Positive pricing has been continuing in the USA for a long time. The first positivity came in line with inflation expectations. The increase in inflation stopped, and when Powell said "There may be an interest rate cut in 2024", all the negativities in the market were put aside and inflation would decrease very quickly, and then the Central Bank immediately started pricing as if it would start reducing interest rates in March. But when we look at it closely, the data we have does not support an interest rate cut in March. But when we look at the market's expectations and surveys, 70% of the market says there will be an interest rate cut in March. Then, with the effect of this, there was a rally in risky assets in the markets. Following this, the Central Bank presidents came out and made a statement. “There may not be an interest rate cut in March. At the same time, the first slap came to the market when he said, "Yes, the data is going well right now, but if necessary and if there is a deterioration in the data, we can increase the interest rate again." This was the slap of reality. This became an excuse to fix it. Now everyone is optimistic, the New Year's rally we were waiting for has happened. US stock markets will enter a minor correction. It started to fall below the medium-term trend, which started from 1.43 in the US decades and reached 5.08 levels. In fact, when we look at the US decades, there may be a reaction, but a very strong resistance has been reached. Unless the US ten-years rise above 4.14 levels, which is where it may react to 4.14 levels. But unless this reaction goes above 4.14 levels, I think the 5.08 peak may remain a peak for a long time. In this sense, assuming that there will be a reaction in the US decade from the current 3.86 levels to 4.14 levels, but adding that this will also be a selling opportunity, my personal opinion is that the US decade will continue to decline after a reaction towards 3.5 levels or even 3.26 levels in 2024.
I am optimistic about the US stock markets for 2024. Nasdaq 10400 has reached its previous historical top from its bottom in September-October. In fact, Nasdaq probably even made a new peak by seeing 16800 levels. I can say that the medium-term trend will clearly go up. But there may be possible corrections here, as it has reached its previous peak, due to the classic double peak story, and moved away from its eight-week moving average. When there is a correction, the investor should not think that the exit is over. Long investors can read partial corrections by taking partial profit, or they can read the pullbacks that will occur up to the trend as a part of the process unless the trend is broken and stay calm. This is the investor's choice. But technology tells us this. 15970 is our trend support level. This Nasdaq may make a correction up to 15900 levels, without going above 17000 levels. However, it is not important for the investor and his trading discipline whether he makes this correction or not. In my personal opinion, I will continue to read the discipline, making 17000 and 17100 the intermediate target and 18490 as the target, in order to keep the risk notes that Nasdaq may correct unless it closes below 15950 and 15970. Therefore, I will continue to read on the positive side that Nasdaq remains above 15970 levels. However, the possibility of a slight correction towards these levels should be followed carefully, especially by investors who will open new positions. If anyone is looking for an opportunity in Nasdaq, saying "it was a big breakout, I missed it", and if a fall accidentally widens towards the 14400-15100 band, this can be interpreted as an opportunity on the Nasdaq side.
In the big picture, the medium-term trend in S&P, which rose from 3600 to 4700, is strong, but the short-term trend got tired and reached channel resistance. Therefore, I say that if the S&P closes above the 4779 level, the correction will continue. But if there is no closing above 4779, there may be a need to rest for a while and make a small correction in the 4779 and 4580 region, with the maximum value being 4530 and the median value being 4580. Above 4779, S&P goes into a very serious spoiling phase and opens the door to 5174 levels. The investor who trades long direction can do the following. What if it passes above 4779, it can ease before 4779 passes to return, this is a modification. Or, you can say that you are trading the trend and unless the 4580 and 4530 levels are broken, the pullbacks can be managed without fear by labeling them as intra-trend corrections. Investors looking for an opportunity here should interpret the withdrawals that will occur towards the 4400 and 4250 levels as an opportunity, not fear, if it drops below 4533. As short-term 4530 and medium-term 4250 remain above these two supports, S&P will take pressure from 4779 levels for a while and then continue its movement towards 5174 levels.
