Buckle up for another wild week

Traders should expect more volatility in the upcoming week.  Here is the backdrop and upcoming events to be aware of:

Backdrop

-Last week’s volatility was driven by; slowdown in manufacturing and services, solid jobs and unemployment numbers

-Overall global slowdown

Upcoming events

-Q3 earnings season is kicking off.  Earnings expectations are “Dim” according to the WSJ, bad news will be punished.

-China trade talks resume Thursday/Friday.  Positioning ahead of the meeting is not good.  Breaking headlines will cause dramatic market reactions.

-FOMC minutes will be released on Wednesday, 10/9/19, there is growing consensus that the Fed “has to” lower rates, given the weak manufacturing/services data last week and fed watchers will be poring over every word looking for evidence of that thesis.

Here is this week’s video update:

How should traders take advantage?

-Shorten time-frames.  Take profit earlier than normal and expect volatile moves

-Tighten up risk management, take smaller position sizes

-Be willing to sit things out if technical setups are not present

-Watch sector rotation very carefully and look for individual stocks that are not moving with the indexes

 

As always, I welcome your thoughts, comments and feedback.

 

Dean

 

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