Market’s Mixed Moves: Eyes On CPI And PPI For Economic Clues

Ulli Market Commentary Contact

[Chart courtesy of]

  1. Moving the markets

The stock market began with a surge of activity, with indices initially climbing before the momentum waned, leading to a plateau where the major indexes closed nearly flat. The Nasdaq stood out, managing to secure a modest gain amidst the general standstill.

This pattern of fluctuation reflects the market’s current state of uncertainty, particularly considering the Dow’s recent triumph, marking its most impressive weekly gain of the year with an ascent of over 2%. The S&P 500 and Nasdaq weren’t far behind, each notching up gains exceeding 1% in the same timeframe.

The financial community is also digesting the implications of a New York Federal Reserve survey, which revealed a noticeable uptick in consumer inflation expectations. The forecast for the coming year has risen to 3.3%, while the five-year projection has increased slightly to 2.8%.

These figures are critical as they precede the release of the consumer price index report this Wednesday, where economists are bracing for a 0.4% rise month-over-month and a 3.4% surge year-over-year. Similarly, the producer price index, set to be published Tuesday, is anticipated to show a 0.3% increase from the previous month.

Amidst these projections, traders are cautiously optimistic that the Federal Reserve may steer clear of rate hikes, despite a series of unexpectedly high inflation readings in recent months.

In the broader financial landscape, bond yields dipped, the dollar held steady, and Bitcoin made a remarkable recovery to $63,000, offsetting the losses from the previous Friday. Conversely, gold relinquished some of its recent gains, while crude oil prices rebounded, recouping most of the losses experienced at the week’s end.

As investors and analysts alike scrutinize these developments, one question looms large:

Will the forthcoming PPI and CPI reports alter the current stagflationary course, or will they reinforce the prevailing economic narrative?

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)

In the financial markets, the early optimism that characterized the opening trades soon faded, a sentiment shift that can be attributed to the traders’ growing apprehension in anticipation of the forthcoming Producer Price Index (PPI) and Consumer Price Index (CPI) reports. These reports are pivotal in gauging inflationary trends and can significantly influence market dynamics.

Despite the volatility, there was a semblance of stability as our TTIs exhibited minimal deviation from their positions at the close of the previous week. This steadiness amidst the market’s ebb and flow suggests that the underlying trend remains positive.

This is how we closed 5/13/2024:

Domestic TTI: +8.61% above its M/A (prior close +8.63%)—Buy signal effective 11/21/2023.

International TTI: +9.50% above its M/A (prior close +9.36%)—Buy signal effective 11/21/2023.

All linked charts above are courtesy of Bloomberg via ZeroHedge.



Do you have the time to follow our investment plans yourself? If you are a busy professional who would like to have his portfolio managed using our methodology, please contact me directly to get more details.


Contact Ulli

Leave a Reply