Inflation Report on Tap. Then The Fed.

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We’ve got a full slate this week, starting with this morning’s CPI report. Tomorrow we get the Fed and Powell’s afternoon press conference, retail sales are on Thursday and the December triple-witching expiration is on Friday. Other noteworthy events include the PPI report and bond auctions. 

According to Goldman Sachs its the BUYBACK BLACKOUT: 

“We are in the first week of the estimated buyback blackout period. We estimate this blackout period will run through 1/19/24. As a reminder, we estimate companies enter blackout ~4-6 weeks prior to earnings. We currently estimate ~15% of the S&P 500 is in the blackout window with ~30% in blackout by the end of the week. During the blackout period, our corp desk's executions typically decline by ~30%. On the authorization front, 2023 YTD authorizations stand at $998B, the third most active year YTD.”

Now, I don't know if the buyback/blackout period had much to do with yesterday's slower trade, but when you throw that in with all the other events this week, it makes sense. 

What I think is, “the ES is up too much to buy, but is too firm to sell.” 

With the positive shift in some of the economic reports, the ES and NQ are expecting more of the same: Better numbers and higher prices. That said, while I’m bullish, the ES has been up 6 weeks in a row. We know the ES can't keep going up without pullbacks. In fact, the small pullbacks and back-and-fill have been the hallmarks of the rally.