Markets gaping up 30 min before the open, but will Head of the Fed Yellen accommodate this morning?

The markets show no signs of slowing down here as all the U.S. Stock indexes are gapping up this morning.

Of note, Metals down, Financials up, Oil up strongly, TLT of a bit.

Overall, looks like a positive bias an hour before the open. Although we are overbought here.

What is driving this market? We are still at very low-interest rates. However, we will get some guidance from the Fed this morning. It is anticipated that there will be no rate hike today but what people will be looking for is a hint of how aggressive the Fed will be for the rest of this year and next.

Not only do we have the Fed as a backdrop to the markets but also the Health Care Debacle in the Senate.

The Senate squeaked through a motion to bring the health care bill to the floor with Pence having to cast the tiebreaker. 2 Republicans voted not even bring the vote to the floor? Figure that one out.

So it McCain who had Brain surgery about a week ago with the concurrent diagnosis of an aggressive form of brain cancer to make the trip to DC to get the motion to bring the bill to the floor passed.

Now, I know I am a bit naive about these things but you would think that once McCain announced that he was making the trip despite his health because his vote was needed, that one of the two Republicans that were going to vote no might announce that they were going to vote yes to save McCain the trip.

I know that is a lot to ask from another human who has worked with McCain many years in the Senate. But not only was that not done, I doubt it was even considered. Not even a passing thought to save a person with aggressive brain cancer the stress of the trip.

And for that matter, you would think 1 Democrat would step forward in that regard also.

But no, that is how far our politics has fallen in the U.S. Just when you think it cannot get any lower our esteemed politicians set a new low mark, not only as lawmakers but also as humans.

This is important in that the markets do not do well in periods of uncertainty. I know, I have been saying that for some time now and the markets have gone straight through the roof:)

My prediction was shortly after the 2nd week in May the market would tank. My prediction could not have been any more wrong. But that is the way market predictions go. You can come up with the most logical analysis only to have the markets disagree with your infallible logic!

I am sticking to my guns here. As I have said its one thing to figure it out and completely another to time it right. Timing is the tough part.

Looking at the political odds this morning the odds that a vote on a health care bill will take place this week is 50/50.  As to before August 5th, you get 3 to 1. That’s a big change as it was 8 to 1 against a week ago. I am staying clear of this wager right now.

The other line I have been watching is the Wray FBI head confirmation. I had indicated awhile back to take 4 to 1 that he would not be confirmed by July 31st. If you want to make that wager today you will have to lay 3 to 1. So far my analysis has been spot on regarding Wray.

Finally, a line I will be watching is whether Ryan wins the primary next year. My guess is if the line comes out soon you will be able to get at least 10 to 1. I think that has a lot of value to it.

Of course, a lot depends on how the next seven months goes but at 10 to 1 you get a lot of leeways. I would not surprise me to see that line approach even money as we get a month away from the primary.

I will save you my analysis for now:)

Today in the markets it’s more of being cautious. I have a few stocks on my radar but it will all depend on how the day sets up. In addition, I do not wish to take a risk as to what Yellen has to say today.

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

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