This video data is as of August 9, Friday.
Howdy, Swings!
As we predicted in last week's video, the jobless claims report helped the market recover from last weekend's decline.
However, the market had already started to recover three days before the jobless claims report was released and is now back to last week's closing levels.
We now await the impact of next Wednesday's CPI report.
Will the rally finally begin next week?
Let's take a look at Fullhapce weekly swing market forecast to get some answers.
Swing Traders' friend, Fullhapce Intelligence presents work week 32 market forecast.
Here is Weekly Market Moves.
The market generally declined a bit, though performance was mixed. Notably, the VIX index dropped by 13 percent.
SNP 500: 5344.16, -0.04% down.
Dow Jones: 39497.54, -0.60% down.
NASDAQ: 16745.3, -0.18% down.
Russel 2000: 2087.8, -1.45% down.
Vix index: 20.37, -12.91% down.
Here is weekly sector performance
Outperformers included Aerospace & Defense, Semiconductors, Oil, and Transportation.
Conversely, the underperformers were Pharmaceuticals, Gold Miners, Regional Banks, Long-Term Bonds, and Homebuilders.
Here are the reasons.
The shocking selling pressure at the beginning of August was somewhat mitigated by positive comments from the Bank of Japan and the release of US jobless claims.
Traders ended the week with a somewhat more positive outlook than they started.
However, second-quarter earnings highlighted that economic conditions are changing for the worse, with lower demand and less pricing power for companies.
Businesses have recently become increasingly concerned about weak sales across a variety of sectors.
This weakening growth and sales environment is leading to a loosening of monetary policy, with central banks around the world moving to cut interest rates.
Here are things to consider.
Economic reports from the United States released this week suggest that the economy is not in a recession, but they are not strong enough to prevent the Federal Reserve from easing policy at its September 18 meeting.
Fed officials have downplayed recession fears and hinted that rate cuts could begin in September.
Upcoming Fed-related updates, including the July CPI report, FOMC minutes, and Chairman Powell's Jackson Hole speech, are expected to support this.
Global risk sentiment benefited as senior BOJ officials lowered expectations for immediate tightening.
Several major companies reported positive earnings this week.
SMCI's positive revenue outlook and TSMC's strong July sales show that AI-related technology spending remains robust despite some concerns.
International semiconductor earnings news was also positive, with SMIC in China and Tokyo Electron in Japan reporting good results.
The world's largest private equity funds have about $720 billion in available funds, according to Bloomberg.
Here is the Weekly Market Forecast for swings.
The weekly market broke the Fullhapce resistance level of 5350 at the open on Monday, but recovered all of it by Friday.
We expected the market to recover from mid-week, but the recovery started sooner than expected on Monday morning, increasing the likelihood that the market will continue to move higher.
Next week (week 33), the market will continue to move higher, and we may even see the S&P reach 5600 in a few weeks.
However, as I mentioned in the August 9 Fullhapce Daily Forecast, there could be a test to the downside around Wednesday's CPI release. But even if that happens, it looks like the market will dip and recover quickly and the trend will be somewhat clearer by Friday.
The market's growth potential is very strong. The data to date suggests that we will likely see the start of a rally before August 23rd. We will keep you updated on any changes in the flow.
Here are some additional insights.
The current market outlook is very uncertain as companies are facing rising costs and slowing growth.
Central banks are making only minor adjustments and inflation concerns continue.
Based on 2025 earnings projections, the S&P 500 is currently trading at around 19 to 20 times earnings, which is still relatively high.
Here is Devil's Advocate.
The opposite scenario is that the market enters a sudden downtrend and drops to S&P 5150 on a weekly closing basis.
This could be an opportunity for optimistic investors to buy on the dips.
The rationale for this scenario is as follows.
Investors should realize that a single jobs report may not reflect the overall trend and that there could be more negative employment data in the future.
Berkshire Hathaway's large cash position of $277 billion suggests that it is not currently finding attractive investment opportunities.
Recent earnings reports have shown that consumer spending has slowed.
Many companies have faced selling pressure after reporting second-quarter earnings.
SMCI's yield woes underscore growing concerns about the effectiveness of AI investments, with few companies, with the exception of Nvidia, posting big gains.
Negative tech news included Berkshire reducing its stake in Apple, Nvidia's possible delay in launching new chips, and Google's loss in an antitrust case.
Trade data from China and Germany was lackluster.
The used car index rose slightly, which could be a sign of potential inflation.
Geopolitical uncertainty is high with tensions in Iran, Hezbollah, Ukraine, and elsewhere.
While this opposition scenario makes sense to some extent, we don't think it's likely given that the market has accelerated its recovery in the midst of the above evidence.
Nevertheless, viewers should be wary of the concerns raised by the naysayers.
Here is the conclusion.
The bullish potential for the weekly market is very strong. The recovery that started on Monday morning was faster than expected, so at this rate, a rally could begin later next week or in week 34. In that case, it might be wise to hold your positions and take profits. However, you may want to consider hedging a bit to account for the volatility that is likely to come in the middle of next week.
Also, viewers may be wise to consider both out main forecast and opposition scenarios to manage risk effectively.
Thank you for watching.
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