QuiCQ 17/01/2025
"I don't call it technical analysis anymore, I call it data visualization"
— Ralph Acampora
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Yesterday’s equity session was relatively calm in comparison to recent past, with the S&P 500 closing down marginally (-0.2%). However, a quick glance at the index’ market carpet reveals that Thursday was much better for equities than the headline number would suggest:
Indeed, the up-down ratio was 3:1, with the mega-caps lagging, led by a USD145 billion market cap drop in Apple, on concerns over margin drops in their iPhone business.
The prove of a broad market advance is in the pudding S&P 500 equal-weight index, which rose 0.8% and is now well off it’s January 10th lows. And the prospects for a continuation of the rally are good, at least from a contrarian stand point of view. Every Thursday, the AAII (American Association of Individual Investors) reports a survey of their members regarding their bullish- respective bearishness. Yesterday’s report showed bears outweighing bulls by the widest margin since November 2023:
Yields continued to contract, partially on not too exciting (read: hot) economic data, partially due to dovish Fed speak, but mainly probably due to a strongly oversold condition on bond markets, which needed some release.
Additionally, headlines like these:
probably also helped to sooth bond investors.
Another headline from incoming Treasury secretary Scott Bessent’s Senate hearing was regarding him being in favour of dialling up economic sanctions on the Russian oil industry. It surprised me how this failed to show through via an higher oil price, with crude futures (Brent) actually nearly down a percent. But maybe the trade was expressed via natural gas, where futures prices advance more than four percent.
The Dollar was largely unchanged, with the largest moves coming from a strongly falling Mexican Peso and a second consecutive strong day for the Japanese Yen:
Today should be another fairly quiet session in recent context, as the world awaits Donald Trump’s inauguration on Monday and then — all eyes on his Twitter feed!
Have a great weekend!
André
Back in mid-November I voiced my opinion that Gold would not reach a new ATH before the inauguration of President Trump. Well, ain’t I lucky that this event is taking place next Monday!
Gold has had a decent, but seemingly largely unnoticed stealth rally since late December. On Wednesday it broke ‘officially’ above its triangle consolidation (dashed line), confirmed by another advance yesterday:
The final confirmation of uptrend resumption, from a data visualization point of view least, would be a move above $2,270 (dotted line) - and of course the previous ATH. But, should this dotted line be exceeded, the technical price target moves anywhere between $3,020 and $3,160.
Stay tuned…