01/19/2022 ES Trade Plan Worksheet

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Jan 192022
 

Has inflation and the Fed’s moving towards interest rate hikes finally hit the markets?  The 10-year and 2-year yields spiked to highs not seen for 2 years, sending stocks down.  Bloomberg Intelligence thinks that Fed will be forced to move on tightening faster and forecasts five 25 basis point rate increases in 2002; March, June, July, September, and December.

Markets now have a 50-basis point hike in March fully discounted at about a 1 in 3 chance.  The Fed is now being blamed for too much accommodation and waiting too long to tighten.

Ford (F) will book an $8.2 billion gain in the fourth quarter for investment profits in EV startup Rivian Automotive (RIVN).  Ford had invested $500 million in 2019 and holds about 12% of the company.  Rivian’s IPO sent Rivian’s market cap to over $100 billion but the value has since retreated to around $66 billion.

After an appeal from airline carriers to federal government, AT&T (T) and Verizon (V) have agreed to pause rollout of 5G service near airports.  The 5G frequencies can bleed over to frequencies used by newer aircraft safety systems.  Several international carriers have cancelled flights or substituted aircraft for US destinations.

US chip stocks are up premarket after German chip equipment maker AMSL NV (AMSL) posted strong earnings and said their chip designing machines will help grow chip sales more than 20% in 2022.  NVDA, AMD, INTC, and MU are all up premarket.

Corporate earnings include UNH, BAC, PG, MS, and STT premarket, DFS and UAL post-market.

The economic calendar includes Building Permits and Housing Starts @ 8:30am ET.  Secretary of the Treasury Janel Yellen will speak to the US Conference of Mayors @ 8:00am ET.

Volatility increased again on Tuesday and remains elevated.

Size bias is bullish into the US session open.

 

 Posted by at 7:22 am

01/18/2022 ES Intraday Swinging Example

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Jan 182022
 

Covid-19 protocols have bubbled back to the top of issues after last week’s Supreme Court decision blocking Biden’s corporate vaccine mandates.  Over 34% corporations were waiting on federal guidance and now the courts have forced corporations to grapple with their own rules, balancing outbreaks that lead to labor absences with pushback from employees that have Covid concerns.  About 25% of US corporations are currently requiring vaccinations or regular testing.  Around 40% of corporations are not imposing any mandates.  The Covid safety landscape is pure confusion with constant guideline changes from the CDC, varying mask and vaccine mandates, pushback and misinformation, and political differences.

Oil is in focus as Brent nears $88/barrel, the highest in 7 years.  Houthi rebels from Yemen who are associated with Tehran have attached the United Arab Emirates sparking oil supply disruption concerns.

Airline CEOs wrote an open letter to the FAA warning of “significant operational disruption to air passengers, shippers, supply chain and delivery of needed medical supplies” with AT&T (T) and Verizon (VZ) set to turn rollout their 5G networks this week.  Apparently 5G bleeds into radio frequencies used by many modern aircraft safety systems, rendering them unusable.  UAL, AAL, and DAL are all down premarket.

Earnings include Truist Financial (TFC), Bank of New York Mellon (BK), PNC Bank (PNC) and Goldman Sachs (GS) premarket; JB Hunt Transport (HBHT) and Interactive Brokers (IBKR) post-market.

The economic calendar includes Empire State and NAHB @ 8:30am ET.

After ticking down last Friday, volatility has increased from the Globex selloff.

No Size bias as Globex volume was mixed.

 

 Posted by at 7:10 am

06/05/2019 ES Trade Plan Worksheet

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Jun 052019
 

Fed Chair Jerome Powell reinforced Fed’s James Bullard’s remarks that trade wars with China, Mexico, and the EU put a dark cloud over the US economy.  Powell said yesterday “as always, we will act as appropriate to sustain the expansion, with a strong labor market and inflation near our symmetric 2% objective.”  Fedwatch now places the probability of a interest rate decrease at 53% for July.

Presidential candidate Sen. Bernie Sanders will be crashing Walmart’s annual meeting at the invitation of WalMart workers.  He expected to push Walmart to raise wages higher than the $11/hour minimum wage.

Earnings today include FIVE, AEO, GILL, CPB, CLDR, SFIX, MDB, and UNFI.  The economic calendar is full with focus on the 8:15am EST ADP and 10:00am EST ISM Non-Manufacturing PMI.  Also on the calendar are Final Services PMI @ 9:45am EST, Oil @ 10:30am EST and Beige Book @ 2:00pm EST.

