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Posted by Martin January 17, 2023
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01.16.2023 – MONDAY MARKET OUTLOOK


Market Outlook
 

Today, the market was closed for the Martin Luther King holiday, but futures continued trading abroad. And it was muted with a slight downward trend. Will we see a renewed rally tomorrow, or is the rally over, and the markets roll back down, failing to hold the new breakout? The price is still above the resistances that may act as supports, but the momentum is failing. Last week the rally was unstoppable, and now it seems it was just a fart.

 
Market Outlook
 

There is not much to say about the Ichimoku chart below. It is positive, but we need renewed optimism, and from the futures trading, that optimism isn’t there yet.

 
Market Outlook
 

The trend forecasting is slightly negative for tomorrow, but let’s wait to see what tone the market sets tomorrow. Right now, it is a toss. The price may slip early in the morning, but the losses may get erased by the EOD. Let’s wait and see.

 
Market Outlook
 

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Posted by Martin January 13, 2023
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01.12.2023 – THURSDAY MARKET OUTLOOK


Market Outlook
 

As expected, the market continued higher, although at a slower pace than expected, given the good news about inflation. The CPI came out and indicated slowing inflation. It rocked the market a bit, but then it went higher. The buy rumors and sell the news didn’t happen, although it may happen tomorrow. The market broke above both resistances (the 3,966 level and 200-day MA) and closed above it:

 
Market Outlook
 

The market still has a lot of work to do, but at least we are bouncing above critical levels. Now we need to stay there. The next target is at 4,100, which we need to break to confirm the new bull market. I expect it to happen because inflation will continue subsiding, and FED will no longer have any reason for raising the rates. Despite all the gloom and doom panickers out there, the economy is still strong (despite slowing it, it can be just a standard economic cycle), so if we see inflation slowing more, the FED pausing the rate hikes, the economy will pick up again. And if inflation stays lower after the economy picks up, we will see a new bull market. And FOMO will follow, so brace for investors that are now overly bearish rushing out of their bearish positions and buying stocks they were overly selling just a few days ago.

 
Market Outlook
 

The price moved above the cloud and if it stays there, we can expect the bullish trend to continue. The red cloud is also changing back to the green one, and the price is also above the light green lagging line. All that we see on that chart is positive and bullish. It may change, but it hasn’t changed yet and the chances of it not changing any time soon are good.

 
Market Outlook
 

As I said in my previous outlooks, the forecasting is skewed by past performance and thus must be confirmed by other indicators and charts. Although the chart above indicated a down market, the charts and indicators were not confirming it, and I expected a muted upside trading. The same can be said about tomorrow’s trading expectations, although the trend is shifting to the upside already. I expect sideways trading, a bit choppy, with the last-hour rush into the market.
 

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Posted by Martin January 12, 2023
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01.11.2023 – WEDNESDAY MARKET OUTLOOK


Market Outlook
 

The market participants are now full of optimism and bidding the prices up in expectation of mild inflation data coming out tomorrow morning.

 
Market Outlook
 

On the chart above, we reached two major resistance levels – the 200-day MA and a long-term resistance at the 3966 level (that is almost 3 years old, so significant). The question is will the bulls be optimistic enough to break above it, and what is even more important, move the index higher and sustain the trend?

 
Market Outlook
 

The ichimoku lines were already broken so we are at an important inflection point. However, despite the market shifting towards a bullish trend, I suspect that what we might see is “buy the rumors, sell the news.” Tomorrow, we might move higher after the report shows declining inflation and then selling. Or if the data will not be good enough, we may see selling right from the start. Trend forecasting indicates selling tomorrow but this market is not momentum driven (when forecasting would work a lot better) but sentiment and news-driven and anything can happen tomorrow. We can see a FOMO-style rally right off the bat or a crash.

 
Market Outlook
 

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Posted by Martin January 11, 2023
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01.10.2023 – TUESDAY MARKET OUTLOOK


Market Outlook
 

The market seems to be improving. Powell had his remarks in Sweden and briefly spoke about the apolitical role of the FED avoiding any hints about the monetary policy. Investors seem to take it as the FED is trying to stay neutral advertising possible pauses in hikes. It seems, he didn’t want to say “we will hike and bring the pain” and then don’t do it and vice versa. After the initial sideways move the market spiked up:

 
Market Outlook
 

The improvement is also visible in the Ichimoku chart as the market is trying to approach the resistance again. And the more times it tries to knock that resistance, the more likely it will break above it.

