From the Trading Desk

Lackluster Session as Trump Trashes Dollar

Stocks once again faced sellers and produced a lackluster session as Trump hammers the dollar. Global tensions are on the rise as North Korea and Syria are in pundits’ focus. Price action is quite unstable here and even though we saw a bullish end-of-day yesterday we lacked the necessary follow-through to confirm the action. For now, we didn’t take out Tuesday’s low and remain vigilant with our exit strategy. Stay focused and always adhere to your risk management strategy.

It would be tremendous to see this market rally here. Distribution is a bit high and we do lack solid price action. However, with all the negatives this market has proven in the past to be resilient. We must remember with such a strong first two months the market typically produces great gains throughout the rest of the year. The only time we saw any significant sell-off after a huge first two months was 1987. Que the haunting music as many will draw a conclusion we are about to have a massive sell-off. It is funny how some always point to the worst-case scenario. Chicken Little syndrome does run rampant amongst those who would call themselves bears. Odds are we find higher ground at some point this year.

Financials are set to kick-off earnings season with JPM set to release its earnings before the market open Thursday. FAZ looks like it wants to push higher as banks looked to show their results after another Federal Reserve rate hike. With more to come this year many believe these rate cuts will help banks’ earnings. Tomorrow we will certainly find out if this is the case. Right now, financials are pricing in weakness as we head into their earnings season.

We certainly would welcome this market ripping higher. Since we are quite long ourselves it would be a welcome sight. We are not blind bulls and have our exit strategy and hedges in place to protect our backside if this market does decide to head in the opposite direction. All we can do is act in accordance to price.

Have a great Thursday!

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