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A Gap Up, But at Resistance November 18, 2023

Posted by Tom in Thoughts.
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November 17, 2023 – A good week for the market, especially after Monday.  Positive economic news will do it, as folks are reacting more toward lower expected rates early next year and (most of all) lower inflation.

But . . . .

This week Walmart (the nations largest retailer) and some select Tech stocks were guiding earnings lower next quarter due to signs of slowing consumer demand.  Corporate spending is also guiding lower.

The market was helped a bunch with a lower US Dollar (bullish) and Treasury Bonds going higher (lower interest rates).

What could happen next?   Reports of “Black Friday” sales.  And that may be the most important piece of consumer data of all.  Stay tuned.

In the meantime, this market is at an important resistance level; back at the swing peak of early September of this year.  I’m slowly scaling into this market; it sure would be nice to see a break above on volume.  I think that we’ll likely get that IF the Friday sales data is positive.  We’ll see.

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The Short-Term Sector table is shown below –

Wishing all (in the US) a very Happy Thanksgiving.   ………..  Tom  …………..

At A Critical Point November 12, 2023

Posted by Tom in Thoughts.
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Nov. 10, 2023 –   Fast Thoughts:

A quick rally last week based on the expectation that interest rates won’t increase the remainer of 2023; watch how the T-Bonds and US Dollar react next week . . . they are “smarter” than the stock market.

Earnings continue to come in; notable are major retailers (Walmart and Target) this week.  Many are expecting the consumer is strong, since credit card debit is increasing significantly.

The CPI (Consumer Price Index) will be announced on Tuesday.  Expect it to show inflation is coming down.

Notice the word “expected” above.  If any of these fail to materialize, look out.  The chart below shows the S&P Futures contact to be at an important resistance level.  Low volume appears to be a possible “short covering rally” and may not last.  The big money has not bought in just yet.  Next week should be “a tell” on this market either way.

Have a good week.         ………….  Tom  …………….

Chart courtesy of Trader Guider.

At An Important Level November 3, 2023

Posted by Tom in Thoughts.
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November 3, 2023 – OK, Wednesday it all started.  No, not the FED as such (Powell holding interest rates steady was widely expected), it was Janel Yellen having an exceptionally successful T-Bond sale.  It seemed that everyone is now expecting rates to hold steady, or nearly so, and early in 2024 rates will come down.  Lower rates . . .  equals higher bond prices, and they couldn’t wait to get ‘in’ on it.  Add to the Bond prices going higher was a US Dollar going lower, making ‘things’ in the USA cheaper.   Off the market went.

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But we’re at or near an important level where in the past, things happened (blue lines).  We’re either going to Scenario ‘A’ (green) and consolidate in November before finishing the year back higher.  Or . . . Scenario ‘B’ (red) where we bounce just a little before heading back lower.  The key level to watch is a close below 13300 on the NASDAQ Composite (roughly 431 on the SPY). 

In either case, we should have to wait very long to see which way it goes.  

Have a good week.    …… Tom  …..