SPY Chart done on hourly timeframe. Market sentiment turned pessimistic last week after mixed economic data and earning results from Tesla and Netflix. September retail sales reflected a 0.7% increase vs the 0.3% expected. On one hand, strong retail sales indicate strong economic activity, but strong spending could also lead to an uptick in inflation. The Fed are using high interest rates to slow down spending and economic activity, so the unexpected jump in consumer spending was a mixed signal for the markets as it could lead to lingering inflation and further interest rates. The PCE report will be released this week, which is The Fed’s preferred inflation gauge. PCE has been slowly cooling down and moving in the favored...
SPY Chart done on hourly timeframe. Earnings season kicked off last week with financial institutions such as JPMorgan, Citibank, and Well Fargo all topping expectations and boosting their forecasts. Although bank earnings were great, the market gave up much of its gain on Friday due to rising conflict in the Middle East and a weakened consumer sentiment reading. The University of Michigan’s preliminary October consumer sentiment index fell to 63 on Friday’s reading, which is the lowest in five months, and it could explain the sharp downside move market saw to end the week. Earnings season will continue this week with many prominent companies such as: Netflix, Tesla, Goldman Sachs…etc. reporting. Wall Street boosted corporate earnings projections early this month,...
SPY Chart done on hourly timeframe. Financial institutions are set to report earnings this week, which means it’s the start of earnings season. Industry leaders such as: JPMorgan Chase, Citigroup, Well Fargo…etc. will update markets on their Q3 performance. Their earnings last quarter surprised investors with better than expected numbers, but analysts are on edge this quarter as weak stock and bond market performance can have an impact on their bottomline. Banks already experienced volatility in the first half of 2023, so investors want to see them at least come in line with expectations to avoid further uncertainty. Other earnings in focus this week are expected from PepsiCo, Delta Airlines, and United Health. All three of these names hold heavy...
SPY Chart done on hourly timeframe. Markets are getting ready to take on a new month after September once again proved to be a very volatile month. The volatility index (VIX) reached a high not seen since May, and SPY closed below 430.00 for the first time since June. This volatility is expected to continue this week as traders face a new uncertainty about the government shutdown. Analysts at Goldman Sachs are estimating that a government shutdown could cost the U.S. 0.2% in GDP growth per week that it is shutdown, plus major reporting agencies like the BEA would no longer report key economic data. The Fed rely on the BEA and BLS to make important monetary policy decisions, so...
SPY Chart done on hourly timeframe. Market volatility continued last week as traders and investors decide which direction to take next. Friday was especially notable for SPY because it recorded the largest volume seen since 6/16/2023, which was a bearish day followed by a full week of downside movement. The Market Volatility Index (VIX) also saw a sharp move up on Friday, likely due to the upcoming Fed’s meeting. The Federal Reserve will be holding its FOMC Policy Meeting on Tuesday and Wednesday to give an update on monetary policy and interest rates. Interest rate decisions are typically based on economic healthy and inflation, but although multiple inflation reports came in higher than expected this month, the probabilities for a...
