Prepare For The Swings

Good morning. Traders have their hands full this morning and premarket futures are significantly pointing to an nasty sell-off at the opening bell.

If earnings were going to be the upside catalyst, you certainly couldn't tell that given the disappointing news from the likes of Intel (INTC) & Yahoo (YHOO), combined with reports that we saw last week. Yet, we're still early into the earnings season and there will be plenty to offer to both the bulls and bears in the coming days. However, so far we are not off to a bullish start.

Beyond earnings, the CPI came in matching economists' expectations, oil prices continue to trade higher, and Japan's Nikkei has taken a dive due to fears surround the Livedoor raid.

Making matters even more interesting, we have a lot of data on the docket today including a Treasury International Capital flows (i.e. net foreign purchases) report out at 9AM, two members of the Fed speak today, and the Beige Book is out a 2PM. And, if option expiration week volatility is seen, we have good potential for relatively large intraday swings. I'm sure that traders (including yours truly) will be on the hunt for gap down reversal plays and will continue to take their cue from the semiconductor sector and the headlines ahead.

All in all, an interesting day is planned. Good luck out there today!