The Fed stands pat, the Senate advanced the $550 billion infrastructure plan, and Facebook posts blowout earnings but looks ahead for growth to slow. As a result, the SPY and QQQ are within striking distance of new records, and though the DIA left behind a bearish engulfing candle, the overall price pattern remains bullish.  With a huge round of earnings, GDP, and Jobless claims coming our way, there is a lot of data to digest, and the potential for volatile prices continues.  Plan your risk carefully as the bull run continues to extend.

Overnight Asian markets rebounded, led by Hong Kong, surging 3.30% after China backs off on the tech crackdown.  European market advance seeing green across the board after the Fed decision.  U.S. futures reverse overnight lows pointing to a Dow gap up more than 100 points as we wade through earnings data waiting on the GDP and claims. 

Economic Calendar

Earnings Calendar

We have the highest number of earnings reports this week on the Thursday calendar, with more than 225 fessing up to results.  Notable reports include MO, AER, AMZN, bud, MT, AZN, CC, CNX, DECK, FSLR, GILD, HSY, HBAN, KDP, LH, LBTYA, MMP, MLM, MA, MPW, MRK, MSTR, TAP, NOK, NOC, OPK, OSTK, PINS, SPGI, SWKS, SO, STM, SU, TMUS, TWLO, X, VLO, WWW & YUM.

News & Technicals’

The Senate has advanced the $550 billion infrastructure plan targeted into transportation, utilities, and broadband.  The highly anticipated Robinhood IPO kicks off today, with some saying there’s considerable upside potential.  The FOMC moved slightly toward reversing its easy-money policies on Tuesday while keeping the interest rate near zero.  However, Jerome Powell said the committee wants to see more data and may now wait until November to begin tapering.  Facebook tops earnings expectations but warned it expects a significant growth slowdown.  Treasury yields are slightly lower this morning ahead in reaction to the Fed decision, with the 10-year falling to 1.249% and the 30-year dipping to 1.898%.

We saw some choppy price action yesterday, as the DIA, SPY, and QQQ hold very bullish price patterns.  The SPY is easily in striking distance of new record highs, and the QQQ is not far behind despite the lackluster price reactions in the big tech blowout earnings.  The DIA finished the day leaving behind a bearish engulfing candle, but that will only matter if it follows through to the downside today.  That said, Dow futures point to a gap up open of more than 100 points with the premarket pump underway. First, of course, we still have to get past a huge wave of earnings reports, the latest reading on GDP, and Jobless claims.  The GDP has the potential of coming in hot signaling inflation, and of course, jobless numbers missed last week though eventually ignored as the bulls charge forward. So expect the volatile price action to continue as the market digests all the data. 

Trade Wisely,

Doug