In this edition of the GoNoGo Charts show, as the S&P 500 continues trading at all-time highs on this final trading day of the year, Alex and Tyler take a look at GoNoGo Trend® conditions across asset classes, style boxes, and emerging markets indices. The conditions in the US Dollar index (UUP) and US Treasury rates ($TNX) remain in NoGo trends on both daily and weekly timeframes, adding accommodative tailwinds for risk assets broadly.

This video originally premiered on December 29, 2023. Click this link to watch on YouTube.

Learn more about the GoNoGo ACP plug-in with the FREE starter plug-in or the full featured plug-in pack.

In this special all-Mailbag edition of StockCharts TV‘s The Final Bar, Dave answers viewers’ burning questions, ranging from the effectiveness of short-term moves with the 5-day MA to deciphering the mysteries of the Russell 2000’s growth or value positioning and much more!

Click here to take advantage of the StockCharts Holiday Sale!

This video originally premiered on December 29, 2023. Watch on our dedicated Final Bar page on StockCharts TV, or click this link to watch on YouTube.

New episodes of The Final Bar premiere every weekday afternoon at 4pm ET. You can view all previously recorded episodes at this link.

In this episode of StockCharts TV‘s The MEM Edge, join Mary Ellen as she as she dives into the latest news and trends that are driving price action in the markets. From housing updates to consumer confidence and inflationary data, she breaks it all down and shows you how it’s impacting the broader markets. Focusing on industry groups and sectors, she uncovers the hidden gems that are showing strength, sharing her top picks for potential investment opportunities.

This video originally premiered December 29, 2023. Click on the above image to watch on our dedicated MEM Edge page on StockCharts TV, or click this link to watch on YouTube.

New episodes of The MEM Edge premiere weekly on Fridays. You can view all previously recorded episodes at this link.

If you’re looking for stocks to invest in in 2024, be sure to check out the MEM Edge Report! This report gives you detailed information on the top sectors, industries and stocks for the upcoming year, so you can make informed investment decisions. With this report, you’ll be sure to make the most of your investment opportunities in the new year!

On this week’s edition of Moxie Indicator Minutes, TG points out how broadly supported the market has been this time around, and how he’s seeing excellent setups on the higher time frames. He walks us through some of the action that is making him look forward to a strong 2024, but only after a near-term pullback.

This video was originally broadcast on December 29, 2023. Click this link to watch on YouTube.

New episodes of Moxie Indicator Minutes premiere weekly. Archived episodes of the show are available at this link.

For the new year, we have given you an extensive 3-pronged look at the markets.

First, we have the general outlook for the economy and markets through the Outlook 2024. This is the general outlook for 2024, including the recap of 2023 and how the predictions I made then played out. It includes a comparison in inflation and disinflation patterns of the 1970s and now. It also includes all the indices and the general outlook for key sectors and the bonds, dollar, metals, and so on.

Moreover, we look at the Economic Modern Family and their outliers through charts and analysis. Also included are overall trends to watch, plus picks.

One other area I cover in the Outlook 2024 is the teachings of Raymond Lo and how he sees the upcoming Year of the Dragon. Part of my comments on his analysis is based on this statement by Lo:

“Many has the misunderstanding that the Dragon is glamorous auspicious animal and will always bring good luck. To the contrary, Dragon and Dog in the 12-animal system is called the “Gate to Heaven and Hell” or the “Net of Heaven and Hell”.

General Thoughts

2024 could see gains; however, we are agnostic and definitely looking to charts. SPY needs to hold 4600 as our line in the sand, and small caps need to hold over 2000. Plus, in January, we will have a 6-month calendar reset this year with the election; instruments that fail the calendar range lows could set the stage for a broader selloff, while instruments that rally above the calendar range highs can be the bigger winners, at least for the first half of the year. Nonetheless, we have keen eyes on junk bonds, which, despite rallying, have well underperformed the indices. If they hold, great; if not, we take that as a warning.

