The market

The Russell 2000 (the IWM) had a very strong move up last night, up 1.37%, but the other major indexes were flat. The Nasdaq was up just a pinch at 0.13%, but the S&P 500, the industrials and the transports were all very flat last night. Gold and the bonds were down.

The SPX stayed within the 30-minute-opening highs and lows for the whole day. The Nasdaq also stayed within its 30-minute opening range for the whole day. The Russell 2000 broke above its opening high and was a great day trade. Why was the Russell 2000 so strong? Ex-FBI Director James Comey appeared before a senate committee last night and it now looks increasingly unlikely that President Trump will be impeached. That means that he might be able to implement some of his trillion-dollar infrastructure-spending promise. And which index would benefit the most from that? The Russell 2000! It has a lot of growth stocks, and moved up substantially last night. Also It appears there could be a hung parliament in Britain. So far it’s had minimal impact on the UK market, but the longer it goes on, the worse it will get.

The sectors

The financials were up strongly last night, 1.15%. Technology was up a little, 0.23%. IBB (the bio-techs) were up 0.6%, but all the other major sectors were flat to down. Banking stocks, which belong to the financial sector, did pretty well and that’s where you needed to concentrate your efforts last night. You could have done a nice trade on Goldman Sachs, which got as high as $221. The reasons financials had a good night was because the US House of Representatives got rid of the Dodd-Frank rules governing Wall Street. Trump wanted those gone.

Going forward …

Looking at the Nasdaq on a 30-minute chart, you notice a very nice squeeze. Is this about to fire to the upside? I think it could. I’ll be watching it. One way to play that would be to buy call options in QQQ. A lot of the Nasdaq stocks are looking good, including Facebook and we currently have a trade on that. Google and Amazon also look strong. The UK election is out of the way and James Comey has spoken to the senate committee. Those events are past, so will the market now move higher, particularly the Nasdaq? The Nasdaq has logged its 38th record this year, the most since 1999. We know that the 2000 tech crash followed 1999 but prior to that the Nasdaq kept moving up.

Tonight I think the Nasdaq wants to have a move up. My focus will be on the 30-minute squeeze. Tonight the elite students and I will focus on ideas within that index.