Today’s Trading Lesson…
“Is it obvious?”
He said “What do you mean?”
I repeated the question with clarity: “Who is in charge, buyers or sellers, and is it obvious?”
“The stock is going higher, I am waiting for it to slow down, so I can start building a short position…”
“So it’s going higher?”
“Why aren’t you long?”
“Because the stock should turn around…”
Oh. “But it’s definitely going higher?”
Me: “I don’t understand your edge…”
On the Tape Today...
$HCA breakdown below $74 with volume looks solid but buyers stepped in again. A sell short below $74 is still valid with a $71 target. If it trades above the open let it go, or exit. (see chart)
$CME bullish inside day breakout with order flow behind it. Look for one more day long.
$KR showing signs of accumulation. Not a long but not a great short either because of this. Look for short covering.
$GS a must watch at this level. Minor resistance at $168, next target would be $182.50
$HCA 8-18-16 (Click to Enlarge)
U.S. stock futures in holding pattern as Cisco’s drop weighs
Analyst: ‘Significant buying interest’ if S&P 500 pulls back
U.S. stock futures on Thursday pointed to a muted open, with upside limited by a premarket drop by Cisco following its quarterly results.
Ahead of the open, investors are waiting for readings on jobless claims and a Philly Fed index, as well as for Wal-Mart’s earnings. “The S&P 500 remains just below the recent high,” said Sam Stovall, U.S. equity strategist at S&P Global Market Intelligence, in a note.
“The bias will remain bullish while above the nearby support zone at 2,159-2,175,” Stovall added. “Even on a deeper pullback that breaches this nearest zone of support, there are lower supports at 2,134 and 2,115 where we would expect significant buying interest.”Read More — >>
Stock Market Today: Heatmap of the S&P 500
Stock Trading Today 8-18-16 | $WMT Earnings Before the Open
Fed Minutes Give Lift To Stocks; Cisco Drops Ahead Of Earnings
The major market indexes were slightly higher at the close Wednesday, after reversing losses following the release of the Federal Reserve policy meeting minutes.
Minutes from the July 27 Fed meeting showed policymakers were increasingly confident about the economic outlook but would wait “to accumulate more data” before hiking rates. The statement pointed to “moderate” economic gains, a strengthening labor market and “diminished” near-term risks to the economic outlook.
$WMT earnings before the open today — >> Cisco Systems (CSCO) was the biggest mover on the Dow, falling more than 1% to 30.72 in heavy trade ahead of its earnings report due out after the close. The networking gear maker plans to cut up to 14,000 employees, or about 20% of its global workforce, according to tech website CRN.
Target (TGT) plunged more than 6% to 70.63, gapping down below its 50-day moving average in big volume. The discount retailer reported mixed Q2 results, as earnings topped views but revenue slightly missed. It also lowered its full-year profit outlook.Read More — >>
Tape Reading the SPY ETF
$SPY price action showing why you don’t short strong order flow.
A move lower off the open can be a terrific buying opportunity in this situation. Too many traders try to catch the top. The reasoning is simple, “hard to make money long, so I must need to be short.”
I understand it, I did it, and I was a fool for it early in my trading career.
If you want to be long, be long until you see a good reason not to be.
Read that twice. I said a good reason, not any reason.
Stocks in Play: $WMT research on finviz.com
$WMT Earnings NEWS: What to watch for in Wal-Mart earnings
Wal-Mart is making big e-commerce moves and is expected to raise guidance, but is that enough?
Wal-Mart Stores Inc. is expected to announce second-quarter earnings on Thursday before the market opens.
The retail giant’s recent acquisition of e-tailer Jet.com for more than $3 billion shows it’s still putting up a fight for online market share against the Amazon.com Inc. AMZN, +0.08% juggernaut. That deal came just weeks after Wal-Mart WMT, +0.05% announced a deal with JD.com Inc. JD, +1.48% in China, a market that has proven hard to crack.
While the company has steadily reported positive same-store sales, some analysts say Wal-Mart will have to do better in an improved retail landscape. Wal-Mart shares have an average rating of hold with a $70.56 target price. That’s 4.7% lower than Friday’s closing price of $73.89.
Stocks to Trade 8-18-16 | Thursday Edition
Short-Term Trading Momentum:
Positive the last 20 and 5 trading days | closed 2% higher from the open: VRX, EA, MDVN, OKE
Negative last 20 and 5 trading days | closed 2% lower from the open: bmy, hca, hain
Quarterly Order Flow:
Bullish Stocks to Trade: DVN, UNP, AET, AMGN, LN, CLR, FB, PXD, SWKS, SM, AVGO, BABA, BIIB, CHTR, AMZN, EOG, COST, TWLO, JWN, DKS, KSS
Bearish Stocks to Trade: fslr, bmy, de, mcd, cf, gild, nclh
2x Normal Volume: VRX, BMY, TGT, LOW, URBN, HAIN, LDOS, CRM, TJX, HCA
Inside days: kmi, hlt, jd, atvi, aal, yhoo, nke, qcom, bsx, dis, met, v, bhi, twx, aig, tyc, ual, cvs, ba, apc, bidu, gs, wynn