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7/13/22 Manage Your Inflation Expectations

News:

Markets opened flat and moved sideways yesterday but finally gave way to selling pressure in the final hour.

The Nasdaq and S&P 500 finished the day down 0.9% each.

Energy was the worst-performing sector. It was dragged down by the price of crude oil which fell 8% intraday to $95.48 a barrel.

A notable bright spot came from the meme stocks…

  • Gamestop (GME^) gained 5.4%
  • AMC Entertainment (AMC^) rose 4.3%

Inflation Data

This morning all eyes will be on the CPI report which is due out at 8:30 A.M.

  • The White House is downplaying expectations, calling the report “out of date.”
  • One J. P. Morgan (JPM) report said, “headline inflation peaked in June.” (see chart)
Peak inflation chart

This morning I’m not focused on the headlines … I’ll be watching the market’s reaction.

Crypto Update

Bitcoin has traded below the critical level of $20,000 level for the past 24 hours.

Failed crypto hedge fund Three Arrows Capital is making headlines.

  • A Judge ordered their assets frozen
  • And the founders’ whereabouts are “currently unknown.”

The failure of 3AC is another stress test for the industry … Bitcoin’s resilience at $20K is a bullish indicator.

Technicals:

Look at the chart … The market is in a downtrend.


SPY Daily Candles – Chart via thinkorswim

Other indicators are neutral this morning.

The market is preparing for the CPI data … Which will drive the price action today.

Timing:

It’s earnings season!

  • Delta Air Lines (DAL) reports this morning before the open

Tomorrow the action starts to heat up with the first big banks reporting premarket…

  • JPMorgan Chase (JPM)
  • Morgan Stanley (MS

Friday is July’s option expiration. That tends to bring extra volatility to the market…

Watchlist:

*Low Float
^Open Position

*TRVI has support at $3.50, resistance at $4
*FNKO has support at $22
^CBIO has resistance at $1.80, support at $1.60
TH is on watch
PLRX is on watch
WVE has support at $4
CELH has support at $75
ALDX has support at $5
VERU has resistance at $16
^CTIC has support at $6.50
SGEN has resistance at $180
TCRT has resistance at $1.50

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