[LIVE] Pre-Market Prep – CPI Inflation Live Market Reaction – IBM Prelim Earnings MISS!

[00:00:00] Speaker ?: *music* [00:00:30] Speaker 1: *music* [00:00:47] Speaker ?: *music* *music* [00:00:58] Speaker 1: *music* *music* *music* *music* [00:01:26] Speaker ?: *music* [00:01:28] Speaker 1: *music* [00:01:42] Speaker ?: *music* *music* *music* *music* *music* *music* *music* *music* *music* *music* *music* *music* *music* *music* *music* *music* [00:02:42] Speaker 2: Good morning everybody, welcome back to the office, welcome back to another day's worth of trade in the market. Looks like I've hit the wrong button twice in a row now on the transition from the intro to the browser. Must be something in the air in this lovely island salt air that is causing my eyes to not see correctly. Maybe it's the salt water getting in the eyes on some swims, but anyways, welcome one and welcome all. We've got Tuesday, July 14th on the calendar and eight o'clock on the clock, which you guys know means it is time to get the job done. And we will of course get the job done starting at 8.05 and we will allow some people to focus. Focus. I can't even focus it, I guess. Take a sip of water and let's try this again. This is like, this is one of the worst openings we've had in a long time. Incredible. All right, sip. And now let's try that again. Good morning, everybody. Welcome back to the office. Welcome back to the stream. Welcome back to a brand new day's worth of trade. We've got Tuesday, July 14th on the calendar and eight o'clock on the clock, which you guys know means it is time to get the job done. And that's exactly what we'll do in today's episode installation of the pre-market prep. There we go. That's feeling a little bit better and a little bit more on pace. So let's scroll up to the tippity top of the chat. Let's see who's here with us in this morning's episode. Let's see who's here up in the office. I would expect nothing other than the Tuesday tango from Mr. G. And yes, indeed at the tippity top. Who's ready for that Tuesday tango? Don't forget to sign in at the like desk if you haven't done so already for some complimentary mystery items. We'll see if we can find it later on at the like desk. Uh, we've got ice by lunar in the building. Mr. Hat bill lakeside is here cooked intentionally the fade. Dr. ET gene Jensen is here. Pandemonium Gnucci is here up in the office very early to the mornings. Good mornings. Again, brain just totally wiped out, I guess somehow mini trader, bad wolf. We've got Chuck alley trader, a hot dog society, dark comet. Paul M Oscar vice for victory is in the house. Hang flying star man. 77 talent. 103. Duna B is in the office. JC, our senior news correspondent. Today is a big day for that. We've got maze 400. Caldy. Good morning. Time to get the job done. Indeed. Fed tracker. Fred is in the house. Parabolic FOMO dip rip. John P. We have Cipriano own worst enemy. Dangerous function 54. Here we go. Seven colors are in the rainbow and seven tones are in the diatonic musical scale. Seven is a prime number and it's the number of your like today. Good morning to Matt and all the traders up here in the office from Orlando. Autizzy Dizzy. Good morning. We have Delightful Sonny. Tyler Johnson. Entertain me. Patrick B. Anthony Wu. Atlanta zone. We have Jarrett Mattson. Steve Davis. Julian S. Chuck. Good morning. Mike Rosales. Fuzz. Shy is in the house. Who else? Timothy Bond. Bondic. Good morning. Teacher Russell with the breakfast buffet. We've got watermelon. We've got croissants. Avocados. We've got chicken on the bone. Chicken legs. Chicken and waffles, I suppose. That goes together. And plenty of coffee to go around. Bob the Day Trading Nomad. Good morning. Real M. Who else? Arc Nemesis. Chris D. Real M. Who else? Marcus G. Digital Coop. A friend in the market. Option Hawk. Good morning. Dirk Fisher Trade. Zombie Wolf. We've got Jim Brogan. Good morning. Lazo N. Cahia holding down the 808 state as we know. Jeffrey Green. Jim Brogan with the tons and tons and tons of coffees this morning. M. Koto. Good morning. Jeffrey Green again. There we go. Nick Farrell. C. Black. Pete and repeat. The most classic name there ever was. Philip B. We've got just hanging out. Tommy. Gucci. Sasha. Jeffrey Green. Yes siree. Time Sellers. Who else is here? Robert Rudeloff. Carl Ware. Florida Homes Investing. Desert Dean. Larry Rowe. Crypto Stock Beach Bunny. Good morning. Who else? Digitally painted. Let me scroll back up. Pick up where we left off. Where did we leave off? Scroll back up. Scrolling, scrolling, scrolling. Should be an easy one to find, I believe. Double check. How are we doing on time? 8.04 in 23 seconds. Doing fine on time. Yes. All the coffees from Jim Brogan make it very easy to pick up where we left off. Massive Ox. Still, we got a couple times in there. Larry Rowe, Desert Dean. There we go. And we left off with Jim Robitaille. Kevin the Edcanny One is here, a.k.a. Kevin Head and Shoulders. Extra coffee today for sure, Jim. I mean, what a wild morning so far. We'll talk IBM in just a moment. Marlee Chunger is the long-lost cousin of Boren Wuffet, as a matter of fact. Nate Dalton. Good morning. Disciplinoid. Corey. Renee F. Leo from Brooklyn. Who else? C. Black. A bunch. Doom Bunny. We have Alleyway Academic. Flip is in the building. Flip in Ohio, that is. Who else? C. Link. Good morning. Swing Long Sean. What's happening? Mr. Black Thought. We've got Jeffrey Green. Kent Hughes. We do have about 8.05 on the calendar. Or on the clock, I should say. So let's see if we can't find the mystery message and then keep going. Mighty Mouse. Good morning. Mark C. Devin. Knowles. Jeremy D. Good morning. Who else? Yes. Siree. Rod. XOXOXO Gaming. That's three X's, three O's. Don't you forget it. AR. Bone Crusher. PJ. Good morning. Gregory. How are you, Renegade 600? And there it is. American Psycho. Tippity top of the morning to you. We've got registered, cricketed, and copywritten. Happy National. Be nice to Bugs Day. Don't squish that spider. Don't smack that mosquito. Let them live. Good morning. All right. We end on that note and we get the job done by jumping into the economic calendar. What a wild day we have on our hands so far. And it's not even 806. I should say it is 806. Let's get the job done. As we can see here, let me give this a refresh because apparently this doesn't like to refresh in the mornings. There we go. We get the ADP non-farm employment change number coming out at the 815 time frame. We'll watch out for that. We'll see what happens there. And beyond that, it, of course, is the main event of today's session, the CPI. Consumer price index coming out at 830. We've got the month-over-month, year-over-year on the core and the non-core month-over-month, year-over-year. It's going to be a big tell. Now, the base assumption here is simply going to be that we do have a pretty simple matrix in the sense that a colder, so let's say cool, colder than expected print is probably going to send the market slightly higher. Not big, but slightly higher. Inline is going to send the market sideways to down, in my estimation. And then a hot print is absolutely going to send, I would think, the market lower. So that's the base case in terms of outcomes here. And then we kind of just manage against that as a base case, right? Pretty straightforward stuff. The market needs to see some cooling and easing of inflation if we're going to get lower interest rates on the 10-year, which would allow some reprieve for the risk assets, allowing the market to rip. If we don't have that, you know, we're probably remaining higher with rates. And that, of course, is a headwind to risk assets, high beta tech, so on and so forth, right? So that's what we've got across the board on that one. I didn't see it, Mr. G, but if you can send it again with the, just send the emojis in here, I can get the morning goodies from the like desk. I did not catch it this morning. Maybe YouTube sort of blocked it out, but I did not see the complimentary item at the like desk today. Anyway, we'll keep an eye out in the chat for now. As we move forward, we do have at the 10 o'clock time frame Warsh testifying. That's the semi-annual monetary policy review in front of Congress. So what is it? The House Financial Services Committee. There you go. So we'll watch to see the political theater. If you're really interested, you could pay attention. It might just be important because it's the first time that Warsh testifies and gives us, or it's not the first time he testifies, but it's the first time he's doing this review. And maybe he leads on a little bit further as to what these task forces are ultimately going to do. It would be quite comical if he, in the testimony says, I can't let you know what we're going to go, or I can't let you know any forward-looking statements. We're just going to continue to let the task forces light the way. It'd be very, very funny if he kind of just said, you know, we're not going to offer forward guidance. We're not really going to tell you what we're doing. We're just, just understand we've got some task forces on it. That'd be pretty comical in my view. Anyways, what else is going on here? Some Fed speak as we move into the afternoon. That's fine. And then on Wednesday, PPI always follows up the CPI report. That's fine as well. Day two of testimony, market probably cares less. Cook speaks, interesting. Beige book, interesting. Thursday, retail sales, jobless claims, the usual stuff. Schmid, Logan, in the afternoon, don't care. Really don't care. Oh, my computer's getting a little toasty this morning. Why are we getting toasty here on the computer? Is this on or off? Let me double check something. [00:12:15] Speaker 3: On or off? Needs to be cranked up. [00:12:27] Speaker 1: Okay. Double checking and turning up setting of the fan. There we go. [00:12:35] Speaker 2: All right. Thanks for bearing with me. Just making sure we can get that done. That way the computer doesn't turn on rocket mode and float away. Anyways, what else is going on over here? We just went through the economic calendar. We know that there is more to come on that Friday session, the 10 o'clock time frame. Preliminary consumer sentiment and inflation expectations, University of Michigan. The usual stuff. Brand neutral French fries from Mr. G at the like desk this morning. Coffee and fries. I like it. I like it a lot. I wouldn't mind some fresh off the press, fresh out of the basket French fries. Sure. Fire it up. Some carbs. Get the brain firing on all cylinders this morning. I love it. So grab yourself some French fries at the like desk if you haven't done so already. Let's grab a sip and then let's move forward into the remainder of the fundamental look. At least ahead of