Semis to take a break?
June 23, 2024 - Update
Current Economic and Market Conditions: A Snapshot
Monetary Policy
Still Restrictive: The pace of restriction has slowed, indicating the FED is waiting for better data to consider easing.
Credit Conditions
Slight Improvement: Banks are slightly increasing loans after a long period of decline.
Inflation
Current CPI: Slightly better than expected at 3.3% YoY.
Inflation Nowcast: Predicts a 3.1% reading for the next report.
GDP Forecast
Q2 Forecast: 3% growth, suggesting a strong economy that does not urgently need rate cuts.
Treasury Yields
10-Year Treasury: Currently in a downtrend.
Oil Prices
Rising: Although the price of oil is up, the overall macroeconomic environment remains favorable for stocks.
Index Performance
NASDAQ
Weekly Performance: Closed at 0%, showing signs of tiredness.
Chart Analysis: Healthy, with prices above key moving averages.
Rotation Indication: NASDAQ is underperforming the SP500, hinting at possible sector rotation away from technology, particularly semiconductors.
Equal Weight SP500
Current Status: Looks healthy, approaching a critical area that might see significant movement.
Sector Analysis
Top Performers
Technology and Communication Services: Outperforming the SP500 over the last six months.
Showing Strength
Financials, Consumer Discretionary, Industrials: Displayed strength last week, indicating potential for growth.
Promising Sector
Real Estate: Could benefit from future rate cuts.
Thematic ETFs
Outperformers
Leading Themes: Technology, Semiconductors, and Communication Services are the few themes outperforming the SP500.
Key Takeaways
The economy is in a stable position, with moderate inflation and a strong GDP forecast.
NASDAQ's recent performance suggests potential sector rotation.
Technology and Communication Services remain top sectors, but Financials, Consumer Discretionary, and Industrials are also showing promise.
Real Estate might become attractive with future rate cuts.
Overall, the macroeconomic environment appears favorable for stocks despite some headwinds. Keep an eye on sector rotation and emerging opportunities in other areas of the market.
MOMENTUM PORTFOLIOS
10X LARGE CAP MOMENTUM
My FOUR 0.00%↑ order was triggered
I was stopped out from FSLR 0.00%↑ for a 34% win
My Stop Levels are updated
I am not adding anything this week to this portfolio.
10X SMALL CAP MOMENTUM
I was stopped from ML 0.00%↑ for a 19% loss
I updated my Stop Loss levels
I am not adding anything this week to this portfolio.
That’s all for the week!
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Important: This is not investment advice. Consult a licensed financial advisor before making any investment decision.