Trading Sunset

As of the November 1st close, the SPX stands at 5728, having seen some choppy cooling from the Oct’17th hist’ high of 5878. Monthly momentum is weakening, but will likely stay positive until at least next March.

Equity bears need a monthly settlement <5400 (to be decisive) to be able to claim the m/t bullish trend has been broken.

Regardless of who wins the US election, it should be clear… the US economy is slowing. Whilst Q3 GDP printed 2.8%, its grossly skewed by 5-6% of deficit spending. Other econ-data points aren’t as pretty, not least with a garbage jobs report from the BLS.

Many have been lost in the hysteria, with the mainstream cheerleaders continuing to tout #everythingisfine . For most within the USA and Europe, the reality is very different, with the consumer increasingly broken.

Yours truly is patiently awaiting a ‘decisive’ main market rollover. Whether that is before year end, or not until next year, I will be there, and hope YOU will too!

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Its the treacherous month of October, but the SPX is close to breaking a new historic high. Why worry though… as everything is fine, yes?

As of Oct’4th 2024, the monthly RSI is 72. Sure, it can stay above the key 70 threshold for months at a time, but on any basis, this market is m/t overbought.

We have ‘interesting’ times ahead, not least with the US election, further rate cuts, and an increasingly nightmarish geo-political situation.

I would keep in mind we’ve now seen rate cut’1, and a sustained uninversion of the US 10yr/2yr yield curve. Both merit as equity sell signals. For now though, the mainstream cheerleaders and associated ‘smart guys’ continue to tout the #everythingisfine narrative.

Ohh, and to be quite clear, whilst we don’t have a m/t turn yet, once we do, I’ll be one of the first to call it.
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yours… still typing

As of Sept’14th 2024, US interest rates are being pinned by the Fed to 5.25-5.50%

I’m expecting three rate cuts at the remaining three FOMCs…
Sept’18th -25bps
Nov’6th -50bps
Dec’18th -50bps

The latter two are predicated on the notions the equity market will see a significant washout before the election, and the jobs data will continue to weaken.

On a grander perspective, it should be clear that rate cuts are usually around the time when equities max out, and begin a broad multi-month/year decline.

–

Subscription offers

6 months at $17 a month for $102 (+ ONE month of free time)
12 months at $15 a month for $180 (+ THREE months of free time).

Notes:
-Payment for each offer is in one lump sum.
-Offers valid until midnight EDT, Sunday Nov’10th 2024
–

You can pay via Stripe, which takes payments, including Visa, Mastercard, American Express, Discover, Diners Club, Apple Pay, Google Pay, and Link.

Six months > https://buy.stripe.com/8wM4kedNq0ee1DG002

Twelve months > https://buy.stripe.com/dR6eYSgZC7GGbeg3cd
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Yours… charts 24/7/365

 

Ten trading days is a long time in market land, with the SPX swinging from 5119 to 5661, a wave of 542pts (10.6%). The mainstream have literally swung from begging for an emergency rate cut to ‘the consumer is strong, #everythingisfine’.

You can argue the mainstream have always been twitchy, and bi-polar to some extent. Yet such collective mood swings have never been more powerful, and more rapid.

The same mainstream believe that a rate cut will help equities, the consumer, and the broader economy. The most recent three grand market declines (2019/20, 2007-9, and 2000-02) all began from around when the fed started cutting rates.

No, I’m not saying rate cuts caused the equity declines or the recession, but they sure as hell do make for the ‘ultimate equity sell signal’.

As things are, I’m expecting three rate cuts before year end.
Sept’18th -25bps
Nov’6th -50bps
Dec’18th -50bps

If I’m right, they will merit as an equity sell signal, especially for the financials, whose net interest margins will be significantly impacted. I’m actually hoping to see a few posts from people this mid September, who turn extra bullish the banks on rate cut’1. Good luck with that!

Regardless of how we trade across the next ten days into the Labor day holiday break, I’d look for price action to become increasingly problematic across September, and more so… October. There are seasonal factors of course, but the uncertainty of the election will be a prime excuse for the market to take another dive lower.
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I’m looking to pick up some more subscribers.

My usual price for monthly recurring is $19.

My offer is $13 a month.

Notes…
The price is guaranteed for one year.
You are free to cancel at ANY time.
You will (likely) need a Paypal account.
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Special note… please provide an active email address when you subscribe, so I can send your account login details!

If you have any issues or questions, please email me!
> https://www.tradingsunset.com/contact/

Yours… charts 24/7/365