1/31/2023T UPTREND Market Rises in anticipation of the Federal Reserve AnnouncementWednesday
THE MARKET’sMESSAGE: Market shows broad upward strength in 2023
Today’s newsletter was lots of fun to put together! It always is when there is so much good news to share.
The market is usually quiet before the Federal Reserve announcements (about every 6 weeks). Thus, I don’t have much to say today, except, “Be sure to watch the market reaction to the two Fed announcements tomorrow.”:
1. The first is a statement at the conclusion (2 p.m.) of the 2-day meeting that updates its opinion of the economic condition of the US, with special focus on:
o the health of the labor market,
o thelatest on inflation, and
o the target Fed Funds rate.
2. The second event (2:30 p.m.) is a press conference lead by the Fed Chair, Jerome Powell.
If you are someone who likes the details (like me), you will find the meeting interesting. If you are more of a big picture person, there will be summary comments on every market outlet to catch you up.
THIS MARKET: The good news is that this market continues to take off! I never expect every day to rise, even in the best Uptrending market. I like to see more UP days than DOWN days and to see the volume higher on those up days. Let’s see how the market did over the last month:
I’m not sure how you judge the last 4 weeks, but I am quite excited. I’m even asking myself, “Is it too early to think this “Year of a Downtrend” could be over?”
Stay tuned…… Really! Don’t stay away. In fact I encourage you to not miss a single day. Uptrend markets can take off like a rocket ship and leave “wanna be” passengers on the ground.
If you aren’t excited about this Uptrend,I encourage you to read my further comments below. Note that not only did all three major indexes have Major Accumulation days (price and volume rose at least 1%), but they blew the day out of the water with big numbers in both categories.
And all three major indexes I follow (Nasdaq,S&P500 and DJIA), earned “B” ratings today. There was a B-, a B and a B+! I don’t care which index got which rating. They are all signs of widespread institutional buying! (OK, the Nasdaq is the B+, as expected.)
Note the markets are frequently quiet right before a Fed announcement, but today’s market shot up 1.7% (Nasdaq) and 1.5% (S&P500.) I guess they just couldn’t wait!
Investors.com’s Big Picture column suggests the Fed could raise the fed funds rate by a 0.25% tomorrow and once againat the next Fed meeting. Then they might hold off on additional rate increasesuntil they see how the economy absorbs these increases. The slow down with smaller rate increases is encouraging that this phase of “expensive” adjustments might end soon.
On the ACCUMULATION/DISTRIBUTION RATINGS table below, note the shift to more and more “A” and “B” stocks points to some aggressive buying of top stocks. I suspect the 3% drop in the “As + Bs” last column is more of a “bounce” off the significant rate of “As + Bs” rising, than a sign of a softer market. The 59% total of “A” and “B”stocks is spectacular and could only be achieved by some serious buying over the last 4 weeks. I hope you have started adding to your portfolio - either with some strong new stocks, or by increasing your positions in stocks you own that are taking off!
>>>>> BOTTOM LINE: This market continues to rise, showing strength – I hope you are grinning as much as I am!
Note: When you look at today’s MARKET ACTION table above, scan down the PRICE column and note the GREEN highlighted prices. They are green because, in the last 20 days, the Nasdaq hit new highs in the last 4 weeks of this chart! THAT’S A LOT OF GREEN.