Client Portal

Canadian Dollar & Mexican Peso have both lifted off early lows which happened late last night on the announcement of 25% tariffs to both Canada and Mexico (China was left out) Thus, this move is exactly opposite of what most traders expected when Tariff announcements were made, as and both Peso and Canadian Dollar ("Loonie") are nearly positive on the day. Both Loonie and Peso had declined sharply following the Election but have begun to stall on this advance. As most know from the 2016-2010 period, the rhetoric proved to be more extreme than the actual results, and both Mexican and Canadian Exports continued to flow to the US. (Canada remains the biggest exporter of Oil to US while being the source of more than half of US imports of Wood) Overall, i suspect near-term gains are possible for both Peso and Loonie, but the weekly charts of both USDMXN and USDCAD still show both having an excellent chance of further gains in US Dollar vs. both. Key support for USDMXN lies at 20 and its expected that an eventual gain to 22.14 will happen. 1.426 is a key support level for USDCAD, but it's thought that a rise back to 1.4667 happens before a larger stallout. (Hourly chart of USDCAD shown below)

Crude oil has dropped about $5 since last Wednesday, and today's drop was specifically linked to Trump's signing of an Energy Emergency Act aimed at increasing US Energy Exports. However, but still no guarantee that this marks the beginning of Crude's downward slide. Rather, the attempts at bottoming after the early 2% decline today likely will result in a snap back rally where front month Crude futures lift to $77.90- $78.60. Above that level would drive Crude temporarily back to new highs given the bullish momentum over the last month. I expect Crude likely does lift to test last Summer's highs initially near $84.50 before it turns back down to new lows likely into Summer of 2025. At present, there's not enough to suspect Crude's decline will continue given the hourly pattern at work, and investors need to be mindful if/when Crude breaks the most recent downtrend and reclaims 1/20 peaks at $77.18

Gold and Silver have diverged lately, with Gold breaking out of its trend from last October's peaks while Silver has lagged sharply. Both might show some minor consolidation after these runups, but the patterns of both Gold and Silver should be favored for gains from February into the Summer and good likelihood of a push back to eventual new highs, above last October. Note that the pattern on the Silver chart (shown in yellow on this chart (Ishares Silver ETF SLV1.45% ) looks almost identical to China's FXI, both which peaked out in October and have made lower highs. Overall it looks a bit premature to expect this move to continue in Gold back to new highs right away, but one should consider Gold and Silver attractive on weakness over the next couple weeks

Early gains this morning have moderated a bit, which has less to do with political reasons & more to do with just 5 out of 6 days of gains reaching resistance for ^SPX0.98%  near 6021 and some evidence this morning of both US Dollar as well as TNX starting to stabilize. Still a very good day for Equal-weighted S&P 500, which is up nearly +0.92%, but most concentrating on QQQ note that QQQ0.96%  is up just +0.11%. Today's gains are largely defensive, with REITS, Utilities, and Healthcare leading all greater than 1%, while Energy is the big laggard, with Crude declining nearly 2% on the day. For now, no evidence of a reversal which was thought possible this week technically, but this would be more on the radar on SPX decline under 5963

Today marks a solid day for Breadth again this week and SPX has rallied to within striking distance of Jan 6 highs. A couple important short-term developments as the Wave structure has gotten better based on today's move above 5965. While this doesn't signal a move straight back to new highs, it does signal that 1/13 lows likely won't be undercut right away. Thus, there is some short-term resistance into today/Monday near 6021. However, next week's pullback likely should only retrace 50% or so of the rally this week before turning back higher in stronger fashion. Thus, it's right to expect that despite some likely consolidation next week that prices did in fact bottom on 1/13 and are en route back to new all-time highs eventually. As shown below, there hasn't been structural change to the trend. However, sentiment had gotten worse into recent days, while breadth has proven much better this week. Overall, it's right to be bullish into mid-February, but expect some stalling out in all likelihood that could begin Monday, taking SPX down to 5900-5925 before turning up and moving to new highs into late January/early February

