TheStrategyLab.com Price Action Trading Support Forum

Trade Results of M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
Price Action Trading (no technical indicators)


click on the above image to view today's performance verification

Price Action Trade Performance for Today: +1.60 points or $160 dollars in the Russell 2000 Emini TF ($TF_F) Futures.
Russell 2000 Emini TF Futures - 1 tick or 0.10 = $10.00 dollars and there's more contract information @ The ICE.
S&P 500 Emini ES Futures - 1 tick or 0.25 = $12.50 dollars and there's more contract information @ CMEGroup.

In addition, all trades were posted real-time in the free #FuturesTrades chat room. You can read today's #FuturesTrades trading chat room logs for details (e.g. time, price, contract size) about each one of my trades from entry to exit along with price action commentary as the trade traversed in comparison to what's shown in the above image...all archived @ http://www.thestrategylab.com/ftchat/forum/viewtopic.php?f=106&t=1272.

To join our free chat room...log-in instructions located at a different forum @ http://www.thestrategylab.com/ftchat/forum/viewtopic.php?f=5&t=630

Also, posted below are direct links to information about my price action trade methodology and trading plan (there's a difference between the two) that enables me to identify key trading areas in the price action that represent changes in supply/demand and volatility along with being able to exploit these changes via WRB Analysis (wide range body/bar analysis).

WRB Analysis Tutorials @ http://www.thestrategylab.com/WRBAnalysisTutorials.htm and there's a free study guide of the WRB Analysis Tutorial Chapters 1, 2 and 3 @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=119&t=718.

Volatility Trading Report (VTR) @ http://www.thestrategylab.com/VolatilityTrading.htm and there's a free trade signal strategy @ http://www.thestrategylab.com/tsl/forum/viewforum.php?f=89 so that you can freely test drive one of our price action trade strategies with support prior to purchasing the Volatility Trading Report (VTR).

Trading Plan Daily Routine @ http://www.thestrategylab.com/tsl/forum/viewtopic.php?f=163&t=1526

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Market Summaries

The below summaries by Bloomberg, CNNMoney and Yahoo! Finance helps me to do a quick review of the fundamentals, FED/ECB/IMF actions or any important global economic events that had an impact on today's price action. Simply, I'm a strong believer that many variables (key market events) causes key changes in supply/demand and volatility that results in swing points and strong continuation price actions. Thus, I pay attention to these key market events from one trade to the next trade to give me the market context for my technical analysis. Just as important, these summaries becomes my archives to allow me to understand what was happening on any given trading day in the past...something I can not get from my broker statements alone.





Market Update

4:35 pm : Today's 1.7% rally in stocks took the S&P 500 back to flat on the week, after a somewhat disappointing start to earnings season. Today's earnings from financial heavyweights J.P. Morgan Chase (JPM 36.07, +2.03) and Wells Fargo (WFC 33.91, +1.06) provided a boost to the financial sector, which was the strongest sector in the market. While today's results were taken as a positive, there have been several warnings in the tech sector and lackluster results from the majority of other companies that have reported thus far.

Looking more closely at today's earnings, J.P. Morgan reported its highly anticipated second quarter results, and gave additional details on the highly-publicized 'London Whale' trade. The loss from the trade is approximately $5.8 billion year-to-date, and statements that the trade has been largely unwound soothed some fears. Overall results would be viewed as 'noisy' given the number of one-time items that included the CIO loss, DVAs, reserve builds, and litigation expense. The underlying performance of the Investment Bank unit and Housing was a positive for the firm, and has helped shares recover. Wells Fargo posted numbers that were slightly better than consensus as housing helped provide a solid quarter for the bank in a difficult environment.

Aside from the big bank earnings, this morning's data showed PPI run at a hotter than expected 0.1% month over month clip and a Michigan Sentiment number that fell short of estimates with a 72.0 print. The equity market saw no reaction to the negative sentiment reading.