Fed speakers include Vice-Chair Clarida @ 9:45am EST and Bowman @ 10:00am EST.  Volatility is up again due to yesterday’s Fed induced rally.  US stocks had their largest move in over 5 months.  Size bias is long into the US session open.

 

 Posted by at 6:08 am

06/04/2019 ES Trade Plan Worksheet

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Jun 042019
 

A Fed rate course reversal???  St. Louis Fed President James Bullard said yesterday that a “darkened” global trade narrative could slow the growth of the US economy, followed by a “downward policy rate adjustment may be warranted soon.”  The bulls sent US stocks up into yesterday’s cash close.

Markets will be watching Fed speak closely this morning: John Williams @ 8:30am EST and Chair Jerome Powell @ 9:55am EST.  CME futures predict a 50% chance of a rate cut in July with 2 more before 2020.  That would be quite a reversal in Fed policy…

FAANG companies are in US lawmakers’ crosshairs.  A House Judiciary committee announced a top-to-bottom review of US tech companies and the DOJ and FTC announced they would tackle large monopolistic companies such as Alphabet, Apple, Amazon, and Facebook.

Dem David Cicilline of RI said “The growth of monopoly power across our economy is one of the most pressing economic and political challenges we face today…  market power in digital markets presents a whole new set of dangers.”

In the same vein, Apple announced they will be killing iTunes and instead split music, podcasts, and TV into separate apps.  Earnings today include CRM, AMBA, GWRE, CBRL, GME, TIF, LE, HQY, and NAV.

The economic calendar is light with Factory Orders and Constructions Spending @ 10:00am EST.  Volatility continues to tick up and if Powell hints at decreasing rates, the ES could move today.  Size bias is a divergent short into Bullard’s 8:30am talk.

 

 

 Posted by at 6:19 am

04/19/2019 Good Friday Holiday

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Apr 192019
 

US stock and futures markets are closed today for Good Friday.  We’ll resume posting on Monday, April 22.  Enjoy the long weekend!

 Posted by at 5:37 am

04/17/2019 ES Trade Plan Worksheet

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Apr 172019
 

Earnings came in strong yesterday with most beating expectations.  The most notable exception was IBM who beat earnings but missed on revenue.  IBM stock is down over 2.5% premarket.  Netflix also beat but lowered forecasts for new subscribers which sent their stock down around 1%.

Qualcomm (QCOM) stock jumped over 20% yesterday and is up another 5% this morning after they announced a settlement with Apple over technology infringements.  Apple will switch to Qualcomm from Intel for their 5G technology.  A few hours after the announcement, Intel announced they were getting out of the 5G modem business.

Earnings focus today include MS, PEP, AA, ABT, USB, BK, LVS, and TXT.

OPEC is holding their bi-annual meeting today.  Economic data includes Trade @ 8:30am EST, Inventories @ 10:00am EST, Oil @ 10:30am EST, and the Fed’s Beige Book @ 2:00pm EST.  The Fed’s Bullard speaks @ 12:45pm EST.

Volatility continues to contract as the bulls try to push higher.  Volatility is most likely to increase to the downside.  Reaction to earnings will set today’s tone.  Like yesterday, Size bias is a divergent short going into the US session open.

 

 Posted by at 6:48 am

12/04/2018 ES Trade Plan Worksheet

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Dec 042018
 

Confusion and doubt are creeping into the markets over exactly what was accomplished during Trump and China’s Xi Jinping over Sat dinner’s trade talks.  The WH economic advisor Larry Kudlow tried to detail specifics from the meeting but only conflicted with trade talk information released by the Chinese.  The start date of the 90-day truce is in question as Kudlow says it’s Dec 1 and China said it was Jan 1.  With no agreement written down and signed, markets are a little nervous.  Meanwhile yields between the 3 and 5-year note have inverted for the first time in over 10 years suggesting that the US economy is slowing.  Nothing of significance on today’s US economic calendar.  The Fed’s Williams holds a press conference @ 10:00am EST.  Earnings include TOL, DG, AZO, MRVL, and HPE.  Volatility remains elevated, however could shrink into today’s US close as US stock markets will be closed National Day of Mourning for former US President George H.W. Bush.  Size bias is short on lighter Globex volume into the US session open.

 

 Posted by at 6:51 am