Hello! Here’s what’s happening in the market today…
PPI, another inflation reading, confirmed what we already knew … inflation is high. But month-over-month levels are stable. Could be we’ve reached the peak. I’ll be watching for these levels to stay in check for a couple of months.
In COVID news the Supreme Court blocked the vaccine mandate from OSHA. But upheld it for federally funded hospitals. I don’t see this story having much impact on the markets. It’s worth noting … but the sell-off started before this news broke.
The NASDAQ led the way down yesterday declining 2.5% after leading a multi-day rally.
Let’s look at the technicals for the next bounce…
This chart shows the rising support and RSI levels.
Note that the RSI reaches oversold every time the price action reaches support. But this time the RSI level is holding in neutral territory. So I’m not ready to buy just yet.
I want to let today shake out. I’ve got a position in TQQQ and will hold it through today and watch for sideways action. I’ll only buy more if we get another big dip. Otherwise, I’ll look to add on Tuesday.
My indicators don’t look bearish yet:
The VIX continues to stay rather low.
And the put-to-call ratio is neutral.
It’s the first long weekend of the year. Markets are closed Monday for MLK day. Sometimes markets are weak headed into long weekends as investors don’t want to hold too much risk into a volatile news cycle.
That’s why I’ll buy a big sell-off today. But then I’m risking bad news over the weekend. No risk, no reward.
January is historically the best month for the Nasdaq. I’m still long TQQQ riding this wave. My profit target is $80-85+.
Futures are green at writing.
Today I’m generally bullish but risk off today.