Sell in May and go away? SPY ($412.2)
Stock indexes remained mostly unchanged this week as Q1 earnings showed mixed results. However, bears believe that there are still numerous obstacles ahead for stock prices, including inflation, tighter credit conditions, high borrowing costs, and over-stretched consumer budgets. These concerns are coupled with fears of a US recession in the second half of the year. Our robots have also noted a significant level without significant changes. In case of a decline, we will open short positions and make profits from them.
Forward guidance issued by companies during their Q1 reports will likely have a big impact on investor sentiment and could lead to a revision of earnings forecasts. Bulls argue that many of the ongoing concerns have already been priced in, but the S&P 500 is still down more than -13% from its most recent record high.
The Fed's Beige Book yesterday revealed slower growth in several districts and declining bank lending volumes across consumer and business loans, as well as tightened lending standards. Many economists and Fed officials believe that tightening credit conditions could better slow the economy and bring inflation back to the Fed's target rate.
Data to watch includes Existing Home Sales and the Philadelphia Fed Manufacturing Index. Earnings highlights include American Express, AT&T, Blackstone, CSX, D.R. Horton, Nokia, Nucor, PPG Industries, SnapOn, Taiwan Semiconductor, and Union Pacific. The overall tech sector will likely be supported if Taiwan Semiconductor reports good earnings.
The big tech sector's performance has a significant impact on the overall market. Therefore, it's tough to predict a market crash without seeing Apple, Microsoft, Nvidia, Alphabet, Tesla, etc. rolling over and getting hit hard.
Momentum Indicator for SPY turns positive, indicating new upward trend
SPY saw its Momentum Indicator move above the 0 level on November 26, 2024. This is an indication that the stock could be shifting in to a new upward move. Traders may want to consider buying the stock or buying call options. Tickeron's A.I.dvisor looked at 66 similar instances where the indicator turned positive. In of the 66 cases, the stock moved higher in the following days. The odds of a move higher are at .
Technical Analysis (Indicators)
Bullish Trend Analysis
The Moving Average Convergence Divergence (MACD) for SPY just turned positive on November 25, 2024. Looking at past instances where SPY's MACD turned positive, the stock continued to rise in of 51 cases over the following month. The odds of a continued upward trend are .
Following a 3-day Advance, the price is estimated to grow further. Considering data from situations where SPY advanced for three days, in of 366 cases, the price rose further within the following month. The odds of a continued upward trend are .
The Aroon Indicator entered an Uptrend today. In of 455 cases where SPY Aroon's Indicator entered an Uptrend, the price rose further within the following month. The odds of a continued Uptrend are .
Bearish Trend Analysis
The RSI Indicator demonstrates that the ticker has stayed in the overbought zone for 4 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
The Stochastic Oscillator demonstrated that the ticker has stayed in the overbought zone for 8 days. The longer the ticker stays in the overbought zone, the sooner a price pull-back is expected.
Following a 3-day decline, the stock is projected to fall further. Considering past instances where SPY declined for three days, the price rose further in of 62 cases within the following month. The odds of a continued downward trend are .
SPY broke above its upper Bollinger Band on November 06, 2024. This could be a sign that the stock is set to drop as the stock moves back below the upper band and toward the middle band. You may want to consider selling the stock or exploring put options.
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