Market Direction Mid Week: Impeachment Goes On

The trading strategy this website uses as its signature tool is our bullish and bearish alerts. This indicator has effectively been used with accuracy since 2011. The website helps our followers stay in tune with the stock market and profits have been amazing. This post provides a mid-week update on how the stock market has preform. At the bottom of this post are the all-time numbers since the current alert was made. The current bullish alert is moving in the right direction.

Market Direction: BULLISH alert issued 10/24/2019

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U.S. stocks closed slightly higher Wednesday as investors digested a cautious message from the Federal Reserve, while continuing to monitor progress on China-U.S. trade talks.

How are benchmarks performing?

The Dow Jones Industrial Average DJIA, +0.11%  rose 29.58 points, 0.11%, Wednesday, closing at 27,911.30. The S&P 500 index SPX, +0.29%  closed 9.11 points, 0.29%, higher, at 3,141.63. The Nasdaq Composite Index COMP, +0.44%  rose 37.87 points, 0.44%, to 8,654.05.

All three benchmarks ended Tuesday within 1% or less of their record closes set nearly two weeks ago on Nov. 27, according to Dow Jones Market Data.

What’s driving the market?

The Federal Reserve on Wednesday announced it was holding interest rates steady, as widely expected, but added that it expected to make no changes in either direction throughout 2020.

That’s largely because inflation is tame and the job market is healthy, said Kim Forrest, founder and chief investment officer at Bokeh Capital Management. More critically, Forrest told MarketWatch, “This is the Fed saying that they don’t want to interfere with elections. This is a result of the super-politicized environment we live in.”

In U.S. economic data, inflation was slighter higher than expected in November, the government said Wednesday. The consumer price index was up 0.3%, higher than the consensus of 0.2%, and was up 2.1% compared to a year ago, the highest reading since last November, but still below long-time lows.

“Economic growth is 2 percent, and CPI inflation is also running somewhat above 2 percent in November,” MUFG chief economist Chris Rupkey noted. “There are not worrisome deflation undercurrents in this economy and Fed officials do not need to cut interest rates further to boost economic demand. The economy is better than they think.”

Meanwhile, the market is hoping for a delay on an increase in Dec. 15 tariffs on some $160 billion of consumer goods from China as a sign of progress on trade talks. So far, reports have been conflicting.

White House advisers Larry Kudlow and Peter Navarro have both indicated that tariffs scheduled to hit Chinese goods on Dec. 15 are “still on the table,” following a report from the Wall Street Journal that said both parties were bracing for a delay of a tariff increases on China goods on Sunday, which would be read as an escalation of tensions.

See: The runway until more China tariffs kick in is getting short. Expect a bumpy ride

In addition to trade policy and the Fed meeting, investors are keeping an eye on Britain, which is on the eve of a general election that could help to determine the future of its efforts to leave the European Union. Prime Minister Boris Johnson’s Conservative Party leads in polling for the U.K.’s general election set for Thursday, but his lead has been narrowing.

Meanwhile, shares of state-backed Saudi Aramco gained 10% on its first day of trading in Riyadh, making it the world’s largest initial public offering and the most highly-valued company in the world.

How are other markets faring?

The yield on the 10-year U.S. Treasury note TMUBMUSD10Y, +0.14% fell 4 basis points to 1.80%.

West Texas Intermediate crude CLF22, -1.03% on the New York Mercantile Exchange lost 40 cents, or 0.7%, to $58.85 a barrel.

February gold  GCG20, +0.29%  on Comex added $3.10, or 0.2%, to $1,471.20 an ounce, after a similar gain on Tuesday.

The U.S. dollar, as measured by the ICE U.S. Dollar Index DXY, -0.37%, was down 0.3% at 97.12, against a basket of a half-dozen currency peers.

In Europe, the Stoxx 600 Europe index SXXP, +0.22% reversed early losses and closed about .88 point higher, at 406.22.

See: Get ready for a jolly holiday season, and maybe a stock-market rally, Ned Davis Research says

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The all-time highs since our initial recommendation to go LONG this market. Here is how the markets have performed:

Stock Market Direction Recommendation (10/24/2019)
Dow	up 1,369.44 points a 5.11% gain	11/27/19
Nasdaq	up 520.11 points a 6.35% gain	11/27/19
S&P 500	up 143.97 points a 4.78% gain	11/27/19

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