A long weekend over and what do you know…The market is gaping up again today!!!

Gap up again today??? The news in the EU is not that good over the weekend. I encourage you to take a look. The potential problems they face are mounting daily.

From potential exits from the EU to financial problems in Greece again and other EU countries.

One only needs to recall how the Greece financial crisis several years ago rocked the markets. Or the Brexit shaking up the markets. Both created great buying opportunities.

I view it as follows: If Trump gets most of what he is asking for from Congress and Yellen does not get too aggressive this bull market has ways to go.

On the other hand, if Congress puts a halt to items like tax cuts, infrastructure bills, ACA repeal and replace than its going to be a very bumpy ride. In addition, if Yellen goes nuts on hikes this also will not bode well for the markets.

I do not tend to be an expert on fiscal policy, however, my view is the U.S. cannot afford to have short-term rates raised with the size of its debt. That should be the prime consideration. Not trying to fine tune something as random as monetary policy. The Fed, in my opinion, needs to intervene only in cases like the financial crisis 8 years ago.

To think they can fine tune monetary policy where in the past it has been failure after failure is delusional. But again, the U.S. has put itself into a box financing its debt with short term instruments. Even the slightest increase in short-term rates puts enormous stress on the U.S. debt repayment.

If I were head of the Fed I would bring rates back to 0, let the market determine all other rates, and do my fiscal policy by getting into the markets via bond purchases as it has been doing rather effectively.

I expect a phone call very soon to take over Yellen’s position:)

I am long and am looking to get longer on pullbacks. The market is extended here but absents some shock wave I expect more of the same, at least into march April. Then one will need to reevaluate the situation.

I am thinking the sell in May crowd might want to exit early this year. We will see.

I have no trades going that I have shared with followers and am down to only 5 trades from a high of 15 just 2 weeks ago.

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

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