- Moving the market
On this election day, traders viewed the market positively, driving the major indexes out of their recent slump and buying a wide range of assets, including stocks, bonds, gold, Bitcoin, and crude oil.
Wall Street is closely monitoring not only the Presidential elections, but also which party will dominate Congress, as any sweep could lead to significant changes in spending or tax policy.
While the election results can significantly impact market direction, this uncertainty might create more short-term volatility. Historically, however, the major indexes have tended to gain between election day and the end of the year.
Traders believe that a divided Congress would be the most favorable outcome, as it would likely limit severe policy changes. Additionally, the Federal Reserve’s decision on rate cuts is expected Thursday, with a 96% chance of a 0.25% reduction.
Today, the most shorted stocks were squeezed, and bond yields fluctuated, with the 10-year yield rallying to 4.36% before reversing to close nearly unchanged at 4.29%.
The dollar declined, while gold posted a small gain. Bitcoin underwent a wild ride, reaching $70.5k before falling back to around $69k. Crude oil followed a similar pattern and ended the day higher.
Although the election results are still pending, the Federal Reserve’s upcoming interest rate announcement on Thursday is likely to add to market volatility.
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)
On election day, Wall Street underwent a surge of optimism, with bullish sentiment driving the major indexes to impressive gains. The positive atmosphere was evident, as investors showed confidence in the market’s direction.
Our TTIs also reflected this upbeat mood, as they moved further away from their respective trend lines, indicating strong upward momentum.
This is how we closed 11/05/2024:
Domestic TTI: +6.69% above its M/A (prior close +5.46%)—Buy signal effective 11/21/2023.
International TTI: +4.61% above its M/A (prior close +3.65%)—Buy signal effective 11/21/2023.
All linked charts above are courtesy of Bloomberg via ZeroHedge.
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