Shooting Stars Across the Board - Decoding their Relevance
Bullish seasonality can be invalidated. - The predicted move for SPX to its 10 weekly average came true, also the setups for several securities analyzed in the previous edition.
Don't let Friday's price action distract you. The weekly move was bearish, as anticipated in the previous Weekly Compass. More importantly, next week's Fed interest rate decision and significant warning signals for the indexes should be closely monitored. There are shooting stars across the board.
Remember the ocean of bearishness of September, this publication anticipated the bullish target for SPX at $5,885 back then, and highest price reached by the index was $5,878 two weeks ago already.
Last week, this publication anticipated a decline for the S&P 500 to its 10 weekly average considering its bearish context and the chart presented, and that was exactly the destination of the pullback this week: $5,702 was the low, and the line mentioned was at $5,709. It was a -1.37% during the week.
Other anticipated moves came true: GOOG continued its bullish reversal; AAPL declined confirming the top thesis; NVDA declined as technical signs warned; DJI is on the pathway to the bearish destination anticipated; BITCOIN had an intra week reversal as expected; and SILVER declined swiftly as anticipated.
Other securities that suggested consolidation and the key level to watch worked as a reversal confirmation: META, IWM, GDX.
The bullish thesis for MSFT was invalidated, and the support level that would act as line in the sand for invalidation was provided. AMZN was presented with mixed signals, the bullish ones ended up as true, the key level between bulls and bears was provided.
Last but not least, NDX did not save the rally, that was the index without bearish confirmations last weekend, but it broke below the key level to watch.
Today the context is risky for bullish positions, critical support lines have been breached, the next week the FED will decide if more rate cuts are coming in the middle of concerning macroeconomic news. Technically speaking, major bearish reversal signs must be watched, they are presented here with neutral analysis that provides a visual and numeric references, not opinions, just facts.
MACRO ECONOMIC NEWS ARE NOT BULLISH:
The October jobs report was a major disappointment, with only 12,000 jobs added, far below expectations of 110,000.
The Labor Department revised down the previous two months' job numbers, subtracting a total of 112,000 jobs. August and September figures were revised downward by 81,000 and 31,000, respectively.
Over the past two years, a staggering 1 million jobs have been revised downward. This October marked the weakest job growth in nearly four years.
If government jobs were excluded, we would have seen the first negative payroll month since December 2020.
Remember leading macro indicators presented not long ago and their warnings, get access here:
Rate-cuts with weak macro news is not a good formula for the stock market in the middle and long term as studied in a comprehensive study presented before the first rate cut. The short term reaction was studied versus the middle term reaction:
Today’s edition is robust in analysis, we just finished a week and also a month, which by the way was supposed to be bullish, but it ended in the red, let’s study the current context for SPX, NDX, DJI, IWM, GOOG, AAPL, TSLA, AMZN, AAPL, META, NVDA, GDX, SILVER, NAT GAS, DAX, BITCOIN and contextual charts. This is a must read and print or bookmark edition.
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