% and Oil (WTI) is flat at $74.25/barrel in early trading.

The major economic news events scheduled for Thursday include Preliminary Q1 GDP and Weekly Jobless Claims (both at 8:30 am), and March Pending Home Sales (10 am).  The major earnings reports scheduled for the day include AOS, ABBV, MO, AAL, AIT, ARCH, AMBP, AZN, BAX, BFH, BMY, BC, CRS, CARR, CAT, CBRE, CNP, CHD, CMS, CNX, CMCSA, CROX, CRF, DQ, DPZ, DTE, LLY, EME, FIS, FAF, FCFS, FCN, GOL, HOG, HAS, HP, HSY, HTZ, HGV, HON, IP, IPG, IQV, KDP, KEX, LEA, LII, LECO, LIN, LKQ, HZO, MA, MRK, NEM, NOC, ORI, OSK, PATK, PTEN, BTU, PNR, DGX, RS, ROK, ROP, SPGI, SNY, SNDR, SIRI, SAH, SO, LUV, SAVE, SRCL, STM, FTI, TXT, TTE, TSCO, TPH, VLO, VLY, VC, GWW, WST, WEX, WTW, WIT, and XEL before the open.  Then, after the close, ATVI, AEM, ALSN, AMZN, AMGN, ATR, ACA, AJG, BZH, COF, CSL, SS, SINF, COLM, DXCM, DLR, EMN, EHC, ERIE, FLSR, FE, GFL, GILD, HIG, PEAK, HUBG, INTC, LHX, LPLA, MTX, MHK, MDLZ, OLN, PINS, PFG, RSG, RMD, SGEN, SKX, SKYW, SM, SNAP, AWN, SSNC, TMUS, X, WY, and INT report.   

In economic news later this week, on Friday, Q1 Employment Cost Index, March PCE Price Index, March Personal Spending, Chicago PMI, and Michigan Consumer Sentiment.

In terms of earnings reports later this week, on Friday, AON, ARCB, ARES, AVTR, BLMN, CCJ, GTLS, CHTR, CVX, CL, DAN, XOM, FMX, GNTX, IMO, JKS, LAZ, LYB, NYCB, NWL, NHYDY, NVT, POR, SAIA, and TRP report.

So far this morning, CAT, VLO, MRK, HON, OSTK, HSY, KEX, NOC, AZN, CMCSA, KDP, TAL, OSK, PTEN, SO, AOS, LIN, STM, TXT, IP, CNP, ROP, LII, PNR, CHD, DGX, FCFSCNX, RS, ROK, XEL, CBRE, BC, AIT, TPH, LEA, WEX, LKQ, BFH, CBZ, FIS, WST, TTE, WTW, SRCL, CROX, HOG, SPGI, and BAX all reported beats on both the revenue and earnings lines.  Meanwhile, AAL, BMY, SNY, CMS, FAF, ASX, BCS, NEM, DTE, and MBLY all missed on revenue while beating on earnings.  On the other side, LLY, HAS, IQV, ARCH, VC, FTI, and VLY all beat on revenue while missing on earnings.  Unfortunately, LUV, DQ, TSCO, SAH, and HZO missed on both the top and bottom lines.  It is worth noting that LLY HSY, BAX, ROP, PNR, and WST raised their forward guidance.  However, HZO lowered its forward guidance.

With that background, it looks like the Bulls are going to make a run to start the day. The QQQ seems set to gap up to retest its T-line (8ema) and the DIA is not far behind at this point in the premarket. Over-extension is not a problem based on T-line but we are well oversold according to the T2122 indicator. Interestingly, the Fedwatch tool tells us that confidence in a 0.25% rate hike by the Fed next week continues to fade a bit. We are now down to a 76% probability of that, with the other 24% probability being “no hike.” Right now, the chart tells us the bias has flipped bearish after uptrends were broken. However, we aren’t far from the consolidation range, and with good earnings to give them energy, the bulls are not likely to give in easily.

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

On Tuesday, the bears had their day.  The SPY and QQQ were in sync, as both those indices gapped lower at the open (down 0.49% in the SPY and down 0.51% in the QQQ).  At that point, both began selling off in a slow, steady fashion for the rest of the day.  Meanwhile, the DIA held up better, gapping down 0.11% at the open.  It then ground sound sideways until 11:20 am.  From that point, DIA joined the other major indices by selling off in a slow, steady way for the remainder of the day.  All three major indices closed very near their lows of the day.  This action gave us three large, black-bodied candles in the SPY, DIA, and QQQ.  All the major indices dropped out of their recent consolidation ranges and at least the SPY and QQQ have broken their uptrends dating back to mid-March. 

On the day, all 10 sectors were in the red with Technology (-2.48%) leading the charge lower (but it was a broad-based selloff) and Utilities (-0.34%) holding up better than the other sectors.  At the same time, the SPY lost 1.57%, DIA lost 1.01%, and QQQ lost 1.89%.  VXX spiked higher by 8.46% to 42.29 and T2122 dropped all the way down well into the oversold territory at 11.72.  10-year bond yields plummeted to 3.396% while Oil (WTI) fell 2.12% to $77.09 per barrel.  So, despite good earnings reports from major companies, markets seemed to focus on the FRC 40% deposit outflow in Q1 that had been reported Monday night as well as that company exploring asset sales to reduce the bank’s liabilities.  As a result, the bears had their way all day.  However, this move happened on less-than-average volume in all three major indices.     

In economic news, March Building Permits came in much better than the Preliminary number reported last week (better than expected) but still down significantly from the blowout number in February.  The reading was 1.430 million (compares to a forecast of 1.413 million but well below the February value of 1.550 million).  This amounted to a 7.7% decrease compared to February, that was significantly better than the preliminary number which was down 8.8%.  Later Conference Board Consumer Confidence came in at 101.3 (compared to a forecast of 104.0 and the previous reading of 104.0).  This was the lowest reading since July 2022.  Meanwhile, March New Home Sales blew away expectations at 683k (versus a forecast of 630k and a February reading of 623k).  This was a one-year high and amounted to a 9.6% month-on-month increase when only a 1.1% increase was anticipated.  Finally, after the close, the API Weekly Crude Stock Report showed a much larger than expected drawdown of 6.083 million barrels (compared to a forecast of a 1.667-million-barrel drawdown and following last week’s 2.675-million-barrel draw of crude stocks).  This was the second consecutive drawdown as well as the fourth in five weeks.

SNAP Case Study | Actual Trade

In stock news, MBGAF (Mercedes) launched what it said will be its last new internal combustion engine car.  The next generation E-class will be available in early 2024.  In other auto news, GM announced it will end the production of its first-generation electric vehicle Chevy Bolt later in 2023 as the company shifts to focus more on zero-emission trucks and SUVs.  In addition, LCID announced it has begun “public road testing” of its next model, a large SUV called Gravity.  The Gravity is not scheduled for release until 2024.  Meanwhile, the Wall Street journal reported that GPS is eliminating hundreds of jobs (reportedly more than the 500 eliminated in September).  Elsewhere, Reuters reported that BIIB said Tuesday that it will “pause or discontinue” four studies focused on potentially lucrative drugs as part of its cost-cutting plan.  For most businesses, cost-cutting is great.  However, in biotech, company value is usually tied closely to its drug pipeline and eliminating studies on new potential drugs thins the potential revenue streams. 

