On Wednesday, we began to see a separation between what Chairman of the Fed Powell said on fighting inflation and the inflation indicators themselves. 

Food commodities, particularly grains, soared. Weather is the dominant factor as we head into the summer season. Happy June equinox.

Oil rallied, and we hope you read the daily yesterday on why oil could rise (and did). Hoarding is next, as is Round 2 of Inflation. Plus, the dollar is holding, but feels vulnerable. Furthermore, long bonds are holding.

Once we see the risk gauges we like to use from our Big View flip to risk off, even the Magnificent 7 will have a hard time. Meanwhile, in the search for green today on the board, besides commodities, we noticed another type of green in the green.

MSOS, the ETF for U.S. Cannabis, has been left for dead. The ETF provides exposure solely to American cannabis and hemp companies, including multi-state operators.

Interestingly, 99.64% of the basket’s holdings is the U.S. Dollar. I checked ChatGPT to find out more about that. It means that the ETF allocates a significant portion of its assets to holdings denominated in US dollars. We also learned that the ETF manager might hold US dollars as a defensive position during uncertain market conditions. Cash holdings can act as a buffer against market volatility or as a safe haven asset. This could suggest that, with the horrid performance of MSOS, should the ETF increase in price and value, the dollar holdings will lessen.

The chart shows the move above the 50-DMA (blue line). The Real Motion chart is more intriguing. Note how the momentum indicator (red dots) are above the 2 moving averages (blue and green).

The 50 (blue) DMA is about to cross over the 200 (green) DMA. The red dots are also clearing the Bollinger Band.

Talk about a short float?

We will watch next moves carefully to see if Cannabis takes flight or once again, goes up in smoke.

For more detailed trading information about our blended models, tools and trader education courses, contact Rob Quinn, our Chief Strategy Consultant, to learn more.

“I grew my money tree and so can you!” – Mish Schneider

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Follow Mish on Twitter @marketminute for stock picks and more. Follow Mish on Instagram (mishschneider) for daily morning videos. To see updated media clips, click here.

Mish in the Media

Mish and Ashley discuss buying raw materials and keeping an eye on Biotech on Fox Business’s Making Money with Charles Payne.

Ahead of the Fed’s announcement, Mish shares her take on major currency pairs, starting with EUR/USD, in this appearance on CMC Markets.

Mish joins Ash Bennington to discuss the market’s response to today’s inflation data, the AI-powered tech rally, whether we’re seeing signs of exhaustion in equities ahead of the Fed announcement on Real Vision.

Mish explains how the Russell 2000 is the canary in a coal mine on Business First AM.

Mish offers her technical forecasts for gold, EUR/USD, USD/JPY and WTI Crude Oil ahead of today’s CPI report on CMC Markets.

Mish Schneider and TG Watkins continue their chat about the business of trading in this video from StockCharts TV. Topics range from their work/home life balance, how being a consumer does or does not play into their trading decisions, and what they do in their free time to unwind.

Mish and Nicole Petallides go over rates, key sectors and the economy in this video from TD Ameritrade. They also discuss what raw materials are coming into vogue.

Mish and Jon talk about what could make markets continue or reverse and what to buy right now on BNN Bloomberg’s Opening Bell.

Mish and Charles talk inflation fears, the “wall of worry” and trading large-caps on Fox Business’ Making Money with Charles Payne.

The first 5 months of 2023 have been rallying on optimism going forward. Will that continue for the next few months? Mish digs into that question in this Twitter Spaces conversation with Wolf Financial.

Mish discusses impacts of weather, labor market and the FED on tap on Fox Business’ Coast to Coast with Neil Cavuto.

The US dollar rallied following a positive US jobs report last Friday, but could the Federal Reserve’s upcoming interest rate decision halt the greenback’s rise? Mish offers her views on USD/JPY, the S&P 500, and light crude oil futures on CMC Markets.

Mish talks GME (Gamestop) and more on Business First AM.

Where is the US economy actually heading? Rajeev Suri of Orios discusses this question and what trends suggest with Mish in this video.

Coming Up:

June 22: Forex Premarket Show with Dale Pinkert

June 23: Your Daily Five on StockCharts TV

June 26: Podcast FreeFX

June 27: The Final Bar with Dave Keller on StockCharts TV

July 6: Yahoo Finance

July 7: TD Ameritrade

ETF Summary

S&P 500 (SPY): 440 pivotal with potential reversal–has to break under 434.Russell 2000 (IWM): 180-190 stuck.Dow (DIA): 34,000 in the Dow now pivotal.Nasdaq (QQQ): 370 target hit proceeded by some selling; 360 support.Regional Banks (KRE): 41.00 area the 50-DMA.Semiconductors (SMH): 150 now major support.Transportation (IYT): 237 area the 23-month moving average.Biotechnology (IBB): 121-135 range.Retail (XRT): 62 support and, if clears back over 63, optimism returns.

Mish Schneider

MarketGauge.com

Director of Trading Research and Education