With the anticipation of Fed lowering rates multiple times, we also want to see Fed Fund rates stabilize and not fall too dramatically, as those could be the signs of recession that we seemingly avoided in 2023. Additionally, we expounded with Daily newsletters.

From Gold and Silver

For last year’s Outlook, I wrote:

Perhaps our biggest callout for a major rally in 2023 is in gold.

Here we are over $2000 and, although gold has not doubled in price, it did rise by 25%.

For 2024, we stay with our call for higher gold prices. I am looking for a move to $2400, provided gold continues to hold $1980.

That statement was from December 1st. To add to that statement:

Trends for 2024 — Gold and Silver start their Last Hurrah.

From 17 Predictions

With certain areas of inflation coming down, although still higher than what numbers suggest, the discussion of the rate hike cycle at the end is controversial. Statistically, there has been a major financial failure at the end of each rate hike cycle since 1965.

Currently, the catalyst for financial stress could be the rising debt, rising spending, geopolitical issues impacting supply chain and a contentious election year. And anything that gooses inflation will stop the Fed from cutting.

January 2024 will see a new 6-month calendar range reset — it will be very important this time, with many predicting the end of the first quarter with a selloff. Although the stats are on the side of a higher market, this year of the dragon suggests some irritation that could turn the market on its side with more volatility.

To be prepared check out our predictions.

From The Vanity Trade 2024: All About Me!

According to Wikipedia, “Self-help or self-improvement is a self-directed improvement of oneself—economically, physically, intellectually, or emotionally—often with a substantial psychological basis.”

In the Outlook 2024, I quote Raymond Lo yet again,

“The Dragon is considered a ‘Star of Arts.’ The industries that will perform better in the Year of the Dragon will be related to the Metal and Wood elements. Metal industries are beauty and skin care; wood industries are media, fashion….”

This got me thinking about the consumer and the habits of 2023 and how they could continue or change in 2024.

With disposable income still quite high, consumers who spent the last half of 2023 in YOLO or revenge spending go into vanity mode in 2024.

Fashion, beauty, skincare, elective surgeries, self-help, diet drugs, and maybe dating stocks do well.

This daily includes lots of picks to put on your radar.

Click this link to get your free copy of the Outlook 2024 and stay in the loop!

Thank you, all my loyal readers, followers, clients and colleagues, for making 2023 so successful. Here is to a VERY HEALTHY, HAPPY and PROSPEROUS NEW YEAR!!!

This is for educational purposes only. Trading comes with risk.

If you find it difficult to execute the MarketGauge strategies or would like to explore how we can do it for you, please email Ben Scheibe at Benny@MGAMLLC.com, our Head of Institutional Sales. Cell: 612-518-2482.

For more detailed trading information about our blended models, tools and trader education courses, contact Rob Quinn, our Chief Strategy Consultant, to learn more.

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Grow your wealth today and plant your money tree!

“I grew my money tree and so can you!” – Mish Schneider

Follow Mish on X @marketminute for stock picks and more. Follow Mish on Instagram (mishschneider) for daily morning videos. To see updated media clips, click here.

Mish in the Media

Mish and team look at 2023 and make several predictions on commodities and trends for 2024 and vanity stocks in Benzinga Pre Market Prep.

Mish discusses gold, silver and why self care and “all about me” can trend in 2024 in this video from Yahoo! Finance.

Coming Up:

January 2: The Final Bar with David Keller, StockCharts TV & Making Money with Charles Payne, Fox Business & BNN Bloomberg

January 3: Real Vision IP Group Special Presentation

January 5: Daily Briefing, Real Vision

January 22: Your Daily Five, StockCharts TV

January 24: Yahoo! Finance

Weekly: Business First AM, CMC Markets

ETF Summary

S&P 500 (SPY): 480 all-time highs, 460 underlying support.Russell 2000 (IWM): 200 pivotal.Dow (DIA): Needs to hold 370.Nasdaq (QQQ): 410 pivotal.Regional Banks (KRE): 47 support, 55 resistance.Semiconductors (SMH): 174 pivotal support to hold this month.Transportation (IYT): Needs to hold 250.Biotechnology (IBB): 130 pivotal support.Retail (XRT): The longer this stays over 70.00 the better!