CPI. We will have an interesting sort of outline here in just a few minutes. So let's go on over the FedWatch tool. Let me give this a refresh because it looks like the desk did not refresh this before the stream. There you go. So just higher for longer. Ouch. Ouch. And ouch over here. Even bumping that up to a secondary hike in December of 2026. Ouch. Ouch. Ouch. Ouch. The market is not liking what it's seeing as it relates to the escalations on crude oil. The sort of rally that we've seen over there. Ten year rates. TNX, as we know, continue to move in the upward direction. The dollar continues to move in the upward direction. So really pricing in that Kevin Warsh is going to have to be a little bit of a hawk first before he can be more of a dove like he was appointed to be. Let's move forward. Earnings calendar here is pretty straightforward. A lot of the banks gapping down this morning in the pre-market category. Citi, Goldman Sachs, JP Morgan, Bank of America, Wells Fargo. Then after the close today, we do have AEHR test systems. That should be the only interesting one as it relates to semiconductors. Before the open on Wednesday, big deal, ASML. That will give us a little bit of insight as to whether or not the AI trade is continuing to move swimmingly or if there are problems and hiccups. So ASML is a big watch on Wednesday morning and we'll see if they can undo the damage that IBM, the international business machine, just did to the market. Really, really rough stuff there on IBM. We'll take a look at that in just a moment. Other notable earnings names, of course, watch your Morgan Stanley over here, watch some of your other banks. But primarily after that, it's going to be UNH. It's going to be TSM and Netflix. TSM and Netflix will be the next big ones that really move the market as it relates to where we're headed with the technology trade. So that's what I've got for you on this front. Let's jump on over to the top line figures courtesy of CNBC. What do we see? We've got ourselves the Dow futures down about 61 basis points. S&P futures down 14 basis points. The NASDAQ futures up 45 basis points. Is that still true? Give us a refresh over on CNBC. Yeah, I suppose it is still true. NASDAQ, even with IBM, is staying strong enough based on the premise of memory names. So MEM, as well as just say SMH or semiconductors. Those names are still holding up well enough in the sense that the NASDAQ is not plummeting with IBM. Oil futures are up this time more substantially. They did rally more meaningfully yesterday. You could see in the pre-market up 2.06% rather, and up around that $80 a barrel mark. Remember, it was pretty contained yesterday pre-market at 73, or I think it was like 72.90s. Now we're currently at 79.75. That is no bueno on the oil front. Once again, it makes sense why bumping back over here, we have higher for longer across the board. The market's starting to sniff out a little bit of an oil slash energy shock 2.0. Energy shock 2.0. There we go. All right. Let's move forward to the, oops, there we go. The big headlines this morning. We have Citigroup earnings cap. Citigroup's earnings cap a busy morning for major US banks. There we go. What a terrible grammar read through on my part. Dow futures dropped 300 points on IBM earnings warning. Yeah, it was a preliminary issued statement. IBM is not supposed to release earnings for another week or two or so. So pretty interesting that they are coming out and trying to give the market the bad news as soon as possible, front running the actual release date. Warren Buffett excludes Gates Foundation from his annual donations, Berkshire stock. There you go. Interesting. We have IBM shares skid more than 20%. Skid is a kind word here. Who wrote this article? Who wrote this article? Yun Lee, please reevaluate the term skid. Skid is just kind of like, oh, little hiccup. IBM is straight down, straight down this morning. They have a price chart in here. They don't. Anyway, that's a, it's a gnarly look, right? And what did they do? They basically warned that second quarter earnings fell short of expectations. Revenue missed in a big sense. And the commentary from the CEO, CFO, this is just called the C-suite. It was, it was not compelling at all. They literally said like, oh, we really faltered last quarter and are really way off expectations. It's, it's horrible. It is horrible. So straight down over on IBM. Okay, here we go. Uh, global shipping industry sounds the alarm over Trump's Hormuz toll plan. Uh, apparently as guardians of the straight, that is the term that's been used. Uh, we're supposedly going to collect 20% now of shipping tolls. I thought we wanted free shipping through the, through the straight. Now we're going to impose the toll. So I don't know, uh, crazy, but by here we are, what else is going on? HSBC loses conviction in leading drug maker forecast, tough path ahead from AstraZeneca. They missed a study the other day or some milestone the other day as well. We saw that. TikTok policy chief defends safety measures amid the EU push to limit children's social media access. It's probably a good thing. Keep kids off. TikTok. It's just brain rot. What else? JP Morgan, Chase Bank of America, IBM, Apple, biggest movers, pre-market earnings, IBM earnings, prelim and Apple, I believe gets a downgrade this morning. Uh, inflation reports expected to show improvement with a caveat as war sheds to Capitol Hill. No problems there. Taiwan's second largest chip maker starts a mass production plant in Singapore. City sees an improving outlook. Who is this? UMC? UMC. What is UMC? Hmm. Stock is down on Taiwan trade. You can see that here. United Microelectronics Corporation. UMC. Is that tradable on U.S. exchanges? Is that the same UMC I'm thinking of? Maybe, maybe not. Anyway, uh, moving forward. French underwear brand is taking on fast fashion with an IPO. You could buy underwear. Might be more compelling than buying IBM, I suppose. What else? Biggest spenders in the World Cup. Business declares war on the Pentagon. Stock buyback. Uh, SpaceX shares are struggling. Evercore ISI still says it's too compelling to ignore. Well, please just wait for a good technical buy setup there. Evercore ISI. Hopefully we have some technicians on the trade desk there. My God. Uh, breaking the IPO opening print. It's horrible. Retail trader bottleneck bros eyeing AI supply chain. Can't wait for SK Hynix options. Okay. SK Hynix traded, I think, slightly lower yesterday. Is it lower or higher? It's gapping up this morning, though. It's gapping up this morning. Pavlovian trades. I think Kramer literally was advocating for IBM Long yesterday. Keeping an eye on the clock. We do have 8.16 on the clock. And remember, we have CPI. CPI. There we go. CPI coming out at the 8.30 timeframe. So we'll keep an open mind to what CPI gives us in just a bit. Nobody underwrote for that. Private credits. Uh, her moves tolls. We know that South Carolina. So technically some political stuff, toxic stew drags lower. The AI trade can't get back on track. Um, what else? Stock specific stuff. Anything down here? No, nothing down here that's stock specific. So we just focus on IBM. There's a couple of other catalysts that are moving the market this morning. New York state, uh, is imposing a moratorium on data centers. They're pausing permits for a one year period and going to require a few other, uh, you know, just like more paperwork, basically. Uh, if you want to get that going on. So your data center names not doing so well, but also on the flip side of that same coin, CLSK, uh, just penned a 20 year deal, uh, which has the stock flying in the pre-market. And of course that's trickling over to your NBIS, your IREN, uh, not so much Oracle. Oracle is just straight down on the heels of IBM. So that's kind of a broader overview of what's going on outside of the IBM trade there. So I say we, uh, take, it's not really advantage. There's not much of a time head start here, but let's just jump on into some brief overview analysis. As we anticipate slash await the CPI print. When the CPI numbers do come out, we will take a look through the detailed report and we'll figure out where exactly, uh, things are hot or not. Let's just open that up and we'll have the latest release open in another tab. So 830, that gives us about 12 minutes, 11 minutes to go tour through some other stuff. Grab yourself a sip of tea, coffee, water, whatever it is that you've got going on at the desk this morning. And, uh, we'll meet you back over at the screens in just a moment here to take a quick tour. All right. So sipping home, as we used to say, I know we've been sort of up down all over the place with the coffees of this morning. I, I, there's some really nice things about having a European time zone morning routine. You know, I can, I can go about my morning, have a little bit of a relaxed start to the day. Uh, but there's definitely some things I miss about being in the East coast time zone where it's just kind of like, you wake up, you make your coffee, you're locked in, you're starting your research. It's not like you've done 10 things already this morning. Uh, and just now you're sitting down to trade. So let's take a sip of this water. We'll take a quick tour through some of the overview things and, uh, then we'll go from there. Ah, okay. So ES futures headed into today's session. Let's just go ahead and give ourselves a brief overview of where we're at. Let's actually bump this up to the, let's go to the hourly chart. Nice little happy medium here ahead of CPI. So honestly, all the market's really done is produced a look above and fail, right? On the ES futures chart, we have ourselves a, and I mean, pattern traders rejoice. There you go. Left, head, right. Uh, you've got yourself a head and shoulders, right? Look above and fail. And technically speaking, this is still the highest high of the trend count. And there is still an opportunity for a higher low. And I would maintain the stance, just like we talked about yesterday that ideally the higher low is, uh, the higher low would be kind of right in this neighborhood, literally where we bottomed in the overnight trade. So that is, um, pretty much, uh, that's pretty much it. Like, you know, can we get something that gives us a higher low there? And do we sustain price action in the upper 50% of this balance range? And if we do, then guess what? Fine. I would think the odds are back on for some kind of an equal high test up here and a breakout continues and the market tries to remain constructive. Remember S and P 500 is going to be a little bit more resilient because it has rotation, right? Rotation keeps things afloat. That is what we're looking at in the S and P 500 specifically. So again, on the hourly