Can this Bull Run continue?

As this week trading week comes to a close, the majority of traders have just one question on their mind.  Can this Bull Run continue?  Common sense would tell us the odds of a pullback after seven straight days of new records is pretty high.  However, the strength of the run ahead of earnings season already defies logic.  I say that only to remind you that predicting what a market may or may not do is an exercise in futility.  Anything is possible!  The best we can do as traders is have a plan with a set of rules to manage our emotions.  As a result of my rules made it necessary for me to lighten up my risk to the market by taking some profits.  Logic says a pullback is likely, but the price action has no hint of a pullback as of now.  If there are more buyer than sellers, then the market could still move higher!  What matters is that you are managing you and remembering that this is a business.

On the Calendar

On the Economic Calendar today we have the Mr. Big report at 8:30 AM with the Employment Situation.  As this report will incorporate the effect of the hurricanes, the consensus estimates are all over the place.  Essentially the best they can do is guess.  For example, the nonfarm payroll expects 100K, but the consensus ranges between Zero and 140K.  There are two reports unlikely to move the market, Wholesale trade at 10:00 AM and Consumer Credit at 3:00 PM.  There are 5 Fed Speakers on the calendar today.

On the Earnings Calendar, there are only eight companies reporting today.  I do not see any earnings reports that are particularly notable.

Action Plan

After the news reported a successful vote in Congress allowing the Tax Plan Process to move forward, the Bulls came out in force to express their support.  As I mentioned above, I reduced some of my risk to the market closing part or all of a few positions to capture gains ahead of the weekend.  The VIX made a new closing low yesterday below a 9-handle.  Truly amazing!  I think it would be wise to guard yourself against complacency.

Once again I will be more focused on taking profits today, but I will not rule out the possibility of new trades.

Trade Wisely,

Doug