Market Outlook Bullets for 10/13/2024

October 13, 2024

Big View Analysis

By Lincoln Oehlers


Big View Bullets as of Oct. 13th

Risk On

  • Both the Dow and S&P made new all-time highs while the Nasdaq and Russell, just off their highs, also closed up on the week a little over +1% on average with all the indexes in full bullish phases and not at overbought levels.. (+)
  • Sector performance was mostly positive with more up than down, led by transports (+5.4%) and regional banks (+3.8%) and semiconductors (+3.4%). However, retail and consumer discretionary were down, giving a mixed to positive read. (+)
  • The number of stocks above key moving averages all confirm risk-on readings. (+)
  • Risk Gauges improved to risk-on. (+)
  • Value stocks hit a new all-time high and both Growth and Value are performing well in bull phases and relative performance is about equal across the board based on our Triple Play indicator. (+)
  • For the Modern Family, XRT and IBB regained their bullish phase. IYT exploded higher and KRE looks poised to take out a triple top developing since July. (+)
  • Foreign equities remained in a bull phase working off overbought reading from several weeks back with U.S. equities regaining its relative leadership. Important to watch for EFA to maintain its bull phase above the 50-Day Moving Average. (+)
  • Despite the Fed lowering rates last month, Interest rates have risen across the board with better economic numbers and inflationary pressures still simmering. If this is an indication of a more robust economy this could be perceived as bullish for equities, assuming current levels are held. (+)

Neutral

  • Volume patterns lagged the market and surprisingly, distribution days (4) outnumbered accumulation days (3) for the S&P. (=)
  • Mixed reading from the NYSE New High New Low ratio as the short-term averages continued to pull off a little while the positive longer-term trend remains intact. (=)
  • Both Gold and Oil rallied with Gold poised to take out it's all-time highs after digesting recent gains over the last few weeks. (=)
  • Both soft commodities and copper rallied on the week, maintaining bullish phases and indicating inflation is still present. (=)
  • Solar sold off hard for the week, possibly trying to read the political tea leaves. However, clean energy (PBW), had a strong day on Friday, closing up almost 3% on the week. (=)
  • The McClellan Oscillator seems to be a little out of sync with the market putting in new highs and still showing a neutral reading. (=)
  • The intermediate-term basis (the 50-Day Moving Average) color charts are showing a positive reading for the Dow, S&P, and the Nasdaq. However, we are getting a much more mixed read on a shorter-term basis, with sloppy action in the S&P and Nasdaq. (=)

Risk Off

  • Despite the markets closing at new highs, volatility levels remain elevated and the cash VIX remains in a bull phase. (-)