No fear ahead of today’s huge data dump.

The bulls show no fear at all as we head toward the FOMC announcement and calendar full of big reports.  I would not be at all surprised to see choppy price action today.  Swift whipsaw moves are not at all out of the question as with all the data the market will have to chew through.  With the VIX close to testing historical lows once again it would be wise to remember how quickly no fear can shift to panic.  I plan to do a lot of watching from the sidelines today.

On the Calendar

Today the Economic Calendar is a doozy.  It kicks off with two very big reports at 8:30 AM Eastern, Consumer Price Index and Retail Sales.  Consensus estimates expect the CPI to come in on par with last month’s number of 0.2%.  Retail Sales is also expected to come in relatively flat with only 0.1% growth, as consumer spending remains weak.  At 10:00 we a reading on Business Inventories which is expected to stay very low at 0.1%.  The all important EIA Petroleum Status number comes out at 10:30.

At 2:00 PM we will finally get the FOMC Announcement on interest rates followed by the Fed Chair Press Conference at 2:30.  On the Earnings Calendar, there are 30 companies reporting today so make sure to keep checking.

Action Plan

The market remains tenaciously bullish with the Dow making new all time highs and the SP-500 carving out a new all-time closing high.  The VIX is once again pushing lower and may again test all-time low levels of fear.  Even though the overall market keeps marching higher, it has become increasingly challenging to make money.  The whippy price and surprisingly sharp drawdowns test even the most experienced traders.

With this huge data dump today I plan to move very slowly watching price action closely.  I expect to see very choppy price action this morning, and potentially swift whipsaw moves as the market digests all the data.  Personally, I won’t rule out adding new positions, but I will most likely just enjoy the show from the sidelines.  I have had a fantastic year so far, and I see no need to charge head first into danger.  My method is to be more like a sniper, waiting quietly for the shot picture to clear before pulling the trigger.

Trade Wisely,

Doug