Market Strategies Newsletter - Special Daily Edition
For Trading JUNE 12th
IT’S NEVER DIFFERENT!!
Sometimes it Just Takes Longer
Declines Across All Asset Classes
Today’s market was just waiting to happen, and finally it had the FED to blame. More specifically, it had the influx of newly minted retail investors, bored without any sports to bet their PUA and unemployment checks on, and taking a “shot on anything that looked cheap” (not by p/e, but just by price) and all those great bankruptcy lotto plays. To be fair, the spike in COVID-19 cases across 20 states and places like Arizona telling anyone who would listen that they are at capacity in their ICUs, and we had a perfect storm for the sellers. Add to that the unbridled speculation in airlines and cruise ships going back into business and BA going from $140 to $240 (pre-market, not in the real world) and “What could possibly go wrong?” Well, BA traded down to $166.00 before a minor bounce to close $170.00 -33.41 (16.42%). By midday the down 900 preopening futures looked tame with the DJIA -1400 (5%) and the NAZ -400 and the S&P -140. Then, at 2:30 when the margin calls hit the next wave sent us to -1750 by 3:00. Things calmed down for a while and the teleprompter readers made all sorts of excuses for the fall, but the fact that we went too far too fast with no REAL economic justification, or realistic expectation about what a “reopening of the country” would look like, all the while the Orange Emperor and his henchmen were telling anyone who would listen that this was a “rocket ship.” Seems more like the Challengerdisaster today. The final numbers were DJIA -1861.82 (6.9%), NASDAQ -527.62 (5.27%), S&P 500 -188.04 (5.89%, the Russell -111.17 (7.58%), and the Transports – 741>66 (7.74%). Market internals were absurdly warped with the NYSE 33:1 down and NASDAQ 13:1. Volume was slightly higher than yesterday. All 11 S&P sectors were lower and the DJIA had no gainers. The biggest losers were BA -228, UNH-151, GS -132, AAPL -116, and HD -103 DPs. The worst losses were in energy, financials, industrials, material’s and real estate. Least bad was consumer staples.
Our “open forum” on Discord, which allows me to interact with subscribers and others to allow direct questions and chart opinions on just about any stock, continues to grow with more participants every day. It is informative and allows me to share insights as the market is open and moving. The link is:https://discord.gg/ATvC7YZ and I will be there and active from before the open and all day. It’s a great place to share ideas and gain some insights, and we’ve grown to almost 1900 members. I also did this video titled “How to survive being an options trader and not blow up your account,” over the long weekend. I think it’s very informative as a guide to stock selection and option choices. The link is
Tonight’s closing comment video https://youtu.be/Qf9ObfrgJb4
SECTORS:I’m going to change up and shorten tonight’s Note since it was such an overwhelming bad day. I’ll list all sectors with the worst and least worst and the ETF to reflect the overall damage. There were a couple earnings reports, LULU missed numbers by a penny with .22 vs .23 expected. The stock was $308 -14.73 (4.5%) before the numbers and after the miss the stock traded $282 with a last of 287 – another $21 for a total loss of 36.25 (11.2%). Adobe (ADBE) beat on earnings but missed on revenues, but the market was pleased, nonetheless. The stock had closed $388.30 -18.52 (4.55%) but turned on a dime and headed back to trade $407.11 and is currently 403 +15 (3,.8%). Last, we had great news on human trials for REGN for Covid-19 antibodies but after making a new all-time high @ $625.79, even REGN was subject to the decline and finished the day $30 off the highs at $596.77 -9.82 (1.62%).
FOOD SUPPLY CHAINwasLOWERwith FLO the only gainer +.52 (2.26%) and BGS, maker of Green Giant and Ortega to name a few was $22.46 -2.88 (11.37%), HRL and SJM, consumer staples were both down about 2.5% PBJ finished $30.24 -1.24 (3.95%).
BIOPHARMAwasLOWERwith the best performer, REGN (see above) -1.72% and BHC 17.35 -1.43 (7.61%) and IBB $127.57 -5.77 (4.33%).
CANNABIS: wasLOWER with CRON $6.56 -1.03 (13.57%) the worst and GWPH $121.13 -7.00 (5.46%) the best and MJ $13.45 -1.40 (9.43%).
DEFENSEwasLOWERwithLMT -13.80 (3.42 %) the best and TXT $31.63 -3.71 (10.5%) and ITA $166.40 -14.68 (8.11%).
RETAILwasLOWERwith M -1.06 (13.35%) the worst and WMT the best -1.07 (.88%), and XRT $40.84 -2.36 (5.48%).
FAANG and Big Cap:were LOWERwith BA the worst (see above) -31.26 or (15.52%) and NFLX -3.48 (1.95%) and XLK $98.39 -5.72 (5.49%).
FINANCIALS wereLOWERwith C $48.70 -7.17 (12.84%) and V 189.01 -11.47 (5.72%) the best and XLF $23.22 -1.97 (7.82%).
OIL, $36.34 -3.26.Oil was under pressure all day, finishing near the lows and is slightly lower tonight. The stocks were weak with OXY $17.59 -3.17 (15.27%) and CVX $89.80 -7.78 (7.97 the best performer. XLE finished $38.96 -3.92 (9.14%).
METALS,GOLD: $1,739.80 +19.10. After trading higher this morning Gold and Silver both got sold off with the massive liquidation that hit all markets. After finishing no better than mid-range, we are lower by $4 tonight. We bought back the 3rd and final lot of NEM @ $58.86.
BITCOIN: closed $9,300 -635.After trading higher again early this morning (10080) BTC got hit with the same liquidation as all other stocks and commodities. It fell back to 9,090 and is slightly higher tonight. We added 350 shares of GBTC last Wednesday @ $10.02 to our position of 400 @ $8.06, bringing our average price to $8.97. GBTC closed $10.76 -1.53 today.
Tomorrow is another day.
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