Week Ahead: The Bulls Are Getting Stronger

The Bulls Are Getting Stronger:

Stocks ended the week nicely higher as optimism spread regarding the US-China trade deal and investors digested the latest round of earnings data. At this point, the rhetoric from both sides suggests a trade deal will get done and that is a “good” sign for the market. On the economic front, the big miss came from retail sales but that is bullish for stocks because it reduces pressure on the Fed to raise rates anytime soon. Remember, the market loves easy money so any weak data only furthers that cause. So, in some perverse way, we are back in that awkward phase where negative economic data is good for stocks. Technically, it is encouraging to see the Dow and S&P 500 both close above their respective 200 DMA lines which have served as near-term resistance. Meanwhile, the Nasdaq and the Russell 2000 both close near/below their respective 200 DMA lines. For now, the market is getting extended to the upside and due to pullback.  

Monday-Wednesday’s Action:

Stocks were quiet on Monday as investors digested the recent rally below resistance (200 DMA line). On Tuesday, stocks soared after news broke that a tentative border security deal was reached and the government would not shut down on Feb 15. The deal would not completely fund the wall but it would be enough to at least move the needle and get something built. That was considered a big win for Wall Street as it removed a lot of uncertainty regarding the potential impact of another government shutdown and the economic ramifications. On Wednesday, stocks rallied again on optimism that the trade war with China would be resolved.

Thursday & Friday Action:

Stocks ended mixed to mostly lower on Thursday after retail sales plunged in December 2018. The report was released late because of the government shutdown. The Commerce Department said retail sales slid by -1.2% in December which was the largest monthly drop in ten years. Stocks rallied nicely on Friday as optimism spread regarding a U.S.-China trade deal. In other news, energy prices rallied sharply as oil and gasoline prices rallied after a big sell-off a few months ago.

Market Outlook: Bulls Are Back In Control

The market has turned around after the Fed reversed its stance and moved back into the easy money camp. Near-term resistance 2018’s high while near-term support is the 50 DMA line and then 2018’s low. As always, keep your losses small and never argue with the tape. Do you know the most under-valued stocks in the market? Our members do? Take a FREE TRIAL – CheapBargainStocks.com

Week Ahead: Stocks Fall After Hitting Resistance

Stock Fall After Hitting Resistance:

Stocks ended the week mixed to mostly lower as the market fell after hitting resistance (200 DMA line). At this point, it is perfectly normal to see the market pullback to digest its recent rally. On a relative basis, the Dow is trading near its 200 DMA line and is outperforming its peers. Meanwhile, the S&P 500, Nasdaq Composite, Nasdaq 100, and small-cap Russell 2000 are all below their respective 200 DMA lines. For now, the 200 DMA line is serving as important near-term resistance while the 50 DMA line is near-term support. Furthermore, until either level is taken out, I have to expect this sloppy action to continue. The bulls want to see the market get – and stay – above its 200 DMA while the bears want to see it break below its 50 DMA. If it breaks above its 200, the next important level of resistance to watch will be 2018’s high. Conversely, if it breaks below its 50 DMA line, then the next important level of support to watch is December 2018’s low. For now, patience is king as we are still digesting earnings and the latest round of economic data. 

Monday-Wednesday’s Action:

Stocks edged higher on Monday as investors waited for another busy week of earnings to be released. After the close, Alphabet, Gilead Sciences, Seagate Technology, and Beazer Homes were some of the companies to report earnings. In other news, Senators Charles Schumer and Bernie Sanders are proposing a law that would put limit the amount of shares a corporation could buy back at a given time. On Tuesday, the market rallied as investors digested the latest round of earnings data and waited for President Trump’s State of the Union address. On Wednesday stocks pulled back as the major indices flirted with near term resistance near the 200 DMA line. Disney, Snap, and Plantronics were some of the stocks that rallied after reporting earnings. 

