Trade The Journey

Trade The Journey

Happy New Year!

Happy New Year to all my fellow traders out there. Reflecting on the past week, it’s been relatively quiet on the market catalyst front, leading to what appeared to be exaggerated market movements. This will be a brief update, as many are on vacation, gearing up to ring in the year 2024. With Covid concerns receding into the background, the big question is: what does 2024 have in store for us?

We’re stepping into a year packed with pivotal events: the Presidential Election, congressional discussions on the budget, potential risks of a government shutdown, a possibly slower-than-expected recovery, China’s economic resurgence, and ongoing conflicts in various countries. All these factors are critical considerations as we navigate the financial landscape of the new year.

Upcoming Week’s Highlights:

  • Tuesday: Look out for the Construction Spending data, forecasted at 0.3%.
  • Wednesday: A key day with ISM Manufacturing, expected at 48%, JOLTS, and the FOMC Minutes.
  • Thursday: ADP Employment Change is projected at 120k, and Initial Claims are expected at 216k.
  • Friday: We’ll see the ISM Non-manufacturing report, forecasted at 52%, and the Employment Situation Report.

Economic Data Insights:

  • Housing Sector: November’s Pending Home Sales held steady from October, yet showed a year-over-year decline. These figures are significant as pending sales can be a bellwether for the housing market, while existing sales confirm trends. With mortgage rates decreasing and an average savings of $300 per month, the housing market could see an upturn in 2024. The Shiller U.S. National Home Price Index indicated a modest monthly increase and a 4.77% annual rise.
  • Employment Situation: Initial claims edged up by 12,000 to 218,000, slightly above forecasts but not indicative of a broader economic slowdown or recession. Continuing claims rose to 1.875 million. The stability in the four-week moving average of claims suggests a steady labor market.
  • Trade and Inventory: November saw the international trade deficit increase marginally to $90.3 billion. Notably, exports declined across almost all categories, while imports mostly fell, except for a rise in Foods, Feeds, & Beverages. Wholesale inventory levels dipped, reflecting a varied picture in durable and nondurable goods, while retail inventories showed a slight decrease but an overall annual increase.

The Chicago PMI fell short of expectations, coming in at 46.9 against a forecast of 51.

Technical Story:

Personal Review and Goals:

This past week, my holiday spending went a bit overboard, leading to an unexpected extra $500 on Christmas festivities. A few impulsive buys also crept in, but fortunately, they won’t cause significant financial strain. Looking ahead to 2024, my primary goal is to clear my personal credit card balances. December showed that sticking to a budget plan is key, and I’m confident that with discipline, my goals are within reach.

Overall, I’d give myself a C- for the week. There’s room for improvement, but I’m optimistic about the coming year and committed to better financial habits.

As we step into 2024, let’s remain vigilant, adaptable, and focused on our financial goals. Wishing everyone a prosperous and successful New Year!

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