Hope your week went well! Here is a quick recap of Markets for the Week of September 22nd, 2023 and what we are watching for next week 👨‍🏫

There was nowhere to hide this week as markets registered big declines. All 11 S&P 500 sectors finished in the red due to another jump in Treasury yields, thanks to the Fed’s hawkish pause on Wednesday.

As we’ve said before, higher rates are not good for risk on assets like stocks and crypto- see why in our previous post here.

The specter of higher rates has cast concerns about a slowdown in borrowing, consumer spending, and earnings growth.

Here are the key points from last week:

• The Fed - voted unanimously to leave the target range for the fed funds rate unchanged at 5.25-5.50%. The real blow came from their Summary of Economic Projections and dot plot where they conveyed they are not expecting to cut rates in 2024 as much as they were anticipating when they updated their forecasts in June. This dented market hopes that the Fed could shift to an easier policy stance in the near term.

• Chairman Powell - signaled the need for higher for longer rates as growth remains robust, the labor market remains tight, and inflation remains above their 2% target (the target is to get there by 2026).

• US 10-year yield hits highest level since 2007 reaching 4.49 after the Fed’s decision. Yields on the 5-year note and 30-year bond also reached their highest level since 2007 and 2011 respectively.

• Credit card companies are racking up losses at the fastest pace in 30 years 😨 outside of the Great Financial Crisis. These losses have been rising rapidly since Q1 of 2022; which is unusual outside of an economic downturn. Goldman Sachs predicts that credit card losses will continue to climb into the end of 2024 and early 2025. (See some helpful tips to manage debt here.)

• IPO market fizzle and fade thus far After a 21 month hiatus IPOs are back….well kind of. Arm (ARM), Instacart (CART) and Klaviyo (KVYO) initial public offerings were “successful” trading +20% to +40% on opening day only to come down just as fast as they went up. The weakness in the stocks post-IPO indicates that investors are concerned about longer-term valuation prospects of these companies.

$SPY: The S&P 500 sold off sharply last week with a 1-2 punch from Powell and Treasury rates trading down to our 430 price target (mentioned last week). It’s looking to breakdown out of its 12 week trading range 430-450 going back to the end of June.😖

Click the chart below for a quick video preview on how we plan to capitalize on this move down

I do that every Monday during “Office Hours” 8:30pm EST via zoom for the Ceni Capital Community stop by, say Hi and check it out. All are welcome.

$SPXU: is the SPY hedge I mentioned, if the S&P 500 continues trading down look for SPXU to trade to $13.50 and $15.

$SQQQ: is the QQQ hedge I mentioned, if the Qs continue trading down look for SQQQ to trade to $22, $23.50 and $25.

If you are interested in getting our swing trade alerts ahead of time, reply back or comment “I am interested in the swing trade alerts” for more information

We spoke about “The September Effect” and Market sentiment shifting back on September 8th here. This is how some of those trades panned out:

$NFLX was a BIG winner for us! After failing to hold that $435 support we were watching it traded down $55 or 12.68% to $380.

$MSFT as markets failed to go and traded lower, Microsoft failed to break thru that inverted Head & Shoulders pattern on the daily. Then failed to hold that $330 key support I wrote about and tagged our downside targets to $315 for $15 or 4.5% 

In the same period, since the September 8th write up the S&P 500 is down 2.80% so Netflix could of 10x your money and Microsoft small double. Let’s work smarter, not hard people 🤷‍♂️

*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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See you next week! 👋