Halliburton Is Setting Up For A Short

Halliburton issued their second-quarter earnings report today.  The beat the expectations on earnings, but was short expectations on sales.

“International revenue increased 6% sequentially, confirming our expectation of high single-digit international growth for all of 2019. Momentum is building internationally and activity improvement should continue into 2020,” said eff Miller, Chairman, President and CEO. “Both of our divisions made meaningful contributions to growing North America revenue and margins in the second quarter. We are successfully executing our strategy of controlling what we can control and managing our business to perform well in any market conditions.”

Source

That was enough for the stock to receive a couple of upgrades.  Citigroup’s Scott Gruber reiterated a Buy rating and $33 price target and Stephens analyst Tommy Moll reiterated an Overweight rating and $45 price target on the stock, highlighting Halliburton’s ability to deliver “higher margins in North America despite macro headwinds.”

But here’s the problem, the Energy Select Sector SPDR ETF (XLE) is lagging the S&P 500,

and Halliburton is lagging the XLE

Although oil has risen since January lows, it’s still below $60.  Thus, there isn’t a lot of incentive for the producers to produce because they are marginally making a profit, so don’t have a lot of need for the service companies such as Halliburton.

Thus, despite the upgrades, the chart suggest to short Halliburton at the weekly supply at $25.25

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Are You Still Buying The Equity Bull Market???

The Dow Jones Industrial
Average, S&P 500 and Nasdaq Composite keep making new all-time highs.  So do you still believe in this Bull
Market???  If you do, well…you should because
we still are making higher highs vs. lower lows. But I want to give you some
food for thought to be careful.

Consumer discretionary to technology, cyclical stocks that typically associated with bull markets while in down turns or bear markets, consumer staples typically outperform.  However, both consumer discretionary and consumer staples sector are at all time highs…TOGETHER…HOW CAN THIS BE???

Consumer Discretionary Select Sector SPDR (ETF), XLY

Consumer Staples Select Sector SPDR (ETF) , XLP

With the US equity markets, consumer staples and consumer discretionary all all-time highs, something has to give because based on intermarket correlations, this doesn’t make any sense. This is when one has to dig a bit deeper.

 The consumer discretionary sector has consistently lagged the consumer staples sector ever since last year.

Source

For the bull market to continue to run, the discretionary sector must eventually outrun the staples or at some point we will see the equity markets start making lower highs, then lower lows.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Time To Short United Rentals Again

United Rentals, Inc., through its subsidiaries, operates as an equipment rental company that services construction and industrial companies, by renting out backhoes, forklifts, earthmoving equipment, and material handling equipment, scissor lifts, crossing plates, line testing equipment for underground work, electrical distribution equipment, etc.

Three months ago I wrote a post,

United Rentals…Another Great Economic Barometer

where I talked about, like Caterpillar, United Rentals is a great barometer of the economy.  United Rentals their earnings report, United Rentals said they were still on target with the 2019 targets, however, the charts suggested to short the stock at the daily supply at $140.

Price did fall from the zone, but never hit the suggested target price.  Yesterday, United Rentals announced their second quarter earnings reported profits above Wall Street expectations, but cut the top of their guidance range for the year. Because the supply level hasn’t been breached, the chart suggested to short price again, with a confirmation below the $128 level which served as support/resistance.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

CSX Breaches Critical Price Level On Disappointing Earnings

CSX Corporation, together
with its subsidiaries, provides rail-based freight transportation services. The
company offers rail services, as well as transports intermodal containers and
trailers. It transports chemicals, automotive, agricultural and food products,
minerals, fertilizers, forest products, and metals and equipment; and coal,
coke, and iron ore to electricity-generating power plants, steel manufacturers,
and industrial plants

CSX is the third-largest
US rail operator operating in 23 states as well as the District of Columbia and
two Canadian provinces. Its network spans 21,000 miles.

