WEEKLY MARKET DIGEST: OPPORTUNITIES AND PERILS FROM TRADE WAR AND HAWKISH FED $DIA $GLD $QQQ $SLV $SPY $TBT $USO

WEEKLY MARKET DIGEST: OPPORTUNITIES AND PERILS FROM TRADE WAR AND HAWKISH FED $DIA $GLD $QQQ $SLV $SPY $TBT $USO

Weekly Digest from The Arora Report is popular among serious investors and money managers because they have found studying insights from the prior week gives them an edge over the coming weeks. Here is the day by day rundown from the morning capsules made available every morning before the market open in the Real Time Feeds to the paying subscribers of The Arora Report

Please scroll down for the section What To Do Now.

TRUMP PUTS TARIFFS ON CHINA, MOMO SELLS STOCKS

To gain an edge, this is what you need to know today.

China Tariffs

Trump has announced new tariffs on $50 billion worth of Chinese goods.  China has said that is will respond with reciprocal measures.

Momo Crowd And Smart Money In Stocks

The momo crowd is aggressively selling stocks in the early trade. The momo crowd selling is especially strong in high beta popular tech stocks and also in speculative stocks. These are exactly the same stocks that the momo crowd was buying yesterday.

The smart money is inactive.

Gold

Gold is falling as the dollar becomes stronger.  The momo crowd is aggressively selling gold.  Interestingly the momo crowd was aggressive buyers of gold most of yesterday.

Oil

Trading in oil is listless as traders await the upcoming OPEC meeting.

Technical Patterns

None of note.

This is powerful information and many investors use this to enter trades in addition to our official signals.  Here are the three most common uses: 1) Short-term trades in ETFs  2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators.  To learn more please click here.

Markets

Our very, very short-term early stock market indicator is negative.

Interest rates are ticking down and bonds are ticking up as safe haven money flows into bonds from stocks.

Gold futures are at $1295, silver futures are at $17.07, and oil futures are $66.64.

S&P 500 resistance levels are 2800, 2840 and 2860; support levels are 2765, 2740 and 2700.

DJIA futures are down 210  points.

HAWKISH FED, ECB TO END QE, STRONG RETAIL SALES

To gain an edge, this is what you need to know today.

Hawkish Fed

The Fed was hawkish in its policy statement.  Now there are likely to be four rate increases in 2018.  Many Fed watchers were hoping for three rate increases.

ECB To End QE

The ECB left rates unchanged.  The ECB is likely to end its massive QE program by December.  The bond buying will be reduced to 15 billion euros from 30 billion euros in the last three months of 2018.  The ECB is unlikely to raise rates before the summer of 2019.

Strong Retail Sales

Retail Sales Ex Auto came a 0.9% vs. 0.5% consensus.  They exclude autos because that data is very noisy and hinders projections. We pay special attention to retail sales because the U. S. economy is about 70% consumer based.

Momo Crowd And Smart Money In Stocks

The momo crowd is aggressively buying.

The smart money is inactive.

Gold

The momo crowd is aggressively buying gold as it moves above $1300.

The smart money is inactive.

Oil

The momo crowd is aggressively buying oil this morning.

The smart money is inactive.

Technical Patterns

None of note.

This is powerful information and many investors use this to enter trades in addition to our official signals.  Here are the three most common uses: 1) Short-term trades in ETFs  2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators.  To learn more please click here.

Markets

Our very, very short-term early stock market indicator is positive but can quickly reverse and become negative.

Interest rates are ticking down and bonds are ticking up.

Euro is weaker.

Gold futures are at $1307, silver futures are at $17.17, and oil futures are $67.05.

S&P 500 resistance levels are 2800, 2840 and 2860; support levels are 2765, 2740 and 2700.

DJIA futures are up 96 points.

THE FED DAY, HOTTER INFLATION DATA BUT MOMO DOESN’T CARE

To gain an edge, this is what you need to know today.

The Fed Day

The Fed will announce its policy decision at 2:00 pm ET.  There is a news conference at 2:30 pm. The consensus is that the Fed will raise interest rates by one-quarter percent.

We will be carefully reading the tea leaves for the future interest rate direction.  In the past, the Fed has repeatedly made mistakes by raising interest rates too far and causing pain for investors.  We will do a separate post on this subject due to its importance for our subscribers.

Hotter Inflation Data

Core Producer Price Index (PPI) came at 0.3% vs. 0.2% consensus.  This is a leading indicator.  In theory, prices rise at the producer level first and are subsequently passed on to consumers.  However in an anomaly, lately PPI increases have not been showing up in Consumer Price Index (CPI).  This obviously cannot last forever.

Momo Crowd And Smart Money In Stocks

The momo crowd is buying stocks.  The smart money is inactive.

Gold

Gold saw some buying after hotter core PPI.

Oil

IEA says that the world wide oil production may fall due to production cuts in Iran and Venezuela.  This is providing support to oil this morning. Traders are waiting for EIA data to be released at 10:30 am ET.

