Consolidation?

Once again the small caps manage to set new record highs.  However, the DIA, SPY and QQQ’s remain stuck between significant levels of support and resistance.  Currently, the Bulls and Bears seem equally matched and seem to have slipped into a tight range consolidation at least for the short-term.

Futures are pointing to a higher open but that open looks as if it will occur inside the range of the consolidation.  Perhaps one side or the other will be able to find some inspiration in the news, but I wouldn’t be at surprised to see another day of 2-sided price action.

On the Calendar

There is nothing on Friday’s Economic Calendar likely to move the overall market.  We have Fed Speakers at 3:00 AM,  and two at 9:15 AM.  Then at 1:00 PM is the Baker-Hughes Rig Count to close out the day.

The Friday Earnings Calendar only has eight companies reporting as 2^nd quarter earnings wind down.  However, there are two noteworthy reports from CPB and DE that happen before the bell.

Action Plan

Yesterday we saw a little 2-sided price action with the bulls and bears equally matched and settling into a narrow consolidation pattern.  With light days on both the Economic Calendar and the Earnings Calendar, the market may have to look for inspiration from the trade negotiations news.  Currently, the Futures are pointing to a bullish open, but the DIA, SPY, and QQQ all look as if they will open in the consolidation range.  After the morning rush, I would not be at all surprised to the price action become light and choppy as we head into a summer weekend.

As always my primary focus ahead of a weekend is profit taking rather than adding additional risk.  Of course, any trades that you plan to hold through the weekend should have thoughtfully places stop orders in place as well as hedges to the position or portfolio.  It’s been a fabulous week of profits so let’s keep that going right into the weekend.  I wish you all a wonderful weekend.

Trade Wisely,

Doug