The Warlock, Kenny Glick here…
Welcome to earnings season!
I’m licking my lips. I’m so excited.
Going into yesterday’s Warlock’s World live stream, there was a super huge focus on inflation data.
Something about the CPI numbers…I don’t care.
But here’s what IS important.
Whenever economic data is what everyone is worried about, we’re already in a bear market.
Because during a bull market, no one cares about any sort of economic data.
When we’re this riveted by economic data, the market is NOT GOOD.
When the bull market is raging, earnings don’t matter, CNBC doesn’t matter, Goldman Sachs doesn’t matter, NOTHING MATTERS.
Was anybody sitting on the edge of their seat waiting for this economic data to come out to guide you with how you want to trade?
To me, that’s an indicator of a bear market.
Bull markets don’t care about economic data. It doesn’t care about ANYTHING. We go up. That’s over.
And owning stocks stinks.
When the CPI data came out, the market gapped up big time. Just take a look at this chart of my favorite index, the Invesco QQQ Trust (QQQ).
QQQ gapped up in premarket on Tuesday
Taking a look at this chart, the first inclination would be that the market “liked the news”.
But as a devout VWAPian, all I was thinking about was FADING THE GAP.
And it’s another reason you should be there.
Because guess what guy in the back, look what happened next to QQQ.
QQQ fading under VWAP just like I predicted after the market gapped up
This is a perfect example of how economic data can affect a BEAR MARKET.
The watchlist? It’s not some elusive thing.
We know where the watchlist is.
Is anyone reporting earnings? Are there high percentage gainers? There it is.
The CNBC bottom ticker scroll (they only time they’re useful). And stocks that are “in play”.
An example of a “risers and fallers” list from premarket
Some people call them risers or fallers lists. Or percentage gainers lists.
These are stocks that are moving on volume for whatever reason – they cured cancer (or failed to cure cancer), there’s rumors of a buyout, or Elon Musk wants to take over the company – WHATEVER reason.
So I keep an eye on them throughout the day and LOOK AT THE CHART.
There’s nothing magical about being on the list itself.
We trade setups. So it ALL DEPENDS WHAT THE STOCK’S CHART IS TELLING ME.
And I PAY ATTENTION when they look enticing? And when do they look enticing?
When they’re consolidating under the VWAP, possibly breaking it to the upside for a long trade, or when they’re consolidating above the VWAP, possibly breaking to the downside for a short trade.
And I’m going to teach EXACTLY how to build your own watchlist on Saturday.
You see, Saturday is a springboard.
It’s a jumping off point or launching pad.
And the fuel for our Warlock’s World rocket is earnings season, which starts TODAY.
You’ll regret it if you don’t.
Stay nimble my friends.
Kenny “The Warlock” Glick
April 13 2022