- Moving the market
Despite opening on a positive note, the major indexes wavered and fell below their respective unchanged lines. The Dow showed the most resilience, ending as the only index to close in the green.
The tech sector experienced the steepest decline, with companies like Palantir, Nvidia, and Microsoft pulling back. A report indicating that Microsoft is cutting spending on data centers raised concerns about potential weakness in the AI sector.
Adding to the bearish sentiment, February data pointed to economic weakness. The US Service sector contracted for the month, and the Consumer Sentiment index came in below expectations.
Key earnings reports are due this week, with Nvidia’s report on Wednesday being highly anticipated. Given Nvidia’s close ties to AI chips, any weakness in this sector could impact the company’s outlook.
Today’s macroeconomic data highlighted that growth is fading, and even AI stocks are retreating.
Slipping bond yields failed to support equities or Bitcoin, which fell below the $94k level. Gold emerged as the winner, gaining, and closing above $2,965, despite the dollar recovering from an early sell-off.
Traders now foresee a weaker period of growth for the US, which may prompt the Fed to lower rates sooner than expected. This has pushed rate-cut expectations to a two-month high.
However, will the Fed ignore inflation pressures just to appease the markets?
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 markets experienced another volatile session, with the S&P 500 and Nasdaq closing in the red. Despite mid-day recovery attempts, persistent bearish sentiment prevailed.
Our TTIs ended the session mixed, showing no significant gains or losses.
This is how we closed 02/24/2025:
Domestic TTI: +3.12% above its M/A (prior close +3.04%)—Buy signal effective 11/21/2023.
International TTI: +6.75% above its M/A (prior close +6.88%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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