Earnings from Banks have been good, but we have seen sellers use the opportunity to dump on the stocks. As earnings season progresses we’ll focus on how stocks react versus us trying to predict what they will do. Steady as she goes here as we continue to see new long positions trigger. We trade without bias and emotion. While it may seem boring our goal is to grow our account not lose it. A good start to the week!
Telecom, Materials, and Utilities were the top 3 groups in the S&P 500 yesterday. Once again we are seeing utilities show some resemblance of strength despite the Fed’s focus to raise rates. Now, XLU is down well off its November 2017 highs as expected, but the group is showing some signs of life.
XLRE another interest rate sensitive sector is holding its 50 day. Time will tell here, but something to keep an eye on as we approach May 2nd the next FOMC meeting. Traders are not expecting a rate hike until June, but the FOMC statement post meeting will be the talk of the town. After June the next rate hike with 50/50 odds is September. It seems the Fed is on a mission to keep inflation in check. It will be interesting to see how the market reacts.
In the end, it is going to come down to how you trade. Are you going to cut your losses and ride winners? Proper position sizing? These are the tools the greats used and yes we are repeating them. We are not self-proclaimed gurus as we are simply following the protocol to grow our capital. Everything else is simply noise.
We hope you have a great week of trading!
