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Premature Victory Please click here for a chart of SPDR S&P 500 ETF Trust (NYSEARCA:SPY) which represents the benchmark stock market index S&P 500 (SPX).
Note the following:
- The chart shows that the stock market is consolidating below the resistance zone but above the mini support zone.
- RSI on the chart shows that the stock market is oversold in the very short term. Oversold markets tend to bounce.
- Consider not paying attention to Dow Jones Industrial Average (DJIA) as represented by ETF SPDR Dow Jones Industrial Average ETF Trust (NYSEARCA: DIA) and instead focusing on S&P 500. The reason is that Boeing Co (NYSE: BA), a stock in DJIA, is down about 7% as of this writing in the premarket. BA stock is down due to an Alaska Air Group, Inc. (NYSE: ALK) plane 737 Max-9 experiencing a blowout incident with a door plug.
- Treasury Secretary Yellen has declared victory. She tweeted, “The American people, workers, and businesses have helped put us on a path to a soft landing. @POTUS’s economic agenda is giving them the tools they need to grow the economy, including historic investments in infrastructure, clean technology, and semiconductors.”
- In The Arora Report analysis, Yellen is premature. The reason is the 40 year history of recessions that we have deeply studied. It is important for investors to understand how recession occurs and how every single time, a vast majority of investors are blindsided and lose money. To help those wanting next level knowledge, we are preparing a podcast. The podcast will be available in the Arora Ambassador Club.
- There are two important conferences that will impact several stocks and may impact the overall stock market.
- Consumer Electronics Show is taking place in Las Vegas. This time, the focus is on artificial intelligence.
- JPMorgan Chase & Co (NYSE: JPM) Healthcare Conference is taking place in San Francisco.
- The Arora Report will be keeping track of presentations in both conferences and provide signals if they are triggered. Buy signals will be in ZYX Buy, and short signals will be in ZYX Short. In the event a new major trend emerges, there may be a signal in ZYX Allocation.
- As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents. Please scroll down to see the protection band.
India The First Advance Estimate of India’s GDP growth is 7.3% in the current fiscal year. This is slightly higher than 7.2% consensus. This puts India as the fastest growing large economy in the world.
ZYX Emerging has continuously covered India for 16 years. There are two India ETFs in ZYX Emerging Model Portfolio. India is the best large economy growth story for the long term. India small cap iShares MSCI India Small-Cap ETF (BATS: SMIN) is in ZYX Emerging Specialty ETFs Model Portfolio. Members of ZYX Emerging who scaled into ETF SMIN when it dipped into the Buy Zone in 2023 gained 44% in less than nine months.
Magnificent Seven Money Flows In the early trade, money flows are positive in Apple Inc (NASDAQ: AAPL), Amazon.com, Inc. (NASDAQ: AMZN), Meta Platforms Inc (NASDAQ: META), Microsoft Corp (NASDAQ: MSFT), and NVIDIA Corp (NASDAQ: NVDA).
In the early trade, money flows are negative in Tesla Inc (NASDAQ: TSLA) and Alphabet Inc Class C (NASDAQ: GOOG).
In the early trade, money flows are mixed in SPDR S&P 500 ETF Trust (NYSEARCA:SPY) and Invesco QQQ Trust Series 1 (NASDAQ: QQQ).
Bitcoin This is a key week for Bitcoin (CRYPTO: BTC). Investors are expecting a bitcoin ETF approval as early as tomorrow. Here is the key question for investors: Will bitcoin ETF approval be a sell the news event? There is also a risk that the SEC may not approve a bitcoin ETF. The consensus is that the SEC will approve several bitcoin ETFs at the same time.
Markets Our very, very short-term early stock market indicator is