Once again, the bullish run continued Tuesday led by Energy as bulls have their eyes focused out on the future post-recovery.  After a small gap higher at the open markets ground sideways most of the day.  However, a strong late-day rally closed the market very near its highs.  On the day, the SPY was up 0.83%, the DIA up 1.02%, and the QQQ up 0.67%.  The VXX fell to 32.49 and T2122 remains very high at 96.59.  Oil (WTI) closed up over 4% to $36.90/barrel and 10-year bond yields climbed a bit to 0.684%.

In business news, WFC is worried about loan defaults.  As a result, they have stopped making loans to and through independent car dealerships, who they perceive to be servicing riskier customers than major brand dealerships.  In the process, WFC has had to drop hundreds of independent dealership customers.

The SBA announced that over $120 billion of PPP funds remain untapped.  After an initial rush in the second round, demand for the loans/grants dried up.   Small business organizations cited a fear of potential audits if a company takes the loans.  Meanwhile, IL became the first state to tap the Fed loan fund, requesting $1.2 billion for a one-year loan after their bond yields rose.

On the Virus front itself, the global headline numbers are 6,474,784 confirmed cases and 382,922 deaths.  In Japan, the government issued another “stay home” alert for Tokyo after a “jump” in cases.  (They had lifted restrictions on May 25.)  Italy proved that the US isn’t the only place with conspiracy theorists as hundreds of protesters gathered in Rome to shout “Liberty” (calling for complete opening and dropping of restrictions) while their leaders claimed the pandemic never existed and is some global conspiracy.

In the US, we have 1,881,256 confirmed cases and 108,062 deaths reported to date. CNBC reported an industry group that cited a survey of restaurants found the number of transactions was only down 18% (year on year) as of the end of May.  Of course, carryout and fast food in particular are bouncing back fast, with full-service still down just over 40%.  Meanwhile, Amazon has announced plans for a major sale date (similar to Black Friday) for June 22 with the goal of “jumpstarting sales.”  It is likely that other retailers will join the movement rather than yield all the sales to AMZN.

Overnight, Asian markets were in the green across the board yet again.  European stocks are following suit with the major bourses each up 1-2% as of midday.  At 7:30 am, US futures are also pointing to gap higher of 0.3%-0.6%.

Wednesday’s major economic news includes May ADP Non-farm Employment (8:15 am), May Service PMI (9:45 am), Apr. Factory Orders and May ISM Non-Mfg. Employment (both at 10 am), and Crude Oil Inventories (10:30 am).  The only earnings reports of note are AEO, CNK, EXPR, GOOS, CPB and VRA before the open.  Then after the close CLDR, FOSL and GEF report.

The bulls still see nothing but blue skies and optimism as they look past protests and pandemic damage.  The trend, momentum, and a bit of room up to next resistance in the charts should give the bulls the edge again Wednesday.  Even intraday swings have lessened very recently.  Continue to stay focused on the short-term chart and don’t hesitate to lock in profits.  However, don’t bet against the trend unless you’re doing it to hedge.  Above all, don’t chase or predict.

Ed

Trade ideas for your watchlist and consideration. M, EOG, HAL, CF, MGM, HD, CB, AJG, NCLH, INO. Trade your plan, take profits along the way, and smart. Also, don’t forget to check for upcoming earnings. Finally, remember that the stocks/ETFs we mention and talk about in the trading room are not recommendations to buy or sell.

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

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

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

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

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

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

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