There was big news and everyone thought E*Trade Financial was going to be affected most. Based on today’s action, it seems the entire sector is under fire led by TD Ameritrade. Now we do have a partnership with AMTD, so I want to be fully transparent in that. I will state that this news is a long time coming and someone was eventually going to go the route Charles Schwab (Ticker: SCHW) did. They announced commission-free trading and Interactive Brokers recently offered something similar. This is coming on the heels on Robinhood and WeBull apps already offering commission-free trades. While I am unsure this will be the route the entire sector goes, I do think it changes the game forever. AMTD will be forced to lower rates as will the other brokerage houses. This is great news for the retail trader, but terrible news for the investors of these companies. All of these stocks are down big today. While they may bottom out sooner than later, the future does not look bright for ETFC and AMTD for the time being. I would watch SCHW and TROW for bounce plays to the upside, but will longingly watch AMTD and ETFC for fades on rallies. At least until something gives us a reason to be a buyer. For now, we only have a reason to fade those names.  

about the author:

Charles Moon

Charles Moon is a technical "whiz kid" whose experience lies in scalp/swing trading. A patient educator, Charles excels at coaching/mentoring and can make complex concepts simple. Prior to joining the ranks of Prosper Trading Academy, Charles was a proprietary equities trader with Great Point Capital LLC. Coming from a retail trading background, his experience can help those with no experience trading to seasoned veterans.

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