News:
Yesterday markets gapped up when the CPI inflation reading come in at 8.5% year-over-year. The highest level since 1982, 40 years ago.
The Nasdaq was up 2% near the open.
But by the end of the day, the major three indexes closed 0.3% in the red. The Russell 2000 held onto a 0.3% gain, though still closed near its lows.
The decline was slow and controlled. But there were still winners.
Coal stocks rose, I’ve added CEIX, AMR, and BTU to the watchlist below.
Last Friday the EU announced another round of sanctions against Russia and President Putin. That included a ban on Russian coal.
Politico called the move a “short-term win for coal.” Yesterday the market agreed.
Technicals:
At writing the VIX is still below 25. I believe the market could move substantially lower if this level fails to hold. This the main indicators I’m watching right now.
RSI levels and the put-to-call ratio aren’t telling me anything at the moment.
Bank of America released its monthly survey of investment bankers and found that “Global growth optimism [is] at [an] all-time low.”
But I believe that is good news for the stock market because all the negativity is priced in. Historically this marks a strong buying opportunity. I’m still building positions in my favorite beaten-down stocks.
Timing:
The Producer Price Index (PPI) inflation data drops at 8:30 am this morning.
And we’ll get the first look at earnings for Q1. Bed Bath & Beyond (BBBY) and JPMorgan Chase (JPM) will report earnings premarket.
Just two days left in the short week.
Watchlist:
*Low Float
^Open Position
*IPI has support at $100
*AMR has support at $140
CEIX has support at $40
^ASRT has resistance at $3.50, support at $3
SGML has support at $15
^VERU is on watch
^BORR has support at $4, resistance at $4.50
GOGO has support at $22
^LXU has support at $22
BTU has support at $28
^NAT has support at $2.50
^BRCC has support at $30