Renewed hope about tax cuts, first thing in the morning, sent Wall Street sharply higher. Stocks on Wall Street rallied higher on Tuesday, each of the 3 major indexes recording their best gains in over a week against the backdrop of positive comments made by legislators about tax reform and the debt ceiling, which sent investor optimism soaring.

It could be that half of yesterday’s gains were founded on the speculation that the White House and Republican Party are making significant progress on tax reform legislation. Trading volumes are anemic at this time of the year, meaning that even skimpy buying has a disproportionate effect on stock movement.

House Speaker Paul Ryan told CNN that it would be easier to pass tax reform than health reform – a debacle – because of the consensus in the Republican Party. On another front, Senate Majority Leader, Mitch McConnell, told Congress that there’s “zero chance” it will fail to raise the debt ceiling in September, averting concern that the federal government could shut down or become insolvent.

Yesterday’s gains were sweeping, encompassing almost every market sector. The tech sector (XLK) led the gains, with a surge of 1.5%, recording its first day of gains after 4 consecutive losing days.

Daily Summary: The Dow Jones rose 0.9%. The S&P 500 tacked on 0.99%, the NASDAQ jumping 1.36%.

When push came to shove yesterday, 335 stocks recorded new 52-week highs, 300 falling to new yearly lows, making it the first session in 10 trading days with more stocks recording new yearly highs than lows.

Stocks on Wall Street have been doing beautifully, but some of their magical touch has been lost this month. The S&P 500 is up just about 9% on the year, though has shed 0.7% in August.

One of the stocks that stood out yesterday was Boeing (BA), which rallied 1.7% after the company was awarded an Air Force contract for its next intercontinental ballistic missile. The stock also benefitted from the gains that swept the entire security and defense industry after Pres. Trump addressed the war in Afghanistan. In his speech yesterday, Trump stated that a retreat of American forces from Afghanistan would create a vacuum that terrorists could fill instantaneously. “We cannot repeat in Afghanistan the mistake our leaders made in Iraq,” Trump said. Security and defense stocks soared after Trump’s speech, with the ETF on the sector, the ITA, surging 1.2%.

Macy’s (M) took off 4.56%, recording its best day in almost 7 months, after announcing a company reorganization and workforce cut.

DSW rocketed 17.46% higher after the footwear retailer reported a surprise rise in store chain sales.

About 5.24 billion shares changed hands on U.S. exchanges, beneath the 6.28 billion daily average over the last 20 trading days.

Wednesday: Despite the jump in stocks yesterday on the heels of optimism about tax reform, there are many pitfalls ahead, with there being no prospect for tax cuts to materialize prior to October. Yesterday’s movement attests to players being optimistic to some extent that something’s going to happen. It’s still going to be hard; the will, though, is there. Chances, though, are very low that we’ll see any semblance of tax reform be instituted already this year.

What’s next?! The good news is that the market usually does a better job of creating continuity with positive momentum on its side, as opposed to downside momentum. Strong movement, like yesterday, tends to provide a good helping of support. The apprehension about being left behind is still a powerful market driver, fueling the tendency to buy corrections.

Another important factor is the expectation that something market friendly will come out of Jackson Hole over the weekend. The market isn’t expecting anything specific but inherently, likes to be enamored with central banks, investors rejoicing when bankers wax about cutting their balance sheet and hiking rates.

It goes without saying that bears will have their eyes peeled for the next White House scandal which could pique a selloff. Everybody here knows the bit! Trump will cause another media uproar but the market will very quickly shrug it off and refocus on economic matters.

Technically, the market still faces difficulty ahead, but days like yesterday tend to wipe the slate clean. The trading environment isn’t perfect – but until now, the bulls have dug in, chances being favorable that we can still get a few days more on the upside out of them.

IndexLastDaily change
DJX21,8900.90%Up
SPX2,4530.99%Up
Nasdaq6,2971.36%Up

Wednesday’s Hot Stocks: CRM, CREE, LZB, INTU, LOW

IPOs: None

Have a great trading day!

