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Market Recap – Tuesday, June 12th 2018

June 12, 2018

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MARKET SNAPSHOT
Dow25320.73-1.58(-0.01%)
Nasdaq7703.80+43.87(0.57%)
SP 5002786.85+4.85(0.17%)
10-yr Note-2/322.960
NYSEAdv 1463Dec 1449Vol 833.1 mln
NasdaqAdv 1562Dec 1323Vol 2.0 bln

 

IN THE NEWS HIGHLIGHTS:
  • U.S.-North Korea summit ends with North Korea promising to denuclearize in exchange for security guarantees from the U.S.; details will be worked out in follow-up negotiations.
  • Consumer discretionary space outperforms as retailers rally yet again.
  • The market sees increased volatility ahead of FOMC statement.
  • Crude oil closes flat.
  • US dollar advances.

 

RECAP– The market experienced significant volatility as it whiplashed up and down ahead of tomorrow’s FOMC meeting, ultimately closing slightly higher. Crude oil closed flat following a volatile day of trading. The US Dollar traded lower early, but ultimately closed higher. Tomorrow’s FOMC statement will dictate the future trend on the dollar.

In-depth look of daily news at Briefing.com (CLICK HERE)

In-depth look at after hours movers (CLICK HERE)


Economic Calendar

Today

  • June 12:  CPI m/m – Actual: 0.2%  Forecast: 0.2%  Previous: 0.2%
    • The consumer priced indicator tracks the cost of goods to consumers and is used as an overall gauge for inflation.
  • June 12:  Core CPI m/m – Actual: 0.2%  Forecast: 0.1%  Previous: 0.1%
    • Core CPI excludes the price of food and energy which tend to be more volatile and cyclical.

 

Upcoming Reports

  • June 13:  PPI m/m
  • June 13:  Crude Oil Inventories
  • June 13:  FOMC Economic Projections
  • June 13:  FOMC Statement
  • June 13:  Federal Funds Rate
  • June 13:  FOMC Press Conference
  • June 14:  Core Retail Sales m/m
  • June 14:  Retail Sales m/m
  • June 14:  Unemployment Claims

 

FedWatch June 13 Rate Hike Probability for June 12:  95.0% (View the probability chart here)


A Look At The S&P 500 Chart – KEY Levels

  • RSI is above 50 signifies some form of bullishness.
  • On Balance Volume is below its moving average.
  • The market has been experiencing major volatility over the past three months.
  • The market broke the recent resistance level of 2740 and is currently making a new bullish run. Look for this to rally until 2800 which would be the next logical resistance level which was put in twice in February and March.
  • The market experienced significant volatility as it whiplashed up and down ahead of tomorrow’s FOMC meeting, ultimately closing slightly higher.

 


A Look Into the Heat Map

The market was mixed today with Financials down and Utilities/Tech holding the market up.

 

(click on symbol for chart)
SPX – Bullish 
DOW– Bullish
Nasdaq– Bullish
Russell – Bullish

VIX – 12.30

COMMODITIES

Oil (USO)Bullish
Ag (DBA)Neutral
GLD Neutral 
SLVNeutral 

THE DOLLAR

UUP USD weighted ETF – Slightly bullish

 


SOLON’S TRADING THOUGHTS

This is shaping up to be a very busy week for the market. With about a dozen major reports to be released this week, there will be plenty of fuel which will drive the market in either direction. The major economic event of the week will be the FOMC statement and impending rate hike. We discussed on Thursday that the implications are much greater than whether the Fed will raise rates or not (it’s practically a certainty that they will), but the market is looking for any indication of future hawkishness from the Fed which will dictate any acceleration of future rate hikes and the tightening of monetary policy. The Fed has been consistent so far, but it would be interesting to see if they will be striking a more hawkish tone throughout the rest of the year as it sets the platform for 2019.

On top of monetary policy, there are many geopolitical headlines that dominate the news and have major implications for the markets and crude oil. Everything ranging from the Trump/Kim summit, the recent G7 meetings and impending tariffs, volatility with trading partners, the Euro (Italian) debt crisis, and tensions within oil producing countries such as Venezuela all have the potential to shake up the markets. It will be important to remain on top of these events and storylines as not to be caught off guard by any large potential move.

The markets held steady ahead of tomorrow’s FOMC statement which is shaping up to potentially be a market mover.


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