Transcript:
Tom Vaughan:
Hello, everybody, welcome to Wednesday, the S&P 500 was down 1.1%. The big news today was the price of oil moving up. And we’ve got, you know, nearly an all time high happening here for this, you know, kind of modern term, we hit higher oil back in 2007. But nonetheless, one of the things that is really concerning the market is, we’re seeing some of the earnings reports coming out, that are talking about, you know, missing the earnings like Target did, and basically saying that they had a much higher cost of transportation than expected. So the more that this becomes an issue, the more the market is going to worry about future earnings. Also, the markets going to be worrying about what the Federal Reserve has to do, to kind of slow down the economy to maybe try to slow down to demand for for energy as a whole. And, you know, when when the markets worried about the Federal Reserve, the Treasury market starts to pay more. So the 10 year Treasury has moved up over 3%. And that’s kind of why I call it a competitive asset class. So if you can make save eventually 5% on a treasury and some, some version of it, and all of a sudden, you know, you’re averaging 11% and the S&P 500, you might be moving more money to treasuries, which again, is a negative to the stock market.
So you can see what’s happening in terms of what the markets doing. However, if you look closely, the market, you know, hasn’t really done much for the last eight days, it’s been trading in a very tight range. And you know, although the market was down today, it was up yesterday, etc. So one of the questions that was posed to me was just about, you know, what do you do, you know, in these ranges, so, really, right now, I don’t do anything, because the range is Don’t tell me a lot, if it falls out of that range. And we still don’t have signals that are recessions coming, which I don’t have in my major signals, then I’m going to wait for it to fall down to a point where I call the stretch, got a couple of indicators I’m looking for, and I’ll start to nibble and start to dollar cost averaging at that lower point, if we break out of the top of the range, I will also be looking to buy at least some and nibble back in at that point. Also, just because again, now that we’ve gone sideways for a while we’ve created some good support level, if the price does fall back down, it can oftentimes hold up there. But the next resistance levels a little ways away. So it gives the market some room to run as far as that goes. So that’s my strategy. I look for either direction as far as that goes, and see what happens but don’t do anything. Well, it’s in the range. Just wait, I do think Friday’s CPI report is what the markets waiting for. If something’s going to break us out of the range, it could be that one way or another as far as that goes. So anyway, look forward to seeing what’s gonna happen tomorrow. Thank you very much.