It was a strange week, and while it’s not the ultimate gut-check, the market pushed against a key resistance point and finally broke through on news that might have sunk it. Still, there is no runaway optimism just yet, even though the train is trying to move out of the station and begin the next big leg higher.

Growth is back but hesitant, and it’s those brick-and-mortar retailers that continue to rock.

Trends to Watch

Crude oil broke out through $67.00 and is gaining momentum. Gasoline prices are at their highest point since 2014, on the eve of the summer driving season. There are pros and cons to this - staycations are keeping money in the country. But  inflation is an issue for real people, as they start driving back to work.

Note: I said for real people, not the Fed – this is not a part of the calculus for determining policy.

Flying is gaining fast and is approaching 2019 levels.

All eyes will be on the Fed this week. Will they or won’t they mention tapering?  I say no.

Today’s Session

Looks like a tentative start to the session; although, there could be more buying in growth names out of the gate.  On that note, over the past month there has been a stealth rally in Real Estate that seems to be a bet beyond the simple reopening.  Investors are putting up big bucks that big cities come back.  (There are a bunch of niches in the sector with exposure to other areas like 5G.)

We could see a tight trading range for the market ahead of the FOMC meeting, which ends on Wednesday.  Ears are perked up for any hint at tapering.

Portfolio Approach

We are adding a new position in Industrial in our Hotline Model Portfolio this morning.