Markets gapped higher at the open Thursday (up 0.66% in the SPY, up 0.54% in the DIA, and up 0.77% in the QQQ).  However, for the large-cap indices, this was a bull trap as the DIA immediately began selling and the SPY waited an hour and then began selling off.  Both maintained a steady bearish pace once the selling began.  For its part, the QQQ ground sideways and even had a slightly bullish trend until 11:15 am.  At that point, it too began a steady selloff.  DIA reached its low of the day (back below the Wednesday close) at 12:50 pm.  Meanwhile, SPY and QQQ reached their low (still in the gap) at 1:50 pm.   From that point, the bulls stepped in for a slow steady rally that lasted into the close.  This action gave us gap-up candles with the SPY and QQQ both printing Doji and the DIA printing a black-bodied Hanging Man candle.  DIA is also testing a resistance level.

On the day, nine of the 10 sectors were in the green with Consumer Cyclical (+0.97%) leading the way higher while Financial Services (-0.18%) lagged behind other sectors.  At the same time, the SPY gained 0.59%, the DIA gained 0.44%, and QQQ gained 0.95%.  VXX was dead flat at 45.11 and T2122 was also flat, staying in the overbought territory at 88.03. 10-year bond yields fell slightly to 3.553% while Oil (WTI) rose almost 2% to $74.39 per barrel.  So, on Thursday we saw signs of indecision with all three major indices giving us candles with a lot of wick and very little body.  We did move a little further from the T-line (8ema) and there are signs that the bulls are a little tired or at least tepid going into Friday (the last day of the month and quarter).  We also saw a divergence in volumes as DIA had very low volume, QQQ was close to average and SPY was in between the other two major indices.

In economic news, the Final Revision of Q4 GDP came in just shy of forecast at +2.6% (compared to a forecast of +2.7% and a Q3 reading of +3.2%).  At the same time, the Final Revision of Q4 GDP Price Index came in just as expected at +3.9% (versus the forecast of +3.9% and down from the Q3 reading of +4.4%).  So, this confirms that economic growth was slowing in Q4…especially when you consider the inflation factor was above the growth rate.  However, that inflation was also declining.  Both of these are what the Fed hopes to hear and wants to occur.  The only argument, then, is over how fast the slowing of growth and decreasing of inflation are happening.  Elsewhere, the Weekly Initial Jobless Claims were slightly above the forecasted value at 198k (versus an expected 196k and also above the prior week’s 191k reading).  Still, those layoffs are not high enough to significantly impact the labor market. 

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In stock news, on Thursday, VLCN announced it has launched two new models of electric motorcycle, one designed for on road and one for off-road driving.  In other electric vehicle news, F reopened order reservations for its F-150 Lightning trucks at a new $4,000 higher price ($20,000 higher than when the truck was launched in April 2022).  Meanwhile, a bi-partisan group of US Senators introduced a bill aimed at META, GOOGL, AMZN, and AAPL.  The bill would restrict companies selling more than $20 billion in digital advertising from owning more than one part of the stack of services that connect advertisers with the companies who have digital ad space for sale.  After the close, Reuters reported that BA will increase production of its 737 MAX to exceed the current 31 planes per month.  Elsewhere, JD announced after the close that it will spin off its property and industrial units and list those entities on the Hong Kong Stock Exchange.  This appeared to be a counter move to BABA (JD rival) plans to split into six businesses.  After the close, Reuters reported that TSLA “solar roof” installation target were only 2% of CEO Elon Musk’s goals.  (Musk’s 2021 forecast was for an average of 1,000 installations/week in 2021.  However, the 2022 average was only 21 installations per week.)  This miss was due to competitors getting the business.  Finally, after the close it was reported that VORB has failed to secure funding.  As a result, it will cease operations “for the foreseeable future” and will eliminate 85% (675) of the company’s positions.

In stock legal and regulatory news, META announced that beginning next Wednesday, it will allow European users to opt-out of targeted ads on its Facebook and Instagram services.  The move comes in the wake of the December EU privacy order that began fining META $423 million.  Elsewhere, a tech ethics group has asked the US FTC to stop OpenAI from issuing new commercial releases of its ChatGPT-4.  MSFT, which has closely integrated OpenAI into its product offerings, as well as other companies are expected to fight any such move by the FTC.  (A similar request is likely to follow for GOOGL’s Bard and other AI platforms.)  At the same time, the US Consumer Financial Protection Bureau has ruled that lenders must begin collecting demographic and geographic data on loans to small businesses.  The loan census data will be used to identify patterns of discrimination.  Meanwhile, WFC will pay another $98 million for poor oversight and failing to comply with US sanctions against Iran, Syria, and Sudan.  Late in the day, F withdrew its petition to the NHTSA which had sought approval to deploy 2,500 self-driving vehicles annually.  A similar petition from GM is still pending approval.  After the close, President Biden urged the Supreme Court to hear a case after the US Court of Appeals ruled TEVA had infringed a GSK patent by using a so-called “skinny label.”  If the case were heard and the ruling was in TEVA’s favor, generic drugs would likely be more widely available.

In energy news, Natural Gas continues its historic slide.  The front-month natty fell another 4% Thursday with the low of the day coming at $2.082/mmBtu.  This leaves natural gas at the lowest price since mid-July 2020.  And, unless there is a strong rally Friday, the first quarter will book more than a 50% decline in natural gas prices, which would be the largest quarterly drop in history.  Thursday’s move came after the EIA reported a weaker-than-forecasted drawdown of inventories.  The report cited a withdrawal of 47 billion cubic feet for the week (compared to a forecasted drawdown of 54 billion cubic feet).  This leaves inventories 31% higher than the same time in 2022 and up 21% from the 5-year average inventory.  Obviously, UNG reflects the same story, down 53% for the quarter as of Thursday’s close.

In miscellaneous news, the big story for Friday is likely to be ex-President Trump’s indictment by a New York Grand Jury.  This Grand Jury found Trump should stand trial on multiple charges, including at least one felony, related to fraudulent reporting of a hush money payment and it then being claimed as a legitimate business expense for tax purposes.  Apparently, surrender and arraignment has been negotiated to happen next week.  The other big non-economic news is also political but does involve a major corporation.  This one is the story of how DIS outwitted Florida Governor DeSantis’ (and that state’s GOP legislators’) move to punish the company for opposing Florida cultural issue legislation.  DIS, legitimately and in public session, made a minimum 30-year contract (which could actually extend more than 100 years) with the (old) board that governs the Reedy Creek district. (That district board has jurisdiction over Disney World and related properties.)  The contract gives DIS the exclusive right to decide on building high-density projects or buildings of any height or size or to assign those rights to anyone else DIS chooses.  It also bans the new board from using the Disney name or characters in any way (like advertising).  This contract was approved prior to the state taking over the district and DeSantis appointing his own new board.  As a result, the move takes away most of the power of the new board and makes the DeSantis power move largely irrelevant. Obviously, DeSantis and the Florida GOP are furious and threaten action. However, multiple legal experts have reported that the contract is legal and binding.

Overnight, Asian markets were heavily green.  Only New Zealand (-0.41%) and Malaysia (-0.14%) were in the red.  Meanwhile, India (+1.63%), South Korea (+0.97%), and Japan (+0.93%) led the rest of the region higher.  In Europe, we see the same picture taking shape at midday.  Only Russia (-1.37%) and Denmark (-0.19%) are in the red.  Meanwhile, the CAC (+0.56%), DAX (+0.42%), and FTSE (+0.20%) lead the region higher in early afternoon trade.  In the US, as of 7:30 am, Futures are pointing toward a start to the day just on the green side of flat.  The DIA implies a +0.21% open, the SPY is implying a +0.18% open, while the QQQ implies a dead flat open at this point.  At the same time, 10-year bond yields are lower to 3.543% and Oil (WTI) is up more than three-quarters of a percent to $74.96 in early trading.

The major economic news events scheduled for Friday include Feb. PCE Price Index, and Feb. Personal Spending (bot hat 8:30 am), Chicago PMI (9:45 am), and Michigan Consumer Sentiment (10 am).  We’ll also hear from Fed Member Williams at 3:05 pm.  There are no major earnings reports scheduled for the day.

With that background, it looks like the markets are waiting on the Fed’s favorite inflation measure at 8:30 am. As of now, all three major indices are just on the bullish side of flat with 100 minutes left before the open. With today being month and quarter end, there may be some more window dressing activity. Also bear in mind that next week is a short week (Markets are closed Friday for “Good Friday”). Overextension is not a huge issue, but we are getting a little far from the T-line (8ema) and T2122 also shows markets a bit stretched. With the big legal news and so many people who feel they will need to weigh in on the topics, we might see a sleepy day in the market. However, that PCE Inflation gauge and quarter end are likely to call the market tune today.

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.

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

On Wednesday, the bulls were in charge from the opening bell, perhaps on upbeat guidance from LULU and MU.  SPY gapped 1.05% higher, DIA gapped 0.85% higher, and QQQ gapped 1.23% higher at the open.  From that point, SPY and QQQ ground sideways in a tight range until 2:30 pm.  Meanwhile, DIA traded down (back into the gap) and then sideways until 2:30 pm.  However, then a mild rally all the way into the close took all three major indices out on their highs. This action gave us Morning Star-type signals in the SPY and QQQ with both printing white, larger-body, smaller wick candles.  However, the DIA printed a white-bodied, potential Hangman (or Hammer if viewed through bullish glasses).  Once again this happened on lower-than-average volume (much lower in the DIA).

On the day, all 10 sectors were in the green with Technology (+2.10%) leading the way higher while Consumer Defensive (+0.64%) lagged behind other sectors.  At the same time, the SPY gained 1.43%, the DIA gained 1.01%, and QQQ gained 1.82%.  VXX fell 3.28% to 45.11 and T2122 climbed into the overbought territory at 88.12. 10-year bond yields fell slightly to 3.564% while Oil (WTI) fell 0.57% to $72.80 per barrel.  So, hump day gave us a strong start to the day, probably on easing concerns over the banking sector.  Then traders played the “wait and see” card until the afternoon when the last 90 minutes saw a modest but steady rally into the close.  SPY did break its downtrend line (going back to the beginning of February) and crossed just above its 50sma.  DIA also crossed just up through its downtrend (also going back to the start of February).

In economic news, February Pending Home Sales came in much better than expected at +0.8% (compared to a forecast of -2.3% but far below January’s blowout reading of +8.1%).  Later in the morning, the EIA Weekly Crude Oil Inventories report gave us a significant drawdown versus the expectation.  Oil inventories fell 7.489 million barrels (versus a forecasted build of 0.092 million barrels and the prior week’s build of 1.117 million barrels.  On the gasoline front, inventories saw a 2.904-million-barrel drawdown (compared to the forecasted drop of 1.625 million barrels and the prior week’s 6.4-million-barrel decline).  In terms of distillates (diesel and heating oil), there was a 281,000-barrel inventor build (versus a forecast of a 1.455-million-barrel decline and the prior week’s 3.313-million-barrel drawdown).

