- Moving the markets
In today’s financial frolics, stocks took a joyride upwards after the Federal Reserve played it cool, keeping rates parked at a sky-high 23-year peak. Despite this, they’re eyeing a trio of rate cuts by the end of 2024’s calendar pages. The big three indexes didn’t just climb; they set new altitude records, while Small Caps had a blast, rocketing to stellar heights.
The Fed’s crystal ball still forecasts those three rate reductions, but they’re playing hard to get, wanting a peek at more signs that inflation’s taking a chill pill. Before the bigwigs met, the rumor mill churned out fears of inflation’s hot streak leading to fewer rate cuts, but the Fed’s dot plot kept the triple cut dream alive, giving traders and the market’s mood a nice boost. It seems the Fed’s not ready to sober up from the rate-cut party just yet, and for now, the market’s eating it up with a rally spoon.
Powell, the financial oracle, dropped some cryptic clues:
“We’re treading carefully; it’s a coin toss on risks.”
“No decisions today, folks. But we might ease off the money hose soon, as per the grand plan.”
Translation: It’s as clear as a foggy morning in San Francisco.
In a twist, rate-cut bets for 2024 actually went up, sending the dollar on a nosedive and giving gold a high-five with a new shiny record. Bitcoin got back in the game, bouncing over the $65k fence, and the MAG 7 strutted to a record beat, all thanks to bond yields taking a tumble. Crude oil played the rebel, dipping under $82.
Hats off to ZeroHedge for the CPI time-travel chart. So, fellow market watchers, are we strapping in for another inflation rollercoaster ride?
Continue reading…
2. Current “Buy” Cycles (effective 11/21/2023)
Our Trend Tracking Indexes (TTIs) have both crossed their trend lines with enough strength to trigger new “Buy” signals. That means, Tuesday, 11/21/2023, was the official date for these signals.
If you want to follow our strategy, you should first decide how much you want to invest based on your risk tolerance (percentage of allocation). Then, you should check my Thursday StatSheet and Saturday’s “ETFs on the Cutline” report for suitable ETFs to buy.
3. Trend Tracking Indexes (TTIs)
Before Federal Reserve Chairman Powell’s remarks on interest rates, the major stock indexes showed no significant movement. However, after his comments, which leaned more towards a stricter (hawkish) rather than lenient (dovish) stance on interest rates, the markets interpreted this as favorable. Consequently, there was a notable rally, and the markets finished strong.
Similarly, our TTIs also experienced an upswing and ended the day on a higher note.
This is how we closed 3/20/2024:
Domestic TTI: +10.79% above its M/A (prior close +9.84%)—Buy signal effective 11/21/2023.
International TTI: +10.47% above its M/A (prior close +9.70%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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