Markets gapped down 0.7% – 0.9% and then followed through with a long, slow all-day selloff, closing near the lows.  This left us with black candles in all 3 major averages and the first appreciable pullback in well over a week.  Even so, none of the 3 major indices even tested their T-lines (8ema) and the QQQ was just an inside day (Bearish Harami) candle.  On the day, SPY lost 1.29%, DIA lost 1.36%, and QQQ lost 1.44%.  The VXX was flat at 25.49 and T2122 dropped, but remains just inside the overbought territory at 81.95. 10-year bond yields fell to 2.293% and Oil (WTI) spiked another 4.5% to $114.23 as Russia said storm damage could put a major pipeline out of service for a month or more.

On the Russian invasion story, the US formally charges Russia with war crimes on Wednesday, and NATO announced it is expanding the number of troops in Eastern Europe by adding 4 battle groups (only about 500 additional troops) in that area.  In response, Russia is expelling 12 American diplomats and is demanding that “unfriendly countries” pay for Russian Natural Gas in rubles, with Gazprom (Russian LNG firm) ordered to make changes to contracts within a week.  The news caused the Ruble to rally.  (However, existing contracts could not be changed.  So, the impact in the short term is questionable.)  The Russian stock market partially reopened today as well.

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In another Russian Sanctions-related story, it appears the US and EU are close to a deal on cutting European use of Russian natural gas.  Sources told Bloomberg it would be announced Friday.  The agreement is expected to result in a large surge of US-produced LNG being sent to Europe starting as soon as a few months from now.  The largest US natural gas producers are LNG, CQP, XOM, and CVX.

After the close, FUL and TCOM reported beats on both revenue and earnings.  Meanwhile, OLLI missed on revenue while beating on earnings.  Unfortunately, KBH missed on both lines.  So far this morning, MOMO beat on both lines while TITN beat on earnings and missed on revenue.  However, DRI reported missing on both revenue and earnings.

Overnight, the Asian markets were mixed but leaned to the downside.  Hong Kong (-0.94%), Shenzhen (-0.83%), and Shanghai (-0.63%) paced the losses while Singapore (+1.05%) led gainers.  In Europe, markets are also mixed as Russia resumed trading with short-selling banned and foreign investors prohibited from selling at all (at least until April).  It is also suspected that the Russian government is a buyer of last resort placing a floor under the market.  As a result, the Russian MOEX is up 4.37%.  However, the FTSE (+0.14%), DAX (-0.31%), and CAC (-0.04%) are more typical of the region at mid-day.  As of 7:30 am, US Futures are pointing toward a green start to the day.  The DIA implies a +0.48% open, the SPY is implying a +0.64% open, and the QQQ implies a +0.74% open at this hour.  10-year bond yields are back up to 2.379% and Oil (WTI) is flat in early trading.

The major economic news scheduled for release on Thursday include Feb. Durable Goods Orders, Q4 Current Account, and Weekly Initial Jobless Claims at 8:30 am, Mfg. PMI and Services PMI (both at 9:45 am) and more Fed speakers (Waller at 9:10 am and Bostic at 11 am).  The major earnings reports scheduled before the open include DRI, MOMO, HEPS, SNX, and TITN.  Then after the market close, NIO reports.

The major indices look to be pointing higher early, but for the first time in days we have economic news this morning. In addition, news out of the meetings President Biden is attending in Europe has the potential to roil markets. So, be careful not to ignore volatility. With that said, a minor, one-day pullback is the best bulls could have hoped for in the recent rally and if yesterday was our “higher low” the bulls may be ready to run up to at least the next resistance level. The bias is clearly bullish in the short term.

Trade with the trend, don’t chase, keep consistently taking profits when you have them, and move your stops in your favor. The first rule of making big money in the market is to not lose big money in the market. Don’t be stubborn, and protect yourself from yourself. If you are wrong, just admit it and take your loss. Stick to those trading rules and manage the things that you can control while trying not to worry about the things you have no control over at all. Trading is a marathon, not a sprint. So, focus on the process and enjoy yourself.

Ed

Swing Trade Ideas for your consideration and watchlist: QS, JBT, BNTX, PLTR, NFLX, FDX, CRM, HOOD, RBLX, PINS. You can find Rick’s review of tickers on his YouTube Channel here. Trade your plan, take profits along the way, and smart. Also, remember to check for impending earnings reports. Finally, remember that any tickers 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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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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