Predictions

I always find it amazing how a market selloff brings out a litany of talking heads with predictions of new highs or outlooks of gloom and doom as if they have the power to see the future.  It’s honestly laughable because most of them are just talking up their positions.  I submit to you that listening to all that noise is unproductive and very likely damaging to your trading success.

No one cares about your money more than you.  The talking heads care only about their money just like you and me.  The truth is they are working to take our money from us just as much as we want to take money from them!  It may sound harsh, but that’s the truth about the market.  Let them blather on making ridiculous predictions but don’t waste your time.  Learn to read price action, step up and make your own decisions and hold you’re accountable for the results.  That is now and has always been, the path to success.  Let’s turn off the noise, dump the predictions, roll up your sleeves and get to work.

On the Calendar

The Retail Sales report gets the new trading week started at 8:30 AM Eastern and is the most likely market-moving event on the Economic Calendar.  Consensus estimates expect a bounce back in September with a 0.6 percent increase with ex-autos up only 0.4 percent.  Also at 8:30 AM is the Empire State Mfg. The survey which expects steady and growth with a reading of 19.3 in October vs. 10.0 in September.  10:00 AM brings the Business Inventories report which consensus sees a 0.5 increase for August.  After that, we have two Bill Announcements at 11:00 AM and two Bill Auctions at 11:30 AM to wrap up the calendar day.

On the Earnings Calendar, we have 22 companies reporting results as the 4^th quarter earnings season ramps up.  Most notable before the bell are BAC and SCHW.  After the bell, look for JBHT as the most notable of the afternoon.

Action Plan

Those picking up positions as the market rallied into the close on Friday are likely a little disappointed this morning seeing the Futures once again under pressure.  Asian markets all closed down about 1.5% overnight while European markets are currently printing mixed results.  US Futures have recovered some of the overnight lows but as I write this currently point to 100 point gap down at the open.

T2108 and T2122 suggest a short-term oversold condition so keep eyes on price action looking for clues of a rally and a reversion to the mean.  Please understand this in no way means a rally will happen today so don’t rush in anticipation.  Wait for price action clues!  Remember volatility is likely to remain very high which means we need to prepare for head fakes, whipsaws, and fast price action which could make any rally challenging to enter.

Trade Wisely,

Doug