chart here, I just want to be very clear as we take a 90,000 foot view ahead of CPI, uh, we've just got ourselves the midpoint of the balance range, but the ideal location for a higher low. If the market is going to remain constructive, you have to hold here today. That's in the neighborhood of staying over the overnight low. Let's just call that the gap high level at 7526 have to stay above that on today's session. Ideally you would just sort of like, maybe it's a slight gap down that looks below and fails previous days low. And we're back inside the prior days range. And then the next thing, you know, we have a potential, you know, tradable higher low, and we're looking at risk and reward back into these highs and ballooning runners into the high from Friday, right? That would be the compelling story for the bulls. The compelling story for the bears is you rally, you reject, you come down here and you break to an equal low. So instead of higher low HL, we would of course say that this would be an equal low. There we go. And, uh, that is not what we want to see for a developing uptrend. Now, would I be a mega bear there? Probably not because we are technically pulling in from the highest high, right? So this, this would give us a little bit more of a neutral, uh, approach to the higher timeframe trend count. All right. That is what we've got on this one. Let's go ahead and clear that up and let's take a peek over at, uh, the NQ real quick. Still on the hourly chart here. And we still have about eight minutes to go, eight minutes to go until CPI. Just keep that in the back of your brain. So what's going on here? I mean, generally, this is the junk drawer on the NASDAQ. We are still in the thick of it and we're in the midpoint yesterday. Uh, if we were going to remain constructive after the Friday, sort of higher low in the neighborhood of, you know, prior structure, previous resistance, previous resistance, resistance, tried to act supportive. If we're going to remain constructive there, we basically needed a look below and fail, as we talked about in the pre-market session, then some sort of consolidation to remain inside of Friday's range. And that's of course not what actually shaped up. Instead, we just have a break of a previous bar low settled lower. And now we're getting a V shape here, but is there not just an opportunity for a little bit of a lower high? Of course there is. So a rally rejection of previous days, high a rally rejection of roughly this, uh, you know, we've been using like six 75 in here, uh, rejection of this zone keeps the pressure on just in the sense that lower highs are stacking and you're not really resolving the trend. And instead you're just in the junk drawer, right? So it's not like we have a, Oh my God, Armageddon downtrend on the market. I mean, everybody can see in the NASDAQ, right? The potential where this nasty head and shoulders and, you know, the oopsie daisies is probably, you know, should we get through CPI? Should we actually resolve the straight of her moves toll thing? If we can actually put the earning season in the rear view mirror with ASML and TSMC, let's say TSM this week reporting decent enough numbers. If we can put that in the rear view mirror, does the market start to get a little bit more optimistic about the AI trade? We've priced in some of the hiccups. Remember markets don't move in a straight line. Uh, it's just, let's get crazy. I know we don't really, the weekly chart's not going to help us make decisions for the intraday right here, right now, but is this not still just a high tight flag? HTF, not high timeframe, but high tight flag question mark. I would say services. Yes, right. We can go sideways here and continue to build it out. That's fine. Oops. Undercut the bottom end of the flag, rotate back into the range, right? That's okay. That is okay for the nasty NASDAQ. So that's just a reminder of the higher timeframe overview again for the intraday, the here and now. I mean, if we're trading this thing actively, this is just the junk drawer and we're just kind of noodling around in the junk drawer, right? We're just like bouncing off of range low back to the midpoint. Do we rally and fade off of range high? Maybe. Do we go back down to the lows, overshoot and come back in back to the midpoint? Maybe. All right. So just keeping a very open mind here at the middle of the range. And again, this is ahead of CPI, which is now coming to us in about five and a half minutes, five and a half minutes to go until CPI inflation numbers are out. And hopefully a little bit of luck, we'd get a gap, show us a gap that's tradable. So show us some early morning trade rather than just noise and sideways, get us out of these summer doldrums, get this market trending a little bit. That would be much more exciting. And we'll see if we can't get the job done there. Okay. So that is the NQ. Let's jump on over to the rusty Russell, which of course tells us a bit more about the sensitivity to rates over here in small caps. And you can just kind of see how the market did yesterday fade off of the inflection point we had talked about. Remember, 29.90s has been a big, oops, that's a nine. 29.90s has been a big spot for this market. And if we're underneath 29.90s, you know, it's not like end of days, but it is a little bit more of a headwind. And then end of days happens underneath 29.60s, roughly. I think we've been using 29. You know, if you were here yesterday, 29.55 was the number that we've been referencing the last couple of weeks. You lose the 50 SMA and like, I don't want to say all hell breaks loose, but you're probably talking about another, you know, a hundred points potentially lower into this support on the rusty Russell futures. So that would be, if what that would be, if we get a hot CPI report and if the 10 year, let's just jump on over the 10 year interest rate, the 10 year interest rate continues to break out over 4.5. I mean, we're well above 4.5 just from this perspective, right? Here's 4.5, but let's just use the market structure. You know, is this Kevin, where's Kevin? Is this the inverted head and shoulders? Is this, you know, measured move going to step up and bring us back to this hot? on rates around like 4.675. If that's the case on 10 year rates, then obviously your NASDAQ needs to be repriced a little bit, right? So that is, uh, that is what we've got on that one. That is what we've got on that one. All right. So that's the 10 year. That's the small caps. Just as a brief overview, um, you know, for the fancy folk out there, let's use the notes. You can see that notes are being sold, uh, and a break through these lows, you know, probably opens the door for higher on rates. I'd be interested in maybe let's just, uh, TLT. Yeah. I'd be interested in a TLT gap down over here. If the TLT can gap into like 83, 82, 90s, 82, uh, 80s or something, I'd be interested in selling puts on the TLT. Uh, if we can get down towards that level, just as a, as an idea to keep in the back pocket, as a matter of fact, let me just, uh, what do I want to do here? I want to go over to this pre-market side. There we go. TLT. And I just want to set an alert down here. Set alert at or below 82, 93. Fine. Bring it up a little bit, just north of 83. Good. Uh, if that alert goes off, I'd like to know, and we will find out as we get CPI, which is coming to us in about two and a half minutes, two and a half minutes to go until the chefs release the numbers. Let's go over here to the core list. Let's reset this back to that. There we go. And, um, what else can we maybe talk about? Dow futures, any Dow traders out there? Any old man Dow traders? Dow 50K. We're above 50K. Um, you can see that the Dow has been hanging in there a little bit better. Some of your construction stocks like Caterpillar honestly continue to look pretty good. Look at the pre-market session here. Nice lift on that. If we go look through some of the high beta stuff though, DRA M, uh, memory names continue to be bid here off of this 57 level, which is just very simply put an obvious support point, right? Previous resistance turns to new support. It's being bid off of that in the pre-market. I would also say, uh, let's take away EWY. We're just kind of touring around the market right now, getting a sense for what's going on ahead of CPI. We'll jump on over the ES futures or, uh, maybe the NQ futures on a five minute chart in just a second. Here's the EWY, which of course is the Korean markets. So as of right now, what is this doing? I mean, it just made a big pre-market low. Uh, you had sort of nasty bars. I can't pull it up here. There's not a good solution on thinkorswim to look at like the Samsungs and the SK Hynix's that are trading on the Korean markets. You could just look at the new, uh, SKHY. This is not representative of what I'm trying to illustrate. Um, last night on the COSPI, you basically had big down bar look below and fail, and they printed hammers over on the COSPI, something that looks like this. So if you're kind of going to get higher out of that from an, even just an oversold bounce perspective, and we do have about 60 seconds to go. So let's just jump on into our NQ futures. Okay. So we're looking at NQ futures on a five minute chart. This is NQ five minute. Okay. Uh, so we'll see what the inflation report brings us coming out in about 30 seconds, 30 seconds to go. But the point of the exercise was to say that the South Korean markets are getting a little bit of a countertrend bounce. Uh, it's not to say that it's going to sustain that thing is, you know, certainly propped up by very, very thin structure underneath it. Um, but memory names are bouncing a little bit. Pre-market seems to be slightly more risk on it's why your NQ is holding up just fine, even in the face of higher crude oil, right? [00:32:48] Speaker 3: All right, here we go. Five seconds, five seconds to CPI. Let's see what we get. [00:33:00] Speaker 2: CPI is out. Markets are higher to start. Uh, of course, thinkorswim likes to lock up whenever the bid ask gets a little bit too thin, um, higher to start gapping up. I would expect, we'll give it, you know, 120 seconds as we typically do. We'll give them 120 seconds. Um, but let's see if we can't get, uh, a read here based on price action alone. I would imagine that we're doing, uh, better than expected on CPI as crude oil came down. But remember, we do have the, uh, we do have the re-ignition, if you will, of crude oil higher. So let's see. And all like, don't forget too, there's going to be basing effects there for sure. So I think the market might be getting a little ahead of its skis here on the gap up. Uh, just noting that we have basing effects in force. JC, our senior news correspondent has us covered