Technical Patterns

None of note.

This is powerful information and many investors use this to enter trades in addition to our official signals.  Here are the three most common uses: 1) Short-term trades in ETFs  2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators.  To learn more please click here.

Markets

Our very, very short-term early stock market indicator is neutral.

Interest rates are ticking up and bonds are ticking down.

Currencies are range bound.

Gold futures are at $1300, silver futures are at $16.97, and oil futures are $66.00.

S&P 500 resistance levels are 2800, 2840 and 2860; support levels are 2765, 2740 and 2700.

DJIA futures are up 29  points.

MOMO BUYS ON KOREA SUMMIT SUCCESS BUT LACK OF DETAIL LIMITS UPSIDE

To gain an edge, this is what you need to know today.

Korea Summit Success

Korea summit is successful but there is lack of detail.  The outcome is mostly in line with the consensus prior to the summit.

Momo Crowd And Smart Money

The momo crowd is buying on the success of the Korea summit but the lack of detail limits the upside.

Smart money is not buying because smart money had already priced in the success of the summit.

Korean Stocks

Korean stocks had also priced in a successful summit and therefore there is no major impact.  Some Korean construction companies have been rising.  A small cap Korean company has risen 500%.  However for foreigners it is difficult to buy individual small Korean stocks.

Korea ETF EWY has been regularly followed in ZYX Emerging for over a decade.  We expect significant opportunities in Korea and will endeavor to find the best opportunities that are available to foreigners.

Gold

Gold is under pressure as the momo crowd sells on the success of the Korea summit.  The selling is mild.

Oil

Oil is listless awaiting data.

Technical Patterns

None of note.

This is powerful information and many investors use this to enter trades in addition to our official signals.  Here are the three most common uses: 1) Short-term trades in ETFs  2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators.  To learn more please click here.

Markets

Our very, very short-term early stock market indicator is neutral.

Interest rates are ticking up and bonds are ticking down.

Currencies are range bound.

Gold futures are at $1299, silver futures are at $16.87, and oil futures are $66.03.

S&P 500 resistance levels are 2800, 2840 and 2860; support levels are 2765, 2740 and 2700.

DJIA futures are up 12  points.

AN IMPORTANT CENTRAL BANK WEEK AHEAD, KOREA SUMMIT, ITALIAN STOCKS JUMP

To gain an edge, this is what you need to know today.

Important Central Bank Week Ahead

For investors, an important central bank week is ahead.

The Fed is likely to increase interest rates.  We will be carefully analyzing the Fed statement for longer term trends.  The Fed policy has major impact on the stock market.  The Fed will announce its decision on Wednesday at 2:00 pm.

The European Central Bank (ECB) will announce its policy statement on Thursday.  ECB is getting close to ending its QE program.

The Bank Of Japan (BOJ) will announce its policy statement on Friday.  BOJ is likely to keep buying bonds.

Momo Crowd And Smart Money In The Stock Market

The momo crowd is buying stocks in the early trade.  The smart money is inactive.

Korea Summit

Trump and Kim Jong Un will be meeting tomorrow.  The market is expecting a success.  If there is no success, a selloff may occur.

Italian Stocks

Italian stocks and bonds are jumping on an assurance that Italy plans to stay with euro.

Gold

Gold traders are carefully watching the Korean summit.  If the summit is successful, gold may see a selloff.

Oil

Trading in oil is listless but natural gas is seeing a strong rally.

Technical Patterns

This is powerful information and many investors use this to enter trades in addition to our official signals.  Here are the three most common uses: 1) Short-term trades in ETFs  2) Decisions to trim or add to long-term positions, and 3) New option trades. These should be used judiciously only in conjunction with macro, fundamental and quantitative indicators.  To learn more please click here.

Markets

Our very, very short-term early stock market indicator is neutral but the market can swing either way.

Interest rates are ticking up and bonds are ticking down.

Currencies are mixed.

Gold futures are at $1301, silver futures are at $16.84, and oil futures are $65.09.

S&P 500 resistance levels are 2800, 2840 and 2860; support levels are 2765, 2740 and 2700.

DJIA futures are up 42 points.

WHAT TO DO NOW

Looking ahead and not only in the rear view mirror, consider continuing to hold existing core portfolio positions.  Based on individual risk preference, consider holding cash or treasury bills 20% – 35% and short to medium-term hedges of  15% – 25% and very short term hedges of 10%.

 

A knowledgeable investor would have turned $100,000 into over $1,000,000 with the help from The Arora Report. NOW YOU TOO CAN ALSO SPECTACULARLY SUCCEED AT MEETING YOUR GOALS WITH THE HELP OF THE ARORA REPORT. You are receiving less than 2% of the content from our paid services. …TO RECEIVE REMAINING 98% INCLUDING MANY ATTRACTIVE INVESTMENT OPPORTUNITIES, TAKE A FREE TRIAL TO PAID SERVICES.

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