Monday morning trading started off well for the entire market. Small cap stocks broke through highs and all seemed like it was going well. It appeared small caps were going to finally break through resistance and  finally run higher. Sellers were not going to have any of it sending the broader market lower. Not a huge surprise to see stocks hit resistance given the market climate we have been in for much of 2018. Perhaps we can still break through resistance, but time will tell whether or not we are going to be able to consolidate the recent gains. We’d also like to see us break the mold of these constant v-shaped ramp ups. Despite what we want it is prudent to continue to follow price action of the market. Trading what we want versus reality is a dangerous recipe and one leading to disaster. Our preference is to stay in this game by controlling our risk. Whatever this market wants to do we’ll simply follow.

Volume on the exchanges were mixed with NYSE volume coming in slightly higher than Friday’s pace and the NASDAQ slightly lower. Not too significant, but something to keep an eye on this week as we see how this market reacts to Monday’s trading. Our next Fed meeting isn’t until 6/13, but we will continue to keep an eye on the yield curve. Price will always be our guide, but an inverted yield curve is a great signal as to what the economy over the short-term. As we head into the summer trading session volume will become less and less important as many will be spending their time at their vacation homes. We will still be grinding away, but summer trading always makes things a bit different and maintaining sound risk management process is hugely important. For now, we’ll see how this market moves over the short-term and react according to plan. There isn’t a need to play hero trader here.

We hope you have a tremendous week of trading. This market is not going to make it easy on most. However, staying patient and steadfast will serve us well.