Mish Schneider

MarketGauge.com

Director of Trading Research and Education

I have used this Relative Rotation Graph regularly in the past few weeks to indicate the ongoing rotation out of large-cap stocks into the mid- and small-cap segments. This is happening while the market as a whole — in this case, the Dow Jones US index ($DJUS) — continued to move higher.

What this means is that investors are pulling money out of large-cap stocks and re-distributing it to those mid- and small-cap segments, while also adding fresh money into the market (otherwise, we would not be going higher).

In this final RRG article written for 2023, I’d like to review a Relative Rotation Graph that I introduced in Sector Spotlight a few weeks ago.

Sector Spotlight 11/7/23

This particular RRG uses ratio symbols to visualize the difference in rotation between cap-weighted and equal-weighted sectors.

You may need a few seconds to adjust and understand what we are looking at here.

The 11 tails each represent the comparison between the cap-weighted (CW) sector divided by the equal-weight (EW) sector. So for technology, that is XLK:RSPT. When that ratio moves higher, CW is outperforming EW, and vice versa. So we are interested in the absolute direction of that tail. Therefore, we use $ONE as the benchmark.

Now look at that RRG again. What immediately stands out, at least to me and I hope to you as well, is the large group of tails inside the weakening quadrant and heading towards lagging. We can include XLI:RSPN in that group as well, as it is close to crossing into weakening and also traveling at a negative heading. XLF:RSPF is already well inside the lagging quadrant and heading deeper into it at a negative heading.

For all these sectors…

FinancialsIndustrialsMaterialsTechnologyConsumer StaplesConsumer DiscretionaryHealth CareCommunication Services

…the conclusion is that the equal-weight versions should be preferred over their cap-weighted counterparts. That leaves only three sectors where the cap-weighted version has a better outlook for the coming weeks. These are:

Real-Estate inside the leading quadrantUtilities inside the improving quadrantEnergy moving back from lagging to improving

This is a clear rotation away from cap-weighted, i.e., large-cap names, to the second- and maybe third-tier market capitalizations at the start of the new year.

I am going to leave you to think about this observation. I wish you a very happy New Year and I am looking forward to seeing you back in 2024 with more written RRG blog articles and Sector Spotlight videos.

Thank you for 2023, –Julius

The last trading day of the year is behind us. It’s time to relax, get ready to ring in the new year, reflect on stock market action, and set your investment goals for 2024.

2023 was a particularly difficult one for investors. In the early part of the year, investors feared a recession in light of high interest rates, inflation was a huge concern, and we went through a regional banking crisis. The way things were unfolding caused concern, especially with the Middle East conflict, but things changed in the last quarter, and the year ended on a positive note.

Interest Rates

After reaching levels not seen since 2007, Treasury yields fell by around one percentage point. This helped the out-of-favor bond market, which finally showed signs of life. The weekly chart of the iShares 20+ Year Treasury Bond (TLT) below shows that bonds still have to move higher before confirming an uptrend. A break above its first resistance level at the 105.50 level, TLT’s previous high, would be a more confirming signal. Yet, it’s encouraging that the iShares 20+ Year Treasury Bond (TLT) is trading above its 50-week simple moving average (SMA).

CHART 1. WEEKLY CHART OF TLT. Bond prices benefited from declining Treasury yields. Even though TLT is trading above its 50-week simple moving average, a break above 105.50 would confirm an uptrend. Chart source: StockCharts.com. For educational purposes.

In the last Fed meeting, Chairman Jerome Powell indicated that rate cuts could occur before inflation hit the 2% target. That was enough to send investors flocking to equities, especially in the AI space. Investors are confident that a handful of mega-cap tech stocks would make great strides in AI technology. These stocks, known affectionately as the Magnificent Seven, were responsible for most stock market gains.

