GAP AGAIN

Here we go again as the futures pop higher on better than expected inflation news. Core PPI came -.3% vs +.2%; PPI +.1% vs. +.4% consensus. The NY Empire State index came in at 10.3 vs. 14.8 consensus.

The market is focused on the inflation numbers and those were better than expected and the NAZ futures are higher by 20 and SPX higher by 9 as I type.

Buying gaps has been a lousy trade lately as just about all of them have been faded and filled. John Carter's favorite trade in his book, Mastering The Trade, is to fade the opening gaps and Tuesday's gaps have a 77% chance of being filled.

This gap puts the SPX right back at the 1280 resistance level and the NAZ at its resistance level so just keep it in mind.

My plan is to fade it but to wait until I see some kind of exhaustion and downward action before I enter.