Market Update 4/18/2024
Latest recap:
Pullback Of 2024 - April To May [Bounce time?!]
Netflix earnings & unemployment claims today
Market Sentiment: Fear is here!
S&P 500 Levels - S: 5060; R: 5104; MY PULLBACK PT: 4980 or 100MA!
MY BULL/BEAR RATIO: NEUTRAL BIAS
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The Pullback Of 2024 - April To May [Bounce time?!]
Since Monday, the markets have been on a shaky ground with bad news on all ends.
First and foremost, geopolitics clearly is playing a huge role in the market volatility. The Middle East crisis (Israel vs. Iran/Hisbollah/Hamas/Houthis) is the real thing here and any bad news out of that region is bad news for the US stockmarket because of the oil price and in fact the risk exposure that the US army will be dragged into this war directly. A higher oil price means higher expenses in times consumers and energy dependent businsess are already struggling with high inflation. And of course you have also this never ending Ukraine proxy war against Russia on the table along with the never ending question around the China/Taiwan issue.
Then you have the US debt that is approaching $36 trillion soon, hitting $1 trillion of new debts roughly every 3 months. The US government is not more making enough money to offset rising debts due to high spendings and interest payments. Of course the Fed has to jump in at some point but so far it does not officially since it is following a strict monetary policy (QT) to combat rising inflation. As of now, it is highly dependent on sovereigns that are investing into the US through bonds such as Japan as the largest holder of US treasuries. However, what if countries like Japan or China (2nd largest holder) cannot more keep buying US treasuries? For example, Japan is currently struggling big times and cannot more effort to buy US treasuries. So the 2nd largest buyer, China, needs to offset Japan - is this the reason why Secretary of State Blinken is planning a 4 days trip to China next week?;)
Netflix earnings & unemployment claims today
Today the focus will be on weekly unemployment claims update and later on the Netflix earings after the market close.
Now that the first bad news wave was digested, there is usually the time for a little relief rally (market bounce). Coincidentially, the first big tech company is reporting earings today and could kick off/strengthen the relief rally if earnings guidance comes in quiet well and unemployment claims tops estimates, respectively.
However, any adverse developments in the Middle East, particularly involving Israel and Iran, could trigger another market shock, potentially cutting short the relief rally more swiftly than anticipated.
Market Sentiment
Market fear is back, traders are not more buying dips but rather selling rallies!
Live S&P500 Futures - Pre-Market Analysis
From last Friday to yesterday, the S&P500 dropped by almost 4%. After having temporarily cracked a critical resistance level at 5060 yesterday, the index managed to bounce above it and hold.
While this may help the markets to bounce over the very short-term (today, tomorrow and maybe even into the next week), the odds are heavily increasing that the S&P will revisit the lows and even go way below into the pullback price target range area.
Thats what the chart is telling us and technical indicators along with fundamental issues (geopolitics and debt crisis).
Of course you could capitalize on the bounce by going long as a trader, but I would rather stay on the sideline or to wait for the next best moment to enter a short.
Levels to watch S: 5060; R: 5104; MY PULLBACK PT: 4980 or 100MA!
Pro Bullish:
New ALL-TIME-HIGHs!Bullish momentumAt the daily 20MAAbove the daily 100MA, 200MA
Above the weekly
10MA, 20MA, 50MA, 100MA, 200MAAbove the monthly 10MA, 20MA, 50MA, 100MA, 200MA
10/20MA daily goldencross20/50MA 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: 5,500-6,136
Pro Bearish:
Market is rolling over
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
Below the daily 50MA
10/20MA daily deathcross
10/50MA daily deathhook forming
Weakening bullish momentum / Bearish momentum
Potential bearish head and shoulders pattern
Geopolitical Risk: Middle East Crisis / Ukraine Crisis
Currency Risk: Japan’s Yen Currency, US-Dollar crisis looming/happening
PULLBACK PT: 4,808-4,980
MY BULL/BEAR RATIO: NEUTRAL BIAS
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