CSCO Earnings Report Confronts Tech Spending Slowdown

CSCO Cisco Systems Inc 2-12-20 Before Earnings

CSCO Cisco Systems Inc 2-12-20 Before Earnings

Cisco earnings preview: Can it pull out of a ‘shallow pause’?

Cisco Systems Inc. starts the calendar under the dark cloud of what it calls a “broad-based” slowdown in tech spending.

Those were its stark words in November when it projected revenue would decline by 5% or more in the current period. The computer-networking giant CSCO, +0.92% reports second-quarter results Wednesday after markets close.

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FTC Broadens Big Tech Antitrust Probe To ‘Kill Zone'; Facebook Stock Slips

The Federal Trade Commission said that it's expanding a Big Tech antitrust probe into Apple (AAPL), (AMZN), Google-parent Alphabet (GOOGL), Facebook (FB) and Microsoft (MSFT). Facebook stock was hardest hit as the major stock market indexes pulled back from record highs, slashing solid intraday gains.

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FL PhD who made $325,317 this year shares his story

A PhD who lives on an island off the coast of Florida has stepped forward to reveal how he made over $300,000 thanks to a rare phenomenon happening in the stock market right now.

He’s urging Americans to act while this extraordinary event is still in motion: “Missing out on what’s about to happen is going to be a huge source of regret in the months ahead.”

Click here to see his urgent message.

HPQ HP Inc Stock Chart 2-12-20

HPQ HP Inc Stock Chart 2-12-20

Good morning and welcome back to Smart Money Alerts, February 12, 2020

One of my most reliable plays is to wait for "proof" or confirmation. I like to let stocks prove to me the move is real.

If a breakout is real it should keep going. If a trend is real it should keep going, despite expected declines.

The trick though is answering a simple question. "Is it a buy - now?"

Is it a buy...? This can be an easy question to answer. But WHEN to buy, is what traps many traders into losing money on otherwise good ideas.

Here's a general guideline that helped me produce some nice gains over the last 20 years (and avoid losers too!)

The more obvious the order flow, the sooner you can buy. You can trade a breakout using a buy stop, as opposed to waiting for confirmation. (see HPQ trade below).

If your stock shows clear bullish order flow, and consistent well-bid candlesticks, you have "proof" that smart money is active. This allows you to get better prices on declines or breakouts because you acted early.

But what if a stock hits resistance and fails? The the smart money isn't ready. Price action is still in a testing mode. Testing for the "right price."

In this situation you are waiting for confirmation. You want the stock price to "hold" above that level for a certain amount of time. For some trades proof can be one day. For less obvious ideas (breakout of a long sideways channel) you might want to wait for a week of proof.

The chart of HPQ sets up a Smart Money Alert today that had moderate bullish order flow that also broke resistance. (HPQ NEWS)

So in this case the stock offered proof by closing above the resistance for two days. So I am game planning a new long. A nice bonus is the inside candlestick and the tight stop loss.

The inside candlestick provides a simple breakout trade above yesterdays high, with a stop loss if filled, and the stock closes below the previous breakout.

If the stock trade lower, I plan to let it go.

Always remember a great trade is one where you build a great argument. I've given some clues how to do that today. If you're struggling in this bull market you are most likely trading on "weak" arguments.  

If you have any questions feel free to send me an email.

Have a great day.


Pete Renzulli