CSX announced earnings before the opening bell today.  CSX posted earnings that didn’t meet expectations and slashed their full-year revenue forecast amid slowing.

The generally reliable railroad operator said earnings for the second quarter came in at $1.08 per share, up 7% from the like period last year but three cents shy of the Street consensus forecast, while revenues totaled $3.08 billion, missing analysts’ forecasts thanks in part to trade-related weakness in its intermodal business.

“Both global and U.S. economic conditions had been unusual this year, to say the least, and have impacted our volumes,” CSX CEO Jim Foote told investors on a conference call late Tuesday. “You see it every week in our reported carloads. The present economic backdrop is one of the most puzzling I have experienced in my career.”

Source

Because the Dow Transports have lagged the Dow Jones Industrial Avg. since September.

Source

And because CSX stock price has breached the major support / resistance line at $72.50, the chart suggests price will fall to the weekly demand at $55.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Domino’s Pizza…Does It Again

Domino’s Pizza (DPZ) posted weaker-than-expected sales during the second quarter. Same-store sales grew at 3% vs expectations of 4.6% domestic.  Same-store sales internationally grew 2.4%, but also missed analyst expectations for 2.6% growth.  On the news the stock price was fell 9%.

This marks the second consecutive quarter where Domino’s disappointed Wall Street.  I decided to focus only on same store sales figures because of Domino’s long term strategy.  Domino’s is under attack by the food delivery companies that popped up in the last couple of years in which stay at home diners have a lot more options at their disposal.

Image result for grubhub and competitors

Thus, Domino’s is aggressively adding store at the sacrifice of existing stores the clear risk of saturating its existing territories. More stores equates to being closer to the customer, which equates to faster delivery times.  The strategy is called “fortressing,” or adding locations right within the delivery territory of an existing restaurant.

Things might get worse before they get better, thus the chart suggests further downside to the weekly demand at $227.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

I’m Not Feeling Williams-Sonoma On Goldman Sachs Retail Buy List

Retail stocks have been a tough trade in 2019. While the S&P 500 is up nearly 20% year-to-date, the SPDR S&P Retail ETF (NYSEARCA:XRT) is up just 3%, as retail stocks have been weighed by sluggish consumer spending in early 2019 and overarching trade conflicts.

But, Goldman Sachs thinks things are about to get a whole lot better for a whole lot of retail stocks.

One of their picks that I
disagree with is Williams-Sonoma, based on the where the housing market is
headed. Recently, sales of new and existing homes dropped below 6 million for the
first in two years.  And despite rates going
down, mortgage applications are flat. 
However, Goldman Sachs believes the following:

Tariff concerns have been a huge headache for Williams-Sonoma (NYSE:WSM), but Goldman thinks that the kitchenware and home furnishings retailer is ready to bounce back. Trade tensions are cooling, and with a truce on new tariffs between the two countries, it seems the worst of the trade war damage has already been inflicted. Going forward, the numbers here should get better, especially as buying conditions in the U.S. improve, too. This improvement should drive a nice rebound in WSM stock.

Source

I personally think Williams-Sonoma is setting up for a great short. However, this is the type of catalyst that will get price there sooner than later. Thus, the chart suggest to short price at the weekly demand at

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Pounding the Table on $TWTR before earnings…

The twitter setup is there. The shorts a skeptics are on defense and the buyers have the ball. We have seen plenty of fumbles, and turnovers over the past few years but I beleive that $TWTR turned the corner last earnings and this earnings will have to PROVE IT. If this earnings passes the test the buyers and the stock will be off to the races. The pattern is there, the technicals are there, the past earnings report was promising, the expectations are low. Can Jack and company pull through?

This is what we in the technical business call an old fashioned cup and handle pattern. The stock tells a story. Every one usually does. You have the IPO run to 70+, then you have the sell off down to the teens and base. Now we are holding higher….and ready to explode. If $TWTR can pull off a run up into earnings and a gap and go, you ear looking at TWTR going back to all time highs in 2019.

