Is 7-2 really the odds of a Tax bill out of the Senate??? How will the stock market react??

The Stock Market is  green this morning with all indexes up over .25%. IWM leads the way.

Of note, financials strong again with the only red, Metals and TLT.

I am in my GLD system GLD trade and no exit signal as of yet.

XNCR a mean reversion trade is catching some life here. It has a lot of  potential to the upside if it gets going here.

I added a bottom reversal trade yesterday in WEAT. We tried that trade a month ago and was stopped out. Our mental stop is 6.06 on a 1 hr close only.

I took one look at QQQ yesterday and with that divergence in the morning and breadth weak I decided to pass on a day trade.

I will be looking this morning for a trade and have 3 stocks in my basket.

Its all about tax cuts right now. Any hicup will send the market lower.For the 1st time I am thinking there is a chance the bill gets out of the Senate. The odds right now are 7 to 2 in favor this year. I would still take the odds.

I have to think that the schemers have already decided how the no vote is going to go down. Lets see if my cynicism is overblown. We will know very soon!

Also do not forget that after the tax cut issue, next up is the DACA issue and a potential government shutdown. My guess is that there is a better than normal chance this time of a shutdown.

The polarization on the issue of DACA is so severe that I do not see our politicians compromising on these issues. On the one hand you have the Democrats that are united on this issue, then you have the republicans. A mixed bag but there vote seems to depend on what special interest group they are beholden to.

And then you have the conservatives, the ragtag group, that under no circumstances will not vote for DACA.

The wild card in all of this is Trump. He has given mixed signals on this issue but the bottom line I think is that if there is no compromise there is no DACA. Congress does not have the votes to override a veto (I do not think anyway) and Trump will milk this at the very least for full funding for “The Wall”.

Otherwise, I expect a veto from Trump, and a reasonable chance of a government shutdown.

Yet the market just keep blasting higher! Deregulation is most likely the primary cause of the rally along with consumer sentiment finally getting out of the basement. Never underestimate the power of deregulation. Much more important than the tax cuts x 100.

Come join me this morning at @rickjswings. I am on for 30 to 60 min after the open for comments and perhaps a day trade.

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’s Handicapping Picks

Skype: riccja

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