- Moving the market
Anxiety surrounding Nvidia’s earnings announcement, set to be released after today’s close, initially kept equities in a tight trading range but ultimately led to a selloff.
Traders are rightfully questioning how much more upside potential can be realistically expected after Nvidia’s impressive 159% surge in 2024.
Despite this, optimism remains as analysts focus on the company’s delivery schedule for the Blackwell chips and the increasing demand for AI updates. There is hope that Nvidia might surprise traders positively.
Dubbed the “most important earnings announcement ever,” the anticipation had bears eager to control any bullish sentiment, with the Nasdaq leading the decline.
Unsurprisingly, the MAG7 basket followed suit, marking its fifth consecutive day of losses, with the most shorted stocks being heavily sold off.
Bond yields rose as the dollar continued its recovery, while Bitcoin moved in the opposite direction but found support at the $58k level. Rising yields left gold without any positive momentum, causing it to retreat from its record high. Crude oil also sold off but managed to hold its $74 price point.
Once again, stocks appear to be in a state of divergence from bond yields, as illustrated by this chart.
Are we on the verge of witnessing a repeat of the “adjustment” that occurred in late July?
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)
Today, the anticipation surrounding Nvidia’s upcoming earnings report became the focal point for traders. This uncertainty led to a wave of caution, causing many to adopt a bearish stance. Consequently, the markets saw a moderate sell-off, with the Nasdaq bearing the brunt of the decline.
Despite this pullback, our TTIs also retreated slightly, but this did not alter our overall positive outlook.
This is how we closed 08/28/2024:
Domestic TTI: +7.27% above its M/A (prior close +7.57%)—Buy signal effective 11/21/2023.
International TTI: +7.48% above its M/A (prior close +7.46%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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