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04/05/2024 |

Market Update Into March 8th: Kashkari Spooks Markets

The Bulls have had an easy go of it over the past five months. The bid has been relentless as the narratives of lower inflation and rate cuts have taken the forefront, but a new narrative is afoot; Rate cuts might not come this year. These comments, which came from Federal Reserve Bank of Minneapolis President Neel Kashkari, a non-voting member of the FOMC, caused a market-wide selloff on Thursday, the likes of which had not been seen since March of 2023. In other news;

Some cracks are beginning to form on the lower time frames across the three major index ETF charts, and we’ll discuss them, as well as other notable highlights from the week, below!

Weekly Analysis

SPY (SPDR S&P 500)

An interesting change of pace was seen on the SPY daily chart this week, with the price closing below the 21-period EMA for the first time this year. Despite closing only moderately lower than last week at $518.43 (-0.89%), the clear bearish RSI divergence is cause for concern.

This is a daily chart of the SPY index.

QQQ (Invesco QQQ Trust)

Much like the SPY, the QQQ also struggled with its 21-period EMA this week, failing to regain it after Thursday’s selloff and closing at $440.47 (-0.80%). The Relative Strength indicator continues to deteriorate, suggesting weakness under the hood.

This is a daily chart of the QQQ index.

IWM (iShares Russell 2000)

The small caps were the weakest performers of the group this week, closing at $204.45 (-2.78%). Much like its more favored counterparts, the IWM is also showcasing clear bearish RSI divergence while the price struggles below the 21-period EMA.

This is a daily chart of the IWM index.

Earnings

This is an image of all the earnings data discussed in the below copy.

Notable Results

PAYX (Paychex)

  • EPS: $1.38  vs  $1.37 est 
  • SALES: $1.44B  vs  $1.46B est

NNOX (Nano-X Imaging)

  • EPS: $(0.18)  vs  $(0.30) est
  • SALES: $2.50M  vs  $2.82M est

PVH (PVH Corp)

  • EPS: $3.72  vs  $3.53 est
  • SALES: $2.49B  vs  $2.42B est

PLAY (Dave & Busters Entertainment)

  • EPS: $1.03  vs  $1.10 est
  • SALES: $599.1M  vs  $602.6M est

CALM (Cal-Maine Foods)

  • EPS: $3.00 vs  $2.46 est 
  • SALES: $703.1M  vs  $692.4M est

BB (BlackBerry)

  • EPS: $(0.03)  vs  $(0.03) est
  • SALES: $173.0M  vs  $154.8M est

LEVI (Levi Strauss)

  • EPS: $0.26  vs  $0.21 est
  • SALES: $1.558B  vs  $1.547B est

LW (Lamb Weston)

  • EPS: $1.45  vs  $1.46 est
  • SALES: $1.46B  vs  $1.65B est

What’s Happening Now

XLE (SPDR Select Sector Fund)

Over the last month, energy has led the market, outperforming all other sectors, and has room to run. XLE and its three highest weighted holdings (XOM, CVX, COP) see record gains in April, particularly in election years.

This is an image of the XLE seasonality charts discussed in the above copy.

KO (Coca-Cola)

Coca-Cola weathered a 4% decline last week but appears to have found some footing on the 100-Day EMA, forming hidden RSI divergence on the daily chart. Watch for a reversal, as historical data shows this week is particularly potent.

This is an image of the KO seasonality chart discussed in the above copy.

NVDA (Nvidia)

Nvidia suffered back-to-back red weeks for the first time in 2024, closing -9.6% off ATHs, stopping just short of correction territory. Before you get too excited, seasonality shows one more week of tough sledding ahead.

This is an image of the NVDA seasonality chart discussed in the above copy.

Believe it or not, this is just a fraction of what happened in the markets this week. For a full run down delivered straight to your inbox every weekend, sign up for The Official TrendSpider Newsletter! We hope you all have a very happy Easter holiday!