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In stock news, Reuters reported that ICUI has teamed up with a private equity firm to bid against the GEHC and CG in an effort to acquire the medical technology business of MDT.  Elsewhere, UAL CEO Kirby announced the airline had reached an agreement in principle with 30,000 union ground workers for a new two-year contract. At the same time, WMG announced it will lay off 4% of its workforce (only about 270 people) and will cut discretionary spending in the near future.  Meanwhile, the US GSA announced it has awarded BLNK a “Multiple Award Schedule” contract which allows federal agencies to easily purchase BLNK equipment.  At mid-afternoon, M announced it has named Tony Spring (of Bloomingdale’s) as its new President and “CEO in waiting” one day after current CEO Gennette said he would retire in February of next year.  Later, Reuters reported that BAC’s digital personal finance tool (Life Plan) has attracted more than $55 billion in new accounts since it was launched in late 2020.  Meanwhile, DIS announced it has laid off the Chairman of its Marvel Entertainment unit, Ike Perlmutter.  (It is worth noting that Perlmutter had supported activist investor Nelson Peltz’s bid to get a DIS board seat and oppose the reinstatement of DIS CEO Iger.)  In “taking the negotiations public” news, Ryanair confirmed that it is in negotiations with BA over an order of at least 100 jets with the option for 100 more…but that significant discounts needed to be brought to the table to clinch the order.  (Ryanair is one of BA’s largest customers, alongside LUV, and can demand the best pricing.)  Finally, after the close, EA announced it will cut approximately 6% of its workforce as part of a restructuring.

In stock legal and regulatory news, it was announced that FNF will pay the State of NY $3.5 million for anti-competitive agreements that the company had entered into with its competitors in order to avoid competition.  FNF also agreed to end all such “no poach” agreements.  (NY had already reached similar agreements with FNF competitors STC and ORI since late 2021.)  Elsewhere, Britain announced it will “investigate in depth” the $61 billion acquisition of VMW by AVGO.  The announcement said this was after AVGO failed to engage with the UK government after the Brits had published its concerns.  The investigation can take up to six months.  Meanwhile, Bloomberg reports that the FDIC is considering passing a greater share of the $23 billion bank failure costs onto the largest US banks.  While the final decision will not be made until May, this could have significant impacts on BAC, C, JPM, and WFC (each of which may face a multi-billion charge).  At the same time, the state of CA began regulating how much profit oil refiners in the state can make as of Wednesday.  CVX is the largest refiner in that state and PBF has the largest exposure to CA refining with 32% of its refineries located in CA.  After the close, a federal judge ruled that RMAX (as well as other real estate brokerages and the National Assn. of Realtors) must face a class action lawsuit over allegations of conspiring to inflate commission rates in Texas, Florida, New Jersey, Ohio, Pennsylvania, Virginia, North Carolina, and Colorado.

After the close, CNXC beat on revenue while missing on earnings.  Unfortunately, RH and FUL missed on both the revenue and earnings lines.  It is worth noting that RH also lowered its forward guidance.

Overnight, Asian markets leaned heavily to the green side.  Japan (-0.36%), Thailand (-0.32%) and Singapore (-0.26%) were the only red in the region.  Meanwhile, New Zealand (+1.67%), Australia (+1.02%) and Shanghai (+0.65%) led most of Asia higher.  In Europe, we find green across the board at midday.  The CAC (+1.37%), DAX (+1.27%), and FTSE (+0.94%) are leading the region higher in early afternoon trade.  On this side of the pond, as of 7:30 am, US Futures are pointing toward another gap higher to start the day.  The DIA implies a +0.64% open, the SPY is implying a +0.60% open, and the QQQ implies a +0.54% open at this hour.  At the same time, 10-year bond yields are down a bit to 3.556% and Oil (WTI) is up 0.93% to $73.64/barrel in early trading.

The major economic news events scheduled for Thursday include Q4 GDP, Q4 GDP Price Index, and Weekly Initial Jobless Claims (all at 8:30 am) as well as Bank Reserve Balances with Fed (4:30 pm).  However, Treasury Sec. Yellen also speaks at 3:45 pm.  There are no major earnings reports scheduled for the day.

In economic news later this week, on Friday, Feb. PCE Price Index, Feb. Personal Spending, Chicago PMI, and Michigan Consumer Sentiment are reported as well as Fed Member Williams speaking.  In terms of earnings, there are no major earnings reports scheduled for Friday.

In late-breaking news, Russia has detained a journalist from the Wall Street Journal, alleging suspicion of espionage.  This is undoubtedly just another Russian negotiating tactic as with the American women’s basketball player (Griner) arrested last year.  Still, the move will ratchet up tensions between the US and the former superpower Russia.  Elsewhere, AAPL announced its Worldwide Developer’s Conference (where it usually unveils new products) is set for June 5-9.  This year, in addition to new phones, etc. the tech giant is expected to also unveil a new augmented reality headset.  In oil news, Bloomberg reports that slowly disappearing supplies of Brent has forced S&P to make a huge change.  As of June, the world benchmark oil price will be a combination of oil contracts that will include West Texas Intermediate at Midland TX (Permian Basin oil).  Finally, various sources report that, after another failed test, the $1.1 billion LMT hypersonic missile program will be shut down in favor of a program from RTX. 

With that background, it looks like the bulls will be gapping markets higher again at the open. (At least it does ahead of the morning data dump.) We should also look out for potential window dressing as we come into the end of the quarter Friday. In fact, some would explain Wednesday’s rally as just part of that dressing. The SPY is looking to gap open above its 50sma after ending yesterday just above following an all-day retest from below. QQQ will be retesting a potential that can be seen dating back to at least late April ’22. DIA is not there yet but is getting closer to its 50sma from below. All three major indices are in an uptrend now having broken the mid-term downtrend lines and working on higher highs and higher lows. However, be careful insofar as price has not put in a higher low or successful retest above those broken lines. Overextension is not an issue in any of the big indices in terms of the T-line (8ema), but T2122 indicates we are a bit stretched according to that indicator. Treasury Sec. Yellen speaks late in the day, but if her remarks are released early, they could impact markets (especially the banking sector). However, it is more likely that if markets are news-driven today it will come from the GDSP, GDP Price Index, and Jobless Claims data at 8:30 am. Be careful not to chase, don’t expect immediate follow-through, and make sure your stops and exits are planned before you enter.

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 just on the red side of flat (down 0.15% in the SPY, down 0.12% in the DIA, and down 0.18% in the QQQ).  From that point, we saw a divergence in the three major indices as immediately headed South, continuing its fall until 11 am, when it began to grind sideways along the lows until 1:30 pm.  Meanwhile, the SPY meandered sideways from the open until noon, when it began a modest selloff that lasted until 2 pm.  For its part, DIA actually rallied from the open until 10:15 am and then ground sideways (to slightly lower) at noon.  At that point, it too began a modest selloff that lasted until 2 pm.  From 2 pm into the close, all three major indices put in a very steady and modest rally.  This action gave us indecisive candles in all three, with the SPY and DIA printing Doji that held above their T-lines and the QQQ printing a black-bodied Hammer candle that also held its T-line.

On the day, eight of the 10 sectors were in the green with Energy (+1.65%) once again leading the way higher while Technology (-0.58%) again lagged behind other sectors.  At the same time, the SPY lost 0.22%, the DIA lost 0.15%, and QQQ lost 0.53%.  VXX fell almost 3% to 46.64 and T2122 fell back some but remained in the mid-range at 60.24.  10-year bond yields climbed again to 3.571% as money left bonds while Oil (WTI) rose three-quarters of a percent to $73.36 per barrel.  So, Tuesday gave us a mixed morning with the three major indices getting in step during the afternoon to basically go nowhere.  Indecision abounded is about as much as you can say. This all happened on significantly lower-than-average volume.

In economic news, the February Goods Trade Balance came in just slightly worse than expected at -$91.63 billion (compared to a forecast of -$91.00 billion and a January value of -$91.09 billion).  The primary cause for this was a decline in exports as Imports came in increased.  At the same time, February Retail Inventories (ex-Auto) rose 0.4%, which was up from the January increase of +0.1%.  Later in the morning, the Conference Board Consumer Confidence survey found a more optimistic consumer than had been expected.  The reading came in at 104.2, compared to a forecast of 101.0 and a February reading of 103.4.  Later, after the close, the API Weekly Crude Oil Stocks Report showed a much greater than expected drawdown of 6.076 million barrels (versus the forecast of an inventory build of 0.187 million barrels and the prior week’s 3.262-million-barrel build).

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In stock news, AAPL announced its own “buy now, pay later” program imaginatively name “Pay Later.”  The service is enabled through payments made via MA on loans of $50 – $1,000 which are paid in four installments.  The main company in that “buy now, pay later” space (AFRM) fell 8% Tuesday on the news.  Still, AAPL is not the only company reaching into the loan business as PYPL recently did the same thing. AAPL is not even the only retailer to do so as WMT launched the same type of program in December. Meanwhile, the incoming LYFT CEO Risher (who takes over April 17) said Tuesday that the company is not for sale, which runs contrary to Wall Street expectations.  LYFT fell 7.6% on this news.  Elsewhere, AMC shares jumped Tuesday on a report stating that AMZN is considering acquiring the theatre chain.  At the same time, FCNCA shares hit an all-time high Tuesday in follow-through to the Monday acquisition of SIVB assets at a bargain price.   Late in the afternoon, MSFT announced a new cybersecurity product named “Security Co-Pilot” that uses the OpenAI ChatGPT-4 to help identify breaches and potential vulnerabilities by analyzing data.  After the close, LCID said it will lay off 18% of its workforce (about 1,300 employees) to cut costs as part of its restructuring plan. 

In stock legal and regulatory news, the NHTSA opened an investigation into 50,000 TSLA 2022-2023 Model X vehicles after receiving complaints about seat belt failures.  Meanwhile, in Europe, French and German authorities raided the offices of five banks (including HSBC, SCGLY, and BNPQY) over allegations of dividend stripping fraud where the banks and investors quickly trade shares of companies going ex-dividend in order to obscure ownership and allow them to avoid paying taxes on the dividends.  (This was just the kind of headlines the banking sector needed, given the recent industry news.)  Back on this side of the pond, the US EEOC sued WMT Tuesday claiming it had violated the Americans with Disabilities Act when it fired a North Carolina worker.  In Nevada, lawyers for CZR, WYNN, and MGM asked a US judge to dismiss a case that included all the major Las Vegas hotels as well as their software providers and alleged the group was fixing prices on hotel rooms in the city.  In Brazil, META and GOOGL defended (themselves and) a Brazilian law in front of that country’s Supreme Court.  The law in question is very similar to the infamous Section 230 in the US in that it holds that internet platforms are not responsible for the content posted by their users.  After the close, a federal judge ruled in favor of the US Dept. of Justice saying that GOOGL failed to preserve company chat messages related to an antitrust case and that this breach “merits sanctions.”  Finally, CNBC reported that DG is in settlement talks with OSHA after the company was labeled a “severe violator” of workplace safety laws.