Thursday & Friday Action:

On Thursday, stocks fell hard after the major indices slammed into resistance (200 DMA line) on Wednesday. At one point, the Dow fell over 300 points after President Trump said he will not meet with Chinese President Xi before the trade deadline. In other news, BB&T bought SunTrust in the country’s largest bank deal since the 2008 financial crisis. Stocks slid on Friday as investors digested the recent volatility.

Market Outlook: Watch Resistance

The market has turned around after the Fed reversed its stance and moved back into the easy money camp. Near-term resistance is the 200 DMA line for the major indices and then 2018’s high. Separately, near-term support is the 50 DMA line and then 2018’s low. As always, keep your losses small and never argue with the tape.

Bear Bull 2

Week Ahead: Trifecta Of Data Boosts The Market Higher

Trifecta Of Data Boosts The Market Higher:

The market ended higher last week helped by a trifecta of positive data: The Fed, earnings, and economic data. The big move came from the Federal Reserve, after it said it will pause and not raise rates in the foreseeable future. That is a BIG shift from the Fed’s stance in October 2018 which sent the market diving 20% in a few weeks. After that big sell-off the Fed did a 180 and has now shifted back to an easy money stance. Remember, the market is very sensitive to easy money and that has been one of the primary catalysts for this entire 10-year bull market. Stocks also rallied nicely on a slew of positive reactions to earnings and economic data. For now, near-term resistance is the 200 DMA line for the major indices and then 2018’s high. Separately, near-term support is the 50 DMA line and then 2018’s low.

Monday-Wednesday’s Action:

On Monday, stocks fell more than 200 points after shares of Caterpillar and Nvidia plunged on earnings and weak guidance. Caterpillar’s stock fell hard after the company reported earnings. Separately, shares of Nvidia plunged after the company lowered guidance and warned of a weak quarter. Stocks were quiet on Tuesday as investors digested the latest round of earnings and waited for Apple to report after the close. Apple rallied after reporting earnings and this was a classic case where the tech giant lowered guidance before announcing numbers. If the company didn’t lower guidance significantly, it would have been a big miss. Wednesday was a big day on Wall Street as the market soared after the Fed said it will be patient and not raise rates again in the near future. That was a complete shift from what the Fed said in October (it would continue raising rates) and that comment sent stocks plunging 20% before bottoming on December 24, 2018. This lesson reiterates the importance of paying attention to the Fed. After Wednesday’s close, Facebook gapped up after reporting numbers.   

Thursday & Friday Action:
Thursday was the last day of the month and January 2019 was the strongest January since 1987. That could be a good thing or a bad thing depending on what happens later this year. Remember, the stock market crashed in October 1987 and lost over 22% in one day! Let’s hope that doesn’t happen again. Before Friday’s open, the Labor Department said US employers added 304,000 jobs last month (despite the government shutdown) which easily beat estimates. That was a very strong report and signaled continued economic strength. 

Market Outlook: Market Rally Continues 
The market has turned around after the Fed reversed its stance and moved back into the easy money camp. Near-term resistance is the 200 DMA line for the major indices and then 2018’s high. Separately, near-term support is the 50 DMA line and then 2018’s low. As always, keep your losses small and never argue

Week Ahead: Global Central Banks Juice Stocks…Again

Global Central Banks Juice Stocks – Again:

The market opened lower last week but closed mixed to higher after the Federal Reserve and the European Central Bank (ECB) made it abundantly clear that easy money is here to stay for the foreseeable future. The big bullish change is that the Fed put (which means the Fed will step in to help the market when it gets in trouble), is alive and well. Since the Great Recession, every time the market fell 10% or so, the Fed, and other central banks, would step in and announce more easy money. In October 2018, the Fed tried to shift its stance but the market quickly plunged 20% before the Fed blinked and reversed back to an easy money stance. For now, the market continues to react well to that easy money and as long as it continues to act well, the bulls are getting stronger. Near term, the 50 DMA line is support and the 200 DMA line is resistance. Longer-term, December 2018’s low is major support and 2018’s high is major resistance. The fact that the market refuses to fall is very bullish and, as long as that continues, it should be respected. To be clear, if the market starts falling again, and ignores all the easy money, then we will be in for a very ugly bear market. 

