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01.18.2023 – WEDNESDAY MARKET OUTLOOK

Market Outlook
 

The weakness in the market prevailed today. After not-so-good economic data and hawkish talks from the FED heads (there are still a bunch of the FED directors that want to raise rates more than the FED itself as a whole, I guess they are bearish) along with enormous put-buying that the market makers need to hedge sent the market down by more than 1% today.

 
Market Outlook
 

The market participants had a lot of puts expiring this Friday. Normally, market makers would have to reduce their hedges after expiration, which would send the market up. But with today’s put buying, it is probably not gonna happen. The market still struggles with 4,000 resistance, but I think the 3,900 support will hold. Right now, we will sit tight and wait. Patience is a virtue.

 
Market Outlook
 

The Ichimoku chart indicates that we broke the support at the red line making this trend vulnerable again. Ideally, we need the price to stay above the blue and red lines, the blue line cross above the red, and it would be even better if the price stays above the cloud. That is not the case, so this trend is weak and failing until it changes. Next Friday, we will receive a new core CPI report. That will show inflation cooling off more, and that could be a catalyst for a renewed uptrend.

 
Market Outlook
 

The trend forecast failed today. The market is news driven, and that changed the narrative as spooked fragile investors freaked out again about old news. That will eventually dissipate as these fragile people eventually run out of money or shares to sell. The rest of us need to wait them out before stepping back in. The trend indicates sharp selling tomorrow morning with some recovery during the day. I do not expect a positive market outcome tomorrow. The market needs to settle down and spooked investors to calm down before the trend changes again. More selling tomorrow.
 

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