After the close, LULU, JEF, CALM, and PLAY all reported beats on both the revenue and earnings lines.  Meanwhile, MU missed on both the top and bottom lines.  It is worth noting that MU lowered its forward guidance after a massive downside earnings surprise (-$2.03/share versus -0.80/share expected).  However, LULU raised its own forward guidance.

Overnight, Asian markets were mostly green.  Only New Zealand (-0.29%) and Shanghai (-0.16%) were in the red. Meanwhile, Hong Kong (+2.06%), Japan (+1.33%), and Malaysia (+0.80%) led the rest of the region higher.  In Europe, we see green across the board at midday.  The CAC (+1.24%), DAX (+0.91%), and FTSE (+0.82%) are leading the region higher in early afternoon trade.  In the US, as of 7:30 am, the Futures are pointing toward a bullish start to the day.  The DIA implies a +0.73% open, the SPY is implying a +0.85% open, and the QQQ implies a +0.84% open at this hour.  At the same time, 10-year bond yields are down a bit to 3.558% and Oil (WTI) is up 1.04% to $73.96/barrel in early trading.

The major economic news events scheduled for Wednesday are limited to February Pending Home Sales (10 am) and EIA Weekly Crude Oil Inventories (10:30 am).  Fed Vice Chair for Bank Supervision Barr also testifies again at 10 am.  The major earnings reports scheduled for the day are limited to CTAS, PAYX, and UNF before the opening bell.  Then after the close, CNXC, FUL, and RH report.

In economic news later this week, on Thursday, we get Q4 GDP, Q4 GDP Price Index, Weekly Initial Jobless Claims, and Treasury Sec. Yellen speaks.  Finally, on Friday, Feb. PCE Price Index, Feb. Personal Spending, Chicago PMI, and Michigan Consumer Sentiment are reported as well as Fed Member Williams speaking.

In economic news later this week, on Wednesday, Feb. Pending Home Sales and EIA Weekly Crude Oil Inventories are reported.  Thursday, we get Q4 GDP, Q4 GDP Price Index, Weekly Initial Jobless Claims, and Treasury Sec. Yellen speaks.  Finally, on Friday, Feb. PCE Price Index, Feb. Personal Spending, Chicago PMI, and Michigan Consumer Sentiment are reported as well as Fed Member Williams speaking.

In earnings later this week, on Thursday and Friday, there are no major earnings reports scheduled.

So far this morning, there have been no major reports.  UNF is scheduled to report at 8:10 am.  Then, CTAS and PAYX are scheduled to report at 8:30 am.

In late-breaking news, the CEO of M, who has been leading the company’s turnaround effort, announced he will retire early next year.  Elsewhere, whistleblowers from failed CS reported that prior to its failure, the bank was once again helping rich Americans dodge taxes.  (In 2014, CS pleaded guilty to criminal charges for “knowingly and willfully” helping wealthy US clients hide assets offshore to avoid taxes.)  The report, released by the US Senate, said the investigation took place over two years and that the illegal activity was still ongoing.  CNBC reports that it is unclear at this point how much liability UBS will face for its newly acquired CS having violated its 2014 plea deal or current ongoing efforts to defraud the US government by hiding taxable assets for US clients.

With that background, it looks like the bulls will be gapping markets higher at the open. The SPY is starting to get closer to its 50sma from below and may move for a retest if there is some follow-through to the opening gap. DIA is also retesting the downtrend line stretching back to mid-February in premarket trading. All three of the major indices are above their T-line (8ema). However, overextension is not an issue in any of the big indices, nor does the T2122 indicator look stretched. Again, the economic news scheduled for today is not likely to be market-moving today. With that said, it is possible some news about the banking sector with another day of grilling for regulators (this time from the House) and the story on CS helping Americans cheat on taxes in the headlines this morning. Either way, the market remains very choppy with a bullish lean (over the last couple of weeks but certainly not a longer timeframe) in all three major indices (especially the QQQ).

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 Monday, markets gapped higher at the open (up 0.60% in the SPY, up 0.69% in the DIA, but up only 0.21% in the QQQ).  After 20 minutes of meandering sideways around the opening level, all three major indices began to selloff.  DIA pulled back the least, stopping its descent at about 11:20 am.  Meanwhile, the SPY reached its lows (at the Friday closing level) shortly after noon.  At the same time, QQQ sold off the most reaching its lows at about 12:10 pm.  From these lows, the SPY and QQQ have put in a very slow, almost sideways, climb, regaining a fraction of the ground lost during the morning selloff by the highs, which were reached at about 3 pm.  For its part, DIA did the same very slow climb but having lost the least was able to regain its opening level.  Again, DIA reached its highs of the day just after 3 pm.  This action gave us indecisive candles across all three major indices.  The SPY printed a black-bodied Spinning Top, the DIA printed a black-bodied Doji, and the QQQ printed a black-bodied Bearish Engulfing Candle with wicks on both ends.

On the day, nine of the 10 sectors were in the green with Energy (+2.33%) leading the way higher while Technology (-0.44%) lagged behind the other sectors.  At the same time, the SPY gained 0.19%, the DIA gained 0.65%, and QQQ lost 0.69%.  VXX fell more than 3.5% to 47.97 and T2122 climbed up to the top end of the mid-range (just outside of overbought territory) at 76.12. 10-year bond yields spiked to 3.541% on the day while Oil (WTI) skyrocketed 5.43% to $73.02 per barrel.  Monday saw a gap higher as banking fears quieted down.  However, after the open, action was very indecisive and even leaned bearish (especially in the tech-heavy QQQ that has led the market for some time now).   This all happened on lower-than-average volume (much lower in the SPY and QQQ).

In stock news, CRM announced it has reached a deal with activist investor Elliott Management, which will avoid a proxy fight.  The move came after CRM disbanded its mergers and acquisitions committee, reported stronger-than-expected results, said it will double buybacks and promised more headcount reductions.  Then, at midday, DIS said it will begin the first of three rounds of layoffs (totaling 7,000 job cuts announced in February) this week.  Meanwhile, LCID announced it is recalling 637 of its 2022-2023 vehicles due to electrical problems that could result in a loss of power while driving.  (LCID delivered only 4,494 vehicles as of the end of last year.  So, this is a significant portion of LCID production.)  In other electric vehicle news, LICY announced it will open a new facility to break down (recycle Lithium) batteries in France in 2024.  The project will be similar to plants LICY already has under construction in Germany and Norway.  Meanwhile, CVS said late Monday that it expects to close its $8 billion acquisition of SGFY this week.  (This likely means CVS has gotten past antitrust scrutiny and approvals.)   Elsewhere, after hours, AMTI cut 57% of its workforce and has begun exploring strategic alternatives.  At the same time, PINS announced a restructuring plan which includes the roughly a 4% workforce reduction announced in February.  The announced plan includes subleasing leased office space in San Francisco.  Finally, the Wall Street Journal reported that LYFT announced it has named David Risher (former AMZN and MSFT executive) as CEO beginning April 17.

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In stock legal and regulatory news, RACE hailed a deal, between Germany and the EU, which will allow small-volume manufacturers like RACE to continue producing internal combustion engine vehicles beyond 2035 as long as they can be run on “carbon-neutral e-fuels.”  (Exactly what constitutes a “carbon-neutral e-fuel” was not explained.)  Elsewhere, the US Supreme Court declined to hear an appeal that was a challenge on US steel import tariffs.  This leaves the 25% tariffs on European steel in place and was a loss for DORM and several other Turkish steel importers who were the plaintiffs.  Meanwhile, AMZN lost its bid to avoid a class-action consumer lawsuit (damages are estimated between $55 billion and $172 billion) filed by residents of 18 states over pricing policies.  Later in the day, it came out that the FDIC will backstop the deal whereby FCNCA will acquire much of SIVB assets.  The FDIC will provide FCNCA with a line of credit.  At the same time, the former TSLA employee who had their $137 million racial bias verdict reduced by an appeals court has filed suit again rather than accept the $15 million reduced amount.  The new trial begins this week.  In other legal news, the newly-fired FOX News producer is recanting her testimony supporting FOX in the $1.6 billion defamation case filed against FOX by Dominion Voting Systems.  That same former employee filed amended discrimination and retaliation lawsuits against FOX as well.

In cryptocurrency news, COIN is waiting on the filing of a lawsuit and charges by the SEC (claiming the company sold unregistered securities) which were announced via the receipt of a Wells Notice letter last week.  However, Binance (the world’s largest cryptocurrency exchange) and its CEO Changpeng Zhao will be the first crypto exchange to be tested by the US government.  The US Commodity Futures Trading Commission (CFTC) filed suit against Binance over regulatory violations on Monday.  (Binance recently made news when its due diligence prior to a proposed white knight acquisition turned up the fraud and mismanagement at now-defunct FTX.

In energy news, the major cause behind Oil’s huge rise Monday came from a halt to exports from Iraq’s Kurdistan region.  Turkey stopped pumping Iraqi oil following its loss of an arbitration case confirming that Bagdad’s approval was required for the shipping of Kurdish oil.  This instantly dropped global oil supplies by 450,000 barrels per day.  Adding to the pain, Russia was quick to announce “it is close to achieving its goal of cutting production 500,000 barrels per day (down to 9.5 million barrels per day produced).

After the close, PVH and EE reported beats on both the revenue and earnings lines.  PVH also raised its forward guidance.

Overnight, Asian markets were mostly green.  New Zealand (+1.36%), Hong Kong (+1.11%), and South Korea (+1.07%) led the broad-based rally.  Meanwhile, Taiwan (-0.81%), Shenzhen (-0.72%), and India (-0.20%) paced the losses.  In Europe, we see a similar picture taking shape at midday with an even split of red and green among the bourses.  The CAC (+0.01%), DAX (+0.06%), and FTSE (+0.07%) lead as always on market size.  However, Greece (-1.22%), Denmark (-0.39%), and Belgium (-0.36%) pace the losses.  On this side of the pond, US Futures are pointing toward a start to the day just on the red side of flat.  The DIA implies a -0.02% open, the SPY is implying a -0.10% open, and the QQQ implies a -0.15% open at this hour.  At the same time, 10-year bond yields are rising again to 3.568% as money leave bonds early and Oil (WTI) is on the green side of flat at $72.89/barrel in early trading.

