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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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