BOB LANG: Good morning, Action Alert Plus subscribers. It's Friday, November 11 Happy Veterans Day. Let's go ahead and get started with the rundown. We've got a lot to cover again today. So yesterday, we saw stocks rallying on their biggest one day move up since April, 2020. And we recently spoke about upside markers around the 3,850 to 3,900 level. Those fell by the wayside on third Thursday like a hot knife through butter with good volume trends, strong breadth, and wide sector participation.

This was an amazing day that started with the CPI number that was released premarket up 7.7% year over year, which is a little bit softer than most people were expecting. But it was the month over month number that came in much lighter than many were looking for and even the Cleveland Fed's now casting was way off on this particular one. It has everyone thinking that inflation has peaked. We're not so sure yet, though and need to see much more data before we try to guess.

Because remember, something back in the spring and the summertime, that was a failing method. People were trying to guess that we had peak inflation, the Fed was going to pivot, and it certainly couldn't have been more wrong. And people had piled up lots of losses in the summertime. Yesterday, VIX was smashed on the release of the news, which activated volatility sellers. And as Chris pointed out yesterday, there's going to be a slew of data coming out over the next 30 to 40 days before the next Fed meeting.

One of those pieces of data include the PPI, and another one is the retail sales. Both those numbers will drop next week. So Tuesday morning before the open, we'll get a read on producer prices and to see if this trend of perhaps lower than expected inflation data, which started yesterday continues. And then we'll get a read on the consumer and how they're ready to spend and set up for the winter time, for the holiday season comes in with the retail sales number.

We'll keep an eye on both these numbers and also be watching bond yields. Now, yesterday was an interesting day for bonds. It actually fixed income products across the board yields plunged and actually headed towards the Fed funds futures number, so 10 year yields ticking up today about 3.81%. Of course, Fed funds are about 3.75, so there's really a very negligible difference there between the Fed funds and the 10 year bond.

We also saw yields cross the lower end of the curve, the five year, the two year also dropped as well, too. We did see gold climb sharply yesterday. The dollar took off to the downside. We saw eurodollar futures also climbing as well, too. So it was really a shift towards lesser inflation type of expectations. And we did see some inflation expectation figures come down quite sharply towards the end of the day.

Yesterday, as far as the markets are concerned, I think it was mostly generated by an emotional response to the CPI number, which came in lower than expected. But again, remember, we saw this happen back in the summertime. Prices turned right back up, though when inflation expectations started to rise once again. So stock market prices of course into resistance level, if we do not get that relief from prices on the CPI and then, of course next week's PPI number, we're going to see stock prices come right back down again.

It doesn't take too much good news though however to get the crowd excited and putting money back to work. Remember, some people have lost a lot of money in 2022. Equities are down anywhere from 15% to 20%. Bonds are down around 13% to 14%. So even with yesterday's large surge in prices in the stock market and the fixed income market, people are still down quite a bit of money. So we still think this could be considered a bear market rally.

And remember, the bear market is not over yet. And eventually, if things don't improve, especially on the earnings front and the economic front, we're going to see this rally that happened yesterday just fizzle out.

So lastly, we'll talk about what move we did today. So we ended up exiting some Axon shares today. Axon Enterprises, which we bought back on October 5 of this year at around the price of $121, it's currently around $186, $187, so that supports about a 54% gain in just less than five weeks since we first bought the number. Of Course they had earnings out earlier this week and the stock has really been ripping to the upside.

So what we decided to do is take a little bit of money off the table here and take some profits. We reduced the holdings by a little bit, and we suggest that maybe some of our subscribers like you do the same thing. It's a prudent and smart thing to do when you have big gains like this. Take some money off the table and start looking for a place to redeploy that capital. So we're happy the gain over there, and hopefully you guys do the same as we do. So that's going to be, everyone. Have a great day. Have a great weekend, and we'll see you back on Monday.