in the chat. US CPI month over month, actual negative 0.4 forecast was for negative 0.1. Um, the core year over year actual comes in at a 2.6 forecast, 2.8 beat there. And the, what else? Non core year over year actual 3.5 forecast, 3.8. So a nice beat across the board. Nice beat across the board. What's up, Oracle of Seattle. Nice to see you. [00:34:22] Speaker 3: Hopefully you're doing well. [00:34:29] Speaker 2: So nice move higher here. Nice push to the upside. I mean, don't get me wrong. I think this is, uh, this is, um, a great sort of bullish look for the NQ here. Uh, it's just a matter of, does it stick? Um, I don't want to be more contrarian than the market tells me to be. Uh, we are still in the range. Ultimately, the only thing I'm keeping in the back of my brain is that is the market a little bit too excited on this beat. If we're going to get crude oil prices that are just ratcheting straight back up, you know, again, it's like, I don't know, this is a pretty solid beat. It does tell us that inflation is moving in the right direction versus the energy shock. So let's go take a look at the detailed report here on, uh, CPI, but for now, really nice response out of the NQ futures pushing up and out over previous day high, we are ultimately getting a gap up, which is fantastic. And, uh, we will go ahead and continue along. Nico says, video gamer, Matt only responds to me when I call him a video gamer. What did I miss? What did I miss in the chat? Anyways, let me clear this up. Let's jump back on over to the screens here for a second. I just want to buzz through the report and see ultimately where the inflation was. Uh, so let's go ahead and click into this. Where is my latest release? Here we go. And let's go to the detailed report down here towards the bottom. Sorry for the scroll. It's like a wall of text going by detailed expenditure category, table number two. All right. So remember and reminder that the column we care about is this one over here. This is the month over month. And if you want the year over year, if you're looking for year over year, you're looking for this right here. Okay. So the two columns we care about left side, right after the relative importance number, and then all the way to the far right hand side, let's see what we got going on here. I wish I could get rid of this little chat bubble or push it over [00:36:18] Speaker 3: somehow. I make it really big. Okay. We don't need it that big. That's better though. Will it stick at the [00:36:27] Speaker 2: bottom? Yes, it will. Okay. That's good. Food on par, on par. That looks fine. Any outliers? We're looking for big outliers here. Rice pasta, cornmeal inflating. Okay. Uh, but fresh biscuits, rolls, and muffins deflating. Fine. Uh, looks like fresh sweet rolls, coffee cakes, and donuts are getting more expensive. I did feel that when I bought the coffee and donuts for the crew up here in the office this morning. So, uh, you know, tip your server basically is what I'm saying. What else is going on here? Meat, poultry, fish, and eggs kind of on par with an okay, more stable read. It's not like a big 1.3 and then minus 2.6 or up, you know, whatever. So stabilizing on meat and poultry is there looking for any big outliers here, big outliers, you know, two pre. Oh, okay. There you go. Comforters up 6.7%. Disgusting. Uh, very, very pricey to get a frank. Eggs re-inflating here at a pace that I'm sure the, well, the administration is going to focus on this number. Look, eggs are down 27% year over year. Incredible. Um, eggs are always just a comical one. It seems fresh whole milk inflating up 3.3% month over month. We've got citrus fruits up 3.4%. Big down inflation. So deflation on tomatoes. That's good. I do enjoy a good tomato. What else is going on here as an outlier? A lot of two handles over here. That's on beverage materials, including coffee and tea. My coffee is getting cheaper. I love it. I absolutely love it. So again, maybe, uh, keep a dime for yourself there as, uh, pay a little bit more for donuts, but a little bit less for coffee. It evens out, right? What else? We're still on foods. It's fun to look at foods, salad dressings up. It looks like, um, but really it's services and housing that matters the most other condiments down. So ketchup, we don't talk about ketchup around here. It's a child's condiment. What else is going on? Energy deflation. That makes sense. Again, month over month, not a shocker to see this down 5.7% as crude oil came basically straight down energy commodities leading the charge there. Uh, what else is happening? Gasoline again, not really a shocker on this front, all items, less food and energy. Here we go. This is the core part of the print. You get window coverings inflating a bit. What else do we have in the neighborhood of inflation? Outdoor equipment coming down just a touch. What else? Looking for big outliers, women's outerwear down. What else? Uh, jewelry and watches down 5.2%. Good time to go buy a Rolex. Apparently, uh, what else is going on? Stock specific stuff. Oof. Other video equipment up 7.7%. Interesting. Other video equipment. I wonder what, uh, is exactly in that category, but that's pretty tough. You don't need to buy that every day though. So I think that's fine for now. Photographic equipment's down. Recreational books are down. So it's cheap to go read something, go read a book. What else? Toys up a little bit. Okay. Get me into, uh, services. Beers are just on par. Nothing crazy on beers. Uh, cigarettes down. Cheaper to go smoke, I guess. What else is going on here? Here we go. This is the print I'm looking for. This is what matters. This is actually really, really healthy. Uh, your shelter just as a, look at this trend in shelter over the last three months, right? This is actually really, really solid. This is going to help because shelter's a huge, I mean, look at this, look at the relative importance for the CPI number. 35%, a third of CPI is shelter, which like rightfully so everybody's got to pay their mortgage. Everybody's got to pay, um, you know, for their rent. Everybody's got to pay for these things. And, and it's a pretty, you know, common, um, what do you say? It's, it's like, it's a regular expense. So to see that coming down is actually really, really constructive for the inflation narrative. Um, and you know, I think it's going to allow the fed or, you know, from my perspective where I sit and who am I, I'm just a guy, but you know, maybe Kevin Warsh is going to look at the same thing. And maybe, uh, if he's, you know, a big brainiac, then he's going to say, well, you know, shelter's acting as an anchor here. You know, this is still a little bit hot on the year over year. Trust me, I could see this number. That's not really what we want to see on shelter. We'd like to see that with a two handle, but this is a really constructive move from what looked to be a reignition of shelter inflation coming back down and stabilizing, right? Especially like, you know, coming out of spring and summer months, maybe you're not having as many home sales. So we'll see what happens in the fall there. There's some seasonality to shelter. Uh, but for now it's, it's pretty solid, pretty solid there on the shelter front. Again, remembering how important this is for the market as a whole lodging away from homes, actually getting cheaper as well. It looks like owner's equivalent rent on the month over month, really stable here, as opposed to some big outlier ups and downs. Um, insurance. I mean, I would prefer my insurance bill was only up 0.2%. Um, so anyway, moving along, what else is going on here towards the bottom medical care services, deflating just a touch, uh, still a little hot on the year over years. And what else? Hospital services look for professional services, transportation services down month over month. That's good to see alongside energy coming down, uh, meaning they're not going to pass that along and you're not going to see it back into food and other items, goods, basically. Uh, where's professional services, airline fares, fine, not really inflating big time. Um, not recreation. I want professional services. Is that down here somewhere? Education and communication, postage, telephone, personal services. Here we go. Legal, business, financial services. This stuff is what I care about right over here. Um, you could see this like financial services, you know, a quarter of a percent of the read there. Uh, but generally what do we have deflating after some massive inflation through tax season? It looked like are on the heels of tax season. So interesting there to see that coming down. Finally. Um, I generally still prices are up on financial services, which is interesting. All right. That is really what I cared about. Uh, here's your taxes, right? That's, that's what we were talking about. Huge. Um, so that's it. That's kind of look through the CPI report. I think that the shelter print is really, really compelling here. Uh, just to scroll back up and point it out one more time. Yes. It's fun to look at food and items and all that stuff, but this shelter number right here, really, really solid string of three months showing us some deflation, uh, or disinflation. It's not deflation. It's disinflation on the shelter side. So really liking that. Thank you, shelter. And, uh, with that being said, I think it's time we get back to what we do best, which of course is looking at the charts. I do like to put my macro hat on for just a little bit, but only just for a little bit, not too, too long. So let's do what we do best charts back to the ES futures. Let's go from the top down perspective. We'll do the full deal with our morning lineup. I'll see you at the screens in just a second, grab a sip of tea, coffee, water, whatever it is that you're rocking this morning. And we'll jump back over. All right. Are we here? I think we're here. ES futures are what we want first and we will jump on into it and we'll correct their overnight highs and all that stuff as well. Let's go to the four hour chart to start. Let's see what we can't see from this perspective and then continue along from here. So welcome one. Welcome all again. Appreciate you all spending a little bit of your time here with us this morning on a beautiful Tuesday morning. Let's see what's going on from a trend perspective. Four hour chart to start. We know that this is kind of the median junk drawer, if you will, on the hourly chart. This is certainly the junk drawer. You can see on the four hour, we've got these equal lows, let's call it. So is this a double bottom? Oops. D double. Is this a double bottom question mark? Is this a potential higher low set question mark? I would still think through the funds of yes. I would answer the question