Information overload

Information overload!  A barrage of earnings data, economic and political data will sweep over the market today.  Futures suggest a modestly bullish open on the Dow while the Nasdaq braces for a substantial gap lower as 150 billion in FB value evaporated after the bell yesterday.  At the same time, the market is breathing a sigh of relief with the agreement reached between the US and Europe averting a battle of tariffs.

How will the market respond?  Your guess is as good as mine, but I plan to approach the morning cautiously and prepared for an extra dose of volatility.  Expect fast price action and be prepared for quick reversal and whipsaws.  Stay focused, flexible and disciplined.

On the Calendar

We kick off the Thursday Economic Calendar with three 8:30 AM report with the potential to move the market.  Durable Good orders are looking for a gain of 3.2 percent bouncing back on May’s 0.6% decline due to a surge in aircraft sales.  Remove transportation and core goods, and consensus expects a solid increase of 0.5 percent.  International Trade in Goods according to forecasters will see the deficit widen from 64.8 billing in May to 67.2 in June.  The Weekly Jobless Claims expects to show strong labor demand but with claims increasing this week to 219,000.  Non-market- moving events include Retail & Wholesale Inventories @ 8:30 AM, The Natural Gas Report @10:30 AM, Kansas City Fed. @ 11:00, 3 Bond Events between 11:00 AM and 1:00 PM, Fed Balance Sheet & Money Supply wrapping up the day at 4:30 PM.

Today is the biggest day of the week on the Earnings Calendar with more than 320 companies scheduled to report.  Stay on your toes.

Action Plan

The market has a lot to react to today that could create significant price volatility.  First, we have more than 320 reporting earnings this morning.  Secondly, the Tech sector will have have to face the huge disappointment from FB earnings and the stock erasing 150 billion in value overnight.  Last but not least a major agreement between the US and the EU effectively ending the trade war with one of our strongest allies.  As I write this, the Dow Future are pointing to a slightly bullish open, but the Nasdaq is bracing for a rough open after the sharp decline in FB.

I think its fair to say anything is possible so stay flexible and focused on price action.  Plan to see some very fast price action during the morning rush and remember fast intraday reversals are possible with so much data to chew through.  Prepare for what could be a wild and challenging day.

Trade Wisely,

Doug