A traders Edge

With the market facing a big day of economic reports, nearly 350 earnings reports and an FOMC interest rate decision, it will be difficult if not impossible to maintain a traders edge.  Anything is possible and today might be better spent protecting your capital rather than pushing to take on new risk.  Fat price action, reversals and intraday whipsaws are possible and could make for a very challenging day.

Remember the fear of missing out is a very strong emotion that can cause some for some very costly trading mistakes.  Remember the quality of trades is more important than quantity and every day does not have to be traded to be successful.  If you don’t fee you have a traders edge, then stand aside and protect your capital.  There is no badge for the honor for charging forward blinding and watching your capital disappear.  Do you have an edge today?

On the Calendar

Another busy Economic Calendar this Wednesday that gets going early with Motor Vehicle Sales expecting 17.1 million annualized rate in July.  The ADP report at 8:15 AM expects a decline to 173,000 vs. the 177,000 in June, however, the actual government number came in 202,000.  At 9:45 AM the PMI Mfg. Index expects to show 55.5 in July which is unchanged from last reading.  Then at 10:00 AM ISM Mfg. Index expect to decline a slightly to 59.9 vs. 60.2 in June.  Also at 10:00 AM is Construction Spending expecting a slight gain of 0.3 percent in June vs. the 0.4 gain in May.  10:30 AM brings the unforecast EIA Petroleum Status Report, but certainly has the power to move the market at times.  Last but not least we will get the FOMC decision on interest rates at 2:00 PM.

On the Earnings Calendar, we have nearly 350 companies reporting results today.

Action Plan

I must admit I was hoping to see markets higher this morning in response to the positive earnings report from AAPL.  However, with Asian and European market mostly lower the early Futures are pointing to slight gap down at the open currently.  Keep in mind with a huge data dump of economic reports, pending FOMC decision on interest rates and nearly 350 earnings reports for the market to digest today anything is possible.

With most of the indexes hovering just above support levels we will have to watch price action closely for clues of change.  After the morning rush, we could see the market become quiet and choppy as it waits for the FOMC decision.  After the statement anything is possible, and there will linky be some fast price action as the market reacts.  It will be very difficult to maintain a trading edge today, and it may be wise to restrict your trading activity or simply stand aside to protect capital.  Remember you don’t have trade every day to be successful.

Trade Wisely,

Doug