of this as so far the answer is yes. And the next ideal is that the market can break and brigade bolt up and through this high, this left side peak right there to get to the all time highs up here. That is the next compelling argument for the bulls, right? For the bulls, the buyers on the four hour chart. So if you're bullish, you want to see this continue to act, you know, this is your four hour high or low. This would be something like a one hour higher low, right? And then we go from there moving in the upward direction. So I do like what I'm seeing on the four hour chart. Once again, I don't necessarily think that we want to just be chasing with both hands the CPI rally specifically, just because again, the market's like, hey, look, we beat the inflation numbers, but then we're going to turn around and say, well, crude oil is moving right back in the upward direction. You're not going to have that basing effect for the next meeting. Yes, there was disinflation, it seems from the extreme peaks back down towards the lows. And just for what it's worth, let's go to crude oil, right? Of course, you're going to experience disinflation when crude oil does this, but look at what it's doing currently, right? Crude is reclaiming the 75 handle. As of yesterday, right before this sort of pre-market rally started to really unfold, we were still in the neighborhood of being able to set some kind of a look above and fail. And this kind of runs away with it. So are we just going to have to reprice another inflation shock again because of energy? It's possible. It is certainly possible, right? We're sort of like benefiting, benefiting from the all month long downtrend in June. And so far in July, we're in an all month uptrend on crude oil. So just keep that in the back pocket here as we come over to the ES. Anyways, four hour chart analysis complete. Let's go back to the hourly chart here. Let's get the job done from the one hour perspective. And let's see what's going on from here. As we could see, this consolidation is still the junk drawer. This is what we were literally just talking about. And the main idea here is to see whether or not we can set and establish a one hour higher low. Again, I want to remain more constructive, the ES than the NQ because of the rotation narrative that we continue to talk about. That makes sense to me. And right now I think that we're doing okay. This is going to give us room basically for any sort of like look above and fail to come back in, consolidate, and then maybe we look forward to ASML and TSM earnings, see if they can't lift us up out of the pain that was IBM this morning. IBM, for anybody who missed it, this is SK Hynix, but let's go IBM. IBM is getting its butt kicked to say it kindly. This is just absolutely abysmal. They released that they are going to have a miss on earnings for the upcoming announcement over here. Massive hit to software, massive hit to basically the revenue numbers that they were looking for are not going to come in at expectations. They are going to come in underneath. So that's it on IBM. Certainly a pressure for your IGV name. Software is getting absolutely walloped here. Look at IGV. Go look at Oracle, right? This thing's getting its butt kicked as well. Look at ServiceNow getting its butt kicked. Look at Adobe, I'm sure. Lower. I mean, these are just the garbage names of tech. CRM, garbage name of tech. What else? Oh, goodness. Monday, monday.com. Probably wrecked. Down. Let's go work day. W day. Wrecked. Don't want anything to do with that. Fig. Fig Newton over here getting walloped. But Fig's been trying to remain somewhat constructive in here with weekly double bottom. And we'll see where it goes. But ultimately, Fig is not immune. And that is your IGV. Look, even Palantir, right? Even Palantir is getting its rear end handed to it over here. Palantir down. What else is garbage? Palantir garbage. And even Microsoft lower here. Garbage. This thing has just been absolutely brutal. Just some really rough looks, really, really rough looks in the IGV sector based on IBM missing. So anyway, that is what I've got for you on that front. Let's get back to where we were, which is the ES futures. Let's go down into this 15 minute chart and see what's going on from this perspective on the 15. As always, we need to ask ourselves the three and a half questions. Let's remain committed to the process. Let's see exactly what's going on here. As it relates to the three and a half questions. Number one, where are we opening relative to the previous day's range? Well, we are opening, this is the prior day's range right here. We're opening in range. So that gives us a neutral indication. We were threatening a gap down ahead of the CPI report. We've reclaimed previous days low. Obviously, we're pushing back up in the range. So neutral there. Let's go along into question number 1.5, where are we opening relative to the value area? Remember, value represents where 70% of the volume transacted yesterday as distributed from the point of control. Point of controls are like here. And you can certainly see that value was lower in the previous day's session. We're opening right at the cusp of the upper bound of value. So I would go ahead and say something like, you know, neutral technically with a small up arrow there on number 1.5. Move along into our question number two. It's going on from an overnight range perspective. Here's overnight high. Here is overnight low. Pressed into the upper third, maybe the lower bound of the upper third. So we'll go with a squiggly up arrow on question number two. It's not like we're pressing the overnight high. I think the market sort of realized what I was saying in real time there, which was just that like, you know, yeah, nice beat on CPI. Really nice to see the numbers come in lighter than expected. But what is crude oil doing right now? We're probably in store for a neutral read next month, if not just kind of a flat or small uptick to flat next month based on crude's rebound. We'll see if it sustains the month of July. I mean, we're only halfway through. So if we end up setting a lower high and then continuing lower on crude, that would be a little bit more compelling, allowing rates to come down a bit. Anyways, moving forward from number two into number three, last but not least in this morning's interrogation, what do we have as it relates to the previous day's settlement? What is the overnight inventory? Net long, net short? Well, most of the time and distance underneath, a little above, back below. And then this currently blows out anybody who was, I shouldn't say blows out, but most traders who are maybe net short through the overnight are probably no longer net short after the CPI and like scrambling to cover. So I would think if you have new money shorts, they need to be located up here. If not, these shorts are out of the market and therefore overnight inventory is, you know, probably going to skew slightly net long at this point, but not by a huge margin, probably something like 60%. No mobile abacus at the mobile command station, but let's just say 60%. Let's say NL for net long, right? 60% net long. And that's it. That's the three and a half questions as it relates to this morning's open on the ES for the CPI report. Again, like this is, this is like, I think within the realm of reasonable outcomes for the market, seeing that the ES does have a higher low technically here in the overnight against the moving average stack, right? That's pretty solid. They're 50 SMA to 20 SMA doesn't look half bad, right? Okay. It's good. And grab ourselves a sip of water, and then we will continue along into the simplified pathing. Simplified pathing is next. Ah, all right. Shall we? I think we are. Three, two, one, poof, gone. Let's jump into the simplified pathing, starting with where we think the ES can go for today's session. Like what are some base cases here? Let's remember that this is the top end of the junk drawer, just for what it's worth. And as it relates to the pathing ideas, I'm probably looking more along the lines of rallies that kind of come in, can consolidate and just kind of stay neutral. I hate that that's like a base case path, but to me it is, right? Rallies that basically do the same thing as yesterday, continue to keep the market biting its, you know, biting its tongue, not really doing much. So I would think rally rejections, you know, if you really want to, you could fade that towards previous day low and then try to find buyers down here, right? And then we just kind of have this neutral outcome on today's session. That to me is a very reasonable outlook here. If the market rips over the value area high from yesterday and can consolidate up here, keyword is like it needs to consolidate now that we've set this overnight high. You need to rally, pull back, kind of consolidate, I'd say over the overnight high. Let's see if we can't get continuation towards the next major spot, which is a 76 50s, right? 76 50s on the top side. What else is there? Opening drives to the downside. Again, it's the same thing. It's just kind of like, can we get bid back up and chop into the midpoint? How do I want to draw that? It's just kind of like like that, chop into the midpoint. I'd say problems really start to emerge if this market gets super, super weak underneath the previous day's low, right? If this market comes in here, and starts to do this, right? And shows us lower highs, yikes, that's going to be a little bit more problematic, right? That is where the problems absolutely step up. So this is kind of a look. [00:53:14] Speaker 3: So let's say, let's say this is waiting for, that looks like a six, doesn't it? Waiting. Here we go. For ASML, TSM. This is like, well, let's say this is hourly, high or low sustained. This is one hour trend reversal. [00:53:54] Speaker 2: To down. And then we target the bottom end of the balance range, or the boredom box, [00:53:58] Speaker 3: or the junk drawer, whatever you prefer. Target. Junk drawer, JD, low. [00:54:08] Speaker 2: Good. All right. That is pretty much it. That's kind of the way I would look for today's action to unfold, right? That's most of what we got going on here for the ES. Let's go ahead and hit this with some cyan crayon levels, just to put them on there. This is 76.50s up there. This overnight high level is at like 76.13, I believe. 76.13 is the CPI high there. It's technically 76.14. What is that? Let me hover my cursor. High. 76.13.75. 76.13.75. That's CPI high. This value area high level, which is kind of the top end of the junk drawer, is at that 75.90s to 7,600. So let's just use a zone there. 