Free Daily market review Jan 11th, 2024 (market stall at previous high after recovering from CPI-induced drop in intraday session, newly added Bitcoin chart section)
Broad market overview
On Jan 11th 2024 trading session. SPX, NDX , DJIA stalled at new high after CPI-induced intraday drop were reversed around US eastern time 12 – 1pm. Major cap weighted indices are stalling at the high and showing hanging man candles, which may suggest continuation of consolidation.
Equal weighted, Mid&small cap and transportation range are contracting, which typically happen before occurrence of large range candles in near term future.
S&P 500 11 sectors
It’s mixed and not showing much signal.
Apple downgrade (to 2nd largest holdings in SPY )
FYI,
=> as of Jan 4th 2024, Apple is the 2nd largest holdings in SPY ETF (6.76% ), overtaken by Microsoft (6.95%)
=>Apple is still vanguard total stock market fund ,VOO, InvesCo QQQ,QQQM largest holdings
If Apple market Cap is overtaken by Microsoft ( AAPL 2.90T vs MSFT 2.84T as of Jan 10th ) and other ETF, Mutual funds start lowering Apple weightings in the fund, Apple performance will likely lag both market & Tech Sector return going forward
On the surface, the % changes may not seem much, but 0.2% differences in all these ETF and Mutual funds are equivalent to billions of dollar in flow allocation differences, inflow differences of this magnitude widen the return performance chasm between them.
Apple technical charts
Currently price is between 50D and 100D MA. Apple may possibly recapture 20D MA, but its performance will likely lag the market going forward.
The difference in fate could not be starker, Apple is facing few headwinds( sales slowdown, lawsuits, and possibly weightings changes in ETF/mutual in future ), while Microsoft is having tailwind on its back ( AI deployed across all the divisions )
Personally, I am still a big fan of Iphone 15 pro. ( 3D facial recognition is still best, idiot proof, Scam proof, what’s there to not like about this phone ? )
MOVE index
Move index give us one possible lenses to look at private sectors collateral pool utilization. MOVE index close at 103.45, price has broken out of symmetrical triangle formation. MOVE has broken to the downside, but stock is still in consolidation phases, things are getting curioser and stranger. We will need observe for a few more days to see the relationship convergence/divergence between stock market and bond volatility gauges
NYSE market internals
Wednesday Jan 10th, 1.31 to 1 NYSE Advancer to Decliner ratio ( 1660/704 )
Thursday Jan 9th, 1.39 to 1 NYSE Decliner to Advancer ratio ( 1631/1174 )
Bitcoin overview
I have decided to include a section to analyse Bitcoin daily charts, after Bitcoin ETF is approved.
=> It’s becoming mainstream and will continue to receive significant institutional flow in future
=> BIS allowed Central bank to store 2% reserve in cryptocurrencies as of 17 Dec 2023
=> In terms of bondspeak, Cryptocurrency has larger “duration risk” than Technology stock, therefore Crypto possess far higher sensitivities to liquidity & interest rate fluctuation than other financial instrument, offering one extra lenses to look at ( outcome of ) liquidity and risk appetite.
Now let dive into Bitcoin daily charts
A few technical characteristics worth noting,
1)Tight coiling, bottom is higher and keep getting bought
2) 20D MA delineate the shorter-term uptrend and downtrend phases very well.
3) Price stay above 20D MA after 20D MA cross above 50D MA (Green Phase)
4) Price stay below 20D MA after 20D MA cross below 50D MA (Red Phase)
That’s all I have for now for bitcoin, do not really have any biases /clue on near term directional movement.
My future plan
As market are quiet, these are the best time to work on my other sections in the blogs and publishing. Amongst which, Final market lesson of 2023 and market model approach. I was planning to published them in the first week of January, however market had other plan and decide to throw a monkey wrench to my time schedule, as the saying goes, man proposes but god disposes.
As always, we will continue to monitor the charts, assess the bullish/bearish evidence day-by-day to make appropriate capital allocation and investment decisions.
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