MOTIVATION
QUOTE OF THE WEEK

In a market full of highs, real opportunities come from those willing to buy at the top."
This week, we explore how buying at all-time highs (ATH) might yield better returns than waiting for corrections.

WEEK 23/09/2024 to 27/09/2024
What you need to know this week

  • Buying at all-time highs yields better returns than other strategies: Despite the psychological discomfort, historical data shows that buying at market highs tends to produce higher returns over time than attempting to time corrections.

  • Gold keeps rising while oil struggles: Gold continues its upward trajectory, driven by inflation concerns, while oil faces volatility due to uncertain demand projections from the OPEC, IEA, and BP.

  • UK government debt hits 100% of GDP: For the first time in decades, the UK has seen its debt soar to equal its GDP, raising concerns about future fiscal policy and economic growth.

  • Interest-sensitive sectors look attractive: In this early stage of the interest rate environment, utilities, finance, real estate, and consumer discretionary stocks are becoming attractive picks.

  • Intel among the worst performers of 2024: Down 56% YTD, Intel is struggling, attracting attention from Qualcomm and Apollo Global Management, possibly eyeing acquisition.

  • 14 banks to back nuclear energy: A consortium of 14 major banks has announced increased financial support for nuclear energy projects, marking a shift in energy investment priorities.

  • Visa accused of antitrust practices: Visa faces accusations of anti-competitive behavior, which could lead to regulatory challenges.

  • Consumer confidence drops from August to September: The largest decline since August 2021, this dip could signal trouble, as consumer spending drives much of the U.S. economy.

  • Mixed oil demand forecasts: Forecasts from OPEC, IEA, and BP remain contradictory, making it difficult to predict future oil prices and market trends.

  • META announces new Quest 3 VR headset for $300: In a bid to make virtual reality more accessible, META launches a more affordable version of its Quest VR headset.

  • Divided opinions on rate cuts: Wall Street is pushing for a more significant rate cut, but the Fed remains cautious, suggesting a more measured approach.

  • OpenAI turns for-profit: OpenAI has officially transitioned into a for-profit entity, signaling a new era for the AI industry.

  • BTC breaks September statistics, gaining 12%: Historically, Bitcoin tends to lose 5.9% in September, but this year it’s up 12%, further solidifying its strong 50% YTD performance.

30/09/2024
Reflection on what happened and what might happen

This week started above last week's close and ended higher (although below last week's high, the second upper white line). This leaves us with some uncertainty. The volume doesn’t give much of a signal to draw conclusions, but it’s true that we are far from the EMAs, with the 9-day EMA, the closest, currently at $568.47 on the SPY, which would represent a 0.56% pullback from today's value. Nothing too significant if it bounces from there. It's quite different if someone entered at this week's high of $574.38, which would imply a 1% drop to the 9-day EMA, and even more so to the 20-day EMA, a stronger support area, which is 1.82% below last week's high.

For now, things look good, and I wouldn’t worry too much. There are no signs of a trend change, though we could see minor pullbacks to the EMA for now.

Historical Perspective

  • Buying at ATHs: Historically, buying at ATHs may seem counterintuitive, but research shows that it often leads to better long-term returns, especially in momentum-driven bull markets.

  • Consumer confidence dips: The drop in consumer confidence mirrors what was seen in 2021, which, combined with rising inflation and economic uncertainty, could trigger slower growth in the months ahead.

30/09/2024
Market Lessons

This week teaches that while market highs may scare some investors, they often present opportunities for those willing to stay disciplined. Interest-sensitive sectors like utilities, finance, and real estate could offer valuable opportunities as the interest rate cycle evolves.

Common Mistakes

A common mistake is avoiding the market at all-time highs, missing out on long-term gains. Historically, waiting for dips tends to underperform compared to simply staying invested and riding the momentum.

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Next Week’s Economic Calendar (30/09 to 04/10)

Monday, 30 September 2024

Time (EST)

Event

Forecast

Previous

Importance

09:50

FOMC Member Bowman Speaks

-

-

M

10:45

Chicago PMI (Sep)

46.1

46.1

M

14:55

Fed Chair Powell Speaks

-

-

H

Tuesday, 1 October 2024

Time (EST)

Event

Forecast

Previous

Importance

10:45

S&P Global US Manufacturing PMI (Sep)

47.0

47.0

M

11:00

Construction Spending (MoM) (Aug)

0.2%

-0.3%

M

11:00

ISM Manufacturing Employment (Sep)

46.0

-

M

11:00

ISM Manufacturing PMI (Sep)

47.6

47.2

M

11:00

ISM Manufacturing Prices (Sep)

53.7

54.0

M

11:00

JOLTs Job Openings (Aug)

7.640M

7.673M

M

17:30

API Weekly Crude Oil Stock

-

-4.339M

M

Wednesday, 2 October 2024

Time (EST)

Event

Forecast

Previous

Importance

09:15

ADP Nonfarm Employment Change (Sep)

124K

99K

H

11:30

Crude Oil Inventories

-

-4.471M

M

12:00

FOMC Member Bowman Speaks

-

-

M

Thursday, 3 October 2024

Time (EST)

Event

Forecast

Previous

Importance

09:30

Initial Jobless Claims

221K

218K

M

10:45

S&P Global Composite PMI (Sep)

54.4

54.4

M

11:00

Factory Orders (MoM) (Aug)

0.1%

5.0%

M

11:40

FOMC Member Bostic Speaks

-

-

M

Friday, 4 October 2024

Time (EST)

Event

Forecast

Previous

Importance

09:30

Nonfarm Payrolls (Sep)

144K

142K

H

09:30

Unemployment Rate (Sep)

4.2%

4.2%

H

Earnings Calendar (30/09 to 04/10)

Monday, 30 September 2024

Company

EPS Forecast

Revenue Forecast

Market Cap

Carnival Corp (CCL)

1.17

7.82B

23.43B

Tuesday, 1 October 2024

Company

EPS Forecast

Revenue Forecast

Market Cap

Nike (NKE)

0.5214

11.65B

134.03B

Paychex (PAYX)

1.14

1.31B

47.84B

McCormick & Co (MKC)

0.6724

1.67B

22.36B

Lamb Weston Holdings (LW)

0.7158

1.55B

9.55B

Wednesday, 2 October 2024

Company

EPS Forecast

Revenue Forecast

Market Cap

Conagra Brands (CAG)

0.5939

2.84B

15.56B

Thursday, 3 October 2024

Company

EPS Forecast

Revenue Forecast

Market Cap

Constellation Brands A (STZ)

4.08

2.95B

46.47B

Summary of the Week’s Summary

This week, the markets aimed for new highs, following the trend driven by rate cut data and the positive market sentiment, without any major news.

On the other hand, we have inflation decreasing, gold reaching new highs, and oil prices falling, but everything can change quickly.

Risk Alert

There’s significant division regarding the Fed's next rate cut. Wall Street is pushing for more aggressive cuts, but the Fed seems to favor a softer approach. If the Fed doesn’t act as expected, we may see increased market volatility.

Opportunity Map

Interest-sensitive sectors like utilities, real estate, and finance may offer attractive entry points in the current rate environment. With ongoing shifts in the energy market and the rise of nuclear energy investments, clean energy stocks could also be worth exploring.

Art
Illustration of the Week

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Disclaimer: This is not investment advice. All the information is provided for entertainment purposes only.


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