7,600 by about 75.93. It's value area low. Previous days low, which is the origin of the CPI print as well. It's down there at 75.50s. Let's just say this is 75.50s. Key spot, overnight low in the gap high. Yeah, [00:55:27] Speaker 3: we're going to use that. That's 75.31 by about 75.26. This is the line in sand. Bottom end of the [00:55:42] Speaker 2: junk drawer is what? Let me just see if I can't find that. Oh, gap low is up first. [00:55:51] Speaker 3: Yeah, 7,500. 7,491s. That makes sense. 7,500. Flash 74. Ooh, 74. 90s. [00:56:13] Speaker 2: All right. That is what we've got on the pathing ideas. So, I mean, this is like a very wide and sloppy range, but that's really all there is in terms of inflection points where I think that there's some edge in the market. I don't think there's much edge through the CPI rally. You have something to do at the overnight high. This checks out. Something to do here, something to do here, something to do down here, and something to do here. There's only a few points on the screen where I think you have some ability to manage risk against a tight level. If you're just in here, I think, you know, we're sloppy. We're sloppy in this lackluster print area from yesterday on the ES. All right. Let's go ahead and grab a screenshot of this just to make sure that we can preserve this in the halls of infamy for forever. Good. We've got that. And let's jam it over here into the database. [00:57:06] Speaker 3: All right. All right. Good. All set on the ES pathing. Let's go back over here. [00:57:26] Speaker 2: Yeah, I mean, they're giving some of it back. I don't know about all of it, but they're definitely giving some of the move back for sure on CPI. I think it was just too, you know, you can't, you can't look at the CPI beat and say like, wow, this is so great. And also ignore the current crude oil move that's been going on. Right. That's the problem. That is the problem. All right. Let's clear this up. Let's go look at the spider's cash ETF. We've got 854 on the clock. Let's get the job done. Three, two, one, poof. And let's see what we got going on in the spider's cash. Oof. There it is. There's a site for sore eyes. Ouch, ouch, ouch, ouch. IBM or the site, not a site for sore eyes. How about that? Let's go on over this spider's cash ETF. Let's see what's going on with the hourly chart. Let's get the job done over here. Yeah. 10 o'clock, worse testimony. We'll see if he says anything insightful or if he just points to like, oh, pay attention to the task force for that, which seemingly would be based on what he said in the past, the thing that he will say. Anyways, here we go. Spider's cash ETF. You can see where we're opening, right? This is not problematic. Let me just be, you know, it's very clear on the hourly chart for the spiders. This is fine. Opening right here is absolutely okay, right? This is not a problem. This provides you a higher low opportunity. Generally here, right? That looks good. Consolidate and go. Awesome. Equal high. Rally and go. Awesome. Equal high. If you're like, no, no, no, no, no. This is a short market's going to go down and fine. Like that's, that's okay. You can have that opinion. That's fine. This is your short, right? That right there. Consolidate here. What starts to get more gnarly? Definitely pushes in the downward direction. Where's the biggest problem underneath these lows at 739.65, right? So that is what we've got on that one. That is what we've [00:59:14] Speaker 3: got on that one. Stream stuck? Shouldn't be. Is it back? Is it back? Yes, no, maybe so. Did the stream [00:59:25] Speaker 2: get stuck? I don't know. Anyway, spiders cash ETF. That's your problem child here. If you, if you're looking for downside, this is what you're looking for. If you're looking for upside, you want to see once again, just simple higher lows, hold previous day low, which is honestly, I think a little bit more compelling of a look, 748s. 748 holds as support. 749 area, look below and fail, inverted head and shoulders and what have you in here. Consolidate and go. Fine. This is, you know, if I had to, if I had to guess, or if you were like, you can only choose a few pathing ideas to really focus on, these would be the ones. That would be what I'm looking at. That would be what I am looking at. There we go. Should the market fade off that? You know, again, I'm not going to be like so shocked and paralyzed and like, oh my God, I thought it was a long, it can't possibly be down. Like if we lose that low, then yeah, it's just not as good. Not as good. You're back inside the range on a lower high, right? So just let the levels light the way. It's really that simple. Every morning, you just let the levels light the way. You're either above, good above, right? Good above, or you're bad back below and you're even worse losing that low. That's it. That is it. So 751.75, 749, I see this as being an hourly uptrend. I see this as an hourly higher low opportunity. And for that reason, once again, if I had to focus on just a few pathing ideas, I would continue to look for the hourly higher low. I would look for digestion and then I would look for higher. If the market says, nope, you don't need to wait. Then this is the higher low. We continue here and we set the equal high, right? Those would be the primary cases that I look for. Once again, just based solely on the premise that the hourly is trying to remain constructive for a higher low over the moving average stack. Right? Okay. Spiders. Mission accomplished. Let's jump on into the nasty NASDAQ. We do have 858 on the clock. Let's get the job done. Starting on the four-hour timescale. Four-hour timescale. What do we see going on from a four-hour perspective NQ? So as bullish as that report is, as bullish and, you know, sort of like, oh, look, we're beating the numbers and we're higher, right? As nice as that is, are we doing anything here to change the four-hour trend on the NQ? The only thing you could maybe start to argue is that this is look below and fail, LBATH, as we say. This is LBATH, and this is a potential higher low, right? That's the only thing that we could sort of say here about the NQ. That's the only thing I would like to say about the NQ for what it's worth. So with that kind of understanding, well, what's, you know, what's the dominant idea? Well, you got one ingredient for a potential trend change. I'd say the next key ingredient is hourly higher lows, right? You need a one-hour higher low above, you know, the four-hour reclaim, say RC for reclaim, or you need just a higher high. You need to bring in the higher high in the trend count. Very simple stuff, right? What is, what's the trend matrix? Let's just go through it. I know it's technical analysis 101, but we'll go through it because why not? Higher highs and higher lows, uptrend on the left, lower highs and lower lows, downtrend on the right. If we're looking to put into our vocabulary, uptrend, if we want to be in this column and call this an uptrend, we need a higher high. We do not have a higher high. We have a series of lower highs. So currently we're split across the board, which means neutral, right? We do not have a dominant trend. So with that understanding, a couple of key reference points. Ideally, you'd hold higher lows here, right? Ideally, you'd set higher highs over the CPI high and break out through the gap level. It's going to be at 30,043 still, no change to that number. And this pullback zone in here is roughly around that 29,675, right? 29,675 is the number to hold, right? So let's get a little bit more granular on down to the hourly chart. Let's see what we can see from this perspective. What do we have on the one hour? Again, there's Kevin, inverted head and shoulders. Let's see if we can rock it and roll it up and over the highs of the pattern. But for now, let's just do a little bit of chart work here and bring in our overnight high to its rightful spot. There we go. And what do we have? Well, we've got a little bit more of a gap up brewing. You can see we're reclaiming the low of the Friday session as of this push. So very straightforward, like one of the pathing ideas will simply be something like that, right? If you could wash out and hold Friday's low, that's bullish looking to target the equal highs, right? That's one scenario to pay attention to. The bears would like to see that fail, lower high, undervalue area high, range rotation back down into the lows of prior day session and sort of where this noise is, right? That's what the bears want to see. So, you know, nothing to really glean too, too much from the hourly perspective, other than if you're bullish, you got to stay over this level, basically Friday's low. And if you're bearish, you'd like to see price back underneath Friday's low. So Friday's low is the name of the game on NQ. It's going over to the 15 minute chart. Let's go ahead and grab a closer look at the price action and see exactly what's going on here. Just want to make sure we could see it against Friday. There we go. The inflection point, once again, is very obvious. You've got your 29, 660 to 29, just call it, what is that? What's the low there? 650 to 700, right? Keep it very simple. It's a 50 point zone. What's 50 points between friends on the NQ? Nothing. Okay. So pull back into this zone. Let's just, well, getting ahead of myself here. I'm getting a little antsy. It's 901. Matt, chill out. We got coffee and donuts. We got coffee and donuts. Take a sip of this water. Then you'll caffeinate on market open. We'll have a bite of the donut. Chill out. Let me just deep breath for a second here. Let's just deep breath it for a second and go from there. There's Kevin, head and shoulders. Let's go ahead and take a sip of this water and then get into the three questions. Let's keep it committed to the process, right? Stay committed to the process. Nice. Okay. All right. NQ futures on the 15 minute chart, three and a half questions. We are opening technically above previous day's range. This gives us a very small gap up. Number one, GR gap rules in force. We are gapping up. Number 1.5, where are we opening versus the value area? Value area is here, pretty central in the previous day's session. We're opening above that. This is bullish, of course, but it does mean that we have bullish buffer, which is exactly aligned with the pathing we just described from the hourly chart. Let's move along to question number two. Where are we opening relative to the overnight range? Here's the high. Here is the low. Certainly pressed into the upper third. Let's give an up arrow on that. Then number three, we'll go over here. Where are we opening versus the settlement from the previous day's session? We'll put a little C there for close. How much time below? How much time below? Above, above. A lot more time and distance above. I'm going out on a limb and saying