Happy Holidays everyone,

Markets rallied again this week on based on more favorable economic data including the Federal Reserve's favorite inflation gauge (PCE) which came in less than expected. The November core personal consumption expenditures price index rose by only 0.1% from October and was up 3.2% on a year-over-year basis.

The indexes all ended positive for the 8th week in a row with the DOW making another all-time high. 

Investors and traders are still anticipating several rate cuts this year starting in March and continuing into May.

Bias for the markets is still to the upside this coming shortened trading week. Volume is usually lighter than usual with many taking time off between Xmas and New Year’s. The VIX remains very low indicating no fear of a pending sell-off. 

Recap Video 

Watch the recap on YouTube

 

Sectors in Play Last Week

• Communication Services and Basic Materials were the biggest gainers this week.
• Utilities was the weakest sector of the week.

Key Levels for this Week

• DOW (37,386) – support 36,200 and resistance 37,600
• QQQ (408) – support 395 and resistance 410
• SPY (474) – support 456 and resistance 475 then 490
• IWM (201) – support 190 and resistance 204

What to Watch for this Week

• Monday – Holiday
• Tuesday – 9:00 Housing Price Index and 10:00 Consumer confidence
• Thursday –8:30 Jobless claims, Retail and Wholesale Inventories, and 10:00 Pending home sales
• Friday – 9:45 Business barometer

Earnings this week

• Nothing notable

Tracking

• AAPL – support is now $192 then around $190. The Apple watch issue is causing a pullback now. Potential to sell puts at $190.
• AMD – looking extended with resistance at $140. Watch for a break higher after consolidation. Potential to sell $135 puts.
• AMZN - Ascending triangle pattern break out – watch $154 for a continuation move higher.
• FDX – sell-off on earnings. Short $245 puts on a pullback.
• GDX – back long – looking for a continuation higher.
• META – breaking higher with$360 as resistance. Might pullback or consolidate here under resistance but watch for a break higher.
• NKE – Friday bad earnings reaction. Watch for bottoming action to sell puts. $1o5 looks like a good strike right now.
• TNA – small caps breaking out and likely heading higher.
• TLT – Extended after a big run-up. As per last week’s plan - sold some upside $102 calls expiring on January
• TSLA – Breaking out with next resistance at $260. The trend looks higher.

Positions

• HGU on TSX is similar to GDX – back long on a pullback.
• FDX – short $245 puts expiring end of this coming week.
• ORCL – as per last week’s plan – shorted weekly 102 puts – collected and kept the premium end of the week.
• TLT – short 85 puts expiring in January 2024.
• TLT – short $102 calls expiring in January 2024.
• TNA – long small caps ETF, sold most on the rally.

 

Note: These are investments I am in or watching however, they may not be suitable for all investors. The author of this email is NOT an investment advisory service, a registered investment advisor, or a broker-dealer and I do NOT undertake to advise clients or recipients of this email on which securities they should buy or sell for themselves. This email is provided for information purposes only and traders should always consult with their licensed BIDO financial advisors and tax advisors to determine the suitability of any investment.