AAPL-3.38%  decline today is a minor negative given its weight within ^SPX0.98%  and QQQ0.96%  and as daily charts show, the stock is set to make the lowest daily close since mid-November. Given AAPL's importance within SPX, this stock remains important to concentrate on, and will need to stabilize before being able to suggest that a move back to new highs is imminent. Under 230 might very well lead to 220 in short run, but would be a very attractive risk/reward on any further weakness that undercuts 225 and will be right to watch for signs of bottoming.

S&P has begun to stall after the bounce from earlier this week. The area at 5980-90 lies near trendline resistance and it's thought that this should be important and then 6021 will be important to exceed to confirm. All 11 sectors are higher today, but breadth is rather mixed, and Utilities and REITS are providing most of the strength. I'll be watching carefully over next 2-3 days, but first area of importance on the downside is today's earlier lows at 5934.44, then 5871.92. The ability to undercut that would be troublesome into next week, and will monitor if/when that happens. At present, Treasury yields and DXY are mildly weaker today which is a minor positive for risk assets, but some of the weakness in large-cap Tech is offsetting this, specifically AAPL. At any rate, the minor bounce from earlier week remains intact, but part of ongoing consolidation from early December.

CPI core came in +0.2% vs. 0.3% which is just what the market wanted to see. Bond yields have dropped sharply (10-yr Yields lower by 10 bp) along with the US Dollar (-0.40%0 while Equity futures have jumped 1-1.65% on S&P and NASDAQ Futures) Price is nearing resistance on S&P so important to see this move stick and see breadth expand meaningfully. Banks showed largely very good earnings across the board and Financials are likely to outperform today. Given that Core inflation running 2.5% and Job market has stabilized,there aren't more cuts being priced in as a result of today's inflation data, and this likely will take some time. Overall, a good outcome for today's data, but S&P futures will require a move above 6020 to truly break out, and this rise is part of the ongoing consolidation since mid-December

PPI downside surprise along w/ Trump's advisors saying he will "gradually bring Tariffs in" (We'll see if he agrees with this) resulting in mild bounce for US equity futures this morning. While a bounce is certainly near, it still might take 3-5 days before a true low is in and I'm eyeing the Inauguration as having a potential better likelihood than now, as price patterns aren't yet complete from a wave perspective and DeMark counts are also not yet in place. However, for those that missed last nights report (which was sent out early this morning) i do detail 10 reasons why a larger than expected bounce is near. For now, it's important to watch for evidence of this bounce from 5814 in Futures taking a three-wave trajectory, which ultimately might result in yet more selling after CPI (as this doesn't necessarily need to follow PPI's path) The area near 5700 has more importance than 5800. However, breadth and momentum would improve on any further selling pressure and these divergences will also be something to watch over the next couple days. ES0.54% _F S&P Front month futures shown below - Both ES_F and ^SPX0.98%  still look possible to not get meaningfully above 5925 before turning back lower, as breadth wasn't as good as expected from yesterday's lows, and structurally the move does not look complete.

Silver's reversal today looks meaningful and likely takes prices down to $27 before a bottoming and the start of a push back to new all-time highs. Given that the Fed is likely on hold with Rate cuts being distant and both Real rates and US Dollar pushing higher, it's unlikely that the next couple weeks will be too constructive for Precious metals, and specifically, Silver which has closer ties to China. Thus, while both Gold and Silver might pull back in the next couple weeks ahead of a bottom (which might also coincide with Treasury yields peaking) Silver should underperform, at present and could undercut December lows into late January. Any decline down to $28.50 in Front month Silver futures should be seen as the start of better risk/reward opportunities for those who are seeking Precious metals strength, but for now, Silver is an underperformer to Gold and might undercut December 2024 lows, while Gold shows some positive divergence in this regard. (SI_F)