I started last week's Momentum Monday with one word, "Positive" and that carried on to the week just past.
<With the renewed optimism don't forget to share your stock of interest for all of us in the Village Square... read on here if you want to learn more>
It's amazing what a difference a month makes. January has done more than enough to distract us from real world issues such as inflation and so forth. This despite analysts all over the world, including here in Australia, increasing their expectations on interest rate rises, yet the market hasn’t battered an eye lid.
It reminds us why traders often choose to ignore analysing the macro scene, preferring price to do the research for them. And with so many stocks showing an improvement in sentiment, is it any wonder we have all forgotten about the impending crash.
I was asked by someone this week, "when will the crash come?" My response, "when we least expect it."
Broader market sentiment
S&P500
Despite the negative close on Friday, it was another positive week for the S&P500.
S&P500 Weekly chart
The index now looks well on its way to the 4250 range which would be the retest of the lower high back in early Aug 2022. Any break above that will likely see continued positive momentum.
The most pleasing aspect of the last two weeks performance was the break about the upper band of the downward channel that the stock was in.
S&P500 3 month weekly chart
While in of itself, it was not going to guarantee a positive stretch of performance, it does provide some comfort that the sell off which commenced from the peak in December 2021 is starting to lose steam, which will form a base for future moves.
But it was an extraordinary week for US markets. Meta rose 25% in a single day on the back of their latest quarterly result. To provide some relative context for Australian investors, imagine Telstra doing the same? Mind boggling.
The triple AAA's (Apple, Alphabet & Amazon) also reported mixed results, with the latter a major contributor to index's weaker finish on Friday.
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