January 19, 2024

Markets:

Stock futures jumped on Friday, with the S&P 500 poised for a record close, as investors returned to buying equities in force in recent days following a short-lived market stumble to start the new year.

Stocks moved sharply higher Thursday, with the S&P 500 and Nasdaq erasing their 2024 losses. Thursday’s gains were powered by major advances in the technology sector, after Bank of America upgraded shares of Apple to a buy rating. Apple posted its biggest one-day gain since May 5, 2023.

Following a 19% loss in 2022, the S&P 500 roared back in 2023, posting a 24% gain as the economy skirted a recession that many had expected and inflation came down to levels that allowed the Federal Reserve to pause its interest rate hikes. The benchmark came close to reaching a record following a forceful fourth-quarter rally, but ultimately fell short. The market rally paused a bit to start 2024 as investors took some profits in the Big Tech leaders like Apple.

But they returned to buying those tech leaders in recent days. If the S&P 500 does close at a record on Friday, it would confirm that the stock market is officially in a bull market that began in October 2022. The S&P 500 is up more than 33% since that low.

Portfolio:

We enter the new trading day holding set-ups in AI, AEHR, AFRM, and PLTR.  I truly feel for those who continue to deny the trend and the opportunity they have in front of them based on a need to want to call some type of market top or pullback.  I never understood the need to fight the trend.  The pain trade only continues to build and the monster runway we spoke about months ago in specific sectors only continues to develop.  Early stages.  Until we see the market break technically on the S&P and the Nas, we will not fight this trend.  Of course we will have tough weeks, but embrace it as an opportunity to add and position yourselves for periods like the last few sessions.  Next week begins earnings season for us!  Our favorite sectors begin to report and we have market movers on the horizon.  The tone will be set for Q1 / Q2 and then we enter the election cycle.  Right around the end of Q2 and especially Q3, we receive the greatest gift which obviously occurs every four years.  It's a traders dream during this period and this is why we believe 2024 will be an even greater one compared to 2023 for traders.  Buckle up!