Weekend Report for Tuesday, January 21, 2025
Bottom Line:
Last week was very strong in the US indices. The SPX is less than 2% from an all-time high, but there is a large gap of relative performance among the indices. This is not what is typical in a strong bull market.
It is quite possible we will see new ATHs in the SPX without the same in the others.
Next week will be the first week of the new US administration. There is potential for an increase in volatility.
PDF: Weekend Report_2025_01_21
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SPX
Upper KRA: 6100
Lower KRA: 5980-5935; 5904-5841
It is impossible to identify relatively precise downside levels at the moment. We’ve had two large gaps in the ramp up. One thing is certain, the SPX will not continue higher at the current rate of change. I am not one who will rote trade gaps, but it the SPX gaps up again without at least testing the current ones, I will strongly consider fading that under a proper set up.
NDX
Upper KRA: ?
Lower KRA: 21331-21097; 21033-20764
Same comments for NDX as SPX.
DOW
Upper KRA: 45086
Lower KRAs: 43340-43173; 42926-42529
Same comments….
RUT
Upper KRA: 2293
Lower KRA: 2252-2218
New York Composite
Upper KRA: 20342
Lower KRAs: 19415; 18858
Internals – VIX
VIX continues to hover at a relatively high level.
Internals – NYSE Data
The 5-day MA of NYSE advancing issues is at a level consistent with the idea that the SPX will not continue higher at the current rate of change.
US Dollar
No change: Favor longs.
US 10-yr Notes
From last weekend’s update: Notes are getting crushed. Could find a little support here, but would favor shorts.
In general I would continue to favor shorts.
Gold
No change: Between important levels of two degrees.
I would favor longs, in general.
Crude
No change: Crude thoroughly tested recent downside levels. There appears to be a bullish sequence of higher highs and lows in place.
Bitcoin
