Considerable uncertainty.

Overall yesterday was a win for the bulls following though from the big rally last Friday.  However, with the DIA and SPY leaving behind doji patterns just below the 50-day average, they left us considerable uncertainty as well.  Although the Tech’s and small caps closed strong the question on everyone’s mind, will that be enough to fend off a bear attack?

Currently, the futures are pointing to a lower open, but with political news pending and a huge number of earnings reports, anything is possible.  I think traders should exercise a little caution this morning until some better price action clues appear.

On the Calendar

There is only one market-moving report on today’s Economic Calendar.  There was a Fed Speaker at 3:15 AM, the NFIB Small Business Optimism at 6:00 AM, Redbook at 8:55 AM and two bond events at 11:30 AM & 1:00 PM.  The potential market-moving JOLTS (job openings) expects to see a slight increase in March to 6.100 million vs. February’s 6.052.

We have another big day on the Earnings Calendar with 420 companies stepping up to report today.  Make sure you’re checking your holdings against expected earnings reports.

Action Plan

We begin Tuesday with a  little uncertainty, after printing doji patterns below the 50-day average on the DIA and SPY.  To make it a bit more confusing the QQQ and IWM managed close bullish and above their respective 50-day averages.  Struggling at this important resistance is not that big of a surprise, but we certainly but it now becomes imperative for the bulls to step up and fend off a possible bear attack.  A day of rest would be perfectly acceptable, but we don’t want to see failure patterns on the DIA and SPY at the end of the day.

Currently, the futures are pointing to a lower open of more than 50 Dow points however with so many earnings reports this morning anything is possible.  I would suggest a little caution this morning as the bulls and bears battle for control.  If holding some unrealized gains make sure you have a plans to protect them because failure here could easily embolden the bears to seek new market lows.  Let’s go bulls it’s time to step up!

Trade wisely,

Doug