The market is marching higher on the heels of the latest Producer Price Index inflation report, which came out this morning ahead of Wednesday’s Consumer Price Index.
The important number to pay most attention to is year over year, which came in at 2.2% versus expectations of 2.3% to 2.6%.
Excluding food and energy, the number came in at 2.4% versus expectations of 2.6% to 3.0%.
These numbers are good and a step in the right direction, showing that we could finally be making progress with inflation.
The big number is coming in Wednesday’s CPI, and I’m taking these numbers with a big grain of salt. Fed Chair Jerome Powell is going to have a difficult time convincing the public that any progress is being made if the numbers are exactly the same as a year ago.
The energy market, meanwhile, broke through several key levels on Monday, including its downward trendline. So I’m looking at energy stocks again, and this is telling us that a recessionary period is likely off the table.
Volatility is also falling under the 20 level this morning…
I’ll cover all that, my daily hitlist of longs and shorts and more in this morning’s “Premarket Must Watch” video!
Roger Scott
Roger Scott Trading
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P.S. Traders Lose Sleep Over This Setup
If you’re hoping for prices to go up, a “gap down” like what you see below can be your worst nightmare.
A lot of traders will panic sell when this happens, wondering if this is a sign of an even bigger downtrend…
But I can show you a way to use this setup in your favor!
You see, people crave stability. It’s how we’re wired. But these wild price fluctuations can create phenomenal opportunities…
IF you can set your emotions aside.
So I joined forces with fellow trader Nate Tucci to show everyone a counterintuitive “Gap to Recovery” trade setup that we both LOVE in times of increased downward sell pressure.
