The U.S. stock market has kicked off 2024 with a bang, fueled by optimism surrounding the economy and expectations of multiple interest rate cuts. This sentiment, combined with the soft landing and AI narrative for equities, has driven market exuberance. The S&P has surged more than 10% year-to-date, marking its strongest first-quarter performance since 2019. Despite setting numerous record highs, there hasn’t been a significant pullback in the market by the end of the first quarter of 2024.
The SPX continues to climb the wall of worry, supported by an uptrend and its short-term moving average. While the market has become overbought, with the weekly RSI reaching its highest level since 2020, analysts have been hesitant to predict when or how the uptrend might reverse. However, if history is any indication, the short-term moving average will likely be the first indicator of a potential downturn.
Despite the overall market strength, #AAPL and #TSLA have struggled, earning the nickname “clumsy twins” of the market. #AAPL is nearing a key support level, potentially forming a double top pattern around $165. Meanwhile, #TSLA is in a downtrend with no significant rebound in sight, testing support levels at $160 and $152, as well as its long-term uptrend support. Both stocks face obstacles and opportunities ahead.
In March, our long-term investment portfolio delivered a 6.6% return, bringing our cumulative gain since May 2020 to 133.02%. However, our dynamic investment portfolio achieved a 1.88% gain, largely due to the struggles of #TSLA, resulting in an overall return of 68.02% since May 2020 . As predicted in the previous quarter, our structured note portfolio showed significant improvement, driven by positive trends observed since January, particularly in the energy, industry, and financial sectors.
Despite the five-month-long uptrend and prevalent FOMO sentiment, it’s essential to heed Bob Farwell’s advice: if everyone is waiting for a pullback to buy, either the market won’t experience a pullback, or if it does, it may not be a wise decision to buy into it.