The S&P 500 made it two consecutive up weeks, closing Friday at 6,816. In a week dominated by ceasefire and negotiation talk, lets focus on some of the economic news and technical analysis behind the markets upward trend. Starting with inflation on Thursday, Februarys core Personal Consumption Expenditure (PCE) price index rose by 0.4% from the previous month, the same as the last two months, while the annual rate came in at 3%, down from 3.1% and remaining well above the Federal Reserve's 2% target. On Friday the March Consumer Price Index (CPI) increased 0.9% month-over-month, the largest increase since June 2022, fueled by a 21.2% jump in gasoline. From an annual perspective, CPI jumped to 3.3%, marking the highest level since May 2024 and a sharp increase from 2.4% in both February and January. Shifting gears, the UMICH Consumer Sentiment Index plummeted 11% to a historic low of 47.6 in April, far below both market expectations of 52 and last years level by 9%. So now lets look at the technical side. As mentioned above, the S&P 500 had two bullish weeks which included a 7-day winning streak which ended on Friday. Looking back ten years, the most recent 7-day streak was between 24 October and 1 November 2023, while the longest was 9 consecutive updays in October 2017. It should also be noted that the NASDAQ 100 is now up 8 days in a row, matching its most recent 8day streak between 13 and 22 December 2023, and its longest streak was 11 days in July 2017. Looking at Moving Averages (MA), during the last two weeks the S&P 500 reversed course from its price being below both its 20 and 50 day MAs, to the price above both. And finally, if you look at the S&P 500 Heikin Ashi weekly chart, weve broke a five-week string of lower lows and lower highs, and reversed that this week with a higher high and higher low. Overall, the economic and technical events seem to be contradictory, but in the end price is the ultimate resolution of all the forces. Next week earnings season starts with the big banks reporting, and on Tuesday we get the wholesale Producer Price Inflation (PPI) number. And just a reminder about tax day on 15 April. For TSP TIPS we recommended a new investment mix this week. Overall, the I fund has the highest Composite Score and Performance Ranking. Its 20 day MA is also GREATER than its 200 day MA, while the S and C funds 20 MAs are LOWER than their 200 MAs. That said, if the S fund stays at its current price, it will join the I fund in 20 over 200 MA territory next week. As always, well continue to monitor market conditions and recommend reallocations if needed.
The S&P 500 made it two consecutive up weeks, closing Friday at 6,816. In a week dominated by ceasefire and negotiation talk, lets focus on some of the economic news and technical analysis behind the markets upward trend. Starting with inflation on Thursday, Februarys core Personal Consumption Expenditure (PCE) price index rose by 0.4% from the previous month, the same as the last two months, while the annual rate came in at 3%, down from 3.1% and remaining well above the Federal Reserve's 2% target. On Friday the March Consumer Price Index (CPI) increased 0.9% month-over-month, the largest increase since June 2022, fueled by a 21.2% jump in gasoline. From an annual perspective, CPI jumped to 3.3%, marking the highest level since May 2024 and a sharp increase from 2.4% in both February and January. Shifting gears, the UMICH Consumer Sentiment Index plummeted 11% to a historic low of 47.6 in April, far below both market expectations of 52 and last years level by 9%. So now lets look at the technical side. As mentioned above, the S&P 500 had two bullish weeks which included a 7-day winning streak which ended on Friday. Looking back ten years, the most recent 7-day streak was between 24 October and 1 November 2023, while the longest was 9 consecutive updays in October 2017. It should also be noted that the NASDAQ 100 is now up 8 days in a row, matching its most recent 8day streak between 13 and 22 December 2023, and its longest streak was 11 days in July 2017. Looking at Moving Averages (MA), during the last two weeks the S&P 500 reversed course from its price being below both its 20 and 50 day MAs, to the price above both. And finally, if you look at the S&P 500 Heikin Ashi weekly chart, weve broke a five-week string of lower lows and lower highs, and reversed that this week with a higher high and higher low. Overall, the economic and technical events seem to be contradictory, but in the end price is the ultimate resolution of all the forces. Next week earnings season starts with the big banks reporting, and on Tuesday we get the wholesale Producer Price Inflation (PPI) number. And just a reminder about tax day on 15 April. For TSP TIPS we recommended a new investment mix this week. Overall, the I fund has the highest Composite Score and Performance Ranking. Its 20 day MA is also GREATER than its 200 day MA, while the S and C funds 20 MAs are LOWER than their 200 MAs. That said, if the S fund stays at its current price, it will join the I fund in 20 over 200 MA territory next week. As always, well continue to monitor market conditions and recommend reallocations if needed.