Are you still trying to predict?

With the Dow Futures pointing to a gap up open and the VIX once again dropping below a 10-handle all is well in the market.  Or is it?  Let’s keep remember; it was just a week ago that many were calling a blow-off top!  The truth is no one knows the future and thinking we can predict it is nothing more than ego trampling common sense.  However, if set aside our bias focus on price and listen closely, the market will whisper clues and allow us to take calculated risks.  Otherwise know as trade planning!  Not just some of the time, All the Time.  each and every trade!  So the questions is, are you listening or are you still trying to predict? With a gap up to new market highs, the market is whispering to me to avoid chasing this morning and watchful of possible whipsaws.  Also with the FOMC on Wednesday, choppy boring price action could lie ahead.

On the Calendar

The Economic Calendar this week kicks off at 10:00 AM Eastern with the JOLTS report.  Job openings have been running very strong.  In September JOLTS counted 6.093 open jobs around the country.  The consensus for October sees that number increasing to 6.100 million.  We round out the remainder of the calendar with bond announcements and auctions.

Ther are 18 companies on the Earnings Calendar expected to report results.  A quick look and I don’t see any that is particularly notable or likely to move the market.  However,r if you now one them they certainly have the power to move your account.  Make sure to check as part of your daily planning.

Action Plan

Last Friday saw the both the DIA and SPY make new record high close while still below the high print.  The QQQ gapped but ran into some sellers at price resistance as did the IWM.  Overall the day was bullish leaving behind a lot of really good looking charts.  Maybe it’s just me, but the price action seemed to lack commitment or perhaps it’s just a little tentative ahead of the FOMC this week.

Futures opened bullishly and currently seems to have strengthed that sentiment into the pre-market session.  The CBOE kicked off trading in Bitcoin futures last night, and the overall market appears to be completely twitterpated by an intangible one and zero digital currency.  It will certainly be interesting watch which I intend to do from the safety of the sidelines.  It will not be a surprise if the market becomes slow and choppy after the morning rush today.  Keep in mind the FOMC is expected to raise interest rates on Wednesday.  Also be on the lookout for whipsaw price action as we test market highs.

Trade Wisely.

Doug