In stock legal and regulatory news, BTI agreed to pay more than $635 million to the US government after its subsidiary pleaded guilty to conspiring to violate sanctions against selling products to North Korea from 2007-2017.  Elsewhere, the US Bureau of Ocean Energy Mgmt. said it has finalized the designation of 10 million acres in the Gulf of Maine for potential offshore wind development.  A 45-day public comment has begun and approval could come later this year.  Companies such as AGR and RWEOY have expressed interest in developing projects in the designated area.  Meanwhile, the EU has singled out 19 tech giants as companies subject to the region’s new online content rules.  This includes the usual suspects (GOOGL, MSFT, AAPL, META, AMZN, SNAP, PINS, BABA, etc.).  Later, Reuters reported that ALB and SQM have begun talks with the government of Chile after the state announced they are nationalizing the lithium mining industry in their country.  (ALB and SQM are the world’s largest lithium miners.)  Theoretically, ALB has a contract to operate in Chile until 2043 but the SQM contract ends this year.  Finally, The Governor of CO signed the nation’s first “right to repair” law into existence Tuesday.  The law requires farm machinery makers (such as DE and CNHI) to provide diagnostic tools, manuals, and parts to farmers who want to repair the machinery they own (as opposed to only being allowed to use exorbitant manufacturer repair services).

After the close, GOOGL, GOOG, MSFT, CB, V, UHS, CMG, OI, ILMN, JNPR, BYD, BXP, NEX, MTDR, CSGP, HA, JBT, LRN, UMBF, and PACW all reported beats on both the revenue and earnings lines.  Meanwhile, TXN, TX, WIRE, ENPH, and ENVA all missed on revenue while beating on the earnings line.  On the other side, AGR, RUSHA, and EQR beat on revenue while missing on earnings.  Unfortunately, TFII and WFG missed on both the top and bottom lines. It is worth noting that V, OI, CSGP, and LRN all raised their forward guidance.  However, NEX and ENPH lowered their forward guidance.  Major surprises included TX (95% upside surprise on earnings), WFG (185% downside surprise on earnings), OI (55% upside earnings surprise), ILMN (300% upside earnings surprise) , WIRE (20% upside earnings surprise), JBT (31% upside earnings surprise), LRN (20% upside earnings surprise), UMBF (46% upside revenue surprise), and PACW (74% upside revenue surprise).

Overnight, Asian markets were mixed on modest moves in both directions.  Malaysia (-0.77%), New Zealand (-0.76%), and Japan (-0.71%) paced the losses.  Meanwhile, Hong Kong (+0.71%), Shenzhen (+0.33%), and India (+0.25%) led the gains.  In Europe, the bourses are mostly in the red on divergent trading at midday.  The CAC (-1.06%), DAX (-0.75%), and FTSE (-0.42%) are leading the region lower in early afternoon trade.  As of 7:30 am, US Futures are pointing to a mixed and divergent start to the day.  The DIA implies a -0.09% open, the SPY is implying a +0.04% open, and the QQQ implies a +0.79% open at this hour.  At the same time, 10-year bond yields are close to flat at 3.396% and Oil (WTI) is off a third of a percent to $76.82/barrel in early trading.

The major economic news events scheduled for Wednesday include March Durable Goods, March Goods Trade Balance, and Preliminary March Retail Inventories (all at 8:30 am), and EIA Crude Oil Inventories (10:30 am) are reported.  The major earnings reports scheduled for the day include ALLE, AMT, APH, ADP, AVY, BA, BOKF, BSX, CVE, GIB, CME, CSTM, DOV, ETR, EVR, FSV, FTV, GD, GPI, HES, HLT, HUM, NSP, MHO, MAS, NSC, ODFL, OTIS, OC, PAG, BPOP, PRG, RCI, RES, R, SLGN, TMHC, TEL, TECK, TDY, TMO, TNL, UMC, VRT, WNC, WAB, and WFRD before the open.  Then, after the close, ACHC, AFL, ALGN, AB, AWK, NLY, AR, ACGL, ASGN, AVB, AXS, BMRN, CHRW, CACI, CP, CLS, CCS, CHDN, CMPR, FIX, EBAY, EW, ESI, EQT, FBIN, GGG, HELE, ICLR, IEX, KLAC, LSTR, MKL, MAT, MTH, META, MEOH, MAA, MOH, MYRG, NOV, ORLY, OII, PPC, PXD, PLXS, PTC, RJF, RHI, ROKU, ROL, NOW, SNBR, STC, SUI, TDOC, TER, TNET, TROX, TYL, URI, WCN, WSC, and WM report.  

In economic news later this week, on Thursday, we get Preliminary Q1 GDP, Weekly Jobless Claims, and March Pending Home Sales.  Finally, on Friday, Q1 Employment Cost Index, March PCE Price Index, March Personal Spending, Chicago PMI, and Michigan Consumer Sentiment.

In terms of earnings reports later this week, on Thursday, AOS, ABBV, MO, AAL, AIT, ARCH, AMBP, AZN, BAX, BFH, BMY, BC, CRS, CARR, CAT, CBRE, CNP, CHD, CMS, CNX, CMCSA, CROX, CRF, DQ, DPZ, DTE, LLY, EME, FIS, FAF, FCFS, FCN, GOL, HOG, HAS, HP, HSY, HTZ, HGV, HON, IP, IPG, IQV, KDP, KEX, LEA, LII, LECO, LIN, LKQ, HZO, MA, MRK, NEM, NOC, ORI, OSK, PATK, PTEN, BTU, PNR, DGX, RS, ROK, ROP, SPGI, SNY, SNDR, SIRI, SAH, SO, LUV, SAVE, SRCL, STM, FTI, TXT, TTE, TSCO, TPH, VLO, VLY, VC, GWW, WST, WEX, WTW, WIT, XEL, ATVI, AEM, ALSN, AMZN, AMGN, ATR, ACA, AJG, BZH, COF, CSL, SS, SINF, COLM, DXCM, DLR, EMN, EHC, ERIE, FLSR, FE, GFL, GILD, HIG, PEAK, HUBG, INTC, LHX, LPLA, MTX, MHK, MDLZ, OLN, PINS, PFG, RSG, RMD, SGEN, SKX, SKYW, SM, SNAP, AWN, SSNC, TMUS, X, WY, and INT report.  Finally, on Friday, AON, ARCB, ARES, AVTR, BLMN, CCJ, GTLS, CHTR, CVX, CL, DAN, XOM, FMX, GNTX, IMO, JKS, LAZ, LYB, NYCB, NWL, NHYDY, NVT, POR, SAIA, and TRP report.

So far this morning, HUM, GSK, TMO, GD, PAG, ADP, TEL, GPI, OTIS, BSX, ASAZY, AMT, GIB, OC, UMC, MAS, DOV, WAB, HLT, TMHC, CME, TDY, VRT, NAVI, TNL, ALLE, PRG, SF, and TKGSY all beat on both the revenue and earnings lines.  At the same time, BA, ETR, CSTM, and WFRD all beat on revenue but missed on earnings.  On the other side, RCI, AVY, TLSNY, DASTY, SLGN, EVR, and WNC all missed on revenue while beating on earnings.  Unfortunately, CVE, TECK, ODFL, and RES all missed on both the top and bottom lines.  It is worth noting that AMT, ALLE, WNC, and HLT all raised their forward guidance.  Meanwhile, AVY is the only one to lower their forward guidance.  Major surprises included a 30% downside surprise on BA earnings, a 26% upside surprise on OC earnings, a 75% downside surprise on TLSNY revenue, a 38% upside surprise on UMC earnings, a 34% upside surprise on MAS earnings, a 35% upside surprise on TMHC earnings, a 41% upside surprise on VRT earnings, a massive 407% upside surprise on NAVI revenue (and a 21% upside earnings surprise), a 24% upside earnings surprise by EVR, a 32% upside surprise on PRG earnings, and a 131% upside surprise on WNC earnings (so much for regional bank issues).

