Morning Market Outlook 12202023

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Good morning, everyone, and welcome to Wednesday morning.
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It's Stephen Whiteside here from theuptrend.com.
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In the pre-market this morning, things are fairly quiet, stock index futures are
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slightly below fair value, while commodities are mixed with crude oil
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higher and gold trading lower in the pre-market.
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I won't keep you very long this morning.
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Let's start off with a little housekeeping.
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Christmas is on Monday.
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We will be closed next week, but we will come back on Saturday, December 30th, and
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do a complete daily, weekly, and monthly update of the website.
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Looking at the VIX, the VIX is just treading water here.
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Notice that we've got two blue dots here.
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We've had that before.
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We are looking for a close on Wednesday above 12.89. If that were to happen, we
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would turn from being short term bullish to being short term bearish on the market.
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Now, we talked about watching the bond market and the TLT and the XBB both
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traded higher on Tuesday, so that's supportive for higher stock prices.
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We saw the US Dollar Index pull back a little.
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It's still on a sell signal.
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That's supportive for higher stock prices.
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Crude Oil continued to move higher on
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Tuesday and closed above the upper channel line, giving us a new daily buy signal.
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The TSX Energy sector also
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generated a new daily buy signal, closing just two cents above the upper channel
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line, joining US energy stocks already on a buy signal.
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Well, what worked on Tuesday?
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Well, silver miners were the big winners.
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They were up over 3 %, followed by US Gold miners, followed by Copper stocks.
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And then the TSX Global Gold Index was up just under 2 % on the day, still trying to
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break out above the highs from a couple of weeks ago.
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Now, the market is still in love with tech stocks.
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We saw the Nasdaq-100, the equal-weighted
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Nasdaq-100, and the Next 100 all make new highs on Tuesday.
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We also saw a new high for Canadian tech
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stocks, but they ended the day slightly lower, so no change there.
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Shopify was able to hit our next price
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target yesterday, and then semiconductors are up at the recent highs.
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No change in trend for semiconductors.
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Now, the majority of stocks in the Nasdaq
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100 are included in the S&P 500, which also made a new high on Tuesday.
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If we look at the percentage of stocks on
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the S&P 500 currently trading above their 50-day moving average, you can see that
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we're right up at the top of the levels where we have peaked previously.
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This is the time and place where you look to sell stocks, not buy stocks.
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Obviously, a lot of people are buying stocks right now.
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They are certainly getting in at the end, not the start of anything new.
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Of course, the best places to look to buy
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stocks is when an indicator like this is down at the bottom of the level.
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We talked about this back in the fall when we were looking for the year-end rally set
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up to start, and it certainly has worked out so far.
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But yeah, this is the time and place you look to be a seller, not a buyer.
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When we overlay the S&P 500 on this indicator, you can see that last time we
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peaked was back in the summer, and that led to a multi-month sell-off.
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Looking at the seasonality of the S&P 500, and we've been looking at this all year
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and expecting rally into year end, and that's what we're getting.
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What happens in January, if you'll look at the bottom left-hand corner here, usually,
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we get buying into the start and selling into the end of January.
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And given where the market is right now, I
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would not be surprised if January ended up being a negative month.
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Let's finish off this morning's
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presentation looking at a stock in the news this morning, and that is FedEx.
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Fedex, like many stocks, bottomed in October and then started to move up off
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the bottom of the Panic Zones, a pressure zone formed.
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That was the low risk setup and we've been moving up.
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We've been up at the top of the Panic Zones for a while, so this is the
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time and place you look for selling opportunities.
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Now, when we look at the Fly Paper channel
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chart, you can see it's not the most volatile stock in the world.
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The average true range is currently at 1.97%, so just under 2% per day.
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Yesterday was a fairly quiet day, was down
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0.68%. When we look at the Right-Side chart, we are coming into today's trading
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action, looking for a close below 271.03 to give us a sell signal.
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Here's where the buy signal showed up, the first close above the upper channel line.
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You could have bought the next day at 245
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and had had lots of opportunity to take money off the table along the way.
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One of the reasons that we like you to
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sell into strength is because stocks usually fall faster than they rise.
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Here's where FedEx is trading.
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Last time I checked this morning, so down over 10 %, down near the 250 level.
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If I still owned any FedEx, I wouldn't be selling at the open.
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Usually, people in the premarket overreact
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and calmer heads get involved after the market open.
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So if I still had some FedEx left in my
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account, I wouldn't be selling at the open.
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I'd wait to see where it closed this afternoon before I put in a sell order to
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get rid of the remainder of my FedEx position.
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Okay, folks, that is all for this morning's presentation.
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So far, it looks like we may get a little selling at the open on Wednesday morning.
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Have a great day.
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Next time to hear my voice is on Thursday morning.

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