 
Market Outlook
 

However, we are still expecting inflation data this week, and that may shake the market. My expectations below are based on the past behavior of the market, and then I use the trend forecasting technique. But that can be skewed by the past data, though. Today, the market went in the completely opposite direction. Tomorrow, we expect another up day. If that happens, that could mean a market’s paradigm shift and potential new bull market, mainly if the expected selling at the end of the day doesn’t happen. As of now, the market is bullish (until it isn’t).

 
Market Outlook
 

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Posted by Martin January 11, 2023
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Technical view: BABA (BABA)


Technical view
 

BABA is now in stage #2. China reopening its economy after a draconical Covid shutdown is helping Chinese stocks. The CCP also reversed or at least is trying to, their policy on the economy and private businesses. They agreed to allow for account audits by the US PCAOB which literally averted the risk of delisting the Chinese stocks. But can we trust the CCP? Or is this stock rally just a pump? The weekly chart moved the stock from a rapid decline up to the long-term bearish trend, and the stock managed to close above it. The question is now, will it hold and continue higher? Or will the buyers who bought at these levels dump the stock here?

 
Technical view weekly
 

Fundamentally, the stock is offering great value, and it is in a buy zone right now. Based on the fundamental data, the earnings are poised for a further decline in 2023, but it may change since the economy is reopening. The stock should start improving from here. I think now is the time to start buying the stock. Remember, the goal is not to fish for the bottom but buy when it may be safe to do so.

 
Technical view weekly
 

Technical view weekly
 

The stock is now BUY
 

This post was published in our newsletter to our subscribers on Saturday, December 24th, 2022. If you want to learn more about our stock technical analysis subscribe to our weekly newsletter.
 




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Posted by Martin January 10, 2023
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01.09.2023 – MONDAY MARKET OUTLOOK


Market Outlook
 

This is still a suckers’ market. Big rally in the morning that was sold in the afternoon. All in CPI and FED’s expectations. Everyone knows what is going to happen, yet everyone freaks out. But from the technical perspective, the market hit resistance and sold off from there. On the chart below, we can see that the price almost hit 3,966 resistance right below 200-day MA.

 
Market Outlook
 

And on the Ichimoku chart, we hit the red line resistance and sold off. Basically, the market got rejected on multiple levels:

 
Market Outlook
 

The price trend is still weak and not gaining any momentum, so bulls have a lot of work to do to convince bears to flip the side (though I think it is a matter of time before it happens). However, for tomorrow, the outlook is bearish and we may continue selling:

 
Market Outlook
 

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Posted by Martin January 08, 2023
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2023 Week 01 investing and trading report


The first week of 2023 is over, and the markets started looking promising again. The same could be said about my trading and investing, except that Tasty Works broker sucks at calculating and displaying a correct buying power, so I have no idea whether I had money or not to trade. They have a problem calculating the BP when multiple SPX spreads open and keep them overnight. Then your account BP goes out of wack, and they show negative BP. But by negative, I mean huge negative. Currently, they show my BP as -30,000!!! That’s almost all my cash value! How come I have $40,000 cash but minus $30,000 negative BP!? I do not get it. So, I decided to transfer my account to another broker that doesn’t have that problem. Thus my account is locked as it is in the middle of a transfer, and all I had to do was to close some trades that were expiring next week to prevent the failure of the transfer.

Our NetLiq-cash-buying power ratio is still a shit show, and I hate it:

 
Cash - Net-Liq - BP 01
 

Our trading delivered -$1,487.00 loss last week, ending January 2023, at -$1,487.00 (-2.28%) of options income. Our net-liq value increased by +4.58% to $65,241.95 value. Our overall account is up 4.80% YTD and -37.65% from when the bear market started.
 