With that background, it looks like the markets are trying to start the day inside of yesterday’s ugly candles. All three major indices are below their T-line and the T-line is descending. Over-extension is not a terrible problem based on T-line (although QQQ was a little stretched last night, the premarket candle is helping a lot) but we are oversold according to the T2122 indicator. Interestingly, the Fedwatch tool tells us that confidence in a 0.25% rate hike by the Fed next week is fading a bit. We are now down to an 80% probability of that, with the other 20% probability being “no hike.” Right now, the chart tells us the bias has flipped bearish after uptrends were broken yesterday, and since we have formed that lower low. However, we aren’t far from the consolidation range, and with good earnings to give them energy, the bulls are not likely to give in easily.

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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 large-cap indices both opened flat on Monday and then spent the rest of the day wandering back and forth within a one-half of one percent range.  Both the SPY and DIA closed toward the top end of their range, crossing back above their T-line (8ema).  Meanwhile, QQQ also opened flat and meandered sideways for an hour.  However, at 10:30 am, QQQ saw a selloff that lasted until noon (at which point it was down 0.9% on the day).  Then the bulls stepped in to drive a long, slow rally that lasted the rest of the day.  This action gave us three indecisive candles with white, small candles in SPY and DIA as well as a black-bodied Spinning Top (which failed a retest of the T-line) in the QQQ.  This happened on far lower-than-average volume in all three major indices.

On the day, six of the sectors were in the green with Energy (+1.59%) by far the strongest and Communications Services (-0.69%) the weakest sector.  At the same time, the SPY gained 0.10%, DIA gained 0.19%, and QQQ lost 0.21%.  VXX fell by a half of a percent to 38.99 and T2122 remained flat in the mid-range at 62.42. 10-year bond yields fell to 3.496% while Oil (WTI) rose to $78.69 per barrel.  So, Monday was another clearly indecisive day where traders seemed unsure whether to give more credence to better-than-feared earnings or signs of economic slowdown.  And, while the probability of a quarter-point rate hike next week is 91%, that is not a certainty.  As a result, markets waffle sideways.     

In stock news, FOX stock took a massive hit midday before recovering by 2.25% over the afternoon.  This came after FOX’s midday firing of their number one-rated host, Tucker Carlson.  Elsewhere, LCID replaced three directors, effective immediately, at its shareholder meeting amid a 46% drop in share price since the end of January.  After the close, FRC reported earnings.  However, the larger story is that the regional banks said deposits fell by 35.5% during Q1.  The bank said it also plans to reduce its workforce by 20%-25% during Q2.  Meanwhile, JNJ priced its consumer unit spinoff IPO (KVUE) at $20-$23/share.  JNJ will continue to own 92% of KVUE after the IPO.  After the close, TSN closed a Nebraska pork processing plant after a weekend fire kept the facility closed.  The company is shipping hogs to other facilities in order to avoid supply disruptions.  Also after the close, AMZN delivery drivers in southern California joined the Teamster Union Monday.  Finally, Reuters reports that GM and Samsung will announce Tuesday that they plan to build a new joint-venture battery manufacturing plant in the US.  This will be the fourth battery plant GM has begun in the last year. 

SNAP Case Study | Actual Trade

In stock legal and regulatory news, cancer victims had their chance to urge a US judge to dismiss JNJ’s second attempt to be granted bankruptcy for a subsidiary that was created to avoid legal liability from its talc products (which have been found to contain asbestos).  Lawyers for the 38,000 lawsuits against JNJ argued that the company has stripped away much of the subsidiary’s funding since the first bankruptcy attempt was denied and the move is a blatant move to force plaintiffs to accept the company’s offered settlement.  Elsewhere, a lawyer for the San Francisco’s public school system began trial against MO claiming the company helped create a crisis of vaping addiction among teenagers.  MO faces thousands of similar cases and the other primary target of the suits (Juul, which MO was a major investor in) settled for $2.7 billion rather than continue to trial.  Later, a US Appeals Court ruled AAPL cannot ban links to outside payment platforms, upholding a ruling in an antitrust case brought by Fortnite game maker Epic Games.  However, the appeals court ruled in AAPL’s favor on nine other matters, saying AAPL’s App Store rules do not violate antitrust laws.  After the close, the European Commission put forward a new draft of its patent rules (draft is to be released Wednesday).  The new rules will make it easier for patent holders of mobile technology technologies (AAPL, MSFT, MSI, NOK, SSNLF) to sue for patent infringement.  (The draft needs to be approved by both the EC and EU countries before they become law.)  Meanwhile, HRB and SQ agreed to dismiss with prejudice (it can’t be refiled) HRB’s lawsuit against SQ over use of the name “Block.”

In miscellaneous news, Canada announced new rules Monday that will force airlines with flights departing or landing in Canada to compensate all passengers for flight delays in essentially all cases other than snowstorms.  The burden of proof that there was no way to avoid the delay is now shifted to the airlines, rather than the passenger.  Democratic Senators introduced a bill Monday to prohibit members of Congress (and their immediate families) from owning individual stocks.  The bill is likely dead on arrival since a very similar bill was introduced and defeated in 2022 and a Republican Senator introduced a similar bill named after former House Speaker Pelosi and aimed at purely political ends back in January.

After the close, CLF, WHR, AMP, CNI, FRC, BRO, CDNS, ARE, SSD, CADE, and RRC all beat on both the revenue and earnings lines.  Meanwhile, CCK, CHX, and AAN missed on the revenue line while beating on earnings.  On the opposite side, NBR beat on revenue while missing on earnings.  Unfortunately, PKG missed on both the top and bottom lines.  It is worth noting that CNI raised its forward guidance while PKG and CHX both lowered their guidance. 

Overnight, Asian markets were mostly in the red.  Hong Kong (-1.71%), Taiwan (-1.64%), and Shenzhen (-1.48%) led the region lower.  Meanwhile, New Zealand (+0.83%) was by far the biggest gainer in Asia.  In Europe, we nearly have red across the board at midday.  Only Switzerland (+0.47%) is in the green while the CAC (-0.64%), DAX (-0.16%), and FTSE (-0.31%) are leading the charge lower in early afternoon trade.  In the US, as of 7:30 am, Futures are also pointing toward a lower start to the day.  The DIA implies a -0.29% open, the SPY is implying a -0.49% open, and the QQQ implies a -0.42% open at this hour.  At the same time, 10-year bond yields are falling again at 3.441% and Oil (WTI) is down 0.71% to $78.20/barrel in early trading.

The major economic news events scheduled for Tuesday include Building Permits (9:30 am…which is an hour later than normal), Conf. Board Consumer Confidence and March New Home Sales (both at 10 am), and API Weekly Crude Oil Stocks (4:30 pm).  The major earnings reports scheduled for the day include MMM, ABB, ALFVY, ADM, ARCC, ABG, BIIB, CNC, GLW, DHR, DOW, FISV, GEHC, GE, GM, GEO, HAL, HUBB, IVZ, JBLU, KMB, LH, LTH, MCD, MCO, MSCI, NEE, NTRS, NVS, OMF, PCAR, PEP, PII, PHM, RTX, ST, SHW, SPOT, SCL, THC, TRU, UBS, UPS, VZ, and XRX before the open.  Then, after the close, GOOGL, AGR, BXP, BYD, CMG, CB, CSGP, WIRE, ENVA, ENPH, EQR, GOOG, HA, ILMN, JBT, JNPR, MTDR, MSFT, NEX, OI, RUSHA, TX, TXN, TFII, UHS, V, and WFG report.  

In economic news later this week, on Wednesday, March Durable Goods, March Goods Trade Balance, Preliminary March Retail Inventories, and EIA Crude Oil Inventories are reported.  On Thursday, we get Preliminary Q1 GDP, Weekly Jobless Claims, and March Pending Home Sales.  Finally, on Friday, Q1 Employment Cost Index, March PCE Price Index, March Personal Spending, Chicago PMI, and Michigan Consumer Sentiment.

