- Moving the markets
The major indexes started the session in the red, with only the S&P and Nasdaq being able to climb out of that early hole and close in the green, as buying picked up late in the session.
The Fed started its 2-day meeting on interest rates today with the verdict being announced Wednesday after 11 am PST. Traders are concerned that any rate reductions may not occur, but they will analyze every word of Powell’s press conference to find something positive to prop up bullish sentiment and keep the rally going.
Last week’s strong jobs numbers decreased the chances of an imminent rate cut, and traders now are expecting or hoping for the first cut in November. To me, it looks that the Fed will continue its “higher for longer” theme and not cave to the market’s wishes. That caused a jump in 2025 rate-cut expectations but not much change in 2024.
Adding more uncertainty will be May’s CPI reading, scheduled for release prior to the Fed’s announcement.
Apple Computers saw a huge surge, with the company now overtaking Nvidia as the second largest market cap company. The MAG 7 stocks stayed their course and rallied.
Bond yields pulled back after the recent rally, the dollar rode the range, while Bitcoin surrendered yesterday’s reach for $70k but bounce off its $66k support level.
Gold staggered higher for the second day, and oil prices advanced but fell short of reaching the $78 level.
Tomorrow’s CPI and the Fed’s decision on rates will have an impact on market direction, the question is “will it be up or down?”
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)
Despite a sloppy start, caused by anxiety about the upcoming CPI release and the Fed’s verdict on interest rates, the S&P 500 and Nasdaq ignored those uncertainties and closed higher.
Our TTIs did not concur and slipped a tad.
This is how we closed 06/11/2024:
Domestic TTI: +6.05% above its M/A (prior close +6.49%)—Buy signal effective 11/21/2023.
International TTI: +7.22% above its M/A (prior close +8.16%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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