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Market Trends | Stocks
Are 3 Months of Consolidation Ending?
David Russell
January 16, 2025

Downloads are available here. TradeStation’s ideas on TradingView are available here.

Check out our next “State of the Market,” on Monday, 1/27.

Sizing Up the S&P 500

  • S&P 500 rallies 1.8%, the most since 11/6 (day after election)
  • Potential bullish flag after testing Election Day close
  • 63-day rate of change continues positive run that began in November 2023
  • 3-month consolidation phase potentially ending as breadth improves
  • S&P 500 members yesterday had the most:
    • 52-week highs since 12/11
    • Members above 20-day MA since 12/4
  • Intermarket signals:
    • 10-year Treasury yield stalls at 4.75% area from November 2023 and April 2024.

SPDR S&P 500 ETF (SPY), daily chart, with select patterns and indicators.

Inflation & Rates

  • CPI +0.3% in December. Y/Y core +3.2%. Both 0.1 point below estimates.
    • Shelter has smallest Y/Y gain since January 2022
  • John Williams of NY Fed: Inflation going to 2%, expectations are anchored
  • Goolsbee: Neutral rate is still lower (implies rate cuts)
  • UK inflation 0.1 point lower than expected, spurring rate-cut optimism
  • Empire index -12.6 in January, missing +3 estimate. New orders weak

Regulator Departures

Some noteworthy changes around the arrival of President Trump:

Leaving Potential Replacement Position
Lina Khan Andrew Furguson FTC Chair
Gary Gensler Paul Atkins SEC Chair
Paul Munter N/A SEC Chief Accountant
Michael Barr N/A Vice Chair for Supervision at Fed

News & Views

  • Financials jump on strong results: GS WFC JPM C BK BLK
  • FactSet: S&P 500 earnings likely to grow 14% in Q4, the most since Q4 of 2021.
  • MarketWatch: Trump SEC nominee Paul Atkins viewed as more favorable for financial sector
  • GS CEO David Solomon: Backlog in dealmaking, increased CEO confidence post-election
  • NVDA announces Quantum Day at GTC 2025 on 3/20
    • Comes after active CEO Jensen Huang expressed skepticism about quantum computing’s near-term prospects, which impacted related stocks in the field.

Upcoming Events

  • Fri 1/17: Housing starts, building permits
    • Earnings: SLB TFC
  • Mon 1/20: MLK Day – Market Closed
  • Tue 1/21:
    •  Premarket earnings: MMM SCHW KEY DHI
    •  Post market earnings: NFLX UAL
  • Wed 1/22:
    • Premarket earnings: JNJ PG
  • Thu 1/23: Jobless claims, crude oil inventories
    • Premarket earnings: FCX GE

 

 

Standardized Performances for ETFs mentioned above
ETF 1 Year 5 Years 10 Years
SPDR S&P 500 ETF (SPY) +23.30% +82.09% +185.14%
As of December 31, 2024. Based on TradeStation Data.

Exchange Traded Funds (“ETFs”) are subject to management fees and other expenses. Before making investment decisions, investors should carefully read information found in the prospectus or summary prospectus, if available, including investment objectives, risks, charges, and expenses. Click here to find the prospectus.

Performance data shown reflects past performance and is no guarantee of future performance. The information provided is not meant to predict or project the performance of a specific investment or investment strategy and current performance may be lower or higher than the performance data shown. Accordingly, this information should not be relied upon when making an investment decision. 
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About the author

David Russell
David Russell is Global Head of Market Strategy at TradeStation. Drawing on nearly two decades of experience as a financial journalist and analyst, his background includes equities, emerging markets, fixed-income and derivatives. He previously worked at Bloomberg News, CNBC and E*TRADE Financial. Russell systematically reviews countless global financial headlines and indicators in search of broad tradable trends that present opportunities repeatedly over time. Customers can expect him to keep them appraised of sector leadership, relative strength and the big stories – especially those overlooked by other commentators. He’s also a big fan of generating leverage with options to limit capital at risk.

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