The euro hit multi-year year lows this week, but gained sharply vs. the dollar shortly after today's U.S. equity market open. The euro finished the week at $1.2240. Treasuries have witnessed some light selling on today's return to risk with the 10-yr yield climbing two basis points to 1.50%.

Looking back on the week, Alcoa (AA 8.42, +0.12) kicked off earnings season reporting in-line EPS and better than expected revenue. AA also reaffirmed its forecast for 2012. The S&P finished nearly unchanged on Monday.

On Tuesday, markets closed lower for a fourth consecutive session as a drop of 1.0% saw the Nasdaq pace the decline. Losses accelerated mid-day after Cummins (CMI 88.63, +2.86) announced it expects its full-year revenue outlook for 2012 to match 2011 despite prior guidance suggesting an increase of 10%.

On Wednesday, a late-day rally lifted the S&P 500 into positive territory moments ahead of the close, but the index finished with fractional losses to close lower for a fifth straight session. The FOMC Minutes failed to mention more quantitative easing by the Fed, but suggested ‘further policy stimulus likely would be necessary to promote satisfactory growth,' and that the Fed should study ‘new tools' for easing. The minutes were taken as a disappointment for stocks.

On Thursday, things were quiet ahead of the bank earnings and Chinese GDP data overnight as the S&P fell 0.5% on the day.

Next week, earnings season will dominate the headlines and have a bigger influence on the market. Over 200 companies will report Q2 results, including many Dow components; most of the large cap financials and some major technology bellwethers. Citigroup (C 20.02, -0.02) will kick things off on Monday morning.DJ30 +203.82 NASDAQ +42.28 SP500 +22.02 NASDAQ Adv/Vol/Dec 1827/1.3 bln/660 NYSE Adv/Vol/Dec 2551/683 mln/520

3:35 pm : Following a notable rally in commodities this morning, gains were largely held and many ended the day near their session highs.

Oil ended 1.3% higher at $87.16. Crude oil ran to a new session high of $87.62 in the afternoon session, just about 10 minutes before floor trading ended and finished the day just below that high. Oil ended 1.3% higher at $87.16. Natural gas continued to chop around the unchanged line for most of the session, finishing the day unchanged at $2.88.

In the metals space, gold and silver remained in positive territory rally this morning's rally, but gold ended the day with stronger gains. Gold hit a Hod of $1596.50 and finished the day just below that level at $1578.70, up 1.7%. Silver pulled back from its session high and erased most of its gains, ending 0.8% higher at $27.37.DJ30 +193.22 NASDAQ +43.77 SP500 +21.41 NASDAQ Adv/Vol/Dec 1829/1088 mln/645 NYSE Adv/Vol/Dec 2530/448 mln/501

3:00 pm : The dollar index was hammered to session lows near 83.30 as equity markets opened for trade, and has held at that level throughout the session. Selling of the greenback came amid chatter of an Eastern European central bank buying euros with some suggesting that player was Russia. The single currency briefly crossed above the 1.2255 level before pulling back and stabilizing near 1.2240. Sellers were unable to push the pound below 1.5400 after this morning’s disappointing CB Leading Index reading, and the currency surged to session highs near 1.5575 on today’s return to risk. An 85 pip advance has run the Australian dollar back up to its 100-day moving average at 1.0225 as traders moved back into the hard currency amid expectations China will implement a stimulus plan to ignite growth.DJ30 +168.36 NASDAQ +39.29 SP500 +19.31 NASDAQ Adv/Vol/Dec 1802/937.2 mln/667 NYSE Adv/Vol/Dec 2492/387.4 mln/553

2:30 pm : Stocks hold at their best levels of the session as action drifts towards the close. All three of the major averages are currently holding gains of close to 1.4%.