In terms of earnings reports later this week, on Wednesday, we hear from ALLE, AMT, APH, ADP, AVY, BA, BOKF, BSX, CVE, GIB, CME, CSTM, DOV, ETR, EVR, FSV, FTV, GD, GPI, HES, HLT, HUM, NSP, MHO, MAS, NSC, ODFL, OTIS, OC, PAG, BPOP, PRG, RCI, RES, R, SLGN, TMHC, TEL, TECK, TDY, TMO, TNL, UMC, VRT, WNC, WAB, WFRD, ACHC, AFL, ALGN, AB, AWK, NLY, AR, ACGL, ASGN, AVB, AXS, BMRN, CHRW, CACI, CP, CLS, CCS, CHDN, CMPR, FIX, EBAY, EW, ESI, EQT, FBIN, GGG, HELE, ICLR, IEX, KLAC, LSTR, MKL, MAT, MTH, META, MEOH, MAA, MOH, MYRG, NOV, ORLY, OII, PPC, PXD, PLXS, PTC, RJF, RHI, ROKU, ROL, NOW, SNBR, STC, SUI, TDOC, TER, TNET, TROX, TYL, URI, WCN, WSC, and WM.  On Thursday, AOS, ABBV, MO, AAL, AIT, ARCH, AMBP, AZN, BAX, BFH, BMY, BC, CRS, CARR, CAT, CBRE, CNP, CHD, CMS, CNX, CMCSA, CROX, CRF, DQ, DPZ, DTE, LLY, EME, FIS, FAF, FCFS, FCN, GOL, HOG, HAS, HP, HSY, HTZ, HGV, HON, IP, IPG, IQV, KDP, KEX, LEA, LII, LECO, LIN, LKQ, HZO, MA, MRK, NEM, NOC, ORI, OSK, PATK, PTEN, BTU, PNR, DGX, RS, ROK, ROP, SPGI, SNY, SNDR, SIRI, SAH, SO, LUV, SAVE, SRCL, STM, FTI, TXT, TTE, TSCO, TPH, VLO, VLY, VC, GWW, WST, WEX, WTW, WIT, XEL, ATVI, AEM, ALSN, AMZN, AMGN, ATR, ACA, AJG, BZH, COF, CSL, SS, SINF, COLM, DXCM, DLR, EMN, EHC, ERIE, FLSR, FE, GFL, GILD, HIG, PEAK, HUBG, INTC, LHX, LPLA, MTX, MHK, MDLZ, OLN, PINS, PFG, RSG, RMD, SGEN, SKX, SKYW, SM, SNAP, AWN, SSNC, TMUS, X, WY, and INT report.  Finally, on Friday, AON, ARCB, ARES, AVTR, BLMN, CCJ, GTLS, CHTR, CVX, CL, DAN, XOM, FMX, GNTX, IMO, JKS, LAZ, LYB, NYCB, NWL, NHYDY, NVT, POR, SAIA, and TRP report.

So far this morning, GM, ADM, GE, PEP, RTX, DOW, NVS, MMM, DHR, ABB, MCD, SHW, THC, HAL, FISV, GLW, PHM BIIB, PII, JBLU, IVZ, MCO, ST, TRU, and GEHC have all reported beats on both the revenue and earrings lines.  Meanwhile, VZ, UPS, ABG, XRX, and MSCI all reported misses on revenue while beating on earnings.  On the other side, CNC, UBS, LH, OMF, SCL, GEO, and BKU all beat on revenue while missing on earnings.  Unfortunately, SPOT and ARCC missed on both the top and bottom lines.  It is worth noting that GM has raised its forward guidance and, so far, there have been no lowered guidance reported.  Notable surprises include GE with an 108%, GM with a 40%, DOW with a 57%, XRX with a 133%, MCO with a 29%, and PHM with a 32% upside surprise on earnings.  Meanwhile, SPOT had a 26% downside surprise on earnings.  On revenue, UBS had a 41%, IVZ had a 31%, OMF a 21%, BKU a 74% upside surprise.  There were no notable downside revenue surprises.

With that background, it looks like the uncertain consolidation wants to continue in the DIA with yet another test of the flat T-line (8ema) likely in the cards today. However, SPY and QQQ look a little more bearish as they seem to be preparing to retest the lows of the last week this morning. However, it is not a huge bear move (at least yet) and still can’t be classified as anything more than a modest pullback. Over-extension is obviously not a problem in terms of the T-line or the T2122 indicator. Meanwhile, even though the Fedwatch tool tells us that there is an 89% probability of a quarter-point hike by the Fed next week, the market just isn’t sure and seems leery. Right now, the chart tells us to maintain a long bias, but expect consolidation to continue as the 3ema has crossed below the 8ema in all three major indices. Also, keep a sharp eye out for trend breaks.

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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 an essentially flat open as the SPY gapped 0.10% higher, the DIA gapped 0.09% higher, and the QQQ gapped 0.13% lower.  From that point, both large-cap indices chopped sideways in a fairly tight range, ending the day inside the tiny opening gap.  Meanwhile, the QQQ did something similar but with stronger magnitude swings than the large-caps and ending up on the bullish side of the opening gap.  This action gave us indecisive Doji candles in the SPY and DIA (both of which retested their T-lines all day and ended right on that average) and a white-bodied Spinning Top candle in the QQQ that also retested its T-line (8ema) but failed to break above.  The moving averages are still stacked bullish (3ema > 8ema > 17ema > 50sma > 200sma) in all three major indices with the 3ema, 8ema, and 17ema all rising in the large-cap indices while the 3ema is falling slightly in the QQQ.

On the day, the sectors were split 50/50 with Healthcare (+1.20%) by far the strongest and Basic Materials (-1.52%) by far the weakest sectors.  At the same time, the SPY gained 0.08%, DIA gained 0.05%, and QQQ gained 0.10%.  VXX fell almost 2% to 39.20 and T2122 remained flat in the mid-range at 65.10. 10-year bond yields rose a bit to close at 3.568% while Oil (WTI) rose three-quarters of a percent to $77.95 per barrel.  So, Friday was clearly an indecisive day where trader seemed to ponder better than feared earnings, a seemingly resolute and unfazed Fed, and signs of economic slowdown or maybe even mild recession ahead.  This all happened on average volume in the QQQ with lower-than-average volume in the two large-cap indices.    

In economic news, Preliminary Manufacturing PMI came in slightly above expectation Friday at 50.4 (compared to a forecast of 49.0 and a March reading of 49.2).  (This puts this indicator right at flat since anything above 50.0 indicates growth and anything below this level indicates contraction.)  At the same time, Preliminary Service PMI also came in slightly above the anticipated value at 53.7 (versus a forecast of 51.5 and a March reading of 52.6).  Again, this indicates just a bit of growth in the services sector.  Meanwhile, the S&P Global Composite PMI (also preliminary) was reported at 53.5 (slightly better than the forecast of 52.8 and the March reading of 52.3). These all show very modest economic growth in the US and the world (if the data can be believed). Finally, the Fed’s “Inflation Expectations Index” (a new very broad-based tool the Fed developed in 2020) fell to its lowest level in almost two years as of the end of last quarter.  The IEI stood at 2.22% down from 2.31% at the end of December and below all readings going back to June 30, 2021, when it was at 2.18%. 

