Market Update 4/15/2024
Latest recap:
The Pullback Of 2024 - April To May
Earnings, Fed Chair Powell And The Middle East
Market Sentiment: Fear is coming
Trade Idea: Short The S&P500 With The “SPY” ETF
S&P 500 Levels - S: 5180 or 50MA; R: 5260 or 10MA/20MA; 5104 is next
MY BULL/BEAR RATIO: NEUTRAL BIAS
ATTENTION
The “S&P 500 Blow-Off Top Forecast for 2024” REPORT IS AVAILABLE:
Anticipate a final peak of 6,136 by August! Dive into detailed analysis and forecasts, from price targets to market correction scenarios, by subscribing to my premium service.
PLUS, SPECIAL REPORT AVAILABLE NOW ON HOW TO PROFIT FROM THE MARKET PULLBACK
The Pullback Of 2024 - April To May
Last week major indices took a nose dive and officially kicked-off the trend reversal over the short-term.
The initial trigger was the shocking CPI inflation report from last week that revealed that inflation is here to stay if the Federal Reserve does not want to tighten financial conditions harder. Although the Fed has its 3 month benchmark short-term rate at 5.5%, the highest since more than 20 years, it appears that there is still too much of excess cash in the financial system that is grinding its way into the real world, occuring the resurge of goods inflation.
The implications are crystal clear now to everyone: The stockmarket needs to adjust its eurphoric outlook (inflation fight is won) from 3 months ago to face the bad reality.
And then we also have external shocks like the geopolitical tensions in the Ukraine and more important now, the escalation in the Middle East between Israel and Iran which could end up dragging the US directly into that conflict.
The events over the weekend where Iran was counterattacking Israel with up to 300 rockets for the strike on its embassy in Syria, lead to a sudden spike in the gold price that we also have to pay big attention to! Yes, the markets were closed over the weekend… However, the crypto market trades 24/7 and there is this one coin that is pegged to the gold price. And as you see, it was spiking up by almost 40% in just a single hour from $2,368 to $3,297 before giving it all back thereafter.
So not only that we are dealing with high inflation but also with war issues that is toxic to stocks over the short-term.
Due to the most recent inflation readings, the bond market has started to adjust itself to the new situation by pushing the rates higher which automatically leads to the tightening of financial conditions.
When rates are going up, it usually means no good news for equities. Then you add the uncertainty about the geopolitical situation and you have the cocktail ready for a stockmarket downturn over the next 4-6 weeks. Note: Good earnings may not save the markets from a downturn at this time!
Earnings, Fed Chair Powell And The Middle East
In this week earnings from big banks and Netflix (Thursday after hours) will be the key, especially on the outlook for this quarter and next.
As for the economy, the consumer will be in the focus and Fed Chair Powell is scheduled to speak on Tuesday, increasing the odds for a market bounce into Tuesday.
But we also have this situation going on in the Middle East where Israel could escalate things at any moment and time right now.
Market Sentiment
Traders are becoming nervous! Although neutral, we smell the fear!
Trade Idea: Short The S&P500 With The “SPY” ETF
All the current noise and majority of technical indicators are pointing to a continuation of the short-term downtrend (market pullback).
Certainly, there are many ways to make money in a downturn but one of the easiest is to short market indices rather than individual stocks.
The S&P500 appears to me the best index to short and the SPY ETF makes it easy to do that. You can short it with shares (SPY shares), options (SPY puts) or an inverse ETF ( SPXU 0.00%↑ ), depending on your experience and risk tolerance.
EXCLUSIVE OFFER
IF you want to trade the downturn with put options but you are struggling to choose the right options, strike price, and expiration date then access my SPECIAL REPORT NOW!
In this special report I’ll reveal the top two options that currently show the most promising potential for profitability (30% to potentially 200%) in the SPY ETF downturn.
Live S&P500 Futures - Pre-Market Analysis
Friday was a very bearish day but it looks like there is no follow through on Monday yet! Instead the market is bouncing since it hit the 50MA.
We may get today the same playbook like in the last trading days - big drop followed by a sharp recovery just to drop again the next day and so on and so forth. Technicals are all bearish right now, suggesting a bearish continuation in this week.
For today, the 10MA is the key - if the bounce will bring the price above the 10MA, we may continue to bounce into Tuesday. If not, then the downturn will continue right away!
Levels to watch S: 5180 or 50MA; R: 5260 or 10MA/20MA; 5104 is next support
Pro Bullish:
New ALL-TIME-HIGHs!Bullish momentumAt the daily 20MAAbove the daily 50MA, 100MA, 200MA
Above the weekly 10MA, 20MA, 50MA, 100MA, 200MA
Above the monthly 10MA, 20MA, 50MA, 100MA, 200MA
10/20MA daily goldencross
20/50MA daily goldencross
20/100MA daily goldencross
50/100MA weekly goldencross
Strong Fourth Quarter of 2023
Strong First Quarter of 2024
Strong January Month of 2024
Strong February Month of 2024
Strong March Month of 2024
Price Target: 5,100-5,200 ACHIEVED (Wall Street Consensus for 2024!)
NEW Price Target: 5,500 (Oppenheimer Wall Street Bank March Update)
NEW Price Target: 5,700 (Fundstrat's Tom Lee April Update)
Blow-Off Top: 6,136
Pro Bearish:
Market at risk to roll over
Bullish momentum stalling
Long-term trendline break confirmed!
Weak April month
Wall Street’s 5100 price target for the year 2024 already achieved!
Wall Street’s 5200 price target for the year 2024 already achieved!
Market Sentiment was at EUPHORIA level
Below the daily 10MA
Below the daily 20MA
10/20MA daily deathcross
Weakening bullish momentum / Bearish momentum
Potential bearish head and shoulders pattern forming
Geopolitical Risk: Middle East Crisis / Ukraine Crisis
Currency Risk: Japan’s Yen Currency, US-Dollar crisis looming
MY BULL/BEAR RATIO: NEUTRAL BIAS
Thanks for reading my newsletter!
Have a happy trading day!
Seeking Exclusive Investment Ideas?
Upgrade to a Premium Subscription!
Exclusive Short-Term Trade Ideas: Get access to handpicked trade recommendations, designed for short-term gains using options. Ideal for those looking to capitalize on quick market movements.
Monthly Investment Ideas: Gain access to exclusive, carefully selected long-term investment opportunities each month. Ideal for individual investors and asset managers seeking to expand their portfolios with strategic, growth-oriented assets.
Direct Chat Access: Let me know if you may have any questions or comments, for example, regarding trade or investment idea!
Upgrade to our Premium Subscription today. Save tíme and level up your trading and investment game right now. Cancel at any time.