New Highs On The Horizon

Hello traders everywhere. Once again we are on the verge of new all-time highs for both the S&P 500 (3,027.98) and DOW (27,359.16) as both indexes along with the NASDAQ will post their third straight week of gains. Even though the markets overall will end the week mixed on a daily level, all three indexes will end the weeks with gains of +1.1%, +1.6%, and +1.2% respectively.

Will we see record highs on Monday when trading opens?

Crude oil is going to post a weekly loss of roughly -2.8% as trading closes Friday. This drop is a reflection of how fears of excess supply continue to keep crude prices down even as hopes for coming trade talks boost the outlook for the global economy. And although oil prices have rebounded this year, they are down about 20% in the past year, compared with a nearly 4% climb in U.S. stocks.

Bitcoin continues to disappoint as it's trapped below the $11k market and after posting a weekly gain of +9% last week it gave back a bit of that move this week losing -1.8% trading just above the $10k level at $10,300 right below its 50-day MA. We will need to see a move above $10,949.00 for a potential breakout and move higher.

Key Levels To Watch Next Week:

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Market Breaks Out Of Trading Range

Hello traders everywhere. In Wednesday's video, I discussed how the market had been stuck in a trading range for the last month and that we needed to see a move above the 50-day MA to potentially see a move higher. Well, we got that move on Thursday when the news of an agreement between China and the U.S. to set a meeting for trade talks hit the wire resulting in a big move higher which resulted in three new green weekly Trade Triangles being issued for the S&P 500, NASDAQ and DOW.

The market is ending the week relatively quiet as the U.S. economy added 130,000 jobs in August, the Labor Department said. Economists polled by Dow Jones expected jobs to grow by 150,000 last month. Unemployment remained steady at a rate of 3.7% while wages rose more than expected. Wages expanded by 0.4% on a month-over-month basis and by 3.2% year over year. August marked the third straight month that job creation in the U.S. slowed. In June, 178,000 jobs were added while 159,000 were created in July.

After four straight weeks, of declines, the major indexes are looking to post consecutive weeks of gains with the S&P 500 gaining +1.8%, the DOW +1.5%, and the NASDAQ will post a weekly increase of +2%. Will we continue to move higher from here or is just a short-term bump?

Key Levels To Watch Next Week:

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Trapped In A Trading Range

Hello traders everywhere. There was no doubt that the market would bounce back today after a losing day on Tuesday, after all, that's the cycle we've been in for a while now. But more importantly, it's the trading range that we're currently stuck in. Not familiar with the term "trading range?"

A trading range occurs when a security trades between consistent high and low prices for a period of time. The top of a security's trading range often provides price resistance, while the bottom of the trading range typically offers price support. In this case, we will be looking at the 50-day and 200-day moving averages. With that definition mind, let's take a look at the major indexes.

All three major indexes, the S&P 500, DOW and NASDAQ, are all stuck in a trading range between the 50-day and 200-day moving averages. This range began almost exactly one month ago on August 5th, where we saw all three indexes lose roughly -3%. The NASDAQ led the way with a daily loss of -3.4% with the S&P 500 and DOW close behind with losses of -2.9%. Since then they have failed to break out above their 50-day MA's, the level of resistance, while the 200-day MA is providing a level of support.

Key Levels To Watch This Week:

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Market Set For Second Losing Month Of The Year

Hello traders everywhere. What a wild month! A trade war, a yield inversion curve and a rate cut by the Fed have led to an extremely volatile month, and while we will finish the last week of August in the green with weekly gains, overall we will finish the month of August in the red, the second losing month of the year. The S&P 500, DOW and NASDAQ will all lose over -1.5% with the NASDAQ leading at a -2.7% loss for the month.

Crude oil and Bitcoin joined in on the losing party by losing -5.48% and -4.9% respectfully on the month. The Dollar Index checks in with a slight gain of +.03% or unchanged for the month as it has found resistance at the $98 level. And that leaves us with the one bright spot, gold, which had a gain of +7.8% on the month trading above $1,550 at one point for the first time in a LONG time. Can gold's move higher continue? Is it a sign of things to come?

Key Levels To Watch Next Week:

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Always One Tweet Away

Hello traders everywhere. Do you find yourself following President Trump closely on Twitter? I sure do and you probably should too. Reason being, recently it seems that we are one tweet away from disaster or prosperity. Take today, for instance, the market overall was barley in the red after Fed Chair Jerome Powell said "The U.S. economy is in a "favorable place" and the Federal Reserve will "act as appropriate" to keep the current economic expansion on track. He then continued to say "the U.S. economy has continued to perform well overall, business investment and manufacturing have weakened, but solid job growth and rising wages have been driving robust consumption and supporting moderate overall growth.”

And Then we get this tweet from President Trump: "As usual, the Fed did NOTHING! It is incredible that they can “speak” without knowing or asking what I am doing, which will be announced shortly. We have a very strong dollar and a very weak Fed. I will work “brilliantly” with both, and the U.S. will do great..."

"....My only question is, who is our bigger enemy, Jay Powell or Chairman Xi"?

After that exchange, he shifted his sights to China they unveiled new tariffs. China stated that they will implement new tariffs on another $75 billion worth of U.S. goods, including autos. The tariffs will range between 5% and 10% and will be implemented in two batches on Sept. 1 and Dec. 15.

He started tweeting: "Our Country has lost, stupidly, Trillions of Dollars with China over many years. They have stolen our Intellectual Property at a rate of Hundreds of Billions of Dollars a year, & they want to continue. I won’t let that happen! We don’t need China and, frankly, would be far...." Continue reading "Always One Tweet Away"