The major economic news events scheduled for Tuesday include Feb. Trade Goods Balance and Feb. Retail Inventories (both at 8:30 am), Conference Board Consumer Confidence (10 am), and the API Weekly Crude Oil Stocks report (4:30 pm).  Fed Vice Chair for Bank Supervision Barr, FDIC Chair Gruenberg, and Treasury Department Undersecretary Liang are also scheduled to testify to (be grilled by) the House at 10 am.  The major earnings reports scheduled for the day are limited to CNM, ESLT, IHS, MKC, SNX, and WBA before the opening bell.  Then after the close, CALM, PLAY, JEF, LULU, and MU report.

In economic news later this week, on Wednesday, Feb. Pending Home Sales and EIA Weekly Crude Oil Inventories are reported.  Thursday, we get Q4 GDP, Q4 GDP Price Index, Weekly Initial Jobless Claims, and Treasury Sec. Yellen speaks.  Finally, on Friday, Feb. PCE Price Index, Feb. Personal Spending, Chicago PMI, and Michigan Consumer Sentiment are reported as well as Fed Member Williams speaking.

In earnings later this week, on Wednesday, we hear from CTAS, PAYX, UNF, CNXC, FUL, and RH.  On Thursday and Friday, there are no major earnings reports scheduled.

So far this morning, WBA, MKC, and HIS have reported beats on the revenue and earnings lines.  Meanwhile, ESLT beat on revenue while missing on earnings.  On the other side, CNM reported inline on revenue while missing on earnings.  (SNX reports later in the premarket).  It is worth noting that HIS raised its forward guidance.

In late-breaking news, BABA founder Jack Ma returned to China Monday (after more than a year abroad) in what many saw as a potential sign that President Jinping may be softening his stance on the technology sector.  Then overnight it was announced that BABA will split into six different business units, each with its own CEO and board as well as its own ability to raise outside funding and go public.  Ma will not be CEO of any of the units, but his return to China is perceived as the blessing of the move by the government.  BABA shares were up almost 9% in premarket on the news.  Elsewhere, Bloomberg reports SCHW has more than $29 billion in unrealized, long-dated bond losses on its books (as of year-end).  In addition, the report said higher interest rates are starting to cause its customers to move money out of SCHW and into money-market vehicles.

With that background, it looks like the markets are in a “wait and see” mood this morning. All three of the major indices sit just above their T-line (8ema) with DIA and SPY also sitting just above the 17ema. DIA also sits just atop its 200sma. So, overextension is not an issue in any of the big indices, nor does the T2122 indicator look stretched. The economic news scheduled is not likely to be market-moving today. However, it is possible some news about the banking sector will come from the (mostly political) grilling of regulators by the House today. The market remains very choppy with a bullish lean in the SPY, a full-blown bullish trend in the QQQ, and much more of an undecided feel to the DIA.

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 modestly on Friday (down 0.34% in the SPY, down 0.43% in the DIA, and down 0.21% in the QQQ).  This came as DB had put a shock into markets globally on default risks.   After that open, all three major indices wandered around the open level for 90 minutes.  However, about 11:15 am, the bulls stepped in to lead a long, steady rally that lasted the rest of the day, closing very near the highs.  This action gave us white-bodied candles with larger lower wicks, including a Hammer in the QQQ.  This happened on slightly less than average volume on SPY and QQQ as well as a bit heavier than average volume in the DIA.

On the day, eight of the 10 sectors were in the green with Utilities (+2.83%) leading the way higher while Technology (-0.26%) lagging behind the other sectors.  At the same time, the SPY gained 0.64%, the DIA gained 0.44%, and QQQ gained 0.37%.  VXX fell more than 4% to 49.74 and T2122 climbed up out of the oversold territory into the mid-range at 31.67. 10-year bond yields dropped again to 3.374% while Oil (WTI) fell 1% to $69.20 per barrel.  So, Friday saw a gap down, about 1.5 hours of reconsideration, and then a modest rally that lasted the entire rest of the day.

In economic news, February Durable Goods Orders came in lower than expectations at -1.0% month-on-month (compared to a forecast of +0.6% but far better than the January reading of -5.0%).  Later in the morning, Manufacturing PMI was reported to be above the forecast at 49.3 (versus an expected 47.0 and February’s 47.3 value).  The Services PMI also beat expectations at 53.8 (compared to a forecast of 50.5 and even compared to the February reading of 50.6).  At the same time, the S&P Global Composite PMI also beat expectations with a value of 53.3 (versus the forecast of 47.5 and the February value of 50.1).  In Fed talk, St. Louis Fed Pres. Bullard (uber hawk) largely stuck to his guns, telling reporters that the Fed policy rate will likely need to continue rising to higher-than-expected levels once the banking sector stress eases.  (Bullard’s terminal rate forecast is a half percent higher than most Fed members at 5.50% – 5.75%.)  Later, Richmond Fed President Barkin (also a hawk) told CNN that he had no second thoughts on the Fed’s 25-basis-point hike Wednesday.  He went on to say that by the time the FOMC voted, the banking system “felt very stable…So, the conditions were right to do monetary policy the way we want to…”  Meanwhile, Atlanta Fed President Bostic (neutral to dovish) told NPR that “There was a lot of debate.  This wasn’t a straightforward decision, but at the end of the day, we decided there were clear signs that the banking system is sound…(and) inflation is still too high.”

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In stock news, TSLA rolled out version 2.0 of its Full Self-Driving software that makes the feature only available to drivers who achieve a 100/100 safety score (as scored by TSLA sensors and other proprietary factors).  In other auto news, F announced its new Tennessee factory (BlueOval City) is scheduled to build 500k electric vehicles per year.  This is part of the F plan to be producing 2 million electric vehicles per year by 2026.  The BlueOval plant will begin production in the fall of 2025.  Elsewhere, the Wall Street Journal reported that MO is considering expansion of its non-nicotine product lines over the next 12 months.  At the same time, AAL said it would suspend its Philadelphia to Madrid route for about a month (in May to June) due to delivery delays of BA 787 Dreamliner jets.  Over the weekend, according to the Financial Times, the CEOs from PG, PFE, and AAPL are among the very few US-listed company leaders to attend the Chinese Development Forum in Beijing.

In stock legal and regulatory news, late in the day Friday, the US FDA approved a PHAR treatment for weakened immune systems.  (PHAR jumped 22% on the news.)  Meanwhile, Reuters reported that the US Dept. of Justice (and outside lawyers) are investigating TSN over the antitrust law aspects of its announced closure of a Virginia Chicken processing plant.  TSN gave suppliers two months’ notice while antitrust and the Packers and Stockyards Act laws require 90 days’ notice.  Elsewhere, FRBK said Friday that it expects to file its annual report with the SEC much later than the March 30 deadline.  The bank hopes to report by May 1.  The US Dept. of Transportation has rejected an application from JBLU and SAVE that the two be allowed to operate under common ownership.  The DOT cited the pending US Dept. of Justice lawsuit seeking to block the acquisition.

Overnight, Asian markets were mixed.  Hong Kong (-1.75%) was by far the biggest mover with Taiwan (-0.53%) and Shanghai (-0.44%) rounding out the group that paced the losers.  Meanwhile, Singapore (+0.82%), Japan (+0.33%), and New Zealand (+0.28%) led the gainers.  However, in Europe, the bourses are strongly green across the board at midday.  The DAX (+1.40%), CAC (+1.17%), and FTSE (+0.98%) are leading the region higher in early afternoon trade.  As of 7:45 am, US Futures are pointing toward a gap higher to start the day.  The DIA implies a +0.66% open, the SPY is implying a +0.67% open, and the QQQ implies a +0.39% open at this hour.  At the same time, 10-year bond yields are higher to 3.466% and Oil (WTI) is up 1.3% to $70.15/barrel in early trading.

There are no major economic news events scheduled for Monday.  The major earnings reports scheduled for the day are limited to BTNX and CCL before the opening bell.  Then after the close, PVH reports. 

In economic news later this week, on Tuesday, we get Feb. Trade Goods Balance, Feb. Retail Inventories, Conf. Board Consumer Confidence, and the API Weekly Crude Oil Stocks report.  Then Wednesday, Feb. Pending Home Sales and EIA Weekly Crude Oil Inventories are reported.  Thursday, we get Q4 GDP, Q4 GDP Price Index, Weekly Initial Jobless Claims, and Treasury Sec. Yellen speaks.  Finally, on Friday, Feb. PCE Price Index, Feb. Personal Spending, Chicago PMI, and Michigan Consumer Sentiment are reported as well as Fed Member Williams speaking.

In earnings later this week, on Tuesday, CNM, ESLT, IHS, MKC, SNX, WBA, CALM, PLAY, JEF, LULU, and MU report.  Then Wednesday, we hear from CTAS, PAYX, UNF, CNXC, FUL, and RH.  On Thursday and Friday, there are no major earnings reports scheduled.

In late-breaking news, the fallout from the banking crisis continues.  In the US, FCNCA announced it has reached a deal to acquire the deposits and loans of SIVB from the FDIC.  The deal includes $72 billion in assets acquired at a discounted price of $16.5 billion. In Europe, the top managers of CS are facing an investigation and potential disciplinary action from the Swiss Banking Regulator.  Meanwhile, in the Persian Gulf, the head of the Saudi National Bank (whose public refusal to buy more of CS caused that bank’s depositor run) has resigned “for personal reasons.”  Elsewhere, the UAW has elected a reformer as union President.  This may mean trouble for automakers as the new President ran on promises to take tougher negotiating stances in upcoming negotiations.

With that background, it looks like the bulls are going to gap the major indices (large caps) back up above their T-line (8ema). The DIA will also be retesting its 200sma from below at the open. Overextension from the T-line is not an issue in any of the big indices, nor is the T2122 which is back in its mid-range. With no economic news scheduled, the FOMC decision off the table, and banking problems somewhat subsiding, I suspect that the bulls will have a little room to run this morning. This doesn’t necessarily mean any market trend change. It just means the bulls have momentum in the premarket and there is no known obstacle to them stretching their legs in the short-term.

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 higher to differing degrees (up 0.74% in the SPY, up only 0.37% in the DIA, and up 1.24% in the QQQ).  All three major indices then went on a bullish run, reaching the highs of the day at about 11:10 am.  However, then the bears took over selling off the SPY, DIA and QQQ at an increasing tempo that reached the lows of the day at 3 pm.  The last hour saw a volatile bounce up off the lows that took all three back up to the opening level by the close.  This action gave us gap-up indecisive candles (Doji in the QQQ and DIA as well as a black-bodied Spinning Top in the SPY).  This happened on greater-than-average volume in all three of the indices.