The stock market ended the year with a bang, with the Dow Jones Industrial Average ($INDU) rising 13.7% for the year, the S&P 500 ($SPX) up 24%, and the Nasdaq Composite up 43.6% (see daily chart below), the clear winner of the three broad indices.

CHART 2. DAILY CHART OF NASDAQ COMPOSITE. AI euphoria resulted in a stellar rally in the Nasdaq Composite, making it the biggest gainer of the three broad indices. Chart source: StockCharts.com. For educational purposes.

Given all the positive data, the stock market is positioned to continue moving higher in 2024. The Santa Claus Rally is on track, and which would mean a year-end boost. Earnings and revenue expectations are high, and the market has priced in interest rate cuts. Yet there are other segments of the stock market that investors may be able to gain from in 2024.

Trading the World

Next year is a record year of elections, and over half of the world’s population will be heading to the polls. This serves as a reminder that investors could benefit from international stocks. So far, emerging markets outside of China have picked up, as seen in the chart of iShares MSCI Emerging Markets ex China ETF (EMXC) below. After trending lower for most of 2022 and then trending sideways for most of 2023, emerging markets are starting to break out of a trading range. Their price action is similar to US small-cap stocks, another area you should watch in 2024.

CHART 3. DAILY CHART OF ISHARES MSCI EMERGING MARKETS EX CHINA ETF. Emerging markets have struggled in 2023, but they are breaking out of their trading range. Chart source: StockCharts.com. For educational purposes.

Three countries that have seen a strong 2023 are India, Japan, and Mexico. These three markets could continue moving higher, but if some other emerging markets start showing signs of catching up to these three, you could find some good values here.

If you will be investing outside of the US, closely follow the US dollar. Although the US dollar has weakened, it’s still relatively high. A weakening dollar is an indication of loosening financial conditions, but it also benefits developing countries. The bigger question would be if the US dollar holds on to or falls below its 200-day SMA.

Bitcoin

Bitcoin prices fell drastically in 2022. After reaching a high of 69,355 in October 2021, it fell to a low of 14,925 in November 2022. Higher interest rates, the Sam Bankman-Fried incident, the collapse of FTX, and regulatory crackdowns hurt the cryptocurrency’s price. Since then, Bitcoin has soared, reaching a 52-week high of 45,260. Some of that move may have to do with the possible regulatory approval of spot Bitcoin ETFs, which would open the door for a larger investment pool.

Based on the weekly chart of Bitcoin to US dollar ($BTCUSD) below, the cryptocurrency can rise further. After breaking above $30,000, there was no turning back until it hit its 52-week high of $45,260. The cryptocurrency is now stalling, forming a pennant formation.

CHART 4. WEEKLY CHART OF BITCOIN TO US DOLLAR. A break above the pennant formation could take $BTCUSD to its all-time high of $69,355.

A breakout above the pennant formation could see Bitcoin move 42.6% higher, the length of the flagpole. This would mean a rise to $61,275, close to its all-time high. If it continues higher, there’s a chance Bitcoin hit a new all-time high. Of course, things could go in the other direction; Bitcoin could break below its pennant formation and go down to the $30,000 level or lower.

The Bottom Line

AI growth, emerging markets, and Bitcoin are three areas to watch in 2024. As 2023 winds up and before you ring in the new year, it may be a good idea to set your investment goals for 2024. Create ChartLists of the different areas to watch, i.e., mega-cap tech, small caps, bonds, emerging markets, and Bitcoin, and be ready to sell assets that aren’t performing well and add those that can sizzle your portfolio.

As small caps and emerging markets (besides China) break out of their trading range and interest rates fall, Financials and other small caps will probably do well in 2024, as will bonds and emerging markets. A lot depends on how worldwide elections play out. Geopolitical tensions could flare up, which could have an impact on supply chains and trade restrictions. This could introduce volatility in equities, which is why it’s good to add an uncorrelated asset class such as Bitcoin or gold to your portfolio. It’s always good to have a healthy balance of different asset groups.

If there’s one word that encapsulates your investment strategy for 2024, it would be diversification. And last but not least, make it a point to go over last year’s trading resolutions.

Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.