Lexmark International (LXK 20.59, -3.72) is one of the notable underperformers today, trading down 15.5% after lowering its second quarter earnings per share and revenue guidance. The company now expects earnings per share of between $0.87 and $0.89 which falls well short of the $1.00 expected by the Capital IQ Consensus Estimate. Management also lowered its revenue guidance to $919.6 million which represents a 12% year over year decline, and is below the $960.9 million expected by the consensus. The company cites weakening demand in Europe and unfavorable changes in currency exchange rates for the change to its forecast. DJ30 +167.79 NASDAQ +38.71 SP500 +18.82 NASDAQ Adv/Vol/Dec 1796/869.4 mln/661 NYSE Adv/Vol/Dec 2494/358.1 mln/546

2:00 pm : All the major averages are hovering just beneath today's highs. Shaping up to be quiet afternoon of trading ahead of the weekend.DJ30 173.39 NASDAQ 38.22 SP500 18.97 NASDAQ Adv/Vol/Dec 1783/809 mln/645 NYSE Adv/Vol/Dec 2492/333 mln/541

1:30 pm : Treasuries are back near session lows as some light selling has begun to take hold in afternoon trade. The complex fell to its worst levels of the day following this morning’s hotter than expected PPI number, but buyers quickly emerged after the disappointing Michigan Sentiment reading. A loss of 18/32 dropped the 30-yr bond to 108 17/32, and has its yield near 2.60%. Meanwhile, less aggressive selling of the 10-yr note has made for a decline of 7/32 while running the benchmark yield back above the 1.500% threshold. Slight steepening of the yield curve persists with the 2-10-yr spread wider at 123.5 basis points. The bond market will be on alert next week as Fed Chairman Ben Bernanke will give his semi-annual “Monetary Policy Report to the Congress” in front of both the Senate Banking Committee and House Financial Services Committee.DJ30 +167.64 NASDAQ +36.32 SP500 +18.42 NASDAQ Adv/Vol/Dec 1784/724.5 mln/633 NYSE Adv/Vol/Dec 2504/308.0 mln/515

1:00 pm : Stocks trade at session highs as hopes of a potential Chinese stimulus package coupled with this morning’s reaction to earnings from financial heavyweights J.P. Morgan Chase & Co. andWells Fargo have provided the boost. This morning’s data showed PPI run at a hotter than expected 0.1% month over month clip and a Michigan Sentiment number that fell short of estimates with a 72.0 print.

Earnings season continues to pick up steam, highlighted by reports from two of the biggest banks in the U.S. J.P. Morgan Chase & Co. (JPM 36.07, +2.03, +1.68) reported it's highly anticipated second quarter results, and gave a detailed outlook of the infamous 'London Whale' trade. The loss from the trade is approximately $5.8 billion year-to-date, and statements that the trade has been largely unwound soothed some fears. Overall results would be viewed as 'noisy' given the number of one-time items that included the CIO loss, DVAs, reserve builds, and litigation expense. The underlying performance of the Investment Bank unit and Housing was a positive for the firm, and has helped shares recover some of the post-'Whale' announcement losses. Wells Fargo (WFC 33.91, +1.06) posted numbers that were slightly better than consensus as housing helped provide a solid quarter for the bank in a difficult environment.

Acme Packet (APKT 16.25, +0.64) is up 4.2% this morning after the company’s Board of Directors announced a $200 million share buyback program that will take place over the next 12 months. Today’s buy has lifted the stock off its recent lows that correspond with levels last seen in February 2012.

Fertilizer names are higher today on continued strength in the grain complex. Agrium (AGU 90.36, +1.29) and Mosaic (MOS 55.22, +0.78) are trading up 1.5% and 1.4% respectively and are both up in excess of 20% since the beginning of June. That compares to a gain of close to 6% for the broad-based S&P 500.