Long $TWTR

BITCOIN: Trading Volume inclined to TETHER

Not only altcoins have been suffering the market correction…People, trying to increase desperately their stakes on BITCOIN is what we have seen these days…Everyone is panic selling their altcoins in order to avoid losing further…but this action does not avoid at all the losses since what we can see today is that the 24h volume of TETHER (USDT) is increasing while BITCOIN volume is decreasing…

During the past few days the volume between Tether and BITCOIN has stayed under equilibrium, in a proportion of 1 to 1, meaning that, for instance, we had exactly the same amount of Volume (24h) as you can see below in the pic I get yesterday:

Now, we have 1 Billion difference, meaning that BITCOIN is being Shortening .

I confess I did sell some BTC a couple of days ago as well, since the forecast seems clear and the count launches a 3-3-5 Correction…

Now, I am going to be focused on two main price levels:

  • The range between 9400 and 9700 USD
  • The 8800 USD price level which is the target of the HS pattern.

Observing these two levels can bring me the chance to get between 17 and 25% more bitcoin and so getting more BTC for the same amount of FIAT (Dollar averaging).

Let’s see how the market evolves.

@toofasteddie


Disclaimer: This is just my personal point of view, please, do your own assessment and act consequently. Neither this post nor myself is responsible of any of your profit/losses obtained as a result of this information.

Did You Go Out And Buy WD-40 Too???

I put WD-40 up there almost with water and air, meaning it’s something we take for granted, but can’t live without it. It has infinite uses, from cleaning cleaning tiles, to softening leather, to free struck legos, to getting rid of rust, is the real utility knife.  Just look at the more than 2000 uses of WD-40.

WD-40’s stock had its best day in more than six years Wednesday after it said customers stockpiled the product ahead of a price increase.

The chemical manufacturer reported third quarter-earnings late Tuesday that beat expectations. Sales rose 7% to $114 million for the quarter, which the company said was bolstered by especially strong North American sales as customers stocked up on their grease and cleaning products. The company’s shares were up 8.6% Wednesday.

WD-40 (WDFC) CEO Garry Ridge said in a release that its North American customers were “buying high volumes of product in advance of our planned price increases in the region.” WD-40 announced it was hiking prices a year ago. It hiked prices predominantly because of rising commodity prices, although steel and aluminum tariffs had raised its canning costs somewhat as well.

Ridge said on a call with analysts that the company doesn’t expect any additional price increases this year. He said that it has felt “some residual impact of tariffs,” but the price increase for its can are “somewhat coincident with the timing of tariffs.”

Source

Despite the bump up in price this week, the levels in play and to monitor are the $150 level on the downside and the $188 level on the upside.

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

Kroger Is Not A Buy

Kroger Co.’s stock has been beaten down this year, but some investment pros are bullish on its prospects for a rebound.

“While I think the battle for market share in the grocery space is far from over, I believe the risks are worth the potential rewards when I look at Kroger’s dividend metrics combined with its low valuation,” Nicholas Ward, of private investing community the Dividend Growth Club, recently wrote on investment website Seeking Alpha,

Ward doesn’t own Kroger stock, at least not as of the Monday writing of his post on Seeking Alpha.

Source

While Ward believes the risks are worth the potential rewards, he doesn’t own the stock…I wonder why.

Maybe because Kroger must compete against Amazon in the digital world.

Maybe because Amazon is planning on opening dozens of grocery stores in several US cities.

Maybe because a couple of months ago, a Robert Beyer, Kroger Co. director has completed the largest outright stock sale by a company insider in six years.

Maybe because price broke out of the wedge to the downside. Kroger is not a buy, the chart suggest, price is heading to the monthly demand at $16.50

This post is my personal opinion. I’m not a financial advisor, this isn’t financial advise. Do your own research before making investment decisions.

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