Today’s Trading Lesson | Trading a Potential Change of Trend
With so much indecision in the market right now I thought it a good time to discuss what to do.
My team is getting a lot of emails about getting chopped up. This occurs because you recognize order flow but not a “box.” This box is the potential change of trend.
When a trend line is broken, it’s imperative to draw a box and be patient. Most money is lost here. Consider it the “right price” until order flow kicks in again.
I highly recommend you draw trend lines on the stocks you plan to trade. NO moving averages, just pure price action. This gives you a much better feel than simply rising or declining. I use a weekly chart going back about 18 months to draw the trend lines, and a daily chart showing 3 months of action using moving averages.
Give these two charts a try when you do you your game plan. The combination gives a really solid view of your ideas.
On the Tape Today...
$CELG a buy today ONLY if it opens lower. A higher open is a great profit taking opportunity. (see chart)
$HD continues to trade above the breakout level with 3 well-bid days. Look for one more day higher.
$UA 3 days of indecision at the 50 sma, look for a sell short below $39. Avoid the long at support.
$FB bottom tail look for a buy above $124.50 with a target of $128.
$CELG 8-2-16 (Click to Enlarge)
U.S. stock futures tread water with income, spending reports due to roll in:
Earnings expected from CVS, P&G, Pfizer, Molson Coors
U.S. stock futures edged lower Tuesday, as investors waited for readings on personal income, spending and inflation, along with earnings from CVS, P&G and other household names.
The dip puts the Dow Jones Industrial Average on track for its seventh down session in a row.
“While many investors may already be eyeing up Friday’s U.S. jobs data, today’s income, spending and inflation figures should not be overlooked and will also be very influential when the [Federal Reserve] is deciding whether or not to raise interest rates at the coming meetings,” said Craig Erlam, senior market analyst at Oanda, in a note.Read More — >>
Stock Market Today: Heatmap of the S&P 500
Stock Trading Today 8-2-16 | $CVS Earnings
Nasdaq Ends Near Record High; Oil Stocks Sink Dow, S&P 500
The Nasdaq edged up 0.4%, ending just shy of its all-time high of 5231.89 hit a year ago. But the Dow Jones industrial average slipped 0.2%, and the S&P 500 dipped 0.1%. Both the Dow and S&P recently rose to record highs.
Volume was lower, falling 11% on the NYSE and edging down a fraction on the Nasdaq compared to Friday, according to preliminary data.
Meanwhile, oil prices dropped almost 4% to nearly $40 a barrel amid data showing that OPEC members were increasing output, adding to an already saturated market.
Exxon and Chevron each sank nearly 4% in heavy volume, weighing on the Dow.Read More — >>
Tape Reading the SPY ETF
$SPY is still silent.
Oil stocks getting hit across the board, and a ton of inside days today (see list below), I am expecting a trend day today.
Good trading days can sneak up on you when the market goes into a funk. Be ready today.
If the market trades lower today stay away from the 3 major indices, they are not a short sale. There are plenty of stocks in today’s short sale list that have “mark down’ order flow or well-offered momentum.
Stocks in Play: $CVS research on finviz.com
$CVS Earnings NEWS: CVS Health’s Q2 Earnings: Here’s What To Expect
VS Health (CVS) reports second-quarter results early Tuesday, after Walgreens Boots Alliance (WBA) takeover target Rite Aid (RAD) in June noted reimbursement-rate pressure at its pharmacies.
Meanwhile, CVS has been adding health-conscious food and drinks to its CVS Pharmacy stores as consumers continue to gravitate toward natural and organic foods.
Estimate: EPS of $1.30, up 7%, on a 19% revenue gain to $44.28 billion.
CVS shares closed up 0.8% on the stock market Monday at 93.49. CVS is trying to retake their downward sloping 50-day average.
What to Expect When CVS Health (CVS) Reports Q2 Results
CVS Health (CVS) will report 2016 second quarter earnings before Tuesday’s market open.
NEW YORK (TheStreet) — Shares of CVS Health (CVS) are climbing 1.29% to $93.92 this afternoon as the company prepares to report 2016 second quarter earnings before Tuesday’s opening bell.
CVS stock is down 15% for the year, however, industry trends could aid the pharmacy benefit manager in the upcoming quarter. The Food and Drug Administration currently has a backlog of 3,000 applications for branded drugs to turn generic, and CVS should be able to expand its margins as these applications are approved.
Stocks to Trade 8-2-16 | Tuesday Edition
Short-Term Trading Momentum:
Positive the last 20 and 5 trading days | closed 2% higher from the open: IONS, EXAS, NFLX, NWL, SRPT, KORS, CELG
Negative last 20 and 5 trading days | closed 2% lower from the open: dor, mur, clr, dvn, apa, etp, apc, nfx, hes, oke, mbly, nbl, eog, xom, cvx, hal, wdc, rrc
Quarterly Order Flow:
Bullish Stocks to Trade: BABA>85, CELG, AAPL, GRUB, AEM, AMGN, AMZN, LRCX, IBM, HD, FB, STT, UNH>145, UNP, VMW, CAT
Bearish Stocks to Trade: do, nur, hes, cop, psx, skx, de, luv, gild
2x Normal Volume: IONS, NWL, ETN, HIG, XOM, DO
Inside days: msft, kr, dal, mrk, mpc, dvn, cog, hig, gps, azn, atvi, wfm, pypl, mgm, mo, pm, ccl, teva, mcd, esrx, oxy, ctrp, pep, nxpi, bby, hog, hfc, gis, psx, jwn, lvs, hon, de, anf