Treasuries have witnessed some light selling on today’s return to risk with the 10-yr yield climbing more than two basis points to 1.503%. Early strength in the euro weighed on the dollar index, dropping it to a loss of 0.3% near 83.40. Elsewhere, precious metals are strong with gold up $26 at $1591 and silver higher by $0.20 near $27.35.DJ30 +171.99 NASDAQ +36.07 SP500 +18.74 NASDAQ Adv/Vol/Dec 1791/682.5 mln/619 NYSE Adv/Vol/Dec 2529/285.2 mln/503

12:30 pm : Equity markets continue to chug higher as cyclical stocks lead the way. Major European bourses all closed near session highs.

Financials continue to outperform led by JP Morgan (JPM 36.11 +2.07), now up 6% after reporting Q2 results this morning. Wells Fargo (WFC 33.90 +1.05) is up 3% after generally in-line Q2 results.

The industrial and Materials sectors are also strong. The defensive Healthcare, Utility and Consumer Staples sectors are lagging but are still notably higher.DJ30 +173.20 NASDAQ +36.25 SP500 +18.58 NASDAQ Adv/Vol/Dec 1788/627 mln/597 NYSE Adv/Vol/Dec 2514/262 mln/495

12:00 pm : The major averages hold at session highs with both the Dow and S&P 500 trading up 1.4%. Slight underperformance can be seen from the Nasdaq which holds a 1.2% gain.

Fertilizer names are higher today on continued strength in the grain complex. Agrium (AGU 90.44, +1.37) and Mosaic (MOS 55.18, +0.74) are up 1.5% and % respectively, and are both higher by more than 20% since the beginning of June. That compares to a gain of close to 6% for the broad-based S&P 500.DJ30 +181.57 NASDAQ +33.57 SP500 +18.17 NASDAQ Adv/Vol/Dec 1753/544.3 mln/593 NYSE Adv/Vol/Dec 2512/234.8 mln/473

11:30 am : Earnings season continues to pick up steam, highlighted by reports from two of the biggest banks in the U.S. J.P. Morgan Chase & Co. (JPM 35.72, +1.68) reported it's highly anticipated second quarter results, and gave a detailed outlook of the infamous 'London Whale' trade. The loss from the trade is approximately $5.8 billion year-to-date, and statements that the trade has been largely unwound soothed some fears. Overall results would be viewed as 'noisy' given the number of one-time items that included the CIO loss, DVAs, reserve builds, and litigation expense. The underlying performance of the Investment Bank unit and Housing was a positive for the firm, and has helped shares recover some of the post-'Whale' announcement losses. Wells Fargo (WFC 33.86, +1.01) posted numbers that were slightly better than consensus as housing helped provide a solid quarter for the bank in a difficult environment. Next week will see a pick up in earnings report volume with notables including: Citigroup (C 26.02. +0.74), Goldman Sachs (GS 97.05, +3.03), IBM (IBM 185.62, +2.53), and Google (GOOG 571.42, +0.94).DJ30 +161.13 NASDAQ +27.67 SP500 +16.20 NASDAQ Adv/Vol/Dec 1711/459.2 mln/618 NYSE Adv/Vol/Dec 2457/208.5 mln/495

11:00 am : Stocks trade at session highs as all three of the major averages hold gains in excess of 1.0%. Both the Dow and S&P 500 are pacing today’s advance, trading up 1.3%.

Shares of Acme Packet (APKT 16.10, +0.49) are up 3.1% this morning after the company’s Board of Directors announced a $200 million share buyback program that will take place over the next 12 months. Today’s buying has lifted the stock off its recent lows that correspond with levels last seen in February 2010. DJ30 +165.37 NASDAQ +30.07 SP500 +16.77 NASDAQ Adv/Vol/Dec 1760/385.6 mln/506 NYSE Adv/Vol/Dec 2509/172.6 mln/421

10:35 am : The dollar index dropped sharply in recent trade this morning, which gave a boost to commodities.

In the energy space, Aug crude oil was trending rather steadily higher all session until hitting its current HoD of $87.28/barrel at 7am EST. WTI crude oil pulled back to the unchanged line, but has since bounced back about 80 cents per barrel. The Aug contract is now +0.9% at $86.87/barrel.

