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12/13/23 Inflation Down, Fed Steps Up

News:

The latest CPI report showed inflation is continuing to trend lower.

Chart from CNBC

Price gains from last month and last year were tame.

  • +0.1% month-over-month
  • +3.1% year-over-year

Initially, profit-takers sent the market to a red open. But buyers showed once again to push the indexes mostly higher by the close…

  • Dow Jones +0.5%
  • Nasdaq +0.7%
  • S&P 500 +0.5%
  • Russell 2000 -0.1%

Under the surface, the divide was even. Of all listed stocks…

  • 48% advanced
  • 48% declined

Sector Round Up

8 of 11 sectors were positive at Tuesday’s close

At the top…

  • Financials (XLF) +0.7%
  • Technology (XLK) +0.7%
  • Materials (XLB) +0.6%

The biggest loser out-paced the biggest winners…

  • Real Estate (XLRE) -0.0%
  • Utilities (XLU) -0.4%
  • Energy (XLE) -1.4%

Technicals: 

Fear levels are trending lower with inflation…

VIX Daily Candles – Chart from thinkorswim

The VIX hit a new 52-week low on Tuesday.

Don’t expect it to move much lower than the current level. A super low VIX is a telling sign that the market lacks fear.

Levels this low haven’t been seen since the 10-year bull market that ended with the Pandemic crash.

Your latest readout…

Timing:

Today at 2 PM, the Fed will announce its latest interest rate decision.** 

It’s widely expected that rates will remain unchanged.

After the announcement, Fed Chair Powell will address reporters. His comments will likely overshadow the decision.

**Earlier updates incorrectly stated there was a FOMC minute release today.

Watchlist:

*Low Float
^Open Position

*CHSN support at $8.50
OPFI support at $4
ALXO support at $12
AAOI support at $18
GTHX support at $3, resistance at $18
APLT support at $3
HNST support at $2.50
ASPN support at $12, resistance at $13
PRCH support at $2

Secondary watchlist—float about 100 million

GPS on watch
NMRK support at $8.50
^IOT support at $32.50, resistance at $35
S support at $22
LYFT support at $13

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