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01/19/2024 |

Market Update Into January 22nd: Bulls On Parade

Sometimes a little fear is all that’s needed to get markets moving higher, and that’s exactly what we got this week! On Wednesday, the VIX ticked up to new multi-month highs and ‘Stock Market Crash’ was trending on socials. By Friday, we were at new all-time highs on the indexes. Funny how that works, right?

This week also saw Elon Musk threaten to move business away from Tesla,  a continuation of the flip in the credit markets, and the return of contrarian indicator Davey Day Trader.

In other news, crypto continued to struggle despite last week’s ‘Cointucky Derby’ and the billions of dollars that were pumped into the host of new BTC ETFs. Next week brings earnings from tech heavyweights like TSLA and NFLX, among others. Let’s dig into the charts!

Weekly Analysis

The SPY ETF has officially made a fresh new all-time high this week, closing at $482.43 (+1.20%). After testing the bottom of the ‘strong uptrend’ area of the CHATS indicator over the past few weeks, this index is firmly back in the green and looks ready to continue its push higher.

When it comes to trend strength, the QQQ ETF was unrivaled this week closing at $421.18 (+2.85%). It seems there’s absolutely no stopping this index as it’s now hitting the strongest reading possible on the CHATS indicator, a level not seen since December of 2021. For skeptics who might fear this to be an overbought signal, worry not. In the strongest trends, the CHATS indicator pins to the upper and lowermost extremes! 

The small caps were again the underperformer this week with the IWM ETF closing at $192.43 (-0.40%), but is a reversal imminent? The index put in a hammer candle and is holding above the 50-level of the CHATS indicator suggesting momentum is still on the side of the bulls. Also, the weekly chart displays a textbook Wyckoff Accumulation pattern.

What is CHATS, you ask?

The Chande Absolute Trend Strength (CHATS) indicator is a breakout-friendly indicator that measures both momentum and trend persistence. It was developed by technical analysis legend Dr. Tushar Chande and it is only available right here on TrendSpider! Want to learn more about it? We’ve got you covered. Watch this video:

Introducing CHATS: The Chande Absolute Trend Strength Indicator by Tushar Chande

Earnings To Watch

Next week is a big week for earnings, with results from NFLX, TSLA, and many more on deck. Here are a few charts to consider if you’re thinking about trading either of these names!

NFLX

On the monthly chart, we can see price is currently stuck between the Point of Control and the VWAP from the swing that brought the name to its all-time high.

On the daily, there’s a clear bearish divergence on both MACD and RSI while the price is consolidating just above its 50-day SMA.

Of note also the Seasonality chart, which clearly shows Q1 as the strongest quarter historically for the name. Also, January has the highest mean change of the year, with an average of +15.29%. Being that we closed the week just a few pennies from the monthly open, this could mean some real fireworks next week!

TSLA

On the monthly chart, the price is breaking down just below the long term symmetrical triangle pattern and trying to find support at the aVWAP from the Covid low.

On the daily, we see price falling back into the descending channel with RSI hitting oversold levels. Note the last three major lows all came in tandem with similar RSI readings.

As for Q4 earnings expectations, analysts expect quarterly earnings of $0.74 per share, pointing to a year-over-year decline of 37.8%. It is anticipated that revenues will come in at $25.94 billion, an increase of 6.7% compared to the year-ago quarter. For an in-depth view of past Q4 earnings, look no further than our ‘What’s Happening Now’ widget pictured below.

This image shows all of the historical Q4 earnings for TSLA.

Earnings Scanners

To keep track of all the companies reporting next week, feel free to subscribe to these free earnings scanners!

"Earnings in next 7 days ($QQQ)" scanner by TrendSpider
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“Earnings in next 7 days ($QQQ)” scanner by TrendSpider
"Earnings in next 7 days ($SPY)" scanner by TrendSpider
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“Earnings in next 7 days ($SPY)” scanner by TrendSpider