Friday and a gap higher in the Markets!!! Do we get a gap fill or a continuation higher???

Friday and a gap higher in the Markets!!! Do we get a gap fill or a continuation higher???

After some consolidation following a small pullback, the markets are gaping higher this morning an hour before the open.

Futures are at their overnight highs. Of note is GS +1.56% and IBB +.58%. That bodes well for the trading day today if you are long.

Although, as with everything in life I can think of we are talking probabilities, not certainties:)

I still have my GEO and GLD positions along with my 1/4 position in SPY via SSO. The consolidation over the last few days has taken the oversold to mildly oversold. So any rally today would most likely trigger an exit on my Mean reversion index trade.

My SBUX trade is looking good, however, the CEO had a revelation that perhaps being a social warrior at the expense of a company that he has been hired to maximize profits for shareholders was not a good idea! So he announces they would also be hiring Veterans. This could be a skit on Saturday Night Live. But more often than not reality tends to be more of a comedy.

As far as news the tension in the U.S. just gets worse. Violence and rioting is becoming an everyday occurrence. So far the markets have looked the other way on this disturbing trend.

Another trend that is rapidly changing is the idea that the Senate is the voice of reason. The House has always been considered tumultuous while the Senate was the branch you could count on to keep sanity in check.

But rapidly that is changing in the Senate. We saw it first with Reid using the Nuclear option on appointees and now a continuation by boycotting hearings on appointees by the minority party. In addition, the news is (although anymore it’s hard to discern real from fake news) that the minority party is going to boycott anything to do with the Supreme Court nomination.

So the Senate is not going to be a branch the people can count on the maintain sanity in a country that is rapidly going insane.

I just do not see the markets turning its head to this disturbing development much longer. What happened at Berkely last night is just another indication of this trend.

Then on the geopolitical front, the U.S. is rapidly approaching some sort of confrontation with Iran. What this turns into remains to be seen.  But the rhetoric on both sides is disturbing. The wildcard in all of this is what Russia and China do in the event the U.S. decides to confront Iran. But that is above my pay grade:)  Rest assured if keeps the progression it is on the markets will be for a wild ride.

Enough of my fear mongering this morning:) I am going to take a more cautious approach to swing trading today for several reasons.

First, the market is not as nearly oversold as it was in the middle of the week and second it may well be a long weekend for rioting here in the U.S.

If I see something however that looks especially good I will take the trade and post it on my twitter feed @rickjswings

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

RickJ

RickJ’s Handicapping Picks

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