This week is all about inflation. This morning’s Consumer Price Index report for August shows inflation slowed slightly but continues to be high. The market will likely remain choppy, so I wouldn’t trade breakouts just yet. So I picked out the top 2 plays to benefit from a reversal in an oversold market — and more in Tuesday’s stock market recap.
Stock Market Recap
In this stock market recap, global stocks are mixed as investors await inflation data this week.
The CPI measures the average change in time of what consumers pay for goods and services. The year-over-year CPI was 5.3%, and 0.3% month over month. The Federal Reserve has continued its stance that inflation is transitory. The CPI figures show that inflation is cooling off slightly. The most recent spike in COVID-19 has made it difficult to gauge our economic recovery and whether or not inflation will continue higher.
The put/call ratio we talked about on Monday is giving us a major alert after hitting 1.17. A put/call ratio higher than 1 or lower than 0.7 typically signals a reversal in the market. The market will likely continue its choppy behavior, so a reversal would be temporary.
Roger’s Radar: 2 Pullbacks Ahead of Market Reversal
Global X Cybersecurity ETF (Nasdaq: BUG) provides exposure to companies involved in the development and management of cybersecurity systems. BUG has pulled back and could bounce back, looking to up its one-year return of 50.47%
The second play is a company providing health care delivery and payment solutions. Traders should stay away from breakouts right now and just trade pullbacks like these to capture upside gains in this choppy market.
In this video, you’ll discover what momentum levels are showing us… what the put/call ratio is predicting… what to look out for as we approach the holiday season… if there is a directional bias in the market… and two pullbacks to trade right now.
Just because the market is an unpredictable mess doesn’t mean investors’ financial situation also has to be…
That’s why Joy of the Trade Head Trader Jeff Zananiri is sharing a strategy that works in all market conditions.
He relies on a little-known anomaly that could help traders see incredible results with a more systematic approach.
And there’s never been a better time to implement Jeff’s strategy. With interest rates set to increase sometime this year or early next, we will continue to see choppiness.
Jeff’s strategy allows traders to use “Money Links” to hedge against surprise pullbacks — and even make money off of them!