(re)Balancing Act

Monday Market Update December 11, 2023

Dec 11, 2023

The Markets

Let’s start with an update to Thursday’s chart. Stocks (SPY and QQQ) are breaking out of the box today.

A development welcomed by the Bulls. But it's not without complication, as an upcoming NASDAQ 100 rebalance is being blamed for all M7 stocks starting the week in the red.

On Friday, December 18, the index will be rebalanced and updated to remove six stocks and add six new ones.

Incoming:

CDW, CCEP, DASH, MDB, ROP, and SPLK

Outgoing:

ALGN, EBAY, ENPH, JD, LCID and ZM

The Charts

SPY steady buying all day long carries the SP 500 further above the breakout level in what looks like the beginning of the next leg higher.

QQQ looks to have gathered the energy for the next move-up after spending several days testing the 21-day MA last week.

IWM Small Caps lagged a bit today but are still showing constructive action.

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DIA The Dow 30 broke higher from the bull flag pattern.

TLT printed a hammer, and so far, it looks like a healthy test of the rising 8-day MA.

DXY The Dollar had day five at resistance. Still watching for a move back toward $103 to boost stocks.

The Closing Bell

The NASDAQ 100 annual reconstitution may not be the only shakeup this week. We will get the latest CPI data tomorrow morning, and PPI will follow on Wednesday.

Then, on Thursday, we have the latest FOMC rate decision. No change in rates is the expectation.

We’ll look at the effects of that in Thursday’s Market Update.

See you then.

The Disclosures

***This is NOT financial advice. NOT a recommendation to buy, sell, or trade any security. The content presented here is intended for educational purposes only.

Andrew Moss is an associated member of T3 Trading Group, LLC (“T3TG”) a SEC registered broker/dealer and member of FINRA/SIPC. All trades placed by Mr. Moss are done through T3TG.

Statements in this article represent the opinions of that person only and do not necessarily reflect the opinions of T3TG or any other person associated with T3TG.

It is possible that Mr. Moss may hold an investment position (or may be contemplating holding an investment position) that is inconsistent with the information provided or the opinion being expressed. This may reflect the financial or other circumstances of the individual or it may reflect some other consideration. Readers of this article should take this into account when evaluating the information provided or the opinions being expressed.

All investments are subject to the risk of loss, which you should consider in making any investment decisions. Readers of this article should consult with their financial advisors, attorneys, accountants, or other qualified investors prior to making any investment decision.

POSITION DISCLOSURE

December 11, 2023, 4:00 PM

Long: AMZN, AMZN1229C150, GOOGL, IWM, META, NVDA, QQQ, RIVN, RXRX, SPY1208P455, XHB1222P88, XBI0119C81

Short:

Options symbols are denoted as follows:

Ticker, Date, Call/Put, Strike Price

Example: VXX1218C30 = VXX 12/18 Call with a $30 strike