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In stock news, Reuters reported Friday that LLY will release results of an Alzheimer’s drug trial before the end of June.  The company told Reuters it expects Medicare to reverse course and fully cover the currently experimental drug (implying the trials went very well).  Rival drugs from BIIB and ESAIY are also scheduled to release studies in the next few months.  In other healthcare news, SWAV shares soared on Friday amid rumors that BSX is looking to takeover the medical device maker.  Elsewhere, China’s aviation regulator published a report telling its domestic airlines they can now take delivery of BA 737 MAX jets, subject to newly prescribed training.  This could be very positive for BA, which has 130 737 MAX jets finished and awaiting delivery to Chinese airlines.  Meanwhile, for the second time in a week, WMT sold off another of its online fashion brands to a private retailer.  This is part of a WMT push to improve margins after having bought the brand (Eloquii) in an attempt to compete with AMZN online.  In South America, Chile (the world’s second-largest producer) announced that it will be nationalizing its lithium industry.  This move will hit ALB and SQM hard and may have ripple impacts on TSLA (major customer of both SQM and ALB).  Finally, in it pays to be the boss news, GOOGL reported late Friday night that CEO Pinchai received $226 million in compensation (including $218 million in stock grants) in 2022 even as the company eliminate 12,000 jobs in January. 

In stock legal and regulatory news, the Wall Street Journal reported Friday that the Fed may end the exemption that allowed midsized (regional) banks such as SIVB and SBNY to hide losses on securities they hold.  This would reverse the Trump-era loosening of Fed banking regulation. At the same time, Treasury Sec. Yellen proposed guidelines that would force more nonbank entities (financial institutions that 2019 rules allowed to avoid Dodd-Frank Act reporting and regulation) posing systemic risk to be subject to supervision.  Elsewhere, a US federal judge in Seattle ruled in favor of AMZN related to a consumer class-action lawsuit that accused the company of scheming to curb competition via the “Fulfillment by Amazon” program which then caused consumers to pay more than a free market would have.  (Appeal is expected.)  Meanwhile, a CA jury found that a TSLA autopilot feature did not fail in the first case involving that feature.  The jury could be a good sign as TSLA continues to roll out more advance “Full Self-Driving” features.  In other auto legal news, F defeated an appeal by consumers who had claimed the company cheated on fuel economy tests for Ranger and F-150 trucks.  At the same time, NLST won a $303 million federal jury verdict in TX against SSNLF (Samsung) over computer memory patent infringement.  In an old case, PARA has agreed to pay a $167.5 million settlement to former CBS stock shareholders related to the 2019 merger of Viacom and CBS.

In miscellaneous news, on Sunday, BBBY filed for bankruptcy after failing to raise the money required to save the company.  The filing requested permission to auction off assets even as the firm’s 480 stores are expected to remain open until the assets are liquidated.  However, at the time of the filing, BBBY had stopped paying for the severance of laid-off workers. So, it is unknown if there will be willing employees to keep the doors open.  Elsewhere, CMCSA fired the CEO of its NBCUniversal unit Sunday after he admitted having an inappropriate relationship with a woman at the company.  Meanwhile, overnight, Bloomberg reported than hedge funds have placed the biggest futures short position in history on 10-year bonds (1.29 million contracts).  On its face, this would be a big bet that the US will see a mid-term recession.  However, the article quotes a Treasury Market analyst as saying this could be a bit misleading since hedge funds will often buy cash treasuries and then short the treasury futures in order to arbitrage the difference in price.

Overnight, Asian markets were mixed but leaned to the downside.  Shenzhen (-1.16%), South Korea (-0.82%), and Shanghai (-0.78%) paced the losses while New Zealand (+0.83%), India (+0.68%), and Taiwan (+0.15%) led the gainers.  In Europe, the bourses are also mixed but are leaning modestly toward the green at midday.  The DAX (+0.03%), CAC (-0.02%), and FTSE (-0.05%) lead the region with many of the smaller exchanges moving slightly more to the upside in early afternoon trade.  In the US, Futures are pointing toward a modestly lower start to the day.  The DIA implies a -0.14% open, the SPY is implying a -0.10% open, and the QQQ implies a -0.03% open at this hour.  At the same time, 10-year bond yields are falling to 3.539% and Oil (WTI) is off three-tenths of a percent to $77.64/barrel in early trading.

There are no major economic news events scheduled for Monday.  The major earnings reports scheduled for the day include KO, CS, GTX, and PHG before the open.  Then, after the close, AAN, ARE, AMP, BRO, CDNS, CNI, CHX, CLF, CCK, FRC, NBR, PKG, RRC, SSD, and WHR report. 

In economic news later this week, on Tuesday we get Building Permits, Conf. Board Consumer Confidence, March New Home Sales, and API Weekly Crude Oil Stocks.  Then Wednesday, March Durable Goods, March Goods Trade Balance, Preliminary March Retail Inventories, and EIA Crude Oil Inventories are reported.  On Thursday, we get Preliminary Q1 GDP, Weekly Jobless Claims, and March Pending Home Sales.  Finally, on Friday, Q1 Employment Cost Index, March PCE Price Index, March Personal Spending, Chicago PMI, and Michigan Consumer Sentiment.

In terms of earnings reports later this week, on Tuesday,  MMM, ABB, ALFVY, ADM, ARCC, ABG, BIIB, CNC, GLW, DHR, DOW, FISV, GEHC, GE, GM, GEO, HAL, HUBB, IVZ, JBLU, KMB, LH, LTH, MCD, MCO, MSCI, NEE, NTRS, NVS, OMF, PCAR, PEP, PII, PHM, RTX, ST, SHW, SPOT, SCL, THC, TRU, UBS, UPS, VZ, XRX, GOOGL, AGR, BXP, BYD, CMG, CB, CSGP, WIRE, ENVA, ENPH, EQR, GOOG, HA, ILMN, JBT, JNPR, MTDR, MSFT, NEX, OI, RUSHA, TX, TXN, TFII, UHS, V, and WFG reports.  Then Wednesday, we hear from ALLE, AMT, APH, ADP, AVY, BA, BOKF, BSX, CVE, GIB, CME, CSTM, DOV, ETR, EVR, FSV, FTV, GD, GPI, HES, HLT, HUM, NSP, MHO, MAS, NSC, ODFL, OTIS, OC, PAG, BPOP, PRG, RCI, RES, R, SLGN, TMHC, TEL, TECK, TDY, TMO, TNL, UMC, VRT, WNC, WAB, WFRD, ACHC, AFL, ALGN, AB, AWK, NLY, AR, ACGL, ASGN, AVB, AXS, BMRN, CHRW, CACI, CP, CLS, CCS, CHDN, CMPR, FIX, EBAY, EW, ESI, EQT, FBIN, GGG, HELE, ICLR, IEX, KLAC, LSTR, MKL, MAT, MTH, META, MEOH, MAA, MOH, MYRG, NOV, ORLY, OII, PPC, PXD, PLXS, PTC, RJF, RHI, ROKU, ROL, NOW, SNBR, STC, SUI, TDOC, TER, TNET, TROX, TYL, URI, WCN, WSC, and WM.  On Thursday, AOS, ABBV, MO, AAL, AIT, ARCH, AMBP, AZN, BAX, BFH, BMY, BC, CRS, CARR, CAT, CBRE, CNP, CHD, CMS, CNX, CMCSA, CROX, CRF, DQ, DPZ, DTE, LLY, EME, FIS, FAF, FCFS, FCN, GOL, HOG, HAS, HP, HSY, HTZ, HGV, HON, IP, IPG, IQV, KDP, KEX, LEA, LII, LECO, LIN, LKQ, HZO, MA, MRK, NEM, NOC, ORI, OSK, PATK, PTEN, BTU, PNR, DGX, RS, ROK, ROP, SPGI, SNY, SNDR, SIRI, SAH, SO, LUV, SAVE, SRCL, STM, FTI, TXT, TTE, TSCO, TPH, VLO, VLY, VC, GWW, WST, WEX, WTW, WIT, XEL, ATVI, AEM, ALSN, AMZN, AMGN, ATR, ACA, AJG, BZH, COF, CSL, SS, SINF, COLM, DXCM, DLR, EMN, EHC, ERIE, FLSR, FE, GFL, GILD, HIG, PEAK, HUBG, INTC, LHX, LPLA, MTX, MHK, MDLZ, OLN, PINS, PFG, RSG, RMD, SGEN, SKX, SKYW, SM, SNAP, AWN, SSNC, TMUS, X, WY, and INT report.  Finally, on Friday, AON, ARCB, ARES, AVTR, BLMN, CCJ, GTLS, CHTR, CVX, CL, DAN, XOM, FMX, GNTX, IMO, JKS, LAZ, LYB, NYCB, NWL, NHYDY, NVT, POR, SAIA, and TRP report.

