Next Day Prep: Powell’s Signals Roil Markets, Bonds at Breaking Point
A quick analysis of today’s market outlook and key trading opportunities to start your day.
Intro & Market Mood
Welcome to Next Day Prep – What We Are Watching Tomorrow. It was a pivotal day in the market as Fed Chair Powell’s statements during the FOMC press conference led to significant shifts in market sentiment.
Overnight Headlines
- The market reacted to Powell’s cautious stance on rate cuts, with stocks turning south and bond yields spiking.
- Key economic data, including Q2 GDP and the ADP employment report, exceeded expectations, supporting Powell’s views on the economy.
- Seagate (STX) reported strong earnings but fell due to high expectations and cautious guidance for the next quarter.
Economic Announcements
Tomorrow’s focus will be on the release of the PCE Price Index, a key inflation indicator favored by the Fed.
Earnings Highlights
Notable earnings reports include Microsoft and Meta after the close. Keep an eye on how these reports impact market sentiment.
Top Movers
- TSM: Watching for a potential continuation play with a breakout above $243.80.
- SPGI: Consolidating tightly, a move above $531 could signal a quick run.
Quick Trade Ideas
- Continuation Setups:
- AVGO: Showing relative strength, a breakout above $302 may signal further gains.
- GE: Building a base, a move over $272 could initiate the next leg up.
- Anticipation Setups:
- AMD: Chart shows potential, but downgrade to ‘Sell’ introduces higher risk. Watch for decisive moves with tight stop-loss.
Key Takeaway
Exercise caution in trading as market sentiment remains uncertain following the Fed’s statements. Watch key support levels at $632 for SPY and $570 for QQQ. Tomorrow’s PCE data release will be crucial in determining market direction.
Trade smart and stay alert for opportunities amidst the current market volatility.