Here is our investing and trading report:

 

Account Value: $65,241.95 +$2,986.17 +4.58%
Options trading results
Options Premiums Received: -$1,487.00
01 January 2023 Options: -$1,487.00 -2.28%
Options Premiums YTD: -$1,487.00 -2.28%
Dividend income results
Dividends Received: +$81.52
01 January 2023 Dividends: +$81.52
Dividends YTD: +$81.52
Portfolio Equity
Portfolio Equity: $175,044.91 +$395.12 +0.23%
Portfolio metrics
Portfolio Yield: 5.62%
Portfolio Dividend Growth: 15.73%
Ann. Div Income & YOC in 10 yrs: $135,989.21 68.87%
Ann. Div Income & YOC in 20 yrs: $32,800,034.46 16,611.62%
Ann. Div Income & YOC in 25 yrs: $5,544,253,292.86 2,807,894.91%
Ann. Div Income & YOC in 30 yrs: $10,639,559,613,450.50 5,388,419,984.99%
Portfolio Alpha: -7.56%
Sharpe Ratio: 7.70 EXCELLENT
Portfolio Weighted Beta: 0.47
CAGR: 253.61%
AROC: -1.56%
TROC: 7.06%
Our 2023 Goal
2023 Dividend Goal: $8,000.00 1.02% In Progress
2023 Options Income Goal: $70,000 -2.12% In Progress
2023 Portfolio Value Goal: $96,532.51 67.59% In Progress
6-year Portfolio Value Goal: $175,000.00 37.28% In Progress
10-year Portfolio Value Goal: $1,000,000.00 6.52% In Progress

 

Dividend Investing and Trading Report

 

Last week we have received $81.52 in dividends bringing our January’s dividend income at $81.52.

Last week, we did not purchase any dividend stock.

Here is a chart of our account equity showing our accumulation goal and the value of all stocks in our account. It shows a nice upward-sloping chart as our equities grow. This is a result of our options trading and using premiums to buy dividend stocks:

 
Account Equity week 01
 

And here you can see the dividend income those equities pay us every year:

 
Annual Dividend Payout week 01

 

Growth stocks Investing and Trading Report

 

Last week, we purchased no growth stocks.

 

Options Investing and Trading Report

 

Last week options trading delivered a loss of -$1,487.00 making our January options income -$1,487.00. As mentioned above, I am transferring my account to another broker, and I had to close some trades last week that would otherwise interfere with the transfer. I will re-establish those trades once the account is transferred.

 

We were actively trading our SPX strategy that delivered $0.00 gain. Again, I didn’t trade last week because of the transfer of the accounts.

 

Expected Future Dividend Income

 

We received $81.52 in dividends last week. Our portfolio currently yields 5.62% at $65,241.95 market value.

Our projected annual dividend income in 10 years is $135,989.21, but that projection is if we do absolutely nothing and let our positions grow without adding new positions or reinvesting the dividends.

We are also set to receive a $7,024.65 annual dividend income ($585.39 monthly income). We are 5.17% of our 10 year goal of $135,989.21 dividend income.

 
Future Divi on YOC week 01
 

The chart above shows how our future dividend income is based on the future yield on cost and what dividend income we may expect. The expected dividend growth depends on what stocks we add to our portfolio and the stocks’ 3 years’ average dividend growth rate. It is interesting to see what passive income we may enjoy 10, 20, 25, or 30 years from now.

 

Market value of our holdings

 

Our non-adjusted stock holdings market value increased from $174,649.79 to $175,044.91 last week.

In 2023 we planned on accumulating dividend stocks, monetizing these positions, HFEA strategy, and SPX trading. We plan to raise more of our holdings to 100 shares to sell covered calls. We continued rebalancing our options trades that released buying power significantly. That allowed us to start repurchasing shares of our interest.

 
Stock holdings trading week 01
 

We aim to accumulate 100 shares of dividend growth stocks we like and then start selling covered calls or strangles around those positions. We also planned on reinvesting all dividends back into those holdings.

 

Investing and trading ROI

 

Our options trading delivered a -2.28% monthly ROI in January 2023, totaling a -2.28% ROI YTD. We plan to exceed our 45% annual revenue goal in selling options against dividend stocks.

Our entire account is still down -37.65% from when the bear market started. However, in 2023 our account is up 4.80% YTD.

Our trading averaged -$1,487.00 per month this year. If this trend continues, we will make -$17,844.00 in trading options in 2023 (I hope not). As of today, we have made -$1,487.00 trading options.

