2/17/23 Inflation Again? — 2 Charts Show It All


Yesterday the Producer Price Index (PPI) revealed the highest month-over-month increase since March 2022.

Let’s take a look at the trends…

Charts by the U.S. Dept of Labor

While the monthly increase was notably higher, the overall trend continues to point lower.

Markets tried to take the news in stride. 

After opening in the red, markets climbed throughout the day. But in the final hour of trading, bulls surrendered their gains, and markets closed red and at their lows.

The indexes… 

  • Dow Jones -1.3%
  • Nasdaq -1.8%
  • S&P 500 -1.4%
  • Russell 2000 -1.0%

Sector Round Up

The bears didn’t let a single sector escape. All 11 sectors closed Thursday lower…

Declining the least…

  • Consumer Staples (XLP) -0.7%
  • Utilities (XLU) -0.8%
  • Real Estate (XLRE) -0.9%

The biggest losers…

  • Consumer Discretionary (XLY) -2.2%
  • Technology (XLK) -1.7%
  • Communications (XLC) -1.5%


The Russell 2000 is the last major index to move above a significant resistance level.

Now we’re watching to see if that level can hold as support…

RUT Daily Candles – Chart via thinkorswim

The market looks ready to retest the critical level marked on the chart above. And it’s up against a known time of weakness in the seasonal trend.

We’ll address the weakness in the next section.

Our indicators are not suggesting a trend change…


Today is the final trading day ahead of the long President’s Day weekend.

Long weekends bring an additional day of uncertainty to the markets. When markets end green ahead of a break, it’s a sign the market isn’t fearful.

We’re especially mindful of the President’s Day break because the days after have historically belonged to the bears. More than 60% of the time, the two days immediately after the holiday end the sessions lower.

With all that in mind, we’re still seeing a lot of strength in individual stocks. Our watchlist is expanding…


*Low Float
^Open Position

^*BBAI support at $4
*RMTI support at $2.40
*ADXN support at $1.60
*LUNR on watch
BLBD on watch
GRIL support at $1.10
SERA resistance at $3
DPRO support at $2
FUSN support at $4
CAR support at $240
NRDS support at $14
EHAB resistance at $16
QNST support at $16, resistance at $18
ZGN support at $13
VKTX support at $11
INDI support at $9
^AI support at $22

Secondary watchlist … float over 100 million:

TDC on watch
MDXG support at $4.20
FSLY on watch
SLQT resistance at $2.50
MGNI support at $13
NGL on watch
SONO support at $21
CYH on watch
RBBN support at $4
NYT support at $38, resistance at $40
MIR support at $8.20
^PLTR support at $9

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