In what BUD hopes will end the recent conservative indignation and boycott over a (small by BUD standards) Bud Light line advertising campaign featuring a “trans online influencer”, the company has taken action related to the incident. BUD placed the Bud Light VP of Marketing and her boss on leave. Sales figures show that Bud Light sales fell 10.7% the week following the uproar. However, there was a somewhat corresponding uptick in other BUD brand sales. BUD stock has fallen 1% over the weeks since the campaign made news, meaning that no impact from the uproar is apparent in the market value of the company at least yet. In unrelated news, TAP took a hit over the weekend as Belgium customs destroyed thousands of Miller High Life beers. Like the American conservatives, Belgium apparently (suddenly) took offense that Miller High Life labels itself “the Champagne of beers.” (Although what that has to do with Belgium, as opposed to France, or why the outrage manifested itself now, after decades of Miller using that slogan, beats me.)

So far this morning, KO, CS, and PHG all reported beats on the revenue and earnings lines.  Meanwhile, GTX beat on revenue while missing on earnings.  Oddly, the biggest shock was a 43.2% upside revenue surprise from CS (despite it having been sold to avoid failing during the quarter).  PHG also had a 26% upside surprise on earnings but GTX had a 38% downside surprise on the same line. 

With that background, it looks like all three major indices have climbed back to flat and will be thinking about retesting their T-lines this morning. The consolidation or modest pullback seem to remain underway. Even though more than 90% (according to Fedwatch) of the market is sure there will be just a quarter-point hike at the next Fed meeting a week from Wednesday, uncertainty still abounds. Over-extension is obviously not a problem in terms of the T-line or the T2122 indicator. SPY and QQQ seem to be testing a potential support level but DIA does not have that obvious level helping it below. Right now, the chart tells us to maintain a long bias but be wary of weakening bulls and keep an eye out for trend breaks.

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

On Thursday, markets gapped lower again (opening down 0.69% in the SPY, down 0.43% in the DIA, and down 0.97% in the QQQ).  At that point, all three major indices began a long, slow, meandering rally until they reached the highs of the day at about 1:30 pm.  From there, a quicker selloff took the SPY, DIA, and QQQ back to the lows of the day with only some last-minute profit taking closed all the major indices out just up off the lows.  This action gave us indecisive, white-bodied, Spinning Top or Doji-type candles that gapped below their T-line, retested it, and closed just below.  That tends to tell us that markets have not made up their mind yet.  Again, this all happened on lower-than-average volume (much lower in the large-cap indices).

On the day, eight of the 10 sectors were in the red with Communications Services (-2.09%) leading the way lower (by over a percent) while Consumer Defensive (+0.32%) held up better than other sectors.  At the same time, the SPY lost 0.56%, DIA lost 0.31%, and QQQ lost 0.76%.  VXX gained 2.2% to 39.95 and T2122 fell further into the mid-range to 63.13.  10-year bond yields plummeted to close at 3.538% while Oil (WTI) dropped another 2.36% on the day to $77.29 per barrel.  So, Thursday was the second consecutive day that was teed up for the bears, they just could not get their job done.  However, unlike Wednesday, the Bulls also couldn’t keep momentum once they did step in to “buy the dip” at the open.  Accordingly, you could see this as just continued consolidation or as a hesitant start of a pullback within a bullish trend.  That trend is still intact with the 3ema > 8ema > 17ema > 50sma > 200sma in all but the QQQ, where the 3ema crossed just below the 8ema by a few pennies Thursday.    

In economic news, Weekly Initial Jobless Claims came in a bit above expectation at 245k (compared to a forecast of 240k and the prior week’s reading also of 240k).  At the same time, the Philly Fed Manufacturing Index came in well below the anticipated number at -31.3 (versus a forecast of -19.2 and even below the March value of -23.2).  Meanwhile, March Existing Home Sales also came in a little light at 4.44 million (versus an expected 4.50 million and the February reading of 4.55 million).  After the close, the Fed Balance Sheet was reported at $8.593 trillion (as of April 20), which is down $22 billion from the prior week.  At the same time, Bank Balances with the Federal Reserve were reported at $3.165 trillion (as of April 20), which was down $185 billion from the prior week and was the third consecutive weekly decline. 

SNAP Case Study | Actual Trade

In economic speak news, Treasury Sec. Yellen told a Johns Hopkins University audience that “the US banking system remains sound and the (US) government will take any necessary steps to keep it the strongest and safest financial system in the world.”  Later, Fed Governor Waller said that the Fed needs to consider the possible use of AI (which he said offers opportunities and risks) as a way to offset the speed at which customers can pull money out of banks.  “If they are going to have deposit flows being faster we need to think how do we (Fed) do pricing faster, how do we assess the collateral, that’s got to be faster…to make the discount window more effective, we have to be able to do things faster as well.” Waller said.  He also went on to mention that “things have kind of calmed down (in the banking sector).”  Then, at mid-afternoon, Cleveland Fed President Mester (non-voter) told a community roundtable that the Fed has interest rate increases ahead of it, but also said the aggressive move to boost the cost of borrowing to quash inflation is near an end.  (You have to love the doublespeak.)  However, she did go on to say she expects a “soft landing” when she said, “I do think we’re going to have very slow growth – I think growth will be well below 1%.”  Finally, she expects unemployment to top out at 4.5% to 4.75% (it is currently 3.5%) and expects inflation to get down to the Fed’s 2% target in 2025.

In stock news, the CEO of UNP said Thursday that the railroad will slow its pace of hiring in the second half of the year amid a cloudy economic outlook.  In IPO news, UCAR had an eventful first day, including several halts due to volatility. The announced IPO pricing was $6.00/share, while the stock opened at $8.10, reached a high of $75.00, and then closed at $43.18 in its first day of trading…on volume of 3.4 million shares.  (That is interesting since only 2.4 million shares were offered for sale.)  Elsewhere, LMT announced a new partnership with German defense industry leader RNMBF (Rheinmetall) to produce HIMARS rocket launching systems.  The production will take place in Germany but will include both US and German-made components.  Later, NOVA announced the US government would provide a partial loan guarantee of $3 billion to back financing of its solar rooftop systems.  The Dept. of Energy will give an indirect guarantee of 90% for $3.3 billion in customer solar panel installation loans.  Meanwhile, AMZN announced it has launched a program to identify and track sellers in its marketplace who sell counterfeit goods and share that information with the US Customs and Border Protection agency.  After the close, CLX announced it will cut about 4% of its non-production workforce (about 200 jobs) after having cut 100 jobs from the same non-production category in 2022.

