We were bound to see this market cough up gains at some point. Today we saw the market roll over into the close ending the session with a day of distribution. Yesterday’s gains have vanished as we get the latest release of the FOMC meeting minutes. What we did see today was not all that bad unless we continue to see distribution pile up and our stocks cratering. One day does not make a trend, but the kind of action we saw today is not what we would like to see. Light volume pullbacks are quite alright in our book. Unfortunately, today’s move does show sellers are lurking. Whether or not this is just a one-day deal and we continue to march higher is a question we’ll get answered soon. Again, it could have been a lot worse. On the flip side, it could have been better.
A slew of economic data hit the market this morning. Most notably was the latest reading of the consumer price index (CPI). Inflation readings were short of analyst estimates. Gasoline prices are down month over month keeping inflation in check. Economic data other than the jobs report has not really moved the market. All that matters now is whether or not Central Banks around the world will provide support to the markets with QE and low rates. There is no indication this will be pulled any time soon. If Central Banks continue their support any pullback will likely be short-lived. Regardless, we will continue to act accordingly to our strategy and make gains!
Tomorrow’s session will feature the Fed minutes at 2pm. Last time we had the FOMC minutes released the market did not react much. Certainly not like a FOMC day or more recently a jobs report Friday. A nice long consolidation period here would do this market some good. We are stretched pretty good and we need stocks to setup once again for big gains. Whether or not the market cooperates with what we want is another story. We can only control what is in our power to control. We cannot control the market and therefore we let it be. Control your emotions and your actions. You’ll be better off.
We may have a problem if we see this selling continue. For now, it is a one-day wonder.
