Over the weekend a group of drones attacked an oil processing plant and the nearby oil field in Saudi Arabia. It is unclear who was responsible for the attack. When Oil Futures opened Sunday evening prices jumped nearly 20%. Crude Oil futures are nearly up 9% since Friday’s close. We will see how prices react going forward. This week will also have another FOMC meeting and another rate decision. A rate cut is all but priced in and we will see what kind of rhetoric is in the FOMC statement. QQQ and SPY are back near all-time highs. IWM still managing to lag but has been better as of late. Will the FOMC rate decision and statement help push investors back into small cap stocks? Time will tell. This week should be an interesting one to watch. We are locked and loaded ready for anything.
As frustrating as this market might be it is the only stock market we have. Keep focusing in on the best of the best. SNAP continues to hold strong while its counterparts PINS and TWTR have struggled a bit. PINS held up for a bit but could not overcome sellers. MSFT and EBAY are quietly consolidating. By no means any of these are perfect. However, there is the possibility these stocks will break out of their most recent consolidation to move higher. We will continue to scour the landscape for trade signals. You just never know with this stock market. Keep in mind our risk management process is the key to our success. Cutting losses, proper position sizes, and knowing when to take a profit is vital. Those who do not have a plan going into a trade have a high probability of failure. Stick with Big Wave Trading and we’ll help guide you through this stock market.
Bond yields have jumped dramatically since the stock market found its footing. The 10-year yield is back above 1.8%. While the lower end of the curve is still trading higher than the 2-year the 2-year note is no longer trading higher than the 10-year note. We still may have a recession, but it appears bond yields have normalized somewhat. Let’s be honest, it has been a decade since we had any sort of economic correction. It is bound to happen to us at some point. Those who think it won’t or shouldn’t have not studied history. It would help reset the economy clearing out some excess.
We should have an action-packed week as the Saudi Oil field attack story unfolds and the FOMC meeting Wednesday. Keep an open mind. Good luck to your trading!
