Nothingburger?
That is the word I heard being used about the CPI numbers release tomorrow morning. I am not too sure. I do not like to be caught off-guard and so I am flat before tomorrow’s trading day.
The market action was anything but a nothingburger today though.
All the markets were up with the IWM, DIA and the RSP up more than the SPY and QQQ. That is indeed a broadening of the market.
All the SPX sectors were higher today as well. Note that many started negative but all ended strong.
I trade the IWM quite a bit so will go a little deeper into it.
I have 2 sets of moving averages plotted in the above 3-month chart. The green is 10-day, red is 20-day, purple is 50-day, and the pink is 200-day. We can see that the 10-day crossed over the 20-day and also the 50-day crossed over the 200-day. The MACD histogram also turned positive. The price closed at 189.75 after trying to get over the 188-resistance level for over a month.
With the bullish trending in place, the price should go higher. I closed my position today for 2 reasons: 1) the CPI release tomorrow and 2) price has gone up +3.8% in a straight line over 3 days. There is a good chance it takes a small breather.
Looking at SPY …
Price is trending bullish although it has not yet overcome the resistance around the 443 level. Also, the MACD histogram is negative which is in divergence with the moving averages trending. So, some issues to be sorted out there.
Looking at QQQ …
The price is heading towards the resistance bar around 370-372 and needs to overcome that to be able to fly higher. Here also, the MACD histogram is negative in divergence with the moving averages which are trending bullish.