something like 87. Let's go 87% net long, which means inventory correction should be in the downward direction, which aligns with number one. Now, let's just pause for a second because gap rules tell us that we have a very specific framework to attack the session when that's the case. But do we really want to be trading gap rules here headed into the NQ open? I don't really think so. I don't think we want to be looking for a big fade against the overnight high trade back down to the previous day's high. That's not really the idea, right? That is not the main idea. Main idea would just be looking for the resolution of the previous day's high, right? Previous day's high is the thing to resolve right in here, this zone, okay? So with that kind of understanding, let's jump into our simplified pathing. Let's get into it. Here we go. Three, two, one poof, and let's take a look. Main ideas. Quick little look below, reclaim, opening, print, something here, bullish, right? This is where you want to get long, right in this little white dot. Should the market just kind of noodle around in there? Let's just say that we go lower, a little bit higher, a little bit sideways action in here. If it gets really tight, I would expect washout, then reclaim and go. That would be pretty interesting as a potential idea. Let's take that off. How do I want to draw that? How do I want to draw that one? I want to draw a tightening range first, but not so inter... Too much interference with the previous... There we go. It's just going to be a little bit wider. Okay, so you're really drawn out, snaps lower, reclaims, and then goes. That's the long. There we go. So compressed range. Maybe we even take out the cyan crayon here. Dare we do it? Whoa, whoa, whoa, whoa. Straight edge, please. Straight edge, please. There we go. So some kind of range that then breaks and then reclaims, that would be the compelling look. Obviously, if this is just a straight up down move lower... Oops, we don't want the straight edge now. There we go. If this is a down move like this, there's your value area rotation. I would want to see something that does this, and can we stay somewhat contained and at least kind of chill out ahead of TSM and ASML. We'll say waiting, just like the S&P, waiting for ASML and TSM. Okay, that goes there. If the market goes opening drive, I would expect a fade. Oops. Opening drive to here, I would expect a fade. I really hate the way that that overlaps. Let's just try this. There we go. Fade back into the previous day's high. Come on, Matt. Strong comes back in lower high. There we go. That's what I'm looking for. And then that becomes the long over here. Okay, that is the look on this front. All right, that's it. Can't go opening drive into that and sustain, I don't think. You know, I would think there's much lower odds of this if we tighten up here and then start to rally. So let's just say lower odds of that one. Problems really start to emerge breaking previous days low. You know, that's no good if this thing comes down here and it's like, okay, look at me. You know, I'm just weak and I'm ugly and I'm just like, ugh. Right. So once again, lower odds, I would think BNI, but not impossible. All right, let's hit this with some cyan crayon numbers just to get those on the screen here. This is that 30,043 spot. This futures stack of the moving averages is up here [01:09:50] Speaker 3: at 29,925. This spot down here, I would primarily use once again, a zone between 29,700. It's a nine over here. I hate that. I really, really hate that. A little bit better. 29,700 by 650. This spot I would use as 29,4. This is 29,275. All right. That's it. That's kind of what we got [01:10:38] Speaker 2: for the NQ actionable pathing ideas for today's session. Those are sort of the outcomes that I'd be looking for. Simply put. Let's grab ourselves a screenshot of this. Send it into the archives. [01:10:56] Speaker 3: And then we will continue along. Let's just snap this over here. Good. Let's say NQ pathing. [01:11:07] Speaker 2: All right. That's where that needs to be. That's where we need to be. Let's grab ourselves a sip of this water. Let's let this sip simmer simmer. Sim simmer who's got the keys to the BIMA. Haven't heard that one in a while. Uh, let's continue along. Oh boy. Okay. Let's continue into our QQQ cash ETF. QQ cash, QQ, QQ, QQ cash ETF. There we go. The Q's cash ETF. That's what we want. All right. Three, two, one, poof. Let's jump into, uh, this chart. Let's get the job done and see what we got. Uh, all right. So here is the good old range. Here is where we're opening, right? We're opening right around in here. So 722 is still the thorn in the side for the market on the Q's cash, right? 722 right here. Previous support, access resistance on the gap down from the Korea day. Like that's day one, Korea, uh, here is support tries to get above, tries to hold above fails. So on, on rally and look at the overnight high, it's right to the level. So 722 is quite obviously the must hold spot on the Q's. There is no way that you can, uh, you know, there's, there's no way that you can have too much of a bullish bias if we're sub 722, uh, which would naturally keep us underneath the 20 SMA as well on the daily. So first thoughts here are once again, if the market pulls back and can support over the 50 SMA, which is roughly like seven, 16, 15, seven, 16 flat. If we could support over seven 16, it'll be slightly higher today. Uh, but this is almost the equivalent of your value area high, right? So if the market pulls in and supports the daily 50, this would be bullish to get back here, consolidate. And then maybe we have this into the end of the week, maybe TSM earnings, maybe ASML earnings, right? If the market just brigades, brigade bolts, excuse me, over 722, a little bit more compelling on the long side, right? That would certainly help the argument for buyers. Uh, if we go look above and fail, that's where you could actively try to short that to achieve, you know, or to get involved basically on the short for the pullback to make money risk reward as follows. So I would just kind of try to keep it simple today, seven 22 and about seven 16s, right? Those two spots, 50 SMA on the queues are what you want to be watching for. You're opening here in the middle. If the market rallies and fades off the 20 SMA, you could try shorts into the previous day's high and the 50. If the market fades first and comes in lower and supports over the 50, you could try longs in seven 22. That's it. Kind of like look for the response off of either side of this. Don't have, you know, just being kind of clear about why there's a little bit more of an edge in the S and P 500. You don't have a trend here. There's no trend on the queues you have, you know, as stated, look below and fail. Maybe, maybe this is a higher low. We don't know that yet for sure. Maybe that's a higher low. Um, or you open here and you have highs, you have lower highs, right? So this is on the table. Do you have another lower high, right? LH question mark. Do we have to pull in and try for another higher low question mark at the daily 50? Right. That's the big, that's why trading this on the queues is so, you know, like it could go up. It could go down. I know nobody wants to hear that. That's like the least, um, that's the least, uh, compelling thing to say, but that's the reality of just kind of being in here. Right. [01:14:49] Speaker 3: All right. Cues done. I think we've, uh, got mission accomplished on this front. [01:14:57] Speaker 2: Oh, we got some spammer in the chat in silver book, profiter, wait and hold. Um, first of all, if you're in profit, congrats, that's a good first start. Uh, second of all, just follow your trade plan, follow your trade plan. If you don't have a trade plan, then my thoughts and opinions are as always that you shouldn't be in the trade in the first place. Anyway. Um, all right. Cues done. Let's jump on into the rusty. Right. It's nine 12. Oh my goodness. We're well behind schedule today. Look at these rusty Russell futures ripping to the top side on the better than expected inflation report, uh, fading off a considerable portion of it though. So where are we really opening, not doing anything too compelling. Let's go to the hourly chart and just kind of stay on the hourly chart for the Russell. As it relates to this one, there's your balance range. Tried to get in falling back out, still okay in here, but you lose the 50. Yikes, lose the 50 and kiss this goodbye. I think that we are in store for problems. You have a rounding top. Maybe it's a head and shoulders, Kevin, uh, maybe not, but something like that is not good, right? So primary watch today on small caps is, are we still trading north of the 50 SMA or do we start to lose it? If you want to use the idulum cash ETF, you just jump over here and you're like, okay, I could see the same thing, right? 50 SMA is not quite correlated with the same exact level, but if you start losing this head and shoulders, neckline zone at like two 92 fifties, which really isn't that far away. Uh, if you start losing that, it's a bit more problematic. So again, in here is okay and neutral. This is great. This is a headwind for markets. So use 292.50 as the big over under. I think that is the simplest way to approach and attack the small caps today, right? That is what we've got there. I think we got to give Kevin the pass, um, on the all caps. When he says, here I am. Cause that's Kevin head and shoulders. That is Kevin head and shoulders in the chat. Um, we'll see Zero what's happening. Good to see you. All right. So that's, uh, that's IWM. Let's jump on into the core list of companies. Let's quickly buzz through this stuff. Nvidia is trading higher. Um, and, uh, we'll see what we got going on here. I would love to see a pullback into, I was honestly liking it here before we got this little ratchet higher on CPI and whatnot. This is like 7:00 AM though. I was liking it for the potential of a inverted head and shoulders and, um, you know, it didn't have to be inverted head and shoulders, whatever bottoming formation here just for a daily higher low, right? It would have been real nice pulling back the previous resistance, trying it as newfound support, trying to get back higher into the 50. Looks like it's already doing it pre-market. So we'll see makes it a little bit less interesting, a little bit less interesting on my front. Uh, let's go ahead and jump into this apple and see what at feel, uh, which again, I keep saying with the wrong pronunciation apple, uh, what this starts looking like, it's probably a short, uh, looks more like a short to me. Um, big shooting star, inverted hammer, whatever you want to call it. Be my guest. Uh, you know, this kind