Another flat open for the markets. And again nothing of significance to speak of in premarket trading.
The debt ceiling is going to become the headlines very soon. It is already being talked about but within a week or so the headlines will be about a government shutdown.
Will the government shutdown? I put the odds at greater than 50% of a shutdown.
Schumer needs a win badly. So far he is losing the political wars and being made to look like a fool. His outburst in an upscale Manhattan restaurant toward a Trump voter says it all.
The Gorsuch vote is coming up and Gorsuch will get nominated to the Supreme Court one way or another. It will not be through any deal with Schumer.
Either the Nuclear option or enough Democrats will break rank just to save their jobs in the Senate.
One way or another it will be a big loss for Schumer who is beginning to look more and more like Reid as time goes by.
That means the next big agenda item is the debt ceiling. The word is that Schumer will agree to an increase if the Wall is not in the Budget. It is not clear to me what the Republicans will do with this, but considering the high % numbers that favor the wall and controlling the southern border, it would surprise me if the Republicans agreed.
I do not think Schumer is going to back down on this. His political life is at stake. The question then comes down to Democrats breaking rank. Too early to tell on this, but, any Democrat that is up for reelection in 2018 that stays the Schumer line will most likely be gone.
So, a lot to consider about making the debt ceiling trade this time. It’s not the no-brainer it was when the Republicans had the minority in the Senate.
I am going to wait to see how large the sell off is going into the debt ceiling vote. You are not giving up anything by waiting as the MSM is going to play this to the hilt. It will be a sky is falling type of reporting. Every negative scenario will be blown up 100X before the vote. We will see:)
Myself, I am slowing winding my swing trades down to 4 or 5. Most have been taken off with a small profit or small loss.
I still have my GLD position which I will keep until my system gives me an exit. It is one of the few systems I follow that I do not incorporate discretionary thought to it.
Swing trading, for now, is going to be BO trades with a very short leash. Similar to the REN trade the other day where I put it on early, It immediately ran +2% and by the close, it was even and I exited.
The markets are back to neutral. The oversold condition has been taken off by both the rally of the other day and the period of consolidation we are seeing now. In addition, we are almost to April where you will start hearing from the sell in May crowd.
My thinking is that this might be one of the best predictions this method has ever had.
You have the Fed raising rates, Our political system has for all intents and purposes broken down, we are looking at potential trade wars with China, and N.Korea and Iran are saber rattling. Both are backed by China and Russia.
And to top it off you have lawmakers saying what Russia did in our elections is an act of war!!!
Forget though that the previous administration pulled out all stops to defeat Netanyahu, That they went to the UK and threatened them if they pulled out of the EU and they got caught spying on foreign leaders cell phones.
When are we going to get sane people representing the U.S.?
With the above, it would not surprise me to see the bull market come to an end in may or even shortly before.
It is going to get treacherous in these markets. It will be no place to have 100% of our wealth.
A caveat to the above. Nobody is very good at timing these markets. So that should be factored into the above:)
If you want to follow some of my trades along with my thoughts typically given after the open you can go to @rickjswings. Typically I talk about the overall day expected with the markets and also give some levels on the ES and NQ for failed breakout scalping.
It’s my private twitter feed for the stock market and its free. Sports Handicapping is the subscription-based part of this site. But considering the cost of joining it’s almost free:)
Good Luck Today
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