 

Old SPX trades repair

 

Last week I did not trade SPX due to an account transfer.

 

Investing and trading report in charts

 

Account Net-Liq

 

TW Account trading Net-Liq week 01
 

This drawdown of our account is highly discouraging. It’s like all previous gains were all wiped out. But this is just a temporary drawdown. Despite the losses, I am not selling any stock positions (except strategically sold Amazon and Netflix, which I will buy back). I will keep buying more shares if possible. I also have realized losses in my options trades. I am rolling those trades to keep them alive and adjusting them slowly, one by one, until they expire as winners. Then, this terribly-looking chart improves. It will be a long process to get back up, but I am determined.

 

Account Stocks holding

 

TW Account holdings week 01
 

Last week, S&P 500 grew 34.65% since we opened our portfolio while our portfolio grew 9.84%. On YTD basis, the S&P 500 grew +1.92% and our portfolio +0.36%. We are underperforming the market.

The numbers above apply to our stock holdings only.

 

Stock holdings Growth YTD

 

TW Account holdings Growth YTD
 

Our stock holdings are underperforming the market. Hopefully, this trend will stay, and we will constantly do better than S&P 500.

Our 10-year goal is to grow this account to $1,000,000.00 value in ten years. We are in year two, and we accomplished 6.52% of that goal.

Our 6-year goal is to reach $175,000 account value to be eligible for portfolio margin (PM), and today we accomplished 37.28% of that goal.

Our 2023 year goal is to grow this account to a $151,638.03, and today we accomplished 67.59% of this goal.

 

Investing and Trading Report – Options Monthly Income

 

TW Options Trading Income week 01
 

Investing and Trading Report – Options Annual Income

 

TW Options Annual Trading Income week 01

 

Our dividend goal and future dividends

 

TW Received vs Projected Dividends week 01
 

We planned to make $8,000.00 in dividend income in 2023. As of today, we received $81.52. This week, we completed our 2023 dividend goal. We also accumulated enough shares to start making $7,024.65 a year. Our monthly projected dividend income is $585.39, and our current monthly dividend income is $6.79.

 
TW Received vs Future Dividends week 01

 

I have a favor to ask. If you like this report, please, hit the like like button button, so I know that there is enough audience that like this content. Also, if there is something you want to know or you want me to change this report to a different format, let me know in the comments section.

 




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Posted by Martin January 07, 2023
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My Goal 2023


The 2022 year was brutal, but I expected it would be difficult to meet our goals. Yet we met them anyway. Not all of them, but those important ones were met. And it is time to set new goals for 2023.

 

2022 Goal review

 

Buying dividend growth stocks and monetizing those positions goal

 

We set up a goal to purchase dividend stocks and monetize those positions.
At the beginning of the year, we set the following goal to purchase these stocks:

 
Goal 2022 start
 

For the year, we modified the goal by adding more shares of our interest.

 
Goal 2022 start
 

Last year, I was buying stocks like crazy. All dividends and premiums from selling options were reinvested. I am satisfied with the results. We increased the equity value in our portfolio by $44,896 (33.6%). Given how volatile and dangerous the market was in 2022, I think this was a great result:

 
Goal 2022 start
 

We accomplished this goal 100% despite its floating value (the plan developed over time, but the original part was fulfilled).

 

Developing SPX trading goal

 

Last year, I started trading SPX spreads again. It generated high income, and I made $37,687 (1,046%) gains. The only issue is that many SPX trades remain open (I rolled them). So this gain is partially deferred. I consider the received premium a profit or loss when realized (received). But if the trade is still open, the Net-Liq value is blocked by the max risk buying power reduction. That’s why the Net-Liq does not always reflect the gains received.

 

Developing and managing 15% of the portfolio in the HFEA strategy goal

 

This was the most unfortunate goal in the entire 2022 year. At first, I started trading leveraged ETFs like SPXL, but I wanted to add protection. So, I adopted an HFEA strategy adding TMF as downside protection. This failed miserably. Bonds didn’t work in 2022 at all. So I abandoned this strategy and returned to buying the bullish leveraged ETFs and accepting higher volatility. The HFEA account was down -12.22% in 2022. I still think this is a great strategy, and I will continue building it up.