Monday-Wednesday’s Action:

On Monday, global stock markets ended mixed as the U.S., stock market was closed in observance of the MLK holiday. China said its economy grew +6.6% in 2018 which was the lowest rate in 28 years. Separately, the IMF cut its forecast for global growth to 3.5% in 2019 and 3.6 percent for 2020. On Tuesday, when markets reopened in the U.S., stocks fell hard as global economic growth concerns spooked investors. But the bulls showed up right near important support (50 DMA line) and defended it by the close. On Wednesday, stocks opened higher, after IBM, Comcast, and a handful of other companies reported earnings. But sellers showed up after the open and stocks fell into the red for the day before a late day rally helped the market close mostly higher. Stocks ended mixed on Thursday as investors digested the latest round of earnings and digested the recent (and robust) rally.

Thursday & Friday Action:
Before Thursday’s open, the European Central Bank (ECB) said that easy money is here to stay for the foreseeable future but that was not enough to send stocks higher as the market ended mixed. In D.C., the government shutdown continued which is a drag on the economy but it was resolved on Friday after Trump opened it up until Feb 15, 2019. Stocks soared on Friday after the Fed announced that it is open to scaling back its program to reduce its balance sheet. That is another way of them shifting back to an easy money stance. 

Market Outlook: Market Rally Continues 
The bulls are doing their best to rescue the market from falling any further. The market was extremely oversold and is currently bouncing to help work off that oversold condition. Resistance is the 200 DMA line for the major indices. After that, the next big level of resistance to watch is 2018’s high. Meanwhile, support is December 2018’s low. As always, keep your losses small and never argue with the tape.

FLS Setups Review: Stocks Climb Ahead for a Fourth Straight Week

Hi, I’m Andy! I’m a freelance writer and restaurant manager, and I have also been following ChartYourTrade.com since the day it launched. This post is a review of the performance of the 10 Elite Stock Setups that Adam sent to his Advanced Stock Reports subscribers on Saturday, January 12, 2019. Each setup comes complete with annotated charts highlighting the advanced entry point and support level(s), as well as all of the necessary fundamental information.

One of the reasons that I struggled to find success in the market was that I always tried to take on more than I could reasonably handle. I used to commit myself to researching dozens and dozens of stocks and tracking their daily movements, but I would always burn out after a few months and fail to keep up the pace that I set for myself.

It wasn’t until I found Adam’s weekend newsletter that I was able to see the power of a strategy that leaves room for life to get in the way. And life definitely got in the way for me this week, as I didn’t have time to check on the market even once during the week.

Thanks to Adam’s insight and my calm Saturday mornings, I am able to get myself completely caught up and refocused over the weekend. And with seven of the ten stocks from last weekend’s newsletter breaking through their entry points, I can see that the market is starting to command some more attention.

The General Market

In order to properly evaluate what each of our ten elite stock setups did this week, we need to look at them with the context of the general market fresh in our minds.

After a slow start on Monday, the market came to life on Tuesday as it crossed above its 50-day moving average line. It then continued higher throughout the rest of the week, finishing well above the 50-day moving average but still below its declining 200-day moving average.

We have seen a very strong move up from the low that was put in during the week of Christmas, but the market still has some work to do in order to convince us that the bear market is officially over. Regardless of where we are heading, a pullback is certainly in order to give this market a chance to catch its breath.

Juniper Networks – Triggered

With its 50-day moving average holding above its 200-day moving average, JNPR was already in a better position than most stocks coming into the week. After struggling on Monday, the stock retook that 50-day line on Tuesday. It then found support there on Wednesday and Thursday before moving higher on Friday.

That Friday move was strong enough to push the stock above Adam’s entry point, but it was not able to hold above that number. It did hold above its 50-day line though, and JNPR looks to be a very strong stock moving forward.