July natural gas also sold off hard this morning, but is now up 0.5% at $2.89/MMBtu.

In metals: August gold and Sept. silver rallied sharply a short while ago as well, which pushed both precious metals to new session highs (Gold $1596.50, Silver $27.55). Gold is now +1.8% at $1593.70/oz, while silver is +1.1% at $27.45/oz.DJ30 +150.76 NASDAQ +28.04 SP500 +15.49 NASDAQ Adv/Vol/Dec 1768/316.7 mln/475 NYSE Adv/Vol/Dec 2458/149 mln/405

10:00 am : Stocks remain near their session highs despite the disappointing survey on consumer sentiment from the University of Michigan. The preliminary Survey for July came in at 72.0, which is down from the 73.2 that was posted in the prior month, and less than the reading of 73.5 that had been widely expected. Today's number was the lowest reading since December 2011.DJ30 +114.74 NASDAQ +18.82 SP500 +11.97 NASDAQ Adv/Vol/Dec 1559/154.6 mln/536 NYSE Adv/Vol/Dec 2373/86.8 mln/416

09:45 am : The major averages hold solid gains at the open as all three trade up close to 0.8%. Financials are strong as J.P. Morgan Chase (JPM 35.40, +1.36) and Wells Fargo (WFC 33.30, +0.45) trade up 4.0% and 1.4% respectively following their earnings. Other sectors seeing solid performance in early trade include energy, materials, and consumer discretionary.DJ30 +104.60 NASDAQ +20.66 SP500 +11.56 NASDAQ Vol 86.0 mln NYSE Vol 61.3 mln

09:14 am : [BRIEFING.COM] S&P futures vs fair value: +1.40. Nasdaq futures vs fair value: +6.00. Equity futures point to a flat open this morning as enthusiasm for a potential Chinese stimulus appears to be waning. Banking giants J.P. Morgan Chase & Co. (JPM) and Wells Fargo (WFC) will be in focus after both companies released their quarterly results. Data still to cross the wires this morning is limited to Michigan Sentiment which is due out at 9:55 am ET.

08:59 am : [BRIEFING.COM] S&P futures vs fair value: +2.50. Nasdaq futures vs fair value: +6.50. Markets around the world are higher today on hopes China will implement a new stimulus program following its latest GDP miss. The Chinese economy expanded at a 7.6% quarter over year clip (7.7% expected) as all signs point to a continued slowing of the world’s second largest economy. Elsewhere in the region, Singapore’s economy contracted 1.1% quarter over quarter as manufacturing slumped on slowing global demand. In Europe, stocks are pushing higher despite Moody’s downgrading Italy’s rating two notches to Baa2. This morning’s Italian auction is being hailed as a success as the country sold EUR3.5 billion of three-year BTPs as the at-auction yield fell to 4.65% (5.30% previous). However, both Italian and Spanish yields are ticking higher.

The major Asian bourses (Nikkei +0.1%, Hang Seng +0.4%, Shanghai UNCH) finished mostly higher on speculation a Chinese stimulus plan will be launched to combat the slowdown of the world’s second largest economy. Japan’s Nikkei eked out a small gain of 0.1% as names with exposure to China supported the index. Robotics maker Fanuc rose 2.5% and Hitachi Construction Machinery added 1.3%. However, those names with large exposure to Europe underperformed as Canon slipped 1.1%. Hong Kong’s Hang Seng rallied 0.4% as Chinese banks led the advance. China Construction Bank gained 0.6% and ICIC Bank tacked on 0.8%, but the two names fell 7.2% and 5.6% respectively for the week. Shares of real estate giant Sun Hung Kai were suspended early in the session as the company’s co-chairman were charged with corruption. Elsewhere, China’s Shanghai Composite ended flat amid a volatile session. Energy names were weak as Shenhua Energy lost 0.8%, but cement names outperformed with Anhui Conch Cement adding 1.2%.