 

Increase Net-Liq value of the account by 30% goal

 

We failed this goal miserably. Increasing the Net-Liq by 30% meant the ending value would be $151,638.03. We failed this goal as our Net-Liq ended down by 40.51% last year. At the end of the year, Net-Liq was $62,255.78 only.

 
Net-Liq Goal 2022

 

Dividend Income goal

 

We set a goal to receive $4,800 in dividends last year. We received $5,868.88 in dividends (an increase of 122.27%). I am happy with this result. We also accumulated enough shares to start receiving $7,135 in dividends.

 
Dividend Goal 2022
 

Options Income goal

 

We didn’t set up an options income goal last year. I was not sure how to quantify it. But we exceeded the previous year’s income.

 
Dividend Goal 2022
 

Despite the bear market and our account’s Net-Liq being down by 40%, I consider 2022 a successful year. We were able to navigate the markets without significant losses; in fact, we were able to invest more money and increase our base. We own more shares and companies than at the end of 2021, and once the bear market ends, we will see these shares rise in value, propelling our account up. I could not achieve this goal in 2008, 2018, or 2020. In 2020 I even thought that I missed the opportunity. This year, I took this opportunity to buy low.

 

2023 Goal summary

 
In 2023, I will focus on the following tasks:
 

  1. Continue buying dividend growth stocks and increase holdings by 20%
  2. Buying growth companies and increasing holdings by 100%
  3. Monetizing my stock positions.
  4. Continue trading SPX spreads.
  5. Continue building the HFEA strategy.
  6. Increase the Net-Liq value of the account by 30%
  7. Increase cash equivalents to $60,000

 

Dividend growth stock purchasing goal

 

In 2023, I will buy dividend growth and high-yield dividend stocks. These are two separate beasts. Typically, high-yield dividend stocks do not provide any capital and dividend growth. They act as bonds. They have little to no growth but pay high dividends.

The standard dividend growth stocks provide low yield, and it takes time to grow the dividends and capital appreciation. It may take 5 to 10 years to see any meaningful results.

To close the gap between investment and dividend growth, high-yield dividend stock will step in and help. I will be getting high dividends now while waiting for the dividend growth stocks to kick in.

For 2023, I set a goal to receive $8,000 in annual dividend income. I am also setting up a goal to raise my dividend stock portfolio holdings by 20% in 2023. As of today, I have $134,357.50 in dividend stocks. I plan to have $161,229 or more at the end of 2023.

 
Dividend Goal 2023

 

Growth stocks buying goal

 

As of today, I have $44,006.66 in growth stocks. My goal for 2023 will be to double these holdings and own up to $88,000 in growth stocks. The stocks in focus are Amazon (AMZN), Airbnb (ABNB), Google (GOOGL), etc. It is also a goal to reach 100 shares of each company.

Overall, here is my stock (dividend and growth) purchasing goal for 2023:

 
Stocks Goal 2023
 

Monetizing stock holdings goal

 

My goal with all my stock holdings is to reach 100 shares and sell covered calls against these positions. I will also be selling strangles and spreads (and strive to cover them by saving cash to cover the put side of the strangle; and owning 100 shares of the underlying stock to cover the call side).

Originally, I expected to make 30% trading options. But I exceeded that goal and made 104.86%. In 2023 I believe we will have more success, so I will set a goal to make $70,000 in options income (112%).

 

Continue trading SPX spreads goal

 

Trading SPX spreads strategy is a part of our alert program that you can subscribe to. Last year the trading didn’t work very well as the trading was directional, and we had a volatile market with too many false signals. Instead of taking losses, we rolled the trades away.

We use “box trades” to collect enough credits that can be used to roll the old trades. Our goal for 2023 will be to eliminate the old trades using boxes and adjustments.

Our goal for 2022 was to grow our SPX account to $10,000. We fulfilled that goal and ended with $41,287. For 2023 I plan to increase this account to $60,000 by the end of the year.

 

Investing 15% in HFEA goal

 

Although I keep calling this strategy “HFEA”, it is not a true HFEA strategy anymore. The strategy is to keep buying 3x leveraged ETF (SPXL) and maintain approx. 15% of my entire portfolio in this ETF. We will not be trading in and out of this ETF.