Dow Jones outperformed the other two stock markets. But let's not forget this. While returning from 29000 levels, it was the first to rise, but when we look at the five-bar five-week period, it fell at a terrible pace, falling very sharply to the levels of 61.8 and 78.6, and then remained relatively weak. But if we look at it, Dow Jones has passed its historical highs and is making new highs. Therefore, in the broad term, I am not pessimistic for 2024. I can state this clearly. Dow Jones will reach 39200 levels in 2024. It will also price above 39200 levels. But be careful, the weekly breakout, which has risen from 32500 levels in the last two months and we have seen only one red bar for about seven weeks, may make a correction. So, those who are new to trading should be a little cautious here. There may be a correction between 35000 and 35800 levels. Those with a position should read the 36800 level as a Pivot support. One should take profit by saying that the correction in Dow Jones below 36800 levels will expand to 35000 and 35800 levels, or be patient by giving up a certain part of the profit. He can choose one of the two. In this sense, 36800 is important pivot support for the short term, and 35800 is medium-term trend support. Therefore, the risk that the correction below 36800 levels may expand to 35000 levels should be kept in the assumptions. Technically, the Dow Jones is in extreme territory. One must be extremely sensitive about the new costs incurred here. Below 36800, the correction in Dow Jones may expand to 35800 and 35100 levels. Therefore, I recommend that you be a little cautious when opening new positions in Dow Jones. It will correct it, even correct it a little deeper. Then he will continue his progress by saying "where we left off, we continue on our way."
I expect an upward reaction in the dollar index. The decline of 103.89 caused a splash towards 113 levels. DXY will not see 113 levels again for a long time. I must point out that it will be difficult to surpass in the long run. In the short term, I think DXY will stay between 100.8 and 105 for a while. It will be difficult to pass below 100.79 levels. As it approaches 101 levels, it will look for reactions towards 103.60 and 105 levels, just like now. Therefore, as they react to DXY in the 100.79 to 105 band for a long time, they will hit it in the head and pull it down. Tried 105 levels last month, 2 - 3 weeks ago. Might try level 105 again. If it tries again and cannot pass, it may break the 100.79 level downwards. As long as it remains above 101 levels, I expect a reaction in DXy towards 103.5 and 105 levels. Depending on whether it can exceed 105 levels or not, I can advise that a discipline such as holding long positions or taking profits would be correct. Here, above the 105 level confirmably spoils DXY upwards. This should be taken into consideration in short directional trading. In other words, one should pay attention to whether closings begin above the 105 level. Therefore, I would long trade DXY above the 105 level. Below 100.8 levels, DXY starts a second correction wave in the downward trend it started at 113 levels and begins a more aggressive decline, reaching 98 levels. But I don't expect this decline right now. I expect band trading between 101 and 105 for a while and weak reactions from time to time. DXY 101 equals euro - dollar parity is 1.1020. If DXY falls below 101 levels, the parity will permanently sit above 1.10 levels and give a permanent long signal. Otherwise, in my personal opinion, parity attacks towards the 1.0980 and 1.1020 levels will be met with selling. These attacks may occur, but these attacks will be met with sales. Therefore, there is a complete trader market in the parity band between 1.0820 and 1.1020. I think that as it gets closer to the upper limit, sellers will come, and as it gets to the lower limit, buyers will come. It seems like sellers will react in the 1.1020 to 1.0840 band for a while.
Too many developments are happening in oil at the same time. There is the OPEC side. The results of US crude oil stock data indicate that the strength in production continues. On the other hand, the Hulusi stated that their attacks on the ships of the coalition force established by the USA in the Red Sea would continue. There is confusion. Looks like $80 Brent is struggling. When we look at Brent throughout the year, it was a buy and sell market within a 20 dollar band, with sellers as it approached 92 levels and buyers as it approached 72 levels. The $131 levels seen with the