of thing. So you're opening on a subtle gap down rallies that reject prior days. Low. I don't really love shorting through this prior chop and slop. I think Apple would be a really nice short underneath 308. Uh, but are we there? Are we setting that up? And not yet, not yet. You can see the thin structure. Like this makes me, that makes me foam at the mouth. This in here is like, you know, you're just in, in the structure. Speaking of, we will have a setup that is a nice on terms of the short side, unless something's changed in the last little bit, which very, very well possible. Uh, Microsoft is just on ice. There's nothing to do here. If you're really compelled on Microsoft, you're a buyer at three 80, not a seller looking for a stair step on the daily chart, daily higher lows. So if you want Microsoft, you're really looking for maybe look below and fail, reclaim the 20, try to get long three 80 spot. Don't hate it. Uh, but don't love it. Don't hate it, but don't love it. That's that. Um, let's keep moving. Let's jump on into Nancy and see what's going on with Amazon. It's the same old, same old. I don't want to get involved in the middle of the range. If this wants to try over two 50, then maybe it, you know, mag seven, isn't necessarily doing anything super encouraging this morning. So I do, I really want to force the issue on Amazon through two 50, not my favorite, not my favorite. Uh, so I think just letting it balance and waiting for the day when mag seven really catches the baton and starts to pick up some of that relative strength through two 50 would be interesting on Amazon. It's really setting up a nice daily pattern. If anything like on the daily chart, this is working itself into a really nice range. It's being constructive. It's being respectful, trying to set these higher lows, you know, can we do it? Maybe, you know, it's, it's, I've got an alert there for a reason. I'll watch out for it. Uh, Google is one of these names that is a bit more constructive on the short side versus your Apple. Uh, reason I like this Google, you've got yourself head and shoulders and you've got the thin structure off to the left. It's got both of the combinations. So opening on a little bit of a gap down, I'd love to see a little bit of a rally that fails against this spot. And then through the opening print, you know, shorts in their shorts and lower highs under the opening print targeting 344. So Google is definitely interesting to me here, uh, this morning, let's jump on over to this Broadcom. Um, it looks like it's already doing it pre-market, but this 20 SMA hold could have been traded as a higher low here over the 387 level, which is these prior highs. So I hate Broadcom. It's, uh, we're just one of those stocks that's annoying to trade because of the spread, especially on options, but over 387 is pretty good. Look, it's a pretty good look here. Uh, trying to get back up into that 400 spot, uh, which I mean, it's spitting distance away in the pre-market. Let's jump on over to this meta and take a look. Uh, I think you want to look for meta short, but primarily to fade back down to these 620s. Uh, if we could get down there, that is the right, you know, show me the 200 SMA, show me this gap close, show me something in that neighborhood. I don't know if I want a short meta per se. It's got this thin structure gap, but I mean, this has been huge relative strength over the last little bit. So I'm almost a bit more compelled to think like, you know, something in here is like, let it fade and then try it long instead of trying it short. So we'll see. We'll see on meta. It's going over this MU really strong stuff, pre-market gapping up out of the range, reclaiming a bunch of key levels. I personally would like to see, uh, because I've been a little, I I'm a bit timid on this MU. I'm not going to lie here. Uh, the options on it are kind of gnarly and the spread is, is wide, uh, for something that's so well traded on the underlying. I kind of wish that the, uh, options on it traded a little bit better. Just open this up. I mean, these are going to be your Wednesday expirations, but I mean, look at the spread. It's a dollar wide spread on a $10 option. You know, I don't really want to pay 10% to get in and out with market orders. So you've got to be kind of an AMD is the same way ever since it's sort of launched itself over the $300 mark. Anyways, going back to this MU, regardless of spread and execution, the idea would be if this gap up can rally into the thousand mark and then lose a thousand, I think it's kind of a fade. I think it's a fade just because, excuse me, you've got all this overhead supply. You've got longs late to the party. You never really got a capitulation low in here. This is not capitulatory. This is not like everybody puked up their longs. So I think people still want out for break even who are sort of trapped from up here. The new money longs off the 50 SMA are fine, but you know, any, anybody who's not already long, I don't know that I'm a buyer underneath 10, 13 overhead supply. So I would like to see this gap sustain rally and reject. And then maybe there's some sort of a short on MU. That's the idea on that one. Let's go to Tesla. I really liked Tesla's what's going on with the zoom, funky zoom, 919 on the clock. We're almost there. I really liked these equal lows. It looks like we're not going to be opening close enough this morning to really have them in play. But 390s look below and fail back to the 20 SMA could be interesting. So quick sweep, come back in, target the 20. That's an idea. We'll watch for it. If it just breaks below and holds below, don't love it short in the hole there. Let's jump on over to here's JP Morgan on earnings, big flash in the pan being rebid. It's not doing anything wrong though. It's still just in this balance range, which is great. And we had even talked about in the Saturday video that if this thing gapped down towards 315, that'd be a nice weekly higher low against the daily 50. It doesn't even look like we have that scenario, right? So in line with this range here, losing my voice in line with the range here is pretty good. Not bad. I can feel the voice cracks starting to come, starting to come. There we go. Let's not do too much of that. Let's try a little sip here. Let's keep the, let's keep the voice intact. Keep the voice intact. AMD, Ripper. This is, they're going for it, right? They are going for it. Premarket. It looks like it is a relative strength name. It is absolutely ripping up through those highs. So AMD looked really good in here. It still looks really good in here. There's a potential buy just straight through this level. So I'd love to see it pull back. I don't want to chase the gap up, but if this thing can pull back, set a higher low, stay above this level, even if it rallies first, then pulls back, retests, sets a higher low, and then goes, I would really like to have some AMD in the wheelhouse. And then last but not least, Intel, the dog, the dump, just nothing good over here. So much weaker, well below a 50, well below a 20. You know, as much as I want this to be the darling, you know, it's just not acting well. So yes, it's gapping up with the rest of them. Yes, it's opening here. Does it do this? Maybe. Do you get inverted head and shoulders? Maybe. It needs, it needs a lot of work. Needs a lot of work. It really, in my preference would have been, if I was going to try it again, look below and fail of 100, just the round psych number, the low end of the flag, and then higher into the midpoint. It's just not doing it yet. Not really doing it yet. And for now, I think it's just, we'll let it be. I'll let this be on the Intel. Let's jump into this IBM, which of course is interesting on the miss from earnings. I'm not doing anything with IBM this morning. I'm sure there's going to be a bunch of traders all over this thing just purely based on the amount of volume that's transacted pre-market. A lot of eyeballs, a lot of liquidity, you know, usually a recipe for the sharks to start swarming, so to speak. So the day traders will be all over this thing. And, you know, maybe there's something to do on like a look below and fail of this low. That's a possibility. Like if you're really watching IBM, do you want it back on, you know, so fail this to, I don't know, 2, 12, 15s, take it out, come back above and then start to fade the gap a little bit. That's a possibility. Usually the best thing and keep in mind earnings still upcoming. The best thing that I've found on situations like this is to give it a day, give it a day, let some structure build out. You'll have like the daily bar or whatever. And then, you know, it's good above or it's bad below, right? One or the other. So that's typically what you like to do on these. Keep in mind, if you're going to be an options player on IBM, first of all, I don't know what the liquidity profile of this thing looks like, but your implied volatility is going to be cranked to the nines. So please be careful if you're an options trader on IBM, there's probably good implied volatility to sell, if anything, right? It's not a recommendation. It's just an awareness thing. Please be aware of what your IV rank looks like on IBM. Okay. So that is that. Yes. Preliminary earnings release for IBM is the catalyst causing it to go lower. That is correct. Okay. That's all I've got for you in today's episode and installation of the pre-market prep. Have yourself a green and fantastic trading session. Shout out to the CPI for sending markets higher and preserving the hourly higher low for now. We'll see if it turns into a daily higher low, but no real updates to bring on the ES futures as we come into the final moments of the pre-market stream. It looks like we are hanging out over. If you really wanted to put this level on your screen, I wouldn't call you nuts. Previous high acting as support, you know, you could put that on there. I'll be using the CPI unaffected price and the CPI high as the major inflections for today's session outside of the key levels that we always track. So with that being said, have yourself a green and fantastic trading session. Don't do anything crazy out there. Keep your risk in check as always live to trade another day. And until next time, big shout out to the usual suspects, overthinking koala, Charlie J, Chris K, Atlanta zone, big spark. We'll see in the next one, pajama trader. We've got Marcel Fletcher, mighty mouse, sunrise and sunsets, mark C, the grateful one, Zoltan J, Paul M, Sarah A, seven sisters, Jean Jensen. Uh, who else? Teacher Russell with the breakfast buffet, C link. Um, we'd be here all day if I had to get everybody. So say something sooner, get here sooner. And as always, I will see you in the next one.