Looking for market-shifting news?
We’ve got a TON of it coming down the pipeline.
This week, we have a plethora of economic announcements, including:
- PPI/CPI
- Petroleum Inventories
- Retail Sales
- Jobless Claims
- Industrial Production/Manufacturing Output
- Housing Starts/Permits
…just to name a few.
As of this writing intraday 8/12, the broader SPY/QQQ are trading in a tight daily trading range, with many market participants likely awaiting these important numbers as they pertain to the health of the economy.
Since mid-July, both the SPY and QQQ have been weakening, with multiple down gaps along the way and breaking key support levels.
S&P 500 – SPY / Daily Chart
NASDAQ- QQQ – Daily Chart
In the bond market, we are also watching High Yield Corporate Bonds (HYG).
A recent price + momentum divergence recently occurred, and along with the broader market sell off, HYG had a sharp retracement.
Price has since worked its way back up and is consolidating around former resistance levels of December 2023 and March 2024.
Further weakening of momentum and a rejection from these prior levels above would not be an encouraging sign for equities in the near term:
We don’t want to be aggressively adding new positions right here at this particular juncture and are looking for further market direction/catalysts with the impending economic data to be released later this week.
However, should the SPY/QQQ continue to deteriorate, and because of the recent spike in volatility (and potential for further volatility), we will be looking to add bear call “structured trades” with any continuing broader market weakness.
Keep an eye on these levels:
- SPY: Key levels watching include the 536-540 levels above, and below 530-528.
- QQQ: Key levels watching include the 453-460 levels above, and below 445-440.
- HYG: Key levels watching include the 78-78.36 above, and below 78-77.61.
Knowing all of this is only half the battle, of course.
You need to know the trades to make if you want to take advantage.
And that’s what we do every week inside our Inner Circle.
We’re staying on top of big market shifts as they develop (like you see here) and setting up trades to take advantage of them!
Our secret: Market Rover.
Market Rover does all the heavy lifting: the analysis, the reporting, even the trade ideas!
Happy Trading!
