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While the S&P has started to break out from its consolidation range, my outlook for the intermediate term is for more sideways action. We are in the slow season for the stock market, so it may be tougher for the bulls or bears to take control.
One reason I'm not expecting to see a clear direction for the market anytime soon is that we are also in an election year. The 2018 mid-term elections are coming up in the United States, and I think that's going to cause significant uncertainty should the Democrats take back one or both houses of Congress.
The other big story this week is the price of WTI crude oil, which is trading around $71 per barrel at current levels. Over the longer term, I'm still expecting oil prices to decline, but geopolitics will likely drive commodity prices higher in the short term. The U.S. dollar has been on a tremendous rally for a while now, but I think it will pull back eventually.
When it does, that should also help to drive the value of oil, as well as gold and silver, higher. And we'll be positioned to profit with today's bullish trade in Goldcorp Inc. (USA) (NYSE: GG ):
Buy to open the GG Jul 14 Calls (GG180720C00014000) at $0.55 or lower.
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InvestorPlace advisor Ken Trester brings you Power Options Weekly, which delivers 5 new options trades and his latest trading advice to you each Friday. Trester has been trading options since the first exchanges opened in 1973 with a winning streak that goes back to 1984 with money-doubling average annual profits since 1990.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.