- Moving the market
After three consecutive days of losses, the markets finally found some upward momentum, with major indexes showing early gains as expectations for rate cuts rose modestly.
This positive shift was supported by strong earnings reports, notably from Tesla, which surged 21% after surpassing expectations. Whirlpool and Lam Research also posted gains, while IBM weighed on the Dow, dropping 5% after missing estimates.
So far, over 32% of S&P 500 companies have reported their third-quarter results, with 76% beating analyst expectations. Contributing to today’s rebound were slipping bond yields, which encouraged positive sentiment, although the 10-year yield remains above the 4.2% mark.
In economic news, New Home Sales jumped by 4.1% month-over-month in September, with a year-over-year increase of 6.3%. Despite the Federal Reserve’s rate-cutting efforts, historical precedent suggests this rebound might be short-lived.
Bond yields dipped slightly, and the dollar paused its relentless climb. Gold reversed its losses from the previous day, reaching a new inflation-adjusted high since January 1980, as noted by ZH.
Bitcoin mirrored gold’s movement, bouncing back from Wednesday’s lows to cross the $68,000 mark, thereby recouping its losses. Crude oil, however, experienced a volatile session, initially advancing but ultimately surrendering all gains by the end of the day.
Meanwhile, concerns over debt and deficits resurfaced, with the USA’s foreign default risk climbing to a one-year high.
Will this trend prove to be short-lived like in 2023?
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 stock market sniffed a hint of optimism today, with most major indexes, except for the Dow, showing some bullish sentiment.
This positive shift was largely due to a dip in bond yields, which provided the S&P 500 and the Nasdaq the opportunity to close in positive territory.
However, the gains were modest, a sentiment echoed in our TTIs, which showed only a slight advance.
This is how we closed 10/24/2024:
Domestic TTI: +7.57% above its M/A (prior close +7.54%)—Buy signal effective 11/21/2023.
International TTI: +5.51% above its M/A (prior close +5.47%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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