- Moving the market
After a sluggish start, the major indexes found some bullish sentiment despite anxiety about the upcoming earnings report from top AI chip producer Nvidia.
Nvidia’s numbers are due out on Wednesday, and as the bellwether in the tech and AI arena, its financial health will be closely examined to determine if the current rotation away from technology was justified or if it will be reversed.
Until then, the markets may continue in an almost listless mode, despite the enthusiasm gained after Powell’s indication of lower interest rates last Friday. Traders assume that a 0.25% easing is a given, with hopes growing that a 0.50% reduction could happen as well, especially if more negative economic news surfaces between now and September 18th.
In today’s economic news, we learned that consumer sentiments improved moderately, but plans for major purchases were non-existent, as Regional Fed surveys also painted a weak picture. On the other hand, US home prices surged to a new record high in June, while median prices remained unchanged, which is not good for buyers.
Rate-cut expectations rose, giving gold a boost, with the precious metal scoring a new record high despite bond yields edging a tad higher.
The MAG 7 stocks trended sideways, but Nvidia outperformed the others. The dollar stayed unchanged, Bitcoin gave back some of its weekend gains, and oil prices ran into overhead resistance and pulled back.
The latest Nvidia/Cisco system comparison shows Nvidia in the lead.
But for how long?
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)
The market underwent a rather uneventful day, characterized by low volatility as investors awaited Nvidia’s earnings announcement scheduled for tomorrow. Throughout the day, the major indexes remained close to their previous levels, showing minimal movement.
Similarly, our TTIs also hovered near their unchanged lines. By the end of the trading session, the overall changes were minor, reflecting the cautious sentiment prevailing in the market.
This is how we closed 08/27/2024:
Domestic TTI: +7.57% above its M/A (prior close +7.52%)—Buy signal effective 11/21/2023.
International TTI: +7.46% above its M/A (prior close +7.40%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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