Over "The Line"

Weekend Market Review January 27, 2023

Andrew Moss, CMT

Jan 27, 2023

SPY is over The Line.

SPY and QQQ are over “The Line”

— the downtrend line and the 200-day moving average.

IWM is moving smartly through the resistance zones.

Even with an earnings miss by Microsoft.
Even with a terrible report from Intel.
Even though Capital One and Goldman Sachs missed.
Even with Bed Bath and Beyond in default.

Stocks are still going up.

Things feel different.

The charts look different.

People are behaving differently.

Breadth is improving.

The number of SP 500 Stocks above their 200-day moving averages is higher than its been since the beginning of 2022.

We have breakaway momentum signals.

We have bullish seasonality.

There is a high probability of a January Indicator Trifecta.

That’s a pretty long (and growing) but not exhaustive list of bullish data.

There are many more earnings reports next week including AAPL, AMD, AMZN, GOOGL, and META. There will almost certainly be more surprises, good and bad.

Getting some more lowered guidance seems likely as well.

We have The FOMC on Wednesday. (25bps hike expected). Maybe JPow thinks the market is doing too well and wants to cool things off a bit.

We’ll find out soon enough.

Thank you!

A quick note to share my gratitude—

Thank you for spending a few minutes with me each week. Reader growth over the last month has been remarkable, both here and on my Twitter feed. Thanks to all of you for coming back, again and again. And thanks for sharing these articles for others to read.

Writing quick, concise thoughts on the market several times a week is a critical part of my process. I truly love what I'm doing and I enjoy sharing these thoughts, observations, and lessons with you all. I hope it is helping you.

I have plans and ideas for more ways to share and help. Keep an eye out for some new things coming soon.

Thank you for reading Trading Adventures. This post is public so feel free to share it.

The Charts

SPY - A little selloff late in the day took some of the oomph out of the daily candles. But the strength is still clearly evident. 410 is the level to watch above

QQQ - Same with this one. The buying was continuous throughout most of today’s session.

IWM - Not in a hurry. But getting the job done.

DIA - Has been in a tightening range since December. It needs to move through the shaded resistance area and on to higher highs.

DXY - Holding steady

VIX - Still declining

From Twitter

Mike Shell @MikeWShell

The stock market isn't pricing a recession, and the stock market is the leading indicator.

Mike Shell @MikeWShell

Equity markets are not currently pricing a recession, so if it is a recession, it will eventually be reflected by much lower stock prices.

Trading Composure @TradingComposur

"A mistake is when you don't follow your rules. If you don't have rules in trading, everything you do is a mistake." ~ Van Tharp

So what do you think? Are things feeling more bullish?

Let me know in the comments. And find me Saturday mornings on Twitter for a look at the Weekly Charts. We’ll take a look at the bigger picture and then start zooming into some best ideas for the week ahead.

See you there!

Trading Adventures