In stock legal and regulatory news, the US Dept. of Justice announced it has reached a settlement with MU to resolve the company’s discrimination against a US citizen when it hired a temporary visa worker over the citizen for non-pertinent reasons.  The penalty was not specified but MU will pay the affected worker $85,000 and will be subject to DOJ monitoring for two years.  Elsewhere, in a reversal of an announcement earlier in the week, the US Treasury has made vehicles from RIVN and VLKAF (Volkswagen) eligible for the full $7,500 US Tax Credit for electric and hybrid vehicles.  Meanwhile, a US Bankruptcy Judge in New Jersey has halted most, but not all, liability lawsuits against JNJ (over cancer allegedly caused by tac products). The judge stopped 38,000 of the liability cases while JNJ seeks to reach a settlement with the claimants.  (JNJ filed for Chapter 11 bankruptcy for the unit it transferred all talc business to a second time after having had the first filing invalidated as an obvious attempt to avoid liability.)  The ruling in JNJ’s favor gives the company more leverage against the 80,000 claimants who must weigh their portion of JNJ’s proposed $8.9 billion over 30 years settlement against the possibility the unit’s bankruptcy is approved (in which case JNJ is basically free of all liability).  75% of the claimants would need to accept the offer for the JNJ proposed settlement to go into effect.  At the same time, in New York, PARA has counter-sued WBD in the case involving royalty fees for streaming rights of the “South Park” animated comedy.  After the close, RIDE received a delisting notice from Nasdaq and is now exploring a “reverse split” to get the stock price above the exchange minimum requirement.  (The company has until October 16 to regain compliance.)

After the close, PPG, CSX, VMI, and ASB all reported beats on both the earnings and revenue lines.  Meanwhile, SEIC, OZK, and WRB reported beats on the revenue line while missing on earnings.  Unfortunately, KNX missed on both the top and bottom lines.  It is worth noting that PPG raised its forward guidance while KNX lowered its forward guidance.

Overnight, Asian markets leaned heavily to the red side with only New Zealand (+0.40%) and Singapore (+0.25%) managing to stay green.  Meanwhile, Shenzhen (-2.28%), Shanghai (-1.95%), and Hong Kong (-1.57%) led most of the region lower.  In Europe, the bourses are mixed but lean lower on modest moves at midday.  The DAX (-0.33%), CAC (-0.10%), and FTSE (+0.08%) are typical and lead the region in early afternoon trade.  In the US, as of 7:30 am, Futures are pointing toward a modestly red start to the day.  The DIA implies a -0.10% open, the SPY is implying a -0.22% open, and the QQQ implies a -0.42% open at this hour.  At the same time, 10-year bonds are flat at 3.538% and Oil (WTI) is also flat at $77.40/barrel in early trading.  

The major economic news events scheduled for Friday are limited to Mfg. PMI, S&P Global PMI, and Services PMI (all at 9:45 am).  The major earnings reports scheduled for the day include ALV, FCX, HCA, PG, RF, SDVKY, SAP, and SLB before the open.  There are no major earnings reports scheduled for after the close on the day. 

So far this morning, PG, HCA, VLVLY, SLB, SDVKY, and ALV have all reported beats to both the revenue and earnings lines.  Meanwhile, SAP missed on revenue while it beat on earnings.  On the other side, RF beat on revenue while missing on earnings.  (FCX is scheduled to report at 8 am.)  It is worth noting that both PG and HCA have raised their forward guidance.  The only significant surprises were HCA with a 24% and SAP with a 12% upside earnings surprises.

In miscellaneous news, the EIA reported a much higher-than-expected Natural Gas inventory build for last week.  Nat Gas storage increased 69 bcf, compared to 25 bcf the prior week and a 5-year average of 41 bcf stockpile build for this week of the year.  Total inventories are 34% higher than a year ago and 21% higher than the 5-year average.  Elsewhere, in late news, AMZN’s Whole Foods unit informed corporate employees that it will lay off several hundred people (only about 0.5% of its total workforce).  Finally, in a sign of a company that doesn’t know what it’s doing, TSLA reversed course overnight. One day after it lowered prices (for the sixth time in less than four months), reported disappointing earnings (which caused the stock to fall 10%) and signaled that price cuts would continue…TSLA announced overnight it will increase prices for its Model S and Model X cars. 

With that background, it looks like the large-cap indices are continuing their test of the T-line (8ema) level this morning. Meanwhile, QQQ is falling a bit further below its own T-line. With no economic news scheduled prior to the open, it looks like earnings will set the mood until at least 9:45 am. Clearly, there is a consolidation or a so-far weak pullback underway. If you look at the candle shapes in the DIA, it is obvious traders are pretty unsure of what will happen next. Regardless, the bullish trend remains in place but is also looking like it is losing steam. Over-extension is obviously not a problem in terms of the T-line or the T2122 indicator. SPY and QQQ seem to be testing a potential support level but DIA does not have that obvious level helping it below. Right now, the chart tells us to maintain a long bias but be wary of weakening bulls and keep an eye out for trend breaks. Also, remember this is Friday. So, pay yourself, lock-in some profits, and prepare your account for the weekend news cycle.

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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

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

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

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

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

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

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

Hit and Run Candlesticks / Road To Wealth Youtube videos

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

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

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

Markets gapped down to open in a divergent way on Wednesday (down 0.49% in SPY, down 0.19% in the DIA, and down 0.78% in the QQQ).  However, the SPY and QQQ immediately began to rally and recrossed that gap by early afternoon.  From there, both of them traded sideways into the close at very near the previous closing price.  Meanwhile, the DIA began trading sideways right after its gap lower and continued to undulate just below that opening price all day.  This action gave us gap-down, white-bodied candles in both the SPY and QQQ that retested and held their T-lines (8emas).  At the same time, the DIA printed an inside day, indecisive Doji candle that also held a retest of its T-line.  All of this happened on very low volume (far below the average volume in all 3 major indices).

On the day, six of the 10 sectors were in the red with Energy (-0.93%) leading the way lower while Financial Services (+0.57%) held up better than other sectors.  At the same time, the SPY lost 0.02%, DIA lost 0.27%, and QQQ lost 0.05%.  VXX fell another 0.38% to 39.09 and T2122 fell slightly to just outside the overbought territory to 79.79.  10-year bond yields rose a bit to close at 3.595% while Oil (WTI) dropped 2.35% on the day to $78.95 per barrel.  So, Wednesday was teed up for the bears at the open but they just could not deliver.  Bulls simply did not want to give up and bought the dip led by regional banks.  Yet, it remained an indecisive day as the bulls also failed to break out.  All we can say for sure is that we are sitting in a consolidation area with a bullish trend still intact as the 3ema > 8ema > 17ema > 50sma > 200sma.   

In economic news, the EIA Weekly Crude Oil Inventories fell more than expected with a 4.581-million-barrel drawdown (versus to a forecasted 1.088-million-barrel drawdown and farther below the prior week’s 0.597-million-barrel inventory build). The drawdown was largely due to a combination of increased exports and refineries reopening.  At the same time, EIA reported a gasoline inventory build of 1.300-million-barrels (compared to a forecasted 1.267-million-barrel drawdown and the prior week’s 0.331-million-barrel drawdown).  In addition, Weekly Distillate (diesel and heating fuel) Stocks fell 0.356-million-barrels (versus a forecasted 0.927-million-barrel drawdown and the prior week’s reading of -0.606-million-barrels).  Finally, the Fed Beige books showed that economic activity in the US has changed very little in recent weeks and the prospects for future growth were mostly unchanged.  However, there were signs that inflation was cooling as lenders’ new loan volumes and loan demand fell and several banks tightened lending standards.  The report also noted “modest-to-sharp declines in the prices of nonlabor inputs and significantly lower freight costs in recent weeks.”