On the day, six of the 10 sectors were in the red with Energy (-1.51%) leading the way lower while Technology (+1.50%) fairing much better than the other sectors.  At the same time, the SPY gained 0.26%, the DIA gained 0.21%, and QQQ gained 1.19%.  VXX climbed 2.67% to 51.89 and T2122 remained well into the oversold territory at 7.94. 10-year bond yields dropped again to 3.412% while Oil (WTI) fell 2.3% to $69.26 per barrel.  So, Thursday saw a major divergence with much money chasing the safety of bonds while at the other end of the spectrum high tech names like NFLX, MU, MRVL, and others leading the QQQ higher.

In economic news, Building Permits came in a bit above expectation at 1.550 million (compared to a forecast of 1.524 million and the prior month’s value of 1.339 million).  This amounted to a 15.1% month-on-month increase (compared to a forecasted 13.8% increase).  Elsewhere, the Q4 Current Account (Imports minus Exports) came in a bit better than expected at -$206.8 billion (versus a forecast of -$213.2 billion and the Q3 reading of -$219.0 billion).  Later, February New Home Sales were reported slightly lower than expected at 640k (compared to a forecast of 650k but slightly better than the January value of 633k).  During the afternoon, Treasury Sec. Yellen told the House Appropriations Committee that she expects inflation to eventually come down as both supply chain pressures (shortages) and shipping costs continue to fall.  She also said a default on US debt would undermine the US dollar’s reserve currency status as well as lead to a recession or worse.  Finally, Yellen said that the FDIC is prepared for more actions to protect depositors if needed according to Bloomberg.

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In stock news, BLK doubled down on the ESG topic Thursday when it said it would continue to push companies on how they treat “material” climate-related risks as well as maintaining its stance on the energy transition despite any criticism from some US politicians.  Elsewhere, the CEO of C, Jane Fraser, told the Washington DC Economic Club that “this is not a credit crisis” and “the banking system is pretty sound.”  She went on to say this is a “situation where “it’s a few banks (causing the problem).”   At the same time, F said that it is expecting a $3 billion loss from its electric vehicle unit this year, but remains on track to achieve an 8% pretax margin by late 2026.  Later, Reuters reported exclusively that WMT will be asking hundreds of workers at five of the company’s e-commerce fulfillment centers to find jobs elsewhere in the company within 90 days.  Midday, aptly named Hindenburg Research (Short Seller) published a report claiming that SQ (Block Inc) overstated its user numbers, understated customer acquisition costs, and facilitated criminal activity.  SQ CEO Jack Dorsey denied the claims and vowed to take legal action against Hindenburg and file a complaint with the SEC.  After hours, Reuters reported they had internal memos from JPM, C, and BAC telling their employees not to poach clients from stressed banks.  The gist of the report was that the big bank’s management did not want to make the problem worse, give anyone the impression their banks are exploiting the situation, or give the banking industry a bad name.

In stock legal and regulatory news, Bloomberg reported that the European Central Bank is rethinking their treatment of liquidity risk in the wake of the failure of CS (and SIVB in the US).  This seems like a pretty obvious need but Bloomberg says sources confirm the discussions are underway (just not formal yet).  Meanwhile, COIN fell on Thursday after Wednesday night’s Wells Notice from the SEC.  However, the firm tried to push back against the SEC by telling Reuters that the company had asked the SEC what product they are selling the SEC considers a security but the agency declined to respond.  Elsewhere, the CFO of HSY said the company is evaluating how it might reduce or eliminate heavy metals (found by Consumer Reports magazine research) from its dark chocolate products.  HSY faces multiple lawsuits over the presence and lack of disclosure of those metals in the products.  At the same time, the Wall Street Journal reports the Dept. of Defense has launched an investigation into BA over the company allowing 250 people to work on current and future Air Force One jets without proper security clearance.  Mid-afternoon, Reuters reported that the US and European Commission have reached an agreement that will allow electric vehicles containing minerals extracted or processed in Europe to qualify for US green subsidies (as set up in the Inflation Reduction Act package).  After hours, Bloomberg reported that the US Dept. of Justice is investigating CS and UBS (among other banks) for helping Russian oligarchs evade sanctions.

In energy news, Oil snapped a 3-day winning streak amidst rumors that OPEC+ will not increase its production cuts, despite oil being at 15-month lows.  This came after Reuters reported that three OPEC+ delegates told them the group is unlikely to go past the 2 million barrel production cuts agreed on in November.  Elsewhere, US Energy Sec. Granholm told lawmakers Thursday that “the US is in no hurry to refill the Strategic Petroleum Reserves.  She also noted that the department intends to proceed with the congressionally mandated release of another 26 million barrels this year.

After the close, JOAN beat on revenue but missed on earnings.

Overnight, Asian markets were nearly red across the board.  Taiwan (+0.32%) and Shenzhen (+0.25%) were the only green.  Meanwhile, Malaysia (-0.80%), India (-0.77%), and Hong Kong (-0.67%) paced the losses.  In Europe, we see the same picture taking shape at midday with only Russia (+0.04%) clinging to green territory.  The spike in default insurance costs at DB has the whole region in fear.  The DAX (-2.21%), CAC (-2.16%), and FTSE (-1.92%) are typical and lead the region lower in early afternoon trade.  As of 7:30 am, US Futures are pointing toward US markets following the rest of the world lower, at least at the start of the day.  The DIA implies a -0.96% open, the SPY is implying a -0.75% open, and the QQQ implies a -0.42% open at this hour.  At the same time, 10-year bond yields are plummeting as traders seek the safety of bonds, now down to 3.311% and Oil (WTI) is being crushed by nearly 4% to $67.20/barrel in early trading.

The major economic news events scheduled for Friday include Feb. Durable Goods (8:30 am), Mfg. PMI, S&P Global Composite PMI, and Services PMI (all at 9:45 am).  Fed member Bullard also speaks at 9:30 am.  The major earnings reports scheduled for the day are limited to EXPR before the opening bell.  There are no major earnings reports scheduled for after the close. 

So far this morning, EXPR reported a miss on revenue while beating on the earnings line (smaller loss than expected).

In late-breaking news, the big story of the premarket is that DB stock price plunged as much as 13% overnight following a sudden spike in the company’s credit default swaps (i.e. the cost of insuring that they do not default on their debt) Thursday night.  As a result, there is widespread fear in Europe of contagion of runs on the large European banks like DB, HSBC, BNPQY, SAN, UBS, or ISNPY.  In the meantime, across the border in Switzerland, Swiss Banking Regulators blamed the collapse of CS on “the US banking crisis.”  (This conveniently forgets years of scandal, mismanagement, criminal activity, and the $8 billion in losses CS racked up in 2022.)

With that background, it looks like the bears are looking to take us back toward the bottom of the week’s range. However, premarket action is very volatile today, making large swings in both directions. SPY and DIA look like they will open below their T-line (8ema) while, as has been normal for a while, QQQ looks to be holding up best at this point. Overextension from the T-line is not an issue in any of the big indices. However, T2122 is back in the oversold zone. While there is some economic news this morning (including Durable Goods Orders before the open) today, I suspect that talk and fears related to regional banks (and theoretically some of the big boys) will dominate market sentiment. As an aside, it might be interesting to hear Fed mega-hawk Bullard’s tone at 9:30 am amidst market fears over banks. (I wonder if he is a little more dovish than usual this morning and talks up the Fed’s ability to prop up the banking system if needed.) So, be cautious and also remember that this is a Friday. The last two weekends have seen major market-moving news cycles related to banks. Don’t bet against a third such weekend. Have your account 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 flat on Wednesday as traders waited on the Fed decision.  The three major indices then wandered around the opening level before a midday selloff.  The bulls then stepped in at about 1:15 pm and rallied markets into the Fed announcement.  At that point, all three showed major volatility, first spiking up, selling off hard, and reversing again and again.  All three reached the highs of the day at 2:50 pm before then putting in the strongest downtrend of the day.  This move saw a 3:15 pm bounce but resumed and took all three major indices out on their lows.  This action gave us large, black-bodied candles with large upper wicks in the SPY, DIA, and QQQ.  The DIA also printed an Evening Star signal and crossed back below its T-line and 200sma.  SPY crossed down its 200sma while remaining above its T-line.  And, continuing to be the strongest of the major indices, QQQ remains well above its T-line.

On the day, all 10 sectors were in the red with Financial Services (-2.39%) leading the way lower while Consumer Defensive (-0.80%) held up better than the other sectors.  At the same time, the SPY lost 1.70%, the DIA lost 1.67%, and QQQ lost 1.36%.  VXX climbed 4% to 50.43 and T2122 dropped back into the oversold territory at 8.06.  10-year bond yields plummeted again to 3.451% while Oil (WTI) gained half of a percent to $70.02 per barrel.  So, Wednesday saw huge volatility following the Fed statement, Dot Plots, and press conference the bulls seemed to like but Treasury Sec. Yellen said the FDIC will not cover all deposits, which gave the bears firm control at the end of the day (on fears of more regional bank runs).  This all happened on average volume. 

In economic news, the EIA Weekly Crude Oil Inventories came in much higher than expected at +1.117 million barrels (compared to a forecast that called for a drawdown of 1.565 million barrels and the prior week’s build of 1.550 million barrels).  Later, the Fed Future Interest Rate Projections (aka Dot Plots) showed a forecast of 5.1% (the terminal rate) for 2023 (up from the prior forecast of 4.4%), 4.3% interest rate in 2024 (down from the prior forecast of 5.1%), and 3.1% in 2025 (down from the prior forecast of 4.1%).  The FOMC also raised the Fed Funds Rate by 25 basis points to the 4.75%-5.00% range.  The Fed statement continued to predict one more rate hike and no rate cuts in 2023.  However, they also stated that the future hike is not a sure thing and will depend on data. During his press conference, Fed Chair Powell said “the US banking system is sound and resilient.”  He also said disinflation is happening, that the Fed had considered a rate hike pause due to the banking issue, and that this current situation with regional banks is likely to tighten credit conditions for households and businesses (which will help the Fed to curb inflation by weighing on the economy).  At the same time, Treasury Sec. Yellen told the Senate Banking Committee that banks have been shoring up their liquidity the last two weeks and that the government was taking steps to protect depositors.  However, she said the FDIC was not considering providing “blanket insurance” (insuring all deposits regardless of size) at this time.  She said it was worthwhile to look at changes, but increasing above the current $250,000 limit is not being considered. Still, she said when a bank fails and is believed to pose a systemic risk (i.e., pose a risk of contagion of bank runs) “we are likely to invoke a risk exception” that allows the FDIC to cover all deposits.  So, basically, Yellen said they won’t insure all deposits but if a bank gets run and they think it will prevent panic, they will cover all deposits for that specific bank.  (Here’s to hope that your bank is likely to cause a panic if it goes under.)

