If you’ve been following along, then you likely know I’ve been talking about the Consumer Price Index inflation report for months, calling it Wall Street’s Super Bowl.
For most of the year, the market has sold off hard on this inflation data… But Thursday, we finally saw the opposite as stocks took off like a rocket on the latest numbers…
The Consumer Price Index showed month-over-month inflation of 0.4% versus expectations of 0.6%, while the CPI rose 7.7% year over year versus expectations of 7.9%…
Excluding food and energy prices — which are more volatile — inflation grew 0.3% month over month versus expectations of 0.5%.
I’ve been saying when we finally come in soft month over month — which is the more important number — that the market would explode… And boy did it ever, with the CPI data acting like rocket fuel with many traders loaded to the gills with puts.
In fact, I said on Monday’s Crush the Open that if we came in at 0.4%, the market was going to RIP. If you’re not checking out Crush the Open at 9 a.m. ET every Monday, you’re doing it wrong! Join our Telegram channel and we’ll send a reminder before we go live each week! We have a lot of fun while also sharing a ton of valuable, actionable information.
Days like Thursday, when super important data is released, are days you need to be aware of ahead of time. This is market-moving juice, what dreams are made of if you play it right. But you can’t “play it right” if you don’t even know what’s coming!
The fact is the market is oversold. The Nasdaq is still down 30% on the year, even with Thursday’s massive spike. And when you get stretched to extremes in one direction, you’re going to see an explosive move in the other direction when you finally get data the market likes.
This is a great learning experience for everyone, so check out my video up top and I’ll discuss how we traded Thursday’s move before it happened.
Are there any topics you’d like to see me cover or questions you’d like answered? Send me an email at jeff@joyofthetrade.com. And be sure to stay ahead of the markets by subscribing to our YouTube channel and our Instagram page for all of the latest! Don’t forget to like, subscribe and leave us a comment!
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P.S. How to Determine the Real Reason a Stock Is Moving
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