Monday was a volatile and indecisive day gapping higher about a percent and ending near where price opened on the large-cap indices, leaving us with indecisive Doji candles.  QQQ was similar, but faded the gap more than the others to give a black-body Spinning Top candle.  On the day, DIA was up 1.56%, SPY up 1.12%, and QQQ up 0.22%.  The VXX fell to 25.88% and T2122 climbed back to mid-range at 52.14.  10-year bond yields fell a bit to 0.85% and Oil (WTI) surged 3.5% to $37.04/barrel.

Obviously, only the election, the virus, and maybe some earnings surprise will be making news today. While it is possible we will know the outcome of the election by tomorrow, it is also quite possible we won’t know for a week given the shortcomings of the postal service and ballot counting rules varying across the country.

On the virus front, we had yet another day of almost 90,000 new cases. The numbers show we now have 9,568,275 confirmed cases and 237,009 deaths.  The 7-day average of new cases has reached a record of over 86,000 while average daily deaths are also rising at just over 850/day.  The American Academy of Pediatricians reported Monday that last week there were over 61,000 new cases among children nationally, bringing the total so far to over 853,000.  We are at record levels with 47 states showing increases in new case counts the last week, 26 states have deaths increasing versus the previous week.  Yet the administration continues to deny reality along with a significant proportion of the population.

Globally, the numbers rose to 47,428,861 confirmed cases and the confirmed deaths are now at 1,213,224 deaths.  The 7-day average of new cases is just over 500,000 while the 7-day average virus deaths is 6,663/day.  Much of Europe (especially the most economically dynamic portions of the continent) is now under lockdown again as they try to save their healthcare system.  However, in spots of Asia, easing continues.

Overnight, Asian markets were strongly green as they expect good news as the US election ends.  Singapore (+2.21%), Hong Kong (+1.96%), and Australia (+1.93%) led the way.  A similar story is playing out in Europe as they reach their mid-day.  The FTSE (+2.00%), CAC (+2.01%), and DAX (+1.80%) are not only the main bourses, but lead the way today.  As of 7:30am, US futures are pointing to another gap higher at the open.  The DIA implies a open up 1.60%, SPY implies a +1.28% open, and the QQQ implies a 0.69% gain at the start of the day.

The major economic news for Tuesday is limited to Sept. Factory Orders (10 am).  However, major earnings reports include AGCO, ATH, BHC, BMCH, ETN, EMR, EXC, EEXPD, RACE, FOXA, IT, HUM, NSIT, JELD, JCI, LPX, MCK, SYY, TEF, TRI, W, and ZBRA before the open.  Then after the close, ANDE, CC, DAR, PRU, SMCI, and TX report.

Just as on Monday, the raging virus, the election, and earnings (or more importantly future guidance) are the main drivers of the market today. While volatility is sure to remain high, even with the likelihood of the President suing to influence the outcome of the election, there is major and palpable relief that the election will finally be “over.” Regardless of the election outcome, the lame-duck government is expected to deliver more stimulus. So, expect more volatility in the short-term, but realize we can see some light at the end of this tunnel now.

Like earnings, the election is an unpredictable, event. Consider very carefully how much risk you want to have on, even if you think you know how the election will go. Be careful, nimble, and bear in mind you don’t have to trade every day or even week.  Lock-in profits whenever you can and maintain your discipline.  Stick to your rules, follow the trend, and don’t chase moves you have missed. 

Ed

Swing Trade Ideas for your consideration and watchlist: CARR, HUN, BP, MPC, CMA, URI, ALGN, NEM, MOS. 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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