SNAP Case Study | Actual Trade

In stock news, the CFO of BA said Wednesday that the company will be taking more charges due to supplier quality issues on the KC-46 Tanker jet program, but added that the charges would not impact BA annual cash flow.  Elsewhere, the surprise GME profit on Tuesday night triggered a massive short-squeeze resulting in a 35% gain after a very volatile day that saw the stock up 53% at one point.  Meanwhile, BIDU’s smart car business unit received approval to be the first company to test autonomous vehicles on the road in Shanghai (population 26 million).  At the same time, Reuters reported that the MSFT search engine Bing has received a 15.8% boost in usage (compared to a 1% decline in the use of the GOOGL search engine) since the February 7 release of Bing’s AI-powered (ChatGPT) engine.  However, please be aware that Bing’s share of searches was so small to start with that this seemingly big move is really tiny overall.  In other news, ALB announced it will be opening a $1.3 billion lithium processing plant in South Carolina.  After the close, COIN said it has been issued a Wells Notice (notice the SEC intends to bring enforcement action). Finally, F announced on Thursday it will be re-releasing 2021 and 2022 results to reflect a finer level of detail by business unit. This is the first major car company to do so and will give much more insight into the company (and industry). Industry analysts expect to see massive losses from the electric vehicle unit but time will tell.

In stock legal and regulatory news, the CEO of MRNA defended the new, dramatically higher $130/dose price (versus $18/dose) for the COVID-19 vaccine before the US Senate Wednesday.  He was pushed by Senator Sanders but responded by pointing out it will be in single-dose syringes rather than in the 10-dose vials sold to the US government in 2021-2022.  In other drug news, the NIH announced it will not be using its “march-in” rights to grant production licenses to other manufacturers for the PFE prostate cancer drug Xtandi.  The agency said their analysis shows the drug is widely available (despite it selling for $170,000/year/patient).  At the same time, the US FDA has declined to approve ABBV’s Parkinson’s disease therapy.  This was a significant hit to ABBV, as the treatment was meant to be one of the company’s biggest drug introductions in the next one to two years.  Elsewhere, Reuters reported that GOOGL will gain unconditional EU antitrust approval for the acquisition of math app Photomath. The European Commission will rule on the deal on March 28, but sources tell Reuters the deal is approved.  Meanwhile, on this side of the pond, JNJ has appealed to the US Supreme Court to revive its effort to use bankruptcy law to avoid liability in more than 38,000 cases alleging JNJ’s Baby Powder (contaminated with asbestos) caused damages.  In other news, House GOP members are lining up behind business interests as they summoned NRLB officials while alleging the NRLB had been unfair to SBUX in ruling that the company broke labor law hundreds of times in its effort to fight unions.  In transportation, the FAA agreed to a request from DAL to reduce the “minimum flights requirement” and New York and Washington DC airports. The change will allow DAL and UAL to operate fewer flights (during congestion, staff outages, or whatever) without losing their landing slots at those airports.

After the close, CHWY, KBH, WOR, and SCS all reported beats on both the revenue and earnings lines.  Meanwhile, MLKN missed on revenue while beating (significantly) on earnings.  It is worth noting that MLKN lowered forward guidance and SCS raised guidance at the time of the report.  It is also worth noting that in addition to MLKN, CHWY, and WOR earnings were significant upside surprises versus the average analyst forecast.

Overnight, Asian markets were mixed but leaned toward the green side.  Australia (-0.67%), India (-0.44%), and Japan (-0.17%) led the losses.  Meanwhile, Hong Kong (+2.34%), Shenzhen (+0.94%), and Taiwan (+0.66%) paced the gainers.  In Europe, markets are red across the board at midday.  The CAC (-0.55%), FTSE (-0.97%), and DAX (-0.63%) are typical and are leading the region lower in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a green start to the day.  The DIA implies a +0.20% open, the SPY is implying a +0.47% open, and the QQQ implies a +0.90% open at this hour.  At the same time, 10-year bond yields are back up to 3.50% and Oil (WTI) is down three-quarters of a percent to $70.43/barrel in early trading.

The major economic news events scheduled for Thursday include Building Permits (8 am), Q4 Current Account and Weekly Initial Jobless Claims (8:30 am), and February New Home Sales (10 am).  The major earnings reports scheduled for the day include ACN, DOOO, CMC, DRI, FDS, and GIS before the opening bell.  Then after the close, JOAN reports. 

In economic news later this week, on Friday, Feb. Durable Goods, Mfg. PMI, S&P Global Composite PMI, and Services PMI are reported.  In earnings later this week, on Friday, EXPR reports.

So far this morning, ACN, GIS, DRI, and DOOO all reported beats on the revenue and earnings lines.  Meanwhile, FDS missed on revenue while beating on earnings.  On the other side, CMC beat on revenue while missing on earnings.  It is worth noting that GIS has raised its forward guidance.

In late-breaking news, Bloomberg reports that the big Wall Street banks have eased off of their previously announced hiring freezes as they attempt to snap up the best talent available from CS.  Elsewhere, F began releasing its prior results broken out by business unit.  It seems the EV unit lost $2.1 billion in 2022, which was offset by $10 billion in operating profits from the internal combustion and fleet sales units.  Finally, the CEO of C (Jane Fraser) said that the SIVB collapse demonstrates we are in a new world where bank customers can move millions of dollars with just a couple clicks from any location.  She implied there need to be new or changed regulations to protect banks from “digital runs” because remote access to money electronically has removed banks’ ability to forecast the need for liquid assets.

With that background, it looks like the bulls are looking to make a move against yesterday’s late-day selloff. This is especially true in the QQQ. SPY has recrossed its T-line (8ema) and 200sma to the upside in premarket. Overextension from the T-line is not an issue in any of the big indices. However, T2122 is back in the oversold zone. While there is some economic news (including Weekly Jobless Claims) today, I suspect that talk and fears related to regional banks may be a big driver of direction. Until the regional banks stocks calm down, it will be hard for the big banks to hold up. And without the big banks, it’s hard for the DIA and SPY to hold ground either. So, be cautious and don’t let FOMO put you in a position where this daily chop eats you alive.

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 Monday, markets started the day essentially flat (opening up 0.15% in the SPY, up 0.27% in the DIA, and down 0.33% in the QQQ). After that open, the SPY rallied slowly until 11:30 am.  Meanwhile, the DIA rallied more strongly but only for 30 minutes.  The QQQ sold off during the first 30 minutes but then rallied until 11:30 am.  From that point, all three major indices had a midday slump before rallying right back to where they were at 11:30 am.  This action gave us a white-bodied inside day candle in the SPY (crossing above its T-line in the process).  QQQ printed a white-bodies Hammer candle.  For its part, DIA printed a white, large-bodied candle with only a tiny upper wick (also crossing back above its own T-line by pennies).  This happened on average volumes (down from the last week and a half) as traders wait on the Wednesday Fed move.

On the day, all 10 sectors were in the green with Energy (+1.68%) leading the way higher while Consumer Cyclical (+0.38%) lagged behind the other sectors. At the same time, the SPY gained 0.94%, the DIA gained 1.19%, and the QQQ gained 0.20%.  VXX fell 5% to 53.16 and T2122 rose back out of the oversold area to 24.82.  10-year bond yields climbed (significantly from premarket open) to 3.492% while Oil (WTI) fell 1.15% to $67.51 per barrel.  So, Monday saw markets calm down after the Friday bank worries. This came even though FRC got hammered (-47.11% after several trading halts during the day) and a few other regionals were also big losers.  However, NYCB, PACW, FCNCA, and other regional banks also were big winners on the day. 

In stock news, AMZN announced Monday that it will lay off 9,000 more employees in the coming weeks.  (The company laid off 18,000 in November – January.)  In leadership news, the CEO of NCLH announced Monday that he is retiring in June and will be succeeded by insider Frank Del Rio.  At the same time, SBUX CEO Shultz left two weeks early with new CEO Narasimham taking over Monday.  Elsewhere, MULN announced it has acquired both the North and South American distribution rights for the DragonFLY K50 electric supercar (capable of 0-60mph in 2 seconds and a top speed of more than 200mph).  At the same time, PSNY officially launched an electric SUV in China and clashed its starting price by $29,000 in doing so.  It is unclear if PSNY intends to offer the reduced prices in the US as well.  Meanwhile, JPM CEO Dimon is heading up talks with other major bank CEOs in an effort to rescue and stabilize FRC.  The Wall Street Journal reports sources to the talks tell them that some or all of last week’s $30 billion in deposits the big banks made at FRC may be converted to a capital injection.  However, the same sources told WSJ that a complete buyout is also on the table.  In other banking news, COIN has stopped support for the SBNY digital payment platform (more than a week after regulators took control of the bank and a day after NYCB entered into an agreement to buy the deposits and loans of SBNY).  In M&A news, RBA completed its acquisition of IAA on Monday.  In M&A rumors, Reuters reports the TMO and South Korean firm Celltrion are competing to acquire the BAX Biopharma Solutions unit.  Sources told Reuters the sale could net BAX $4 billion.

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In stock legal and regulatory news, European Commission Vice President Vestager said Monday that tax deals between multinationals and EU countries amount to illegal tax breaks.  She indicated new investigations into many multinational companies are likely to happen. Europe’s top court has not yet ruled on her ruling (thrown out by lower courts) against AAPL, AMZN, and SBUX.  However, the same court did uphold her ruling against ENGIY and her actions have forced Luxembourg, the Netherlands, and Belgium to change their practices of giving breaks to corporations.  Elsewhere, the NHTSA said Monday that F has recalled 1.5 million (2013-2018 Fusion and Lincoln MKZ) vehicles over faulty brakes and wipers.  Meanwhile, GOOGL has denied charges from the US DOJ (and 30 states) that the company intentionally destroyed records of internal chat communications related to the search business as part of an antitrust case.  GOOGL said it made “reasonable efforts” to preserve those records since the case was filed in 2020 but unfortunately those records have now been permanently deleted.  In other potential news, IATA (an airline industry lobbying group) told Reuters Monday that increased airline travel may trigger UN-based global emission caps on the major airlines (AAL, DAL, UAL, JBLU, etc.) as soon as 2024.

In energy news, Reuters reported that US crude oil exports to Europe have hit another record this month, at an average of 2.1 million barrels per day so far in March.  The report cited lower demand from US refineries and the broad discounts in the WTI benchmark price.  Meanwhile, over in the Natural Gas space, the front-month April Natty contract continued falling Monday.  The price closed at $2.24/mmBtu, the lowest closing price since February (which was itself the low since July 2020).

