The Week Ahead For June 13th to 17th
Major stock indexes fell this past week across the board, making it down nine weeks in the last ten weeks.
Correction Price Pattern Status for S&P 500: Last week’s action saw all indexes move lower for a second week in a row. We remain with a focus on selective buys and continue to use selective shorts of Type 2s (Technically Strong & Low Shorting) moving to Type 4s (Technically Weak & Low Shorting) as well as Type 4s that do not have an Erlanger Options Rank higher than 70. The Sector Erlanger Options Rank sees 3 of the 24 Sectors with a score about 70 up from 2 last week. We will write about that mid week.
The NASDAQ Composite, NASDAQ 100, Russell 2000 and S&P 400 Mid Cap have all lost more than -20%, putting them in a bear market. The S&P 500 and the Dow Jones Industrial Average have been able to avoid bear market status, with the S&P 500 only by the "strict end of day definition".
There was a 100% chance of a bounce three weeks ago as the Type 4s rallied by 7.03%. Type 4s failed to continue to rally for the first and second week so a reversal to the downside may be starting to play itself out again. We track this statistic out four weeks so this week is key to that data series.
Top Issues Facing The Market This Week
1. Geopolitical and Fiscal Events. The key issue remains how the Russian invasion of Ukraine progresses as the Russians contemplate how they are going to proceed. FOMC meets this week and is likely to raise rates by 50 basis points.
2. Economic Releases. Releases of note this week include the weekly chain store sales, oil/gas numbers, mortgage applications and NFIB Small Business Optimism, PPI, Retail Sales, Empire State Manufacturing, NAHB Housing Market Index, Housing Starts, Philadelphia Fed Index and Industrial Production.
3. Earning Releases. Notable releases this upcoming week include ORCL KR JBL ADBE TCOM.
Monday, June 13th
· None of note.
Tuesday, June 14th
· May NFIB Small Business Optimism is due out at 6:00 a.m. EDT and came in last month at 93.2. There is no estimate for this month.
· May PPI is due out at 8:30 a.m. EDT and is expected to come in high like CPI at 0.8% from 0.5%.
Wednesday, June 15th
· May Retail Sales are due out at 8:30 a.m. EDT and are expected to come in at 0.2% which is positive but lower than April's at 0.9%.
· June Empire State Manufacturing is due out at 8:30 a.m. EDT and is expected to rise by 3.0 from a drop of -11.6.
· June NAHB Housing Market is due out at 10:00 a.m. EDT and is expected to come in at 68 from 69.
· The Federal Reserve Open Market Committee (FOMC) is out at 2:00 p.m. EDT with its latest announcement and presser at 2:30 p.m. EDT. Rates are expected to be raised by 50 basis points.
Thursday, June 16th
· May Housing Starts are due out at 8:30 a.m. EDT and expected to rise to 1,730,000 from 1,724,000.
· Philadelphia Fed Index is due out at 8:30 a.m. EDT and expected to rise to 5 from 2.6.
Friday, June 17th
· May Industrial Production is due out at 9:15 a.m. EDT and is expected to drop to 0.5% from 1.1%.
· June Options Expiration occurs and it is a quadruple witch as we complete the quarter.
STOCK SPLITS OR REVERSE SPLITS THAT ARE SHORT SQUEEZES
None of note.
STOCK SPLITS THAT ARE LONG SQUEEZES
None of note.