January 31, 2024 SPX, ES, SPY Trade Plan

Market Recap

Alright team going to make this recap quick and jump into our plan.

GOOGL sold off post earnings report due to a miss on search revenue. MSFT fought off a selloff though its cloud numbers disappointed some analysis.

IMF raises its 2024 global growth forecast to 3.1% citing unexpected resiliency of the economy.

Let’s see how this plays out this year. Between rate cuts and earning estimates this is what will drive the market this year.

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We are getting closer and closer to the BPSPX’s 20MA crossing over the 50MA. Keep an eye on this.

The S&P500 Bullish Percent Index (BPSPX) is a breadth indicator that measures the breadth of the S&P500. It shows the percentage of stocks in the S&P500 that are in an uptrend compared to a downtrend.

So far on the month the SPX is up 3.25%…

SPX Monthly Performance During Election Years

What we have to keep in mind with some of these seasonality charts is that we are in an election year. Seasonality instead looks like this which is another 2ish percent up from now until early/mid February before we then get a selloff going into March which negates the gains we make in January/February…

We will continue to monitor some of these seasonality views. There are a few of them out there and it will be important to see how the month ends to give us more insight into which seasonality chart it follows.

Election years are the second-best year of the four-year cycle, & the market has performed better with a sitting president running for reelection. There have been six election year declines greater than 5% since 1896 & the first five months of the year are stronger when the party in power retains the White House. But war can be a major factor.

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