The Numbers, Mason!

No, it's not 2011 and you didn't just get home from school. You might just feel like Mason, though, if you're trying to figure out what all the data release numbers are. PPI CPI FOMC ISM Manufacturing PCE GDP there are a lot of abbreviations with numbers that go with them. Do you need to be an expert in macroeconomics to understand their impact on the markets?

It's easy to get sucked into the vortex trying to figure out where all of these news events and data releases are going to push us. You can get lost looking at consensus numbers, previous results, year-over-year numbers, data trends over the past 12-36 months, pulling up charts trying to determine what previous data did to the market. At the end of the day, none of that matters. There's a popular saying, "Show me the chart and I'll tell you the news." While that saying only kind of makes sense, the idea behind it isn't all that bad. The basic theory is that you don't need to know the news in order to know what the directional response is, you just need to know how to react to what the charts are telling you. Even economists have a hard time predicting market direction, and they devote their working lives to economic data and its impact. Don't be a hero and take a trade where you try to guess how the data is going to impact the instrument you are trading.

I know we said it in yesterday's post, but if you don't trade news well then there's no reason to trade. Know your strengths and play to those. We had PPI numbers released this morning, and despite the fact that the data says inflation is remaining persistent the reaction was to immediately recover and continue back upwards. Why bother trying to guess? We also have FOMC minutes at 2pm today, so if you don't FOMC well it's certainly a great idea to sit back and watch the fireworks.

Here are today's NQ levels:

Current Price: 15335

Upside Targets: 15405, 15463, 15507, 15545

Downside Targets: 15290, 15240, 15170, 15125

Stretch Targets: 15586, 15075