In miscellaneous news, President Biden used his first veto to slap down the anti-ESG bill (which forbade federal employee retirement funds from considering ESG issues for any reason when choosing investments, regardless of the implications of such or customer preferences).  The bill had passed both houses of Congress with small majorities. So, it is unlikely supporters can overcome the veto.  On the other side of the political aisle, a few GOP lawmakers have already requested all documents and personnel records from the Fed and FDIC relating to the failures of SIVB and SBNY banks.  Their letter to the agencies seems to state a conclusion (before beginning) with the letter demanding the records, citing what “appears to be glaring bank mismanagement and regulators lack of basic supervision and enforcement of…rules.”  There is no word on when the investigation will begin or when hearings will be held.

Overnight, Asian markets leaned heavily to the green side.  Japan (-1.42%) and New Zealand (-0.29%) were the only red in the region.  Meanwhile, Shenzhen (+1.60%), Thailand (+1.40%), and Hong Kong (+1.36%) led the area markets higher.  In Europe, we see green across the board at midday.  The FTSE (+1.37%), DAX (+1.64%), and CAC (+1.50%) are leading the continent higher in early afternoon trade.  As of 7:30 am, US Futures are pointing toward a move higher to start the day.  The DIA implies a +0.88% open, the SPY is implying a +0.80% open, and the QQQ implies a +0.54% open at this hour.  At the same time, 10-year bond yields are climbing fast to 3.549% and Oil (WTI) is up fractionally to $67.79/barrel in early trading.

The major economic news events scheduled for Tuesday are limited to Feb. Existing Home Sales (10 am) and API Crude Oil Stocks Report (4:30 pm).  The major earnings reports scheduled for the day include CSIQ and TME before the opening bell.  Then after the close, AIR, GME, and NKE report.

In economic news later this week, on Wednesday, EIA Crude Oil Inventories, Q1 Interest Rate Projections, the Fed Rate Decision, and the Fed Statement, are all reported and Fed Chair Press Conference takes place.  On Thursday, we get Building Permits, Q4 Current Account, Weekly Initial Jobless Claims, and New Home Sales.  Finally, on Friday, Feb. Durable Goods, Mfg. PMI, S&P Global Composite PMI, and Services PMI are reported.

In earnings later this week, on Wednesday, OLLI, WOOF, WGO, CHWY, KBH, MLKN, SCS and WOR report.  On Thursday, we hear from CAN, DOOO, CMC, DRI, FDS, and GIS.  Finally, on Friday, EXPR reports.

So far this morning, CSIQ and TME reported beats on both the revenue and earnings lines.  It is worth noting that CSIQ also lowered its forward guidance.

In late-breaking news, this morning Treasury Sec. Yellen told an American Bankers Association audience that the government is ready to guarantee more deposits if the banking crisis were to worsen.  In an apparent attempt to stave off criticism (mostly from GOP lawmakers but also the most progressive Democrats), she said the actions taken so far were not aimed at any specific banks or classes of banks but instead were to protect the broader US Banking system.  She went on to say “And similar actions could be warranted if smaller institutions suffer deposit runs that pose a risk of contagion.”  FRC (currently the most troubled bank) jumped 15% in premarket after her remarks were published. Finally, as of this morning, the Fed Funds Futures are saying that there is an 86.4% probability of a quarter-point hike by the Fed tomorrow and a 13.6% chance we see no hike.

With that background, it looks like the bulls are making another charge this morning (at least in the premarket). SPY is challenging Thursday’s high and DIA is well above its recent high. However, while QQQ is moving up, it remains below the recent highs from Thursday and Friday. Overextension is still not an issue in any of the big indices and T2122 is up out of the oversold territory at this point. While the regional banking issue may cause more turbulence, I suspect we may be in the “wait and see” area ahead of Fed actions on Wednesday. So, the bulls may make a run this morning and we should be prepared for bank-caused volatility. However, much like Monday afternoon, I think we may drift until there is certainty on the Fed’s move.

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 Friday, markets gapped lower in the large-cap indices (down 0.74% in the SPY and down 0.82% in the DIA) while the QQQ opened flat.  This came after markets had rethought the Thursday lifelines that had been thrown the CS ($50 billion loan) and FRC ($30 billion in deposits from the US mega banks).  After a half hour of waffling to the side, all three major indices sold off sharply until 11:45 am.  From there, the rest of the day saw a sideways grind inside of a tight range.  This action gave us Bearish Harami candles in the two large-cap indices and a black Spinning Top in the QQQ.  It is worth noting that the SPY crossed back down through its T-line (8ema) and 200sma after having crossed above Thursday.

On the day, all 10 sectors were in the red with Financial Services (-3.09%) leading the way lower while Communications Services (-0.64%) held up better than other sectors.  At the same time, the SPY lost 1.55%, the DIA lost 1.47%, and the QQQ lost 0.47%.  VXX spiked by 10.90% to 55.96 and T2122 dropped back inside of the oversold area at 8.54.  10-year bond yields plunged to 3.429% on a risk-off day while Oil (WTI) fell another 2.96% to $66.34 per barrel.  So, Friday saw a gap lower on more fear of bank collapses.  However, the QQQ bulls did not really give much back and remained the strongest of the major indices.  Once again, this happened on heavier-than-average volume across the board, particularly in the QQQ.  This pattern of increasing volumes has been noticeable the entire last week.

In economic news, February Industrial Production came in far below expectation on a year-on-year basis at -0.25% (compared to a forecast of +3.00% and the January reading of +0.49%).  On a month-on-month basis, Feb. Industrial Production was flat but still below the expectation of +0.2% and far below the January monthly +0.3% value.  So, bottom line, for the third day in a row we had data suggesting industrial manufacturing is not in great shape.  Then, later in the day, Michigan Consumer Sentiment also came in below expectation at 63.4 (versus a forecast of 66.9 and well below the February reading of 67.0).  With all of that said, fear of spreading liquidity problems for regional banks (which have plowed massive amounts of money in long-dated bonds for years and now would lose their shirts if forced to sell in order to fulfill deposit redemption requests) and the entire CS solvency problem, made the health of the US and Global banking system the primary economic topic Friday.

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In stock news, META launched a verification subscription service like the one Elon Musk did at Twitter and later SNAP launched.  The META service is available on both Facebook and Instagram.  Elsewhere, Bill Ackman tweeted Friday that BAC is buying recently closed SBNY as of today (Monday).  He didn’t cite a source of his information.  However, Reuters then reported that sources tell it that Ackman’s rumor is false.  In unrelated news, the Financial Times reported Friday that the GS trading desk has lost around $200 million in the market turmoil following the collapse of SIVB.  Meanwhile, after the close Friday, BRKB urged its shareholders to reject proposals that company management avoids discussing hot-button social and political issues.  They also asked shareholders to reject a proposal that the company discloses more about its climate change and diversity efforts.  At the same time, but unrelated, BBBY announced it will do a reverse stock split and a special meeting on March 27 to determine the ratio (between 1-for-5 and 1-for-10). The BBBY stock was down 23% in after-hours trading on the news.  Finally, the Wall Street Journal reported that DIS kept 94% of its subscribers despite raising prices 38% on its Disney+ streaming service.

In stock legal and regulatory news, the SEC will vote Wednesday on new regulations first proposed in January 2022 that would require funds to report within one business day any events indicating “significant stress.”  (The idea, introduced after the Archegos Capital Management collapse, is that even the collapse of private funds could pose a systemic threat to other financial institutions.)  Elsewhere, ASTR has asked Nasdaq for more time to get its stock price back above $1 to avoid being delisted.  The company has not been in compliance since October.  ASTR said it expects to hear back from the exchanges by April 5, which follows its March 30 earnings report.  If an extension is not granted, ASTR will face being dropped by the exchange.  After the close Friday, a US Appeals Court revived a lawsuit by UBER challenging the CA law that would require them to provide proof that workers are independent contractors in order to avoid having to treat them as employees.  Meanwhile, days after being sued by the state of Ohio, NSC shareholders sued the railroad for defrauding them by prioritizing profit over safety.  (Being too risk-seeking instead of capital preservationist.) Finally, on Sunday, the FDIC said that a subsidiary of NYCB will take over the vast majority of SBNY (including the branches and $60 billion in outstanding loans), leaving about $4 billion in receivership.

Regarding the CS saga, Friday afternoon, Reuters reported that CS would be holding internal talks over the weekend on “the scenarios facing the bank.” That came as other major European banks had already “curbed dealing with CS” until after events play out.  Those banks included DB and SCGLY, and HSBC according to Reuters.  Friday night, the Financial Times reported that UBS was in talks to buy CS or at least some of the assets of CS.  By Sunday, Bloomberg reported that UBS had offered to buy CS for (a paltry) $1 billion and that CS was pushing back against that offer.  Meanwhile, the Financial Times said multiple sources told it that the Swiss government was seriously considering either a partial or full nationalization of the troubled bank.  Finally, on Sunday evening, CS agreed to terms with UBS acquiring them for $3.2 billion (CS shareholders get 1 UBS share for every 22.48 CS shares they hold).  The Swiss National Bank also pledged a $108 billion loan to support the takeover project.

Overnight, Asian markets were red across the board.  Hong Kong (-2.65%) was by far the biggest loser with Japan (-1.42%). Australia (-1.38%), Singapore (-1.37%) and New Zealand (-1.37%) leading the region lower.  Meanwhile, in Europe, the bourses lean heavily toward the green side at midday.  The FTSE (+0.22%), DAX (+0.65%), and CAC (+0.73%) are leading the region higher in early afternoon trade.  As of 7:30 am, US Futures are Pointing toward a start to the day just on the green side of flat.  The DIA implies a dead flat open, the SPY is implying a +0.02% open, and the QQQ implies a +0.03% open at this hour.  At the same time, 10-year bond yields continue to fall, now at 3.376% and Oil (WTI) is off 1.5% to $65.74/barrel in early trading.

There are no major economic news events scheduled for Monday.  The major earnings reports scheduled for the day include FL and PDD before the opening bell.  Then after the close, ACDC reports.

In economic news later this week, on Tuesday we get Feb. Existing Home Sales and EIA Crude Oil Inventories.  Then Wednesday, Q1 Interest Rate Projections, the Fed Rate Decision, and Fed Statement are all reported and the Fed Chair Press Conference takes place.  On Thursday, we get Building Permits, Q4 Current Account, Weekly Initial Jobless Claims, and New Home Sales.  Finally, on Friday, Feb. Durable Goods, Mfg. PMI, S&P Global Composite PMI, and Services PMI are reported.

