Fed gives Markets what they want ๐Ÿค

Fresh record highs

Here is a quick recap of Markets for the Week of March 22nd, 2024 and what we are watching this week ๐Ÿ‘จโ€๐Ÿซ

The stock market had a strong showing last week, which drove the three major indices to fresh record highs.

The S&P 500 closed with a 2.4% gain this week, Nasdaq Composite jumped 2.9% and the Dow Jones Industrial Average gained 2%.

The gains were largely in response to the FOMC policy announcement.

The committee voted unanimously to leave the target range for the fed funds rate unchanged at 5.25-5.50%.

Here are the key points from last week:

  • FOMC Committee - left rates unchanged as expected but it was the closely-watched dot plot, (updated Summary of Economic Projections SEP) that markets got excited about. It showed that the Fed still anticipates three rate cuts this year despite recent inflation readings coming in hotter than expected.

  • Reddit IPO - Reddit saw a 48% pop in its stock price after its initial public offering (IPO) onto the NYSE. The stock was initially priced at $34 per share and traded to $57.80 at one point, a 70% increase. This will be a good risk sentiment gauge for markets the next few weeks. Keep an eye on it!

  • Earnings caution - results from retail giants Lululemon and Nike raised red flags as they both gave weaker forward guidance, attributed to slower consumption and a shift in consumer spending towards experiences.

  • Bank of Japan - made a historic pivot to hike interest rates for the first time in 17 years bringing an end to 8 years of negative interest rates. The decision to finally hike rates came on the back of the countryโ€™s major corporations increasing wages for their workers to help them cope with the rising cost of living.

S&P 500 Heat map for the week

Sector Performance Breakdown

The Week Ahead

Monday, March 25th - Friday, March 29th, 2024

Attention this week will be focused on:

  • New Home Sales -  Mortgage rates in January moved lower which helped lift new home sales to a 661,000 annualized rate from 651,000 in December. Further moderate rise to 675,000 is the consensus for February.
    - New home sales measure the number of newly constructed homes with a committed sale during the month. The level of new home sales indicates housing market trends and, in turn, economic momentum and consumer purchases of furniture and appliances.

  • Gross Domestic Product GDP Consensus for the 3rd estimate of Q4 GDP is 3.2% growth.

    - GDP represents the total value of the country's production during the period and consists of the purchases of domestically-produced goods and services by individuals, businesses, foreigners and government entities.

  • Personal Income and Outlays - is expected to rise 0.4% in February with consumption expenditures expected to increase 0.5%. Annual rates are expected at 2.5% overall and 2.8% for the core (versus January's 2.4 and 2.8%).
    - Personal income represents the income that households receive from all sources including wages and salaries, fringe benefits such as employer contributions to private pension plans, proprietors' income, income from rent, dividends and interest and transfer payments such as Social Security and unemployment compensation.

Most Anticipated Earnings this week

$SPY:  S&P 500 broke out of its trading range after the Fed gave markets what they wanted to hear, confirming they are still looking at 3 rate cuts this year despite inflation ticking higher.

If SPY can hold 515-520 look for it to grind higher towards 530-540. If it doesnโ€™t hold has room to pull back to 510-500.

SPY over 522 trades to 525,528,530,535. Under 514 pulls back to 510,506,500

What is on your shopping list if markets pull back 5-10%?

I do a weekly Markets analysis every Monday at 8:30pm EST via zoom for the Ceni Capital Community I will be speaking about the shift in market sentiment, companies reporting earnings and the stocks I am watching for Swing Trades.

Trades Recap ๐Ÿ“Š

If you are interested in making your money work for you by getting our swing trade alerts ahead of time, reply back or comment โ€œSwing Tradeโ€ below for more information.

๐Ÿ’ฐ $LYFT: our swing from $16.51 tagged our $20 price target for +23% gain last week.๐Ÿ’ฐ

๐Ÿ’ฐ $RUM: our speculative swing from $6.97 entry tagged our $8 price target for +20% gain and has pulled back to consolidate some.๐Ÿ’ฐ

They are reporting earnings this week and needs to get over $8.50 to start its next leg up.

Learn to make your money work for you, rather than you chasing it. 

If you are interested in getting our swing trade alerts ahead of time, reply back or comment Swing Trades below for more information.

๐ŸšจWatchlist ๐Ÿ‘จโ€๐Ÿซ

$AMD: after rallying +120% since October, AMD has pulled back 20% the last 2 weeks. With Nvidia continuing to rally it may be setting up for a bounce play.

If it can reclaim $185 works its way back to $205, if instead it fails to hold $175 look for it to make another leg down to $160.

AMD over 182 trades to 185,188,190,195. Failure to hold 173 pulls back to 165,165,160

$INTC: Intel normally a slow and steady mover announced it secured up to $8.5 billion in direct funding under the CHIPS and Science Act. If money shifts back into the hot semi sector it sets up for a good risk to reward entry.

INTC over 43.50 has room to 46.50,48.50 and 52. Under 41.50 pulls back to 38.50 and 36

$PDD: reported earnings growth of 123% last week and sold off sharply as investors cashed out on the news.

With a solid report and good forward guidance this discount might actually be setting up for a good dip buy opportunity. Weโ€™re looking for it to consolidate in a tight range to digest this move and then give us a swing entry opp.

PDD over 128 trades to 132,135,140,150. Under 120 pulls back to 115 and 110

*None of these stocks above are recommendations to buy, sell or trade. We do not give financial advice, you should always do your own due diligence and practice proper risk management.*

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