 

Economic Calendar

 

DAYTIME (EST)EventForecastImpact
Monday8:30Chicago Fed National Activity Index0.22Medium
Tuesday9:00FHFA House Price Index0.5 %Medium
Wednesday10:00New Home Sales610KMedium
Wednesday10:30Oil Crude InventoriesLow
ThursdayJackson Hole Economic Policy SymposiumHigh
Thursday8:30Jobless Claims236 KMedium
Thursday10:00Existing Home Sales5.570 MMedium
FridayJackson Hole Economic Policy SymposiumHigh
Friday8:30Durable Goods Orders-5.7 %Medium
Friday10:00Janet Yellen SpeaksHigh

 

Earning Calendar

 

SymbolCompanyAM/PMDay
WUBA58.com Inc.AMMonday
MDTMedtronic plcAMTuesday
TOLToll Brothers, Inc.AMTuesday
MOMOMomo Inc.AMTuesday
COTYCoty Inc.AMTuesday
CREECree, Inc.PMTuesday
CRMSalesforce.com, inc.PMTuesday
INTUIntuit Inc.PMTuesday
LOWLowe’s Companies, Inc.AMWednesday
EVEaton Vance Corp.AMWednesday
WSMWilliams-Sonoma, Inc.PMWednesday
SQMSociedad Quimica y Minera de Chile S.A.PMWednesday
PVHPVH Corp.PMWednesday
HPQHP Inc.PMWednesday
TIFTiffany & Co.AMThursday
SJMThe J. M. Smucker CompanyAMThursday
DLTRDollar Tree, Inc.AMThursday
SPLSStaples, Inc.AMThursday
SIGSignet Jewelers LimitedAMThursday
GMEGameStop Corp.PMThursday
PSTGPure Storage, Inc.PMThursday
BRCDBrocade Communications Systems, Inc.PMThursday
ADSKAutodesk, Inc.PMThursday
ULTAUlta Beauty, Inc.PMThursday
VEEVVeeva Systems Inc.PMThursday
MRVLMarvell Technology Group Ltd.PMThursday
SPLKSplunk Inc.PMThursday
VMWVMware, Inc.PMThursday
AVGOBroadcom LimitedPMThursday
BIGBig Lots, Inc.AMFriday

 

Today’s Picks – Day Trading!

SymbolBreakoutBreakdownMomentumMomentum
AA40.36ATIMOMO
BMY58IONSGNC
AEP73.00AMBATHC
PYPL61.30VRTXBZUN
LUV52.97ATVIELF
 URI 
 DXC 

  

New York Strategy Swing

#DateStockLong\

Short

StatuesData CloseProfit\

Loss

114.6.2017SIGShortClose23.6.2017+2.29%
216.6.2017AABA (YHOO)LongClose26.6.2017+3.14%
321.6.2017KRShortClose27.6.2017-2.75%
429.6.2017DKSShortClose3.7.2017+1.04%
56.7.2017HAINLongClose18.7.2017+2.52%
66.7.2017DKSShortClose13.7.2017+3.96%
710.7.2017ORCLLongClose13.7.2017+1.38%
813.7.2017YUMCShortClose31.7.2017+2.12%
918.7.2017LBShortClose20.7.2017+1.34%
1020.7.2017FIVEShortClose26.7.2017+1.97%
1121.7.2017HOGShortClose27.7.2017+0.39%
122.8.2017AKAMShortClose3.8.2017-1.12%
133.8.2017NKELongClose8.8.2017+0.02%
144.8.2017SBUXShortClose16.8.2017+2.40%
158.8.2017NTAPLongClose9.8.2017-1.17%
1622.8.2017ATHMLongOpen +0.83%
17
18  

 

Today’s Picks – Swing “New-York StrategyMorning Optimism Catapults Wall Street Higher!

No.1 –   KORS

Company NameMichael Kors Holdings Limited
Entry Point42.33
Stop Area41.48
1st Target42.80
Swing Target46.26
Avg. Volume2.86M
SectorConsumer Goods | Textile – Apparel Clothing
Earning Date
Risk RateNormal
Risk\Reward Ratio4.62:1

 

No.2 – AAP

Company NameAdvance Auto Parts
Entry Point94.99
Stop Area96.80
1st Target92.80
Swing Target82.21
Avg. Volume2.31M
SectorServices | Auto Parts Stores
Earning Date
Risk Rate
Risk\Reward Ratio7.06:1