SNAP Case Study | Actual Trade

In stock news, TOYOF (Toyota Motors) announced it will invest $338 million in a plant to manufacture hybrid compact cars in Brazil. GM and VLKAF (Volkswagen) both have recently announced similar investments in the same technology in Brazil.  In other auto news, VLVLY rolled out a new electric “coupe-shaped SUV” that has no rear window.  Meanwhile, META carried out another round of job cuts (as part of its previously announced 10,000 job cuts during 2023).  No specific number of layoffs was mentioned but this round seems focused on the software engineers and related teams.  In the late afternoon, GE announced that workers at its largest union (about 3,000 employees) have ratified a new two-year contract.  Eight other smaller GE employee unions also ratified contract extensions.  Elsewhere, SNAP rolled out a new AI-powered chatbot to all users (it had previously only been available to their premium subscribers) on Wednesday.

In stock legal and regulatory news, the NHTSA reported that STLA is recalling almost 132,000 2021 Model Ram 1500 pickups due to powertrain software issues. Meanwhile, AMGN won an appeal, which upholds patents that bar generic versions of its psoriasis drug Otezla (which had been proposed by NVS).  AMGN sold $2.2 billion of the drug in 2022.  At the same time, the US 5^th Circuit Court of Appeals said it will fast-track the review of ILMN’s challenge of the US FTC’s order to divest Grail LLC (which ILMN acquired and closed prior to regulatory approval).  It is worth noting that the EU also ordered ILMN to divest Grail back in December.  In Asia, Chinese government investigators concluded that the TSLA factory (where an employee died on February 4) had safety weaknesses and recommended an unspecified penalty.  Elsewhere, the US 9^th Circuit Court of Appeals ruled that AMZN must face a class action lawsuit claiming that the company illegally monitored a private Facebook group used by employees to discuss working conditions.  In the semiconductor sector, GFS sued IBM, claiming that IBM shared the proprietary intellectual property of GFS with INTC and a new Japanese-state-backed chip-building consortium named Rapidus.  After the close, TSLA announced it has settled its lawsuit against a former employee they accused of stealing trade secrets.  No details of the settlement were announced.  Finally, STX agreed to pay $300 million for violating sanctions and shipping Chinese phone maker Huawei $1.1 billion worth of hard drives between mid-2020 and mid-2021.

After the close, LRCX, CCI, EFX, LVS, LBRT, FFIV, WTFC, and FNB all beat on both the revenue and earnings lines.  Meanwhile, TSLA, IBM, STLD, and KMI all missed on the revenue line while beating on earnings.  On the other side, DFS and ZION both beat on revenue while missing on the earnings line.  Unfortunately, AA missed on both the top and bottom lines.  It is worth noting that FFIV also lowered its forward guidance. It is also worth noting that AA had a massive 360% surprise miss on earnings while LVS had a strong 65% upside surprise on earnings. Regional banks ZION, WTFC, and FNB all reported strong upside surprises in revenue (27%, 30%, and 26% respectively).

Overnight, Asian markets leaned heavily to the red side on modest moves, with only Japan (+0.18%), Hong Kong (+0.14%), and India (+0.03%) clinging to the green.  Meanwhile, Thailand (-0.99%), South Korea (-0.46%), and Taiwan (-0.40%) paced the losses in the rest of the region.  In Europe, we see red across the board at midday.  The DAX (-0.77%), CAC (-0.43%), and FTSE (-0.12%) are leading the region lower in early afternoon trade.  In the US, as of 7:30 am, Futures are pointing toward another gap lower to start the day.  The DIA implies a -0.42% open, the SPY is implying a -0.66% open, and the QQQ implies a -0.91% open at this hour.  At the same time, 10-year bond yields are starting the day down at 3.566% and Oil (WTI) is off more than 1.5% to $77.90/barrel in early trading.

The major economic news events scheduled for Thursday include the Weekly Initial Jobless Claims and Philly Fed Mfg. Index (both at 8:30 am) and March Existing Home Sales (10 am).  We also get two Fed speakers (Waller at noon and Bowman at 3 pm).  The major earnings reports scheduled for the day include ALK, T, AN, BX, CMA, DHI, EWBC, FITB, GPC, HRI, HBAN, KEY, MAN, MMC, NOK, NUE, PM, POOL, RAD, SNA, SNV, TSM, TFC, UNP, WSO, and WBS before the open.  Then, after the close, CSX, KLNX, PPG, STX, VMI, and WRB report.  

In economic news later this week, on Friday, Mfg. PMI, S&P Global PMI, and Services PMI are reported.  On the earnings front later this week, on Friday, ALV, FCX, HCA, PG, RF, SDVKY, SAP, and SLB report.

So far this morning, DHI, GPC, KEY, SNA, CMA, HRI, SNV, MMC, HBAN, and HSQVY (Husqvarna) all reported beats on both the revenue and earnings lines.  Meanwhile, T, PM, BX, and TSM missed on revenue while beating on the earnings line. On the other side, AXP, RAD, NOK, TFC, and TCBI all beat on revenue while missing on earnings.  Unfortunately, ALK and POOL missed on both the top and bottom lines.  It is worth noting that DHI and GPC raised their forward guidance while TSM and POOL lowered forward guidance.  Among the notable surprises were a 158% upside surprise on revenue from PM, a 44% upside surprise on earnings by DHI, a 61% downside surprise by RAD, and most of the regional banks posting 30% – 60% upside revenue surprises.

In banking news, analytics company Attom Data reported Wednesday that the rate of US foreclosures rose 22% in Q1 (compared to Q1 2022), hitting a 3-year high.  It also reported that home repossessions also climbed 6% versus 2022.  However, we should note that much of the preceding three years was covered by a foreclosure moratorium and the number of foreclosures is still lower than they were prior to the pandemic.  They are also only a fraction of the record foreclosures in a quarter from back in 2009. 

In miscellaneous last-minute news, TSLA signaled more price cuts lay ahead even as it reported the margin damage from its recent spate of discounts.  Analysts argued on Bloomberg over whether this was aimed at killing off upstart rivals which have sprung up all over or is just trying to keep new plants from needing to idle.  Either way, the fact is that TSLA growth has dramatically slowed and discounts are one way to create more demand.  In other electric vehicle news, TM introduced new models and broadened its offerings to China (like most EV makers did at the Shanghai Auto Show with the glaring exception of “no show” TSLA at this year’s event).  Elsewhere, Swedish Home Goods company IKEA (not US listed) said it will invest $2.2 billion in the US over the next three years to update stores, build new order pickup centers, and expand its footprint in the US.  Finally, the most important chipmaker in the world, TSM, forecasts a weak market for chips for the rest of 2023.  However, the company is sticking with its $36 billion investment plan for 2023 to increase capacity.

With that background, it looks like the bears are again retesting the T-line (8ema) as support in all three major indices this morning. (The QQQ could even be gapping down through the T-line.) However, there is still some economic data before we get to the open. Regardless, the consolidation within a bullish trend remains in place and the moving averages remain stacked bullishly. Over-extension is obviously not a problem in terms of the T-line and the T2122 indicator is also not overbought at the moment (but close to that area at the top of the mid-range). We should also realize that the SPY, DIA, and QQQ all sit not far from potential support below or from potential resistance above. Once again, we have to put aside what we think/feel will should happen and just follow the chart. Right now, the chart tells us to maintain a long bias on a swing trading horizon while keeping an eye peeled, watching for trend breaks. So, be careful and continue go with 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 absolutely no reason to keep raising your bet (risk) size just because you’ve had a win. Finally, remember that trading is not a hobby. It’s a job. The money is real and so is the risk. So, treat it that way. Do the work and follow the process. Stick to your trading rules, trade with the trend, and take those profits when you have them. Do the work!

See you in the trading room.

Ed

🎯 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