Good morning
The saber rattling and geopolitical concerns have been putting the market under some pressure and on Friday we got some weak retail sales and a surprise drop in CPI. We closed below some key technical levels on Friday in some sectors and there are a few indexes that are also looking a bit heavy. The bears could be awakening and there could be a correction brewing but before you go out and start shorting everything you can get your hands on we need to recognize that not all the news and technical action is poor.
If we can get through the weekend with nothing more than a military parade in North Korea and no more bombs being dropped by the U.S. maybe the geopolitical concerns will subside. Earnings season will be kicking off in full force with a broad array of sectors reporting. Earnings will likely take center stage and the guidance will be key.
The most impressive sectors by my eye are the biotech and health care sectors. Oil could get some follow through off of OPEC comments and Friday however the black gold could be ready for a pause after the recent run it has had.
Speaking of gold, the junior miners and the precious yellow metal appear to be dis connected recently and if gold continues its recent run look for the junior miners to play a little catch up. Keep in mind that the action in gold will likely be tied to the weakness or strength of the dollar. We should also keep a watchful eye on volatility if the bears do manage to take full control and we see real fear start to pile into the market. Watch the video to get more of my thoughts on the markets, sectors and the stock below.
Its important to understand that neither the bulls or bears have been in control for the last couple of months. Until we have reason for either to become more aggressive we could continue to chop around in a range. Do not chase the first signs of a break up or a break down as it could be just a head fake. Have a plan for every trade you take. Do not trade on what you think should happen. Trade what is actually happening. Know why you are taking the trade and the time frame you are willing to let your thesis play out, Most importantly always know what you are willing to risk. Focus on what you could lose first. Then think about what your potential reward could be and ask yourself if its worth the risk. If you feel as though you have no edge there is nothing wrong with sitting on the sidelines. Cash is a viable position!
Have a great Easter and enjoy the rest of your weekend. Be safe and have fun.
Stocks in this weeks video
$CALI $LQMT $VSTM $STRM $IMGN $MDXG $FLXN $OKTA $PME $ATHX $MTZ $NYMX $VRAY $CGIX $ATRS $SGYP $CVRS $IPXL $EMAN $SINA $KOPN $EVRI $ST $KTOS $DYN
Alpha Wolf Trading Market Wrap and Stocks to Watch April 17-21 2017 from Alpha Wolf Trading on Vimeo.