But if the holdings drop below 15% (which initially equated to a $15,000 value) by 25%, we will start adding new shares to bring the value up to $15,000.
When the ETF goes up by 25%, we will sell shares to bring the value down to $15,000. This is a typical rebalancing process.

The proceeds from the ETF trimming will be invested in Schwab U.S. Dividend Equity ETF (SCHD). When the ETF falls, we will sell SCHD and buy SPXL.

 

Increase Net-Liq value by 30% goal

 

I created a 10-year plan on growing my portfolio (all accounts together), and for 2022 my goal was to reach a $151,638.03 net liq value. We failed this goal.
In 2023 I expect the Net-Liq to grow to $96,532.51, of course, given that we will not hit the recession.

 
I still have goals from last year that are long-term:
 

6-year Portfolio Value Goal:  achieve $175,000.00 net-liq value.
 

10-year Portfolio Value Goal:  achieve $1,000,000.00 net-liq value.

These goals are well underway, and if my portfolio growth keeps growing at the estimated pace, I should be able to achieve the 6-year goal in 2026, and the $1M goal is currently failing to be accomplished at all. It goes well beyond 10 years.

 

Increase cash equivalents to $60,000 goal

 

Part of my problem in 2022 was that I didn’t have enough cash for trading and investing. Many times, I had to skip a buying opportunity or even sell newly acquired positions to release cash and buying power.

I also believe that my current broker caused many issues with our buying power as they were not able to properly display my buying power to make a proper judgment about whether I had enough money or not. So, I decided to change brokers, and I am currently transferring my accounts from Tasty Works to TD Ameritrade. The transfer should be done by January 16, 2023. Until then, I cannot trade the account as the transfer may be rejected (it already happened once due to expiring options in that transfer window).

 
 




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Posted by Martin January 06, 2023
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01.04.2023 – WEDNESDAY MARKET OUTLOOK – Another day of going nowhere


Market Outlook
 

Institutional investors are still on vacation and will return to the markets next week. That means retail investors drive this market and spook themselves easily with every market move. It could be seen in today’s market price action. A relatively big move early in the morning before FED’s meeting minutes were published, and selloff right after that. But the retail investors who spooked themselves do not have enough money to push the market deep into the red. Last year, when Powell said “inflation,” markets lost 3%. Today? Sleepy day.

 
Market Outlook
 

But it still can all change tomorrow. My expectations are that the investors will (as the media like to say) digest the meeting minutes and sell the market. Trend forecasting suggests it.

 
Market Outlook
 

Other than that, we have a motionless and directionless market. It sits right at the support and waits for resolution. In this case, staying aside and waiting for the trend is best. The Ichimoku cloud is pretty much negative and suggests that more selling may still come, so let’s stay put and wait.

 
Market Outlook
 

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Posted by Martin January 06, 2023
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01.05.2023 – THURSDAY MARKET OUTLOOK – CPI can rock it


Market Outlook
 

Another sleepy day. We received labor data this morning indicating a strong labor market. That rocked the market, and investors panicked again, thinking that the FED would go amock and raise the rates more, higher, longer, and indefinitely. But they forget that the FED has its hands tight already unless they want to crash the entire economy and the world with it. And the labor data is not the only piece of the puzzle here. Overall, inflation is easing, although we still may wake up to a nasty surprise tomorrow.

 
Market Outlook
 

Although the market sold off today, it was a mild selling again. We saw a 1.20% decline at first, but then Bullard said that the FED might slow down the rate hikes, and the market recovered some of the losses (it was down only 0.70% at some point). Yet the market finished down -1.00%. But the most important thing is it still holds the 3,800 support. As of now, it is a good thing.

 
Market Outlook
 

The price is inside the green cloud and above the red cloud support line. The line is stepping up slowly, and the market must stay above it. If we break down, we will have a problem.
The blue line is still deep below the thick red line, which is not good. We need these lines to reverse. But as of now, these lines and the cloud changing into the red is not good for the market. We may fail.

 
Market Outlook
 

The expectation is that the market will continue lower or sideways. But tomorrow, before the market opens, we will receive CPI data. That can completely change the narrative. If CPI comes out weak and slowing, the market will likely rally. If the CPI shows inflation rising again, expect a sell-off. It is a wild card and unpredictable. Anything can happen, so the best strategy now is to stay aside.
 

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