In earnings later this week, on Tuesday, we hear from CSIQ, TME, AIR, GME, and NKE.  Then Wednesday, OLLI, WOOF, WGO, CHWY, KBH, MLKN, SCS and WOR report.  On Thursday, we hear from CAN, DOOO, CMC, DRI, FDS, and GIS.  Finally, on Friday, EXPR reports.

So far this morning, FL posted beats on both the revenue and earnings lines.  (FL  posted a massive beat on revenue…at 86.5% positive surprise.)  However, PDD missed on revenue while beating on earnings.  It is worth noting that FL also lowered its forward guidance.

With that background, it looks like the SPY is remaining in its range from the previous seven days. At the same time, DIA was below its own seven-day range but has climbed back up into that area now. Meanwhile, the QQQ (which has been the market leader for some time) seems to be continuing its pullback inside Thursday’s big bullish candle…at least in premarket action. Overextension is not an issue in any of the indices at this point. However, T2122 is well into the Bullish Reversal Zone (extended). Another issue we have to deal with today is that the banking situation in the US (mainly regionals) is not settled. FRC is down more than 20% in premarket action (which is actually a 26% recovery from the premarket lows). On the other hand, NYCB and PACW are up 30% and 18% respectively. So be prepared for volatility swings as the explosiveness of regional banks spills over into other areas of the market on what would normally be a “wait and see” a couple of days ahead of the Fed Meeting Wednesday.

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 weak on Thursday with SPY gapping down 0.62%, DIA gapping down 0.59%, and QQQ gapping down 0.29%.  However, bulls immediately started a strong rally in the QQQ and the two large-cap indices followed after an hour of wandering around near the open.  Shortly after 1 pm, all three major indices rallies began a very mild consolidation pullback that lasted until 2:40 pm.  At that point, a more modest rally got underway again and drove into the close with the SPY, DIA, and QQQ all closing very near the highs of the day.  This action gave us large, white-bodied candles with very little wick.  Again, the QQQ led, bouncing up off its T-line (8ema) and pulling away during the day to break the downtrend line that had held since the start of February.  For its part, the SPY crossed up through its T-line and 200sma.  Meanwhile, the DIA came up and is sitting just below both its T-line and 200sma.

On the day, nine of the 10 sectors were in the green with Technology (+2.77%) leading the way higher while Communications Services (-0.27%) was the only red sector.  At the same time, the SPY gained 1.73%, the DIA gained 1.17%, and the QQQ gained 2.64%.  VXX plummeted 8.19% to 50.46 and T2122 surged back up out of oversold territory at 31.93.  10-year bond yields surged to 3.587% on a risk-on day while Oil (WTI) climbed 1.12% to $68.32 per barrel.  So, Thursday, saw a gap lower on lasting fear of bank contagion.  However, the bulls led by tech (particularly semiconductors) rallied markets out of the recent choppy consolidation range.  Again, this happened on heavier-than-average volumes across the board, particularly in the QQQ.

In economic news, February Building Permits came in notably stronger than expected at 1.524 million (versus a forecast of 1.340 million and much stronger than the January reading of 1.339 million).   Likewise, the February Housing Starts came in above expectations at 1.450 million (compared to the forecast of 1.310 million and the Jan. value of 1.321 million).  This meant Building Permits were up 13.8% for February and Housing Starts were up 9.8%.  Both seem to show the housing market remains strong.  Meanwhile, the February Export Price Index was well above expectation at +0.2% (compared to a forecast of -0.1% but down significantly from the January +0.5% value).  At the same time, the February Import Price Index fell but not as much as expected at -0.1% (versus a forecast of -0.2% and a January reading of -0.4%).  This means the average value of the goods the US exported rose while the average value of goods imported fell in February. Elsewhere, Weekly Initial Jobless Claims came in lower than expected at 192k (compared to a forecast of 205k and well below the prior week’s 212k).  All of the above tends to show a robust economy.  On the other side of the ledger, like the Empire State report Wednesday, the Philly Fed Mfg. Index came in well below the reading expected at -23.2 (versus a forecast of -15.6 but slightly better than the Feb. reading of -24.3).  So, currently (March), Manufacturing seems to have slowed greatly while the rest of the economy appears to still be in good shape.

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In stock news, the Financial Times reported that HOOD made a policy exception (policy banning short positions) for their customers who had Puts on SBNY.  The exception will allow HOOD customers holding profitable Puts in SBNY to keep those positions open into the expiration date (today).  Elsewhere, STLA has launched the first tranche of its nearly $1.6 billion buyback program starting today and going through June.  Meanwhile, BLNK announced Thursday that it has won a contract from the US Postal Service to sell the agency 41,500 electric vehicle charging units.  (No dollar amount was given for the contract.)  Mid-afternoon, Reuters reported that PACW was well into talks about receiving a liquidity boost from ATCO.  In other regional bank news, FRC received $30 billion from JPM, C, BAC, WFC, GS, and MS as part of a rescue package.  Later, to calm investor fears, the CEO of MULN released a statement telling investors that the automaker was on track to fulfill its deliveries schedule, including beginning delivery for a 6,000-unit order before the end of March.  After the close, MSFT announced and made a demo of a new “AI Copilot” for its Office 365 programs (Word, Excel, PowerPoint, and Outlook).  The AI product will first be released to 20 of MSFT’s enterprise customers but will be rolled out wider soon.  Finally, DUK announced after the close, that its unit in Central Florida (Polk County) will begin construction this month on its first water-based (lake) solar array of 1,800 floating solar panels (generating 1 megawatt) covering 2 acres of water.

In stock legal and regulatory news, AAL lost an appeal to the European Union Court of Justice which had sought to get the EU to nullify an agreement between AAL and DAL (where AAL gave up two airport landing slots to DAL for the Heathrow and Philadelphia airports) due to DAL not using the slots they were given.  At nearly the same time, London’s High Court ruled LNVGY (Lenovo) must pay IDCC $138.7 million for a license for use of a portfolio of IDCC’s telecom patents. Elsewhere, CS was sued by US investors claiming the bank defrauded them by concealing problems and for having material weaknesses in internal controls that contributed to those shareholders having the wrong impression of the bank’s finances.  Meanwhile, after the close, the FDA Advisory Board voted 16-1 in favor of full approval of the PFE oral COVID-19 antiviral treatment for adults at high risk of progression to severe disease.  (The FDA very seldom rules against the Advisory Board’s recommendation.)  Also, after the close, Dept. of Labor investigators reported that BP safety rules and poor training contributed to the death of two Ohio refinery workers last year.  OSHA has proposed that BP pay $156,250 in penalties (the amount is limited by federal statute) for eleven violations at the facility, which BP has since sold to CVE.

In miscellaneous news, the Fed reported data Thursday evening saying that banks had borrowed a record $153 billion from its Discount window over the last week.  This was a massive jump over the prior week’s borrowing of $4.58 billion.  In addition, it was a huge increase in the record borrowing from the Fed. Prior to this week, the previous record was $111 billion borrowed in one week during the 2008 financial crisis.  Elsewhere, there are a few troubling signs (in terms of economic strength) coming out of how companies treat their employees when times get tough.  BBBY announced Thursday that it will not pay severance to the employees let go from stores the retailer closes.  (Presumably, those people would still be eligible to draw state unemployment insurance benefits, meaning presumably the company paid unemployment premiums for those employees.)  Then, last night, GOOGL decided it will not honor previously approved (and started) medical or maternity leave of those employees it has laid off.  However, regardless of the employee’s status at the time of layoff, those people will get standard severance as of their termination date. There was no word on how much this move will save the tech giant.

After the close, FDX missed on the revenue line but crushed estimates on earnings ($3.41 versus the analyst-expected $2.76 per share).  FDX also raised its forward guidance for 2023.

Overnight, Asian markets ended the week green across the board.  Hong Kong (+1.64%), Taiwan (+1.52%), Malaysia (+1.46%), and Japan (+1.20%) led the region higher.  Meanwhile, in Europe, the bourses lean heavily to the green side at midday.  Only Portugal (-1.05%) and Switzerland (-0.25%) are in the red.  At the same time, the FTSE (+0.45%), DAX (+0.33%), and CAC (+0.19%) lead the rest of the region higher in early afternoon trading.  As of 7:30 am, US Futures are modestly down.  The DIA implies a -0.44% open, the SPY is implying a -0.30% open, and the QQQ implies a -0.03% open.  10-year bond yields are falling significantly again (implying a move to safety) at 3.50% and Oil (WTI) is up 0.35% to $68.59/barrel in early trading.

The major economic news events scheduled for Friday are limited to Feb. Industrial Production (9:15 am), and Michigan Consumer Sentiment (10 am).  The major earnings reports scheduled for the day include AQN and XPEV before the opening bell.  There are no major earnings reports scheduled for after the close. Also, be aware that today is Triple-Witching Friday.

So far this morning, AQN beat on both the revenue and earnings lines.  However, XPEV missed on both lines.  It is also worth noting that XPEV has lowered its forward guidance. Unrelated, but also of note is that CS, FRC, PACW, and probably other banks are getting hammered by bears again early this morning. There seems to have been a rethink about whether the huge bailout loans/deposits of CS and FRC are bullish or bearish. Beware any spread of that sentiment across the other banks.

In central banks news, despite the EU raising rates 0.50% Thursday, Fed Funds Futures indicate there is an 80.5% probability of a quarter-point hike by the FOMC next week.  The remaining 19.5% of probability is on “there will be no hike at all.” Interestingly, one of the reasons cited by European Central Bank President Lagarde for staying with a half percent rate hike was that the ECB feared a change in course would spook markets.  As one would expect, she went on to say the European banking system is strong, there is no liquidity crisis, and there is no tradeoff between price stability (inflation) and financial stability.  On the other side of the Pacific, China loosened its reserve requirement ratio (the key tool the People’s Bank of China uses to regulate monetary policy).  The move reduces that requirement to 7.6%, the lowest level since 2007.  So, China is easing, Europe is tightening, and the US appears to be on path to slowing its tightening.

With that background, it looks like markets are reassessing yesterday’s bullish move, despite the FRC bailout taking shape (which was just a rumor yesterday afternoon). The SPY looks to be coming back down to retest its T-line and 200sma. Meanwhile, the DIA looks to be failing or pushing down off those averages in premarket action. However, QQQ remains strong and QQQ bulls are not giving an inch this morning. Overextension is not an issue in large-cap indices. However, QQQ is a bit extended above its T-line. Another issue we have to deal with today is that today is Triple-Witching Friday. So be prepared for volatility swings as the big institutions roll positions (on top of banking sector concerns and news). And, triple witching or not, it is Friday. So, take some profit, pay yourself, and get your positions ready for the weekend news cycle and Fed meeting next week.

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