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Stock Market Timing Television – 05022023

Good morning, everyone, and welcome to Tuesday Morning. It’s Stephen Whiteside here from with a quick two minute market update. In the pre market this morning, stock index futures are down across the board. So far it looks like we’re going to see some selling at the open on Tuesday morning. Well, yesterday the story of First Republic came to an end.

And so that stock is no longer in play. Even with it coming off the board, we saw the Regional Bank stocks continue to trade lower, down nearly 3% on the day. Really no upward or downward trend here for the past month and a half. Still waiting for something new to happen. At the same time that First Republic went off the board, JPMorgan picked up some of their assets and it popped yesterday.

That helped put a bid into the DOW and the S&P 500, but it reversed going into the close. So this is certainly not something I would want to chase up here. There’s nothing low risk about this. And then the DOW itself generated a bearish reversal signal on Monday, did not close below the previous day’s low. So it’s still a negative signal, but not that bad.

And we had a similar signal for the Canadian market, which hit a new high yesterday before pulling back again. Did not close below the previous day’s low. There’s the bearish reversal signal. These are one day events. They still need to be confirmed.

You can see that we had several bearish reversal signals over here go off, but the market still continued to move higher. This one marked the top for this particular move. This one the market waved off and continued to move higher. So one day events still need to be confirmed, and they would be confirmed on Tuesday with a lower close. Looking at the bond market, we had a big move in the bonds yesterday ahead of the Fed meeting, which starts today.

So today probably won’t be that volatile a day. We expect volatility to expand dramatically after 02:00 P.m. Wednesday afternoon. And of course, if bond prices are going down, bond yields are going up, and we saw that across the board on Monday. Now, the VIX made a new low yesterday before closing slightly higher on the day, looking for a close on Tuesday above 18.38 to give us a new buy signal.

That, of course, would be negative for stocks. Now, the stock market is on a timetable, whether you’re looking at quarterly earnings or you’re looking at the market’s reaction to Fed meetings. If we want to project into the future to see when we could see our next low risk buying opportunity, if you take a measurement from the Pressure Zone that happened in the fall to the pressure zone that happened around Christmas, and then add that projection out, that takes you into the pressure zone that happened in March. And then if we measure, take the exact same distance and add that that takes us into early June. So that’s probably where we’re going to see the next low risk buying opportunity start to form.

Okay, folks, that is all for this morning’s presentation. Should be a fairly quiet day. Next time you’ll hear my voice is on Wednesday morning.

Stephen Whiteside

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