- Moving the market
The major indexes began the session without clear direction, hovering around their unchanged lines. However, they seem poised for a positive finish to this volatile month of September.
Stock performance was mixed. Hewlett Packard rose over 4% following an upgrade, while Germany’s SAP fell more than 2%, and General Motors dropped nearly 6% after a downgrade.
New Home Sales declined in August despite lower mortgage rates and increased mortgage applications. This data predates the Fed’s new easing cycle, raising the question: will we see a reversal soon?
Today, the tech sector was the standout performer, driven by gains in Nvidia and Meta. In contrast, Small Caps were the biggest losers, and utilities led among the sectors. The market lacked a clear driver, likely due to anticipation of Powell’s speech tomorrow and the latest GDP data release.
Bond yields increased, the MAG7 basket initially surged but faded by the close, and the most shorted stocks remained within their recent trading range. The dollar rebounded from yesterday’s weakness, recovering all losses.
Gold hit another intraday high but couldn’t maintain its advance into the close, diverging from the dollar. The stronger dollar also pulled down crude oil and caused Bitcoin to slump after Tuesday’s surge.
As Zero Hedge pointed out, US sovereign risk now exceeds recent months’ levels. Does this indicate that something has broken or is about to?
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 suffered a lack of motivation from traders, resulting in the major indexes drifting without any significant gains or losses. This period of aimless movement reflected a broader sentiment of uncertainty.
Additionally, our TTIs showed further weakness, retreating from their recent highs.
This is how we closed 09/25/2024:
Domestic TTI: +7.54% above its M/A (prior close +8.25%)—Buy signal effective 11/21/2023.
International TTI: +7.55% above its M/A (prior close +8.05%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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