Stock Market Outlook for August 29, 2024
Asset managers are holding an allocation to S&P 500 Futures that is at the upper limit of historical extremes.
*** Stocks highlighted are for information purposes only and should not be considered as advice to purchase or to sell mentioned securities. As always, the use of technical and fundamental analysis is encouraged in order to fine tune entry and exit points to average seasonal trends.
Stocks Entering Period of Seasonal Strength Today:
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Vanguard International High Dividend Yield ETF (NASD:VYMI) Seasonal Chart
TD International Equity CAD Hedged Index ETF (TSE:THE.TO) Seasonal Chart
Global X S&P 500 Quality Dividend ETF (AMEX:QDIV) Seasonal Chart
Fidelity International Value Factor ETF (AMEX:FIVA) Seasonal Chart
CI First Asset Health Care Giants Covered Call ETF (TSE:FHI.TO) Seasonal Chart
Affinity Bancshares Inc. (NASD:AFBI) Seasonal Chart
Vanguard Mega Cap Value ETF (NYSE:MGV) Seasonal Chart
Usio Inc. (NASD:USIO) Seasonal Chart
Superior Group of Companies, Inc. (NASD:SGC) Seasonal Chart
The Markets
Stocks slipped on Wednesday as investors were on alert for the possible impact from earnings from NVDIA, released after the closing bell. The S&P 500 Index closed with a loss of six-tenths of one percent, still showing signs of stall within a zone of implied resistance between 5622 and 5658, representing the July 17th downside gap. Hint of a short-term peak remains apparent as the bulls show their reluctance adding to risk at current heights. The threat of an intermediate-term double-top pattern below the all-time high recorded during the summer rally period through the first half of July remains apparent, a chart setup that would set the stage for the declines that are normal for stocks during the month of September. The 20 and 50-day moving averages at 5464 and 5497, respectively, provide initial points of support should a rollover around present levels commence. The zone loosely aligns with August 15th upside gap that saw these two variable hurdles broken as resistance. MACD and RSI can be seen rolling over, revealing a negative divergence versus price that highlights the waning of buying demand heading into the traditionally weak month for equity market performance in September. Caution in risk assets remains appropriate, particularly while within this period of seasonal volatility and while the fundamental backdrop appears uncertain.
Today, in our Market Outlook to subscribers, we discuss the following:
- Technology losing buying demand ahead of the weakest month of the year for sector performance
- Gold/Copper Ratio
- Margin debt and credit balances in investor accounts
- Asset manager allocation to S&P 500 e-mini futures
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Sentiment on Wednesday, as gauged by the put-call ratio, ended slightly bullish at 0.90.
Seasonal charts of companies reporting earnings today:
S&P 500 Index
TSE Composite
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