Market: Week 1, Week 2 — What’s next for Week 3? | Mish’s Market Hours

adminJanuary 11, 2024

Looking at the Economic Modern Family (weekly chart), all peaks so far have occurred in December. The Russell 2000, Regional Banks, Transportation and Retail have retreated the most from their highs as far as indices and sectors are concerned. Semiconductors have moved further sideways since their peak, as has biotechnology (which remains the strongest sector).

This sets the stage for a January calendar reset. This range applies for the entire year (although new ranges are available in July) and will appear next week.

For example, IWM’s January high of 201.62 is likely the highest January price for six months. The lowest so far is 192.26, so unless it’s breached, this could be the January calendar low. That range is important to observe. From above, you have to be optimistic. Caution is required below. And you have to be patient because the market can crash in the meantime.

We use small-cap stocks as a gauge of overall economic sentiment. Growth stocks shine, but without small cap stocks, growth stocks are also expected to sell off.

Retail is of particular interest as some of my stock picks (my vanity trades) are performing well while the ETF itself is above key support where it must remain. The growth space is becoming crowded again, and the “inside sector” is showing some wear and tear.

We’ve been here before. Although Newton’s laws state that things in motion stay in motion, we believe it is wise to remain generally agnostic about the next major direction until these calendar ranges are revealed.

What about raw materials?

We will be watching the CPI numbers carefully. But we are more interested in supply chains, geopolitics, Fed rates and the trajectory of the dollar. Despite its recent pop, the dollar appears more vulnerable over the long term.

Gold still looks stable despite being more range-bound now (another great six-month calendar keeper to watch). And oil prices, also range-bound, began consolidating between $70 and $73 per barrel. We remain of the view that it may take a long time, from late spring to early summer, for commodity prices to recover. On the weekly chart, both GLD and USO underperform SPY at risk.

Momentum lies in the bearish divergence in gold. This means the price could go lower, although we believe $2,000 should remain there. In the case of crude oil, momentum is in a bullish divergence, meaning that the selling is currently weakening and there is still room for upside.

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In this video from CMC Markets, Mish continues his analysis of gold, oil and gas, this time adding an outlook for the dollar/yen currency pair and the dollar long term.

Mish appears on Business First AM to talk about how the January effect will play out and how to focus on vanity trading.

Mish covers oil, gold, natural gas, silver, and sugar, and teaches you how to use charts to determine short-term trading strategies in this video from CMC Markets.

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In this appearance on BNN Bloomberg, Mish talks about some particularly interesting charts and other places to invest in 2024.

In this appearance on Fox Business How to Make Money with Charles PayneMish talks to Cheryl Casone about Bitcoin’s volatility and why EVs may not be a good place to invest right now.

Recorded on December 28, Mish talks to Singapore Breakfast Bites about the themes to look for in 2024 and what to focus on, what to buy and what to avoid depending on economic and market conditions.

Mish, along with two other market experts, helps you prepare for 2024 with forecasts, picks and technical analysis from StockCharts TV. draw a chart ahead special.