The Week Ahead: Industry, retail and housing

This week gets back to the basics, what we make, what we buy and where we’re living as we engage in those fundamental activities of life.

The industrial production  report will be published Tuesday at 10 a.m. New York time, preceded by retail sales on Monday at 8:30 a.m.

Today’s Book

The Psychology of Investing

by John R. Nofsinger

What is the secret of successful trading? Lots of money? The best business data? The right technical trading indicators and techniques? As someone who has spent 36 years actively trading the stock and options markets, my answer would be, “None of the above”. 

All of those external tools, in my opinion, are irrelevant to successful trading. Rather, the secret of successful trading lies within. It is the mindset, the psychology, that makes the difference between success and failure in the markets. (Plus, I’d be remiss not to add, on occasion pure dumb luck.)

For insight, Nofsinger turns to the tools of experimental finance. His study of what happens in the brain as we trade can’t do much for the luck part of the equation, but he has much to say about the credits and debits that our built-in human ways of thinking bring to our trading results.

More about the book

Housing rounds out the triplicity with three reports of its own, housing starts, a leading indicator, on Wednesday at 8:30 a.m. New York time, existing home sales — the larger part of the market — on Friday at 10 a.m., and the less-watched National Association of Homebuilders housing market index on Tuesday at 1 a.m.

The Federal Open Market Committee minutes for the Sept. 26 meeting will be published on Wednesday at 2 p.m. The committee at that meeting raised the federal funds rate by 25 basis points to a target range of 2% to 2-1/4%, and also released members’ economic forecasts.

Leading indicators (in descending order of importance):

The interest rate spread between 10-year Treasuries and the federal funds rate, reported continually during market hours.

The M2 money supply, at 4:30 p.m. Thursday.

The S&P 500 index, reported continually during market hours.

Average weekly initial claims for unemployment, from the jobless claims report at 8:30 a.m. Thursday.

Building permits for new private homes from housing starts, at 8:30 a.m. Wednesday.

The leading indicators report collects the individual leading indicators into a “you are here” pointer to the U.S. economy’s location within the business cycle. It will be published at 10 a.m. Thursday.

Events arranged by day:

Monday: Retail sales and the Empire State manufacturing survey of conditions in New York, each at 8:30 a.m., and business inventories at 10 a.m.

Tuesday:  Industrial production at 9:30 a.m., the Home Builders housing market index and the jobs and labor turnover report, each at 10 a.m., and the U.S. Treasury international capital report at 4 p.m.

Wednesday: Housing starts at 8:30 a.m., petroleum inventories at 10:30 a.m. and the FOMC minutes at 2 p.m.

Thursday: Jobless claims and the Philadelphia Federal Reserve Bank business outlook survey of conditions in the mid-Atlantic region, each at 8:30 a.m., leading indicators at 10 a.m., and the Federal Reserve balance sheet and the M2 money supply, each at 4:30 p.m.

Friday: Existing home sales at 10 a.m.

I also keep an eye on the Baltic Dry Index, updated daily, and the 10-year implied inflation rate which is the difference between the yields on 10-year U.S. Treasury notes and  10-year Treasury inflation protected securities (TIPS).

By Tim Bovee, Portland, Oregon, Oct. 13, 2018


Tim Bovee, Private Trader tracks the analysis and trades of a private trader for his own accounts. Nothing in this blog constitutes a recommendation to buy or sell stocks, options or any other financial instrument. The only purpose of this blog is to provide education and entertainment.

No trader is ever 100 percent successful in his or her trades. Trading in the stock and option markets is risky and uncertain. Each trader must make trading decisions for his or her own account, and take responsibility for the consequences.

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