Monday Market Update

December 9, 2024

Dec 09, 2024

The Markets

Stocks declined today as traders adopt a cautious stance ahead of inflation data due later this week. The major indexes, along with Bitcoin, faced losses throughout the day. However, not all stocks experienced selling pressure.

Chinese stocks surged, with BABA, FUTU, and JD leading the charge, propelling FXI upward by 8.22% at the close, indicating that buying interest might simply be shifting to different sectors.

Regardless of the situation, a slight feeling of apprehension permeated the market. This isn’t necessarily due to any technical issues or broken charts but rather from the perception that the recent surge in several high-flying stocks (TSLA, APP, ASAN, ARKK) has lasted ‘too long.’

When trading starts to feel easy, seasoned traders start to feel uneasy.

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Other Notable Names

Bitcoin experienced continued pressure around the $100k level, declining by -4%.
NVIDIA (NVDA) faced headwinds after news broke of a Chinese probe into the company for ‘anti-monopoly activity.’
Tesla (TSLA) surpassed $400 and then cooled off a bit.
Celsius Holdings (CELH) was resilient, closing above its 50-day MA. An accomplishment not seen since late May when the stock was trading in the $80s.
Amazon (AMZN) displayed some potential signs of short-term exhaustion after rising steadily for 11 trading days and an +18% move.

Let’s go to the charts.

The Charts

SPY moved lower to test its 8-day MA. Potential pivot support remains at $600.17, followed by the 21-day MA and anchored VWAPs near $594 and $596. Intermediate-term support can be found near $585 with the rising 50-day MA and a pivot high from mid-October.

QQQ still has a similar picture, though it is still well above its 8-day MA. Likewise, potential support comes in at the various pivots, moving averages, and AVWAPs noted on the chart.

IWM started the day strongly but reversed to close below the 8-day MA and nearing the 21-day MA and post-election AVWAP around $237.

DIA finished up by resting on the $444.87 pivot high made in early November.

TLT Bond buyers took the day off, allowing this ETF to move back below its 200-day MA. It’s a significant level; however, we can still watch the $93 level for bigger potential support.

DXY US Dollar futures rose slightly while remaining in the declining channel. Repeated bull flag or falling wedge potential still exists. We’ll have to wait and see if this moves higher again or falls further to test the 50-day MA and pivot highs near the mid-$ $104s.

BTCUSD keeps giving us the choppy action to which we have become accustomed, as prices on either side of $100,000 continue to be very sticky.

The Trade

Trim and trail winning positions while seeking out new setups in under-focused areas.

Lately, this market has been described in many ways, from bullish to boring. Since the election rally and subsequent digestion period, nothing has been able to shake it much. Technically speaking, the momentum remains as long as the four major indexes continue trading above their respective 21-day MAs.

We do have inflation data coming this week in the form of CPI and PPI on Wednesday and Thursday. That will be followed by the FOMC rate decision next week, with expectations for a cut of 0.25%.

Meanwhile, the mega-cap names are a mixed bag. AMZN looks like it wants a rest, NVDA remains range-bound, and GOOGL may want to break out. So be selective. Be patient. And take your trades when the setups present. But maybe be a little more discerning and take only the best trades.

Did I say, “Be selective?”

The Disclosures

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

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