Citrix Systems, Inc. – Did Not Trigger

We have seen a ton of stocks lately that are demonstrating strength without quite getting to the entry points that Adam identifies for them. CTXS was one of those stocks this week.

The stock gave up its 50-day and 200-day moving averages on Monday, but it was able to quickly recover and shoot back above those lines on Tuesday. It then continued higher on Thursday and Friday and closed near the top of its range for the week.

Walt Disney Co. – Did Not Trigger

DIS started out the week with a down day, just like we saw from most of our elite stock setups this week. However, this stock was unable to respond with a bounce-back day on Tuesday. It actually lost most ground that day, and then stumbled again on Wednesday.

Rally attempts on Thursday and Friday were not successful enough for DIS to close above its 50-day moving average line, which was a major disappointment considering how strong the stock had looked coming into the week.

McDonalds Corp. – Triggered

MCD started off the week just like DIS with three straight down days that saw it falling below its 50-day moving average line. But the big difference is that this stock was able to post strong recovery days on Thursday and Friday where it retook that 50-day moving average and closed right at Adam’s entry point.

American Tower Corp. – Triggered

AMT was having none of the negativity of the general market on Monday. It was one of the few stocks that bucked the trend and posted a positive day. Then, building on that strength, it continued to move higher throughout the rest of the week.

During its run of five straight positive days this week, AMT was able to pull its 50-day moving average higher while breaking through Adam’s entry point on Tuesday and then continuing higher from there.

PayPal Holdings, Inc. – Triggered

There are stocks that trigger Adam’s entry points with dominant strength like we saw from AMT, and then there are stocks that struggle with those key numbers. PYPL was one of the latter stocks this week as it bounced above and below Adam’s entry point.

After starting the week with a bit of a slump to match the general market, PYPL jumped higher on Tuesday and triggered Adam’s entry point. It then fell back below that entry point on Wednesday and stayed there on Thursday before attempting to retake the entry point line on Friday and ultimately closing just short of it.

Shopify, Inc. – Triggered

SHOP was yet another stock that stumbled out of the gate on Monday and then posted a big up day on Tuesday. After bouncing off of its 200-day moving average during Monday’s trading, SHOP was able to break through Adam’s entry point during Tuesday’s move.

The stock showed even more strength later in the week as it climbed again on Wednesday, paused briefly on Thursday, and then moved even higher on Friday.

T-Mobile US, Inc. – Did Not Trigger

With four straight losing sessions to start the week, TMUS was one of the weakest stocks on our list this week. After fighting to hold its 50-day moving average through the early part of the week, it fell below that line during Thursday’s trading.

The stock was able to recover with a positive day that took it back above its 50-day moving average on Friday, but it still closed in the bottom half of that day’s range.

Xilinx, Inc. – Triggered

The leading stocks that make it onto Adam’s FLS Newsletter each week tend to move a bit more dramatically than the general market, but XLNX was not one of those this week. It recorded five days of tight trading that saw the stock push higher through his entry point by the end of the week.

After moving lower with the overall market on Monday, the stock moved higher on Tuesday and briefly broke through Adam’s entry point. It then fell back a bit on Wednesday before recovering and moving higher again on Thursday and Friday.

Nike Inc. – Triggered

I would never trade based on my personal shopping preferences, but I was very excited to see that NKE was going to be on our list of Elite Stock Setups heading into the week where their newest shoes would be hitting the court in the NBA.

The market obviously likes those new laceless sneakers as much as I do, because the stock posted huge gains on Tuesday, Thursday, and Friday that took it well above Adam’s entry point. It also looks like we could be seeing the stock’s 50-day line cross above its 200-day line if NKE continues to show strength in the coming weeks.

This was another strong week for the general market, and the Elite Stock Setups that Adam identified for us showed a tremendous amount of strength. If you would like to see which stocks made the list for us to track in the coming week, make sure you subscribe to his Find Leading Stocks newsletter where he maps out his entire playbook for making money in the market.

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