The economy is humming right along.
With last weeks numbers indicating the economy is humming right along with strong jobs growth and wage increase, the Bulls seem ready to mount attacks on resistance levels. The European concerns have passed at least for now, and the US and North Korea summit is back on the schedule. This weekend the President will travel to Canada for the G7 Summit where there could be some tensions after leveling new tariffs on steel and aluminum on them last week.
Trade negotiations on the North American Free Trade Agreement and with China will likely continue to send shock waves through the market over the next several weeks, but Bulls currently seem inspired to move higher with a substantial gap up open to begin the week.
On the Calendar
The Economic Calendar this week gets going at 10:00 AM Eastern with Factory Orders. According to consensus, the durable good report expects orders to slip 0.4 percent in April. After that, there is Bill Announcement, two Bill Auctions, and the TD Ameritrade IMX report to close the calendar day at 12.30 PM.
Earnings Calendar
The Earnings Calendar shows 32 companies will report today to keep traders on toes with the most notable PANW after the bell.
Action Plan
With the Jobs number coming in strong and real wages increasing the Bulls found the inspiration they needed to move higher on Friday. International concerns in Italy and Spain have subsided, and it appears the summit with North Korea is back on for June 6th. Trade negotiations will once again take center stage and continue to weigh heavily on the market particularly with the President traveling to Canada this week.
Currently, the Dow Futures are pointing to more than a 100 point gap up at the open. After breaking resistance on Friday, the QQQ looks ready to attempt a new record high in the near future. The SPY is set to gap above resistance at the open today with the IWM leaning the way looking to post a new record high at the open. As always be very careful not to chase gap up opens as they can often create nasty whipsaws. Having said that, the Bulls do seem set to gain some control as long as trader negotiation jitters remain in check. Go Bulls!
Trade Wisely,
Doug
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