European markets (FTSE +0.4%, CAC +0.5%, DAX +0.9%) are higher in afternoon trade on anticipation China will act to ignite its slowing economy. Britain’s FTSE is up 0.4% as miners pace the advance. Randgold Resources is holding a gain of 2.4% while Rio Tinto and BHP Billiton are both up 1.7%. Meanwhile, France’s CAC trades higher by 0.5% with luxury goods maker LVMH Moet Hennessey Louis Vuitton seeing an advance of 2.6%. French automaker Peugeot remains under pressure, trading down 7.5% after the company’s Chief Executive Officer suggested labor costs must be cut. Elsewhere, automakers are leading the DAX’s 0.9% advance with BMW and Volkswagen both higher by 1.3%. It should be noted that financials across the region are weak with Deutsche Bank down 1.9%, Credit Agricole off 1.7%, and Barclays lower by 0.2%.

08:35 am : S&P futures vs fair value: +2.70. Nasdaq futures vs fair value: +6.80. Overall producer prices rose during June by 0.1%, which is hotter than the 0.6% decline that had been widely forecasted. Core producer prices were up 0.2% in June which is in-line with the Briefing.com consensus.

08:03 am : [BRIEFING.COM] S&P futures vs fair value: +1.80. Nasdaq futures vs fair value: +5.50. U.S. equity futures are slightly higher vs. fair value this morning, after an eventful overnight session and earnings from JP Morgan (JPM 34.60 +0.56) this morning.

There were several factors of interest impacting overseas markets. First, Moody's downgraded Italy's credit rating by two notches last night. U.S. equity futures shook off the news, but Italy's stock market is underperforming other European markets. Still, the reaction has been quite small, as Italy's MIB index is down just 0.3% and Italy's 10-year yield is up 7 basis points to 5.95%. Other European markets are higher at their mid-day, with Germany's DAX leading the gains with a 1.1% increase. The UK and France are each up by 0.6%.

In Asia, China released its Q2 GDP of 7.6%, which was roughly in-line with expectations and down from 8.1% last year. Markets saw some relief after the data, with China's Shanghai composite recouping modest losses to finish the day flat. China also released an unimpressive Industrial Production reading, which may have tempered enthusiasm about the in-line GDP reading. Japan also closed flat while Hong Kong rose 0.4%.

In U.S. news, JP Morgan's earnings are the biggest item of interest thus far this morning. The results include a number of one-time items related to its CIO losses and there are a lot of moving parts, as expected, but judging by the 2% gain in the stock in the pre-market, the report is being taken as a positive. Overall, JPM reported Q2 earnings of $1.21 per share, but that included several one-time items. Revenues fell 16.5% year/year to $22.89 billion vs. the $21.7 billion consensus. JPM also restated Q1 earnings, cutting its Q1 net income by $459 million due to the CIO trading loss. Additionally, JPM closed down its synthetic credit group and said it would like to buy back stock if approved to do so.

Wells Fargo (WFC 32.48 -0.37) just reported its earnings, and at first glance EPS appears to be slightly better than the consensus on in-line revenue.

There are also a few pieces of data on the economic calendar, with June PPI data at 8:30 ET and July Michigan Sentiment at 9:55 ET.

06:29 am : [BRIEFING.COM] S&P futures vs fair value: +4.00. Nasdaq futures vs fair value: +9.00.

06:29 am : Nikkei...8724.12...+4.10...+0.10%. Hang Seng...19092.63...+67.50...+0.40%.

06:29 am : FTSE...5644.45...+36.20...+0.70%. DAX...6469.23...+49.90...+0.80%.

Special thanks to Bloomberg, CNNMoney and Yahoo! Finance for their market summaries.

Best Regards,
M.A. Perry
Trader and Founder of WRB Analysis (wide range body/bar analysis)
@ http://twitter.com/wrbtrader, http://stocktwits.com/wrbtrader and http://chart.ly/users/wrbtrader

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