For a change, the market was in the red at the start of today's PreMarket Prep Show. The catalyst for the decline was discussed along with a recap of the latest earnings reports.
Trump Tough On Tariffs With Market At All-Time High
The current run-up to new all-time highs was aided by a solid earnings season, but the major catalyst was a potential resolution to the trade war with China. That said, any talk or tweets denigrating the prospects for a deal will instigate a decline in the markets.
Trump comments that he will increase tariffs if a deal isn't reached came Tuesday and the markets backed off intra-day highs. The continued weakness in the overnight session was attributed to Wednesday's decline in the European and emerging markets.
To the hosts of the show, it was a modest retreat near the bottom of a four-day trading range and "buy the dippers" were still lurking as the indexes were off their overnight lows by the open.
Pot Still Not Hot
Over the past week, the prospects for a year-end rally in the marijuana sector has been discussed. With three of the major companies in the sector reporting this week, a potential catalyst was on the horizon.
Unfortunately, Cronos Group (NYSE: CRON) was unable to rally off its third-quarter report and the same can be said for Tilray Inc. (NASDAQ: TLRY). After Tuesday's close, Tilray announced a mixed third quarter with an EPS miss of 6 cents along with a slight sales beat.
Investors attempting to pick a bottom in the issue were alerted to the multiple lows in the $20 handle. That included the recent low for the move from Oct. 14 at $20.20 as a possible exit point if a rally doesn't materialize.
In a see-saw session it matched Tuesday's high ($21.90), reaching $22.16 and found intra-day support just ahead of Tuesday's low ($20.80) at $20.92.
SmileDirectClub Shareholders Frown After Q3 Beat
The carnage in the IPO market continues as SmileDirectClub (NASDAQ: SDC) chewed its way to nearly an all-time low in today's session.
The company announced an EPS and revenue beat, and also raised guidance for 2019 sales slightly above Wall Street estimates.
From the price action in the after-hours and pre-market sessions, it appeared investors who were holding on to their losses in the hope of a post-earnings rally were giving up. The co-hosts identified potential support at the $10 area, but cautioned if that gave way, it was wide open to its all-time low.
Its much lower open ($10.19 vs. Tuesday's close of $11.08) turned out to be the high for the session. The follow-through on the decline matched its all-time-low ($8.73), reaching $8.75 and is attempting to remain the $9.00 handle.
Anne-Marie Baiynd Joins The Show
During the first part of the show, Anne-Marie Baiynd, the author and CEO of thetradingbook.com was interviewed. She shared her cautious but bullish outlook for the markets and discussed the possibility of the economy moving into an inflationary cycle.
Listeners were treated an extra hour of coverage as Sean Udall, CIO Of Quantum Trading Strategies joined me in the 9-10 a.m. EST hour. Sean provided his opinion on a variety of issues from his unique fundamental and technical approach to the markets.
On Thursday's show, Marc Chaikin of Chaikin Analytics will be our guest as he provides updates on the markets from his Chaikin Money Flow Indicator.