Karpel’s Corner: What is this Market’s Kryptonite? It ain’t Copper!

Welcome to Karpel’s Corner. This is where I throw out my thoughts on the markets and share some of my favorite strategies. I keep it market-focused, and never miss an opportunity to teach trading strategies and commentate on the latest trends affecting the financial markets. Hope you enjoy today’s post!

What a market! Bonds struggle. Biotechs and Drug stocks are in merger mania. The Equities continue to lift all boats, and Copper is definitely rising with it.

I talked about the metals, and Copper ($JJC) specifically. After all the data out of China, the industrial metal has broken out to the upside. The Housing data out this week did not hurt, more building only helps the case for this metal. I also mentioned miner Freeport ($FCX) has popped to the upside, +2.71% yesterday alone.

We are walking into a short day today and then will not have any trade until next week. So, adding many new positions will be very strategic. One sector that is showing some potential chinks in the armor is Retail ($XRT). We have seen that some of the discretionary names like Kors ($KORS) and Darden ($DRI) are under some pressure. For the Tradespoon Elite service traders, you will see that we put out a bearish trade on $DRI (and this was a tough one since I love Lobster Fest, unlimited bread sticks or a steak for $7.95!).

This trade could pick up momentum if we see not only weakness in the sector, but weakness in the Small Caps ($RUT). We have seen the Small cap index struggle to continue to climb to the upside yesterday, deviating from it’s larger Cap brothers $SPY and $QQQ.

While one day does not trigger a total shift in trend, this is a flag on two fronts: The consumer could be rethinking discretionary expenditures and domestic economic growth could be slowing. We need to keep an eye on this in upcoming sessions.

Speaking of which, there will be no blog until Monday after this long weekend. So, enjoy your time off and we will talk to you on Monday.

See you next time at the Corner!