Morning Market Report – Monday June 12th
June 12, 2017
The Morning Market Report is a daily report delivered to Tackle Trading members. In this report, you’ll receive a summary of major market news, the list of that day’s economic calendar, information regarding th major markets indexes, industry sector performance, comodities, currencies. and links to usefull sites and/or stories.
The Morning Market Report is designed to compliment the Scouting Reports (available to Pro Members) on Mondays, the Coaches Show on Wednesdays and the Market Recap during the week so make sure to refer to those reports first. This report focus more on short-term swings in the market (especially overnight futures movements) that can help you best begin you trading morning.
This report can be part of your 7 Step Process to Successful Trading. By helping you start at the top of the markets, choosing a trading strategy, and finding and analyzing potential trades. So don’t start trading uninformed; add the Morning Market Report to your daily routine.
Calendar
This week will be a busy one for economic news but for today Monday the news is light with just the Treasury budget indicator which is expected to show another steep deficit.
- 2:00 PM – Treasury Budget
News
- VIX hits lowest point since 1993 – which should indicate extreme bullishness; just minutes before Friday’s big selloff. Read More…
- Friday was a buzzsaw market day – with the markets hitting new all-time highs just before a huge selloff that at one point had the Nasdaq over 4% down.
- Financials Rally – Banks appeared to be getting a chunk of the money on Friday. By the end of the day XLF was up nearly 2%.
- Global Market mostly down – Global stock markets were in the red on Monday, as sentiment took a hit following a slide in U.S. technology shares late on Friday.
- Euro up British Pound down – Sterling last traded at 1.2705 against the dollar, down around 0.3% on the day and The euro edged up 0.2% to 1.1220 against the dollar, staying below a seven-month high of 1.1285 set in early June.
Major Index Futures
Among active pre-market movers on Monday, Apple (AAPL) traded more than 2% lower following a downgrade to neutral by Mizuho Securities analysts – the second ratings cut in a week. Netflix (NFLX), Nvidia (NVDA) and Advanced Micro Devices (AMD) were also among the biggest losers in pre-market action, with each stock down by more than 2%.
- S&P 500 – 2,423 – consolidating within a bullish trend
- Dow 30 – 21,271 – slightly bullish
- Nasdaq 100 – 5,701 – bullish trend is under pressure (sharp selloff Friday)
- SmallCap 2000– 1414 – had a nice rise the last couple of days (be careful if you have iron condors)
- S&P 500 VIX – 10.01 – still near record lows, (complacent markets without fear tend to drift higher)
The charts below are three month daily charts
Commodities
- Gold – $1266 –
- Silver -16.979 –
- Crude Oil – $46.52 –
- Natural Gas – $3.072 –
The charts below are three month daily charts
Sectors
- The sectors are rotating! What does that mean? It means that things change; financials that had been loosing money for the last three months is now started to be the top performer (at least in the last week).
- Sector Outlook – Most sectors have been slightly positive except for Energy XLE (which is still in a longer term downtrend). Technology (XLK) has been the most bullish and for the longest time but there was a sharp selloff on Friday in the tech-heaven Nasdaq which could continue this morning.
The chart is Friday’s sector performance.
This chart shows how the sectors performed for the last five days (look at financials)
This chart shows how the sectors performed for the last 20 days
Dynamic Yield Curve
- The dynamic yield curve still looks good with short term interest below long term interest, and the chance of a near-term small rate hike is almost certain with the Fed.
Currencies
- USD – $97.07 – the dollar is hovering just over $97 again
- Bitcoin – $2,782 – bullish (up $1,040 in the last month)
- Ethereum – $382 – very bullish (was $8 in January, up nearly 3000% YTD!!!)
- Litecoin – $29.35 – up $1.20 in the last month
The charts below are three month daily
Trading Thoughts
- -1 to 0 Market Bias – U.S. stock futures point to a lower open on Wall Street on Monday morning, with the technology sector on track for a second straight session of heavy losses.
Bearish Neutral Bullish
-3 -2 -1 0 +1 +2 +3
Most Recent Book Read
Several rules of thumbs from the book:- An Investor buys the business [based on its price/value],
- A speculator buys the stock [based on trying to foresee where the stock price will go].
– Invest in low expense indexes; use dollar averaging and buy every month instead of once at a random point of time.
– For enterprising investor (willing to spend much more time), look for a diversified list of bargain issues (at least 30 issues, business values (i.e. net current asset and other related metrics) is below market cap)
– During the bubble, hot industries and companies are getting overpriced (like Amazon’s incredible Price to Earning Ratio). - Invest in large well known economically sound companies during a bubble, as soon as the bubble bursts there will be bargains available at good prices.
- Don’t ever buy IPOs!
- Consider company’s that pay dividends. Dividends – you share of the company’s profit.
- Think like an owner – read the company reports, know your company see the trouble before it occurs even the big boys can fall (examples given included Worldcom formerly #7 on the S&P500)
- Diversify – don’t have more than 75% of your portfolio in stocks, and 50% is even safer. Diversify with bonds, commodities and real estate (or funds that track them).
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Hector Duenas Jr. started his trading journey during the height of the tech bubble in 2001 as part of the 90% that looses money in the stock market.
A Rich Dad conference in 2016 changed his life and now he writes the Morning Market Reports for Tackle Trading.
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Thanks as always, for the info to kick-off the week Hector! Happy trading, Traders!