Stock Market Outlook entering the Week of January 14th = Uptrend
- ADX Directional Indicators: Uptrend
- Price & Volume Signals: Uptrend
- Elliott Wave Analysis: Downtrend
ANALYSIS
The stock market outlook shows an uptrend in place, with the S&P500 ($SPX) gaining 0.3% last week. The index is ~4% above the 50-day moving average, and ~9% above the 200-day moving average.
SPX Price & Volume Chart for the Week of Jan 14 2024
There was not change in the ADX and price/volume signals based on last week’s market action. For Elliott Wave, the RSI(5) recovered from last weekends oversold condition; it’s now just under overbought, but continues to show a negative/bearish divergence with price. The MACD continues to show a bearish, albeit improving, trend.
COMMENTARY
December’s headline CPI was higher than expected, while core inflation was inline. Treasury rates rose in response on Thursday, as investors revisited their expectations for rate cuts this year.
- Headline CPI (y/y) = +3.4%
- Previous = +3.1%
- Expected = 3.2%
- Core CPI (y/y) =+3.9%
- Previous = +4.0%
- Expected = +3.8%
Earnings season also arrived, with big banks reporting mixed results. Beating expectations, even lowered ones, was routine last year. This quarter, 2024 projections will be the main story, as companies look to justify the rally in their stock prices since the end of October.
U.S. Markets are closed Monday, in observance of Martin Luther King Jr.’s birthday. The short week won’t stop people from pontificating; there are a total of 6 Fed speeches lined up next week. So expect a lot of “noise” and mixed messaging when it comes to interest rate policy.
Best to Your Week!
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