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January’s PPI Inflation Data
First, I’ll be live with Kane Shieh, Nate Tucci, Alex Reid, Roger Scott, Chris Pulver and Graham Lindman for a special Inauguration Roundtable where we’ll discuss Trump’s impact on the market.
It’s going down at 3 p.m. ET tomorrow, Jan. 15, so stay tuned for a link to join!
As for today’s “Morning Monster,” Producer Price Index numbers are out in the premarket today. Are the numbers spicy or chill? I do think it is odd PPI came out before CPI, which isn't "typical" and might be indicative of a potentially bigger CPI reaction tomorrow.
Come join me as we dive in and see what’s moving!
Plus, as always, we have stocks popping and dropping so come find out what is moving this morning as I look for stocks and do some live premarket analysis on SPX, SPY, NDX, QQQ, Russell, IWM and other stocks that are potential plays for the day.
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Market Chaos Alert: How Reversed Inflation Data Could Trigger a Sell-Off
This week, the markets face an unusual setup — one that could rattle traders and send stocks spiraling lower.
The Producer Price Index (PPI) is being released before the Consumer Price Index (CPI), flipping the usual order of economic data. It’s a subtle change, but history tells us it’s often a precursor to heightened market volatility — and sometimes a deeper sell-off.
Here’s why this matters…
Typically, CPI comes out first, setting the tone for inflation expectations and giving traders a clearer picture of how the Federal Reserve might act. When PPI is released ahead of CPI, it disrupts that rhythm.
Traders must first react to producer inflation without knowing how it’ll align with consumer inflation the next day. The uncertainty this creates has historically triggered negative market reactions.
This week is packed with critical data:
| | • | | Tuesday: PPI at 8:30 a.m. ET. | | | • | | Wednesday: CPI at 8:30 a.m. ET. | | | • | | Thursday: Retail Sales at 8:30 a.m. ET. |
Three straight days of high-impact numbers have the potential to cause sharp, unpredictable moves. If PPI surprises to the upside, it could send shockwaves through the market, setting up a chain reaction as traders brace for CPI and retail sales to either confirm or conflict with the initial narrative.
Why a Sell-Off Could Be on Deck
The markets are already on shaky ground...
The S&P 500 and Nasdaq are hovering near critical support levels, and any unexpected data could be the final push lower. When the order of PPI and CPI flips, it adds confusion — and traders hate confusion.
Historically, this setup has coincided with increased volatility, often leading to a flush as uncertainty escalates.
For futures traders, this could mean higher margin requirements, as brokers anticipate sharp moves. And for investors, sectors like Consumer Discretionary (XLY) and Technology (XLK) could take the biggest hit if inflation numbers come in hot.
Watch names like Amazon (AMZN) and Tesla (TSLA), which are particularly sensitive to interest rate fears tied to inflation surprises.
If the data surprises to the downside — say, PPI or CPI comes in much hotter than expected — the sell-off could deepen.
On the flip side, a milder inflation read might provide some relief, but it’s unlikely to calm the storm completely. Retail Sales data on Thursday add another layer of complexity, especially for sectors tied to consumer spending.
This week’s reversed economic data lineup is more than a scheduling oddity — it’s a potential trigger for chaos in the markets. Traders should be prepared for heightened volatility, unexpected moves and the possibility of a deeper sell-off.
Tighten your risk management, stay nimble, and don’t get caught flat-footed.
Remember…
The market rewards preparation and punishes complacency. Be ready for anything this week, because the data will likely make or break the next move.
Today’s Daily Chart Setup: Matthews International (MATW) | | | | |
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