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| By Jim Nelson |
The market is very mixed right now. After a bit of a bounce on news that the Fed may not actually raise rates again this year, stocks have come back down.
There are some good reasons for this.
The next deadline for government funding is now a month away …
We, in the U.S., have a leaderless House of Representatives …
And two endlessly cruel wars are shaking the world right now …
Inflation, too, is a bit hard to comprehend. Last week, a new inflation report came in mixed. Overall inflation saw an uptick to 3.7%. Yet, core inflation fell from 4.3% to 4.1%.
In a vacuum, both numbers are nearly twice the Fed’s goal of 2% annual inflation and would countenance more rate hikes as soon as next month.
But we aren’t in a vacuum.
Energy prices are soaring as the gruesome Israel-Hamas war enters its third weekend. Treasurys are starting to look worthless as yields on 10-year notes flirt with 5% — a level not seen since before the Great Recession.
All of this is to say stocks are slumping for good reason. The question becomes: Will they find support at some point?
We may find out soon.
As you can see, the S&P 500 recently tested its 200-day moving average earlier this month. It bounced off with relish. But this week’s action could present another big test at the level.
Click here to see full-sized image.
Combine this with the gradual decline from the index’s midsummer peak, and we could see a potential “death cross” (a very bearish chart pattern) forming by year’s end.
Now, as your megatrends expert Sean Brodrick reminded us in the office this week: Interpreting stock charts is an art, not a science.
So, we’ll just have to see if any of this plays out … and how our experts will navigate it.
Speaking of which, all of your daily contributors have been quite busy … and actually rather optimistic this week. Here’s what they had to say …
New Investing Technology for an Old-Fashioned Investor
Ratings & Research Chief Gavin Magor kicked off the week by reminding us that you CAN teach an old-fashioned investor some new tricks. He looked at both AI performance in the market ... and AI performance reading the market.
How AMZN’s AI Development Strategy Is Powering Startups
Sticking with the AI theme — and we’re not done with it by a long shot — startup and private equity specialist Chris Graebe dug into a major deal for one AI developer. While the $1.25-$4 billion deal means little to the likes of Amazon.com (AMZN), it’s huge money for one private company. He explains what it means for AI.
The Bull Case for a Gold Rally Right Now!
Sean takes a temporary break from AI to discuss a big change in gold. Nearly a month to the day before, he shared one chart that explained what would happen next for gold. It was set to break out in one direction or the other. It did. This week, Sean tells you how to play that breakout.
Retailers Are Dead Wrong on Taylor Swift “Funflation”
There is simply nothing bigger than Taylor Swift’s popularity in the world right now. Despite this undeniable fact, some retailers are blaming their poor financial performances on her live performances. Jon Markman stopped by to tell you about one in particular to avoid.
Why the Sam Bankman-Fried Trial Is Good for Crypto
We brought in a specialist to discuss the much larger ramifications of the Sam Bankman-Fried trial, which could start to wrap up next week. Jurica Dujmovic gives us the scoop on why this trial could transform crypto and its many regulations … for the better!
That’s it for this week. Have a great weekend!
Until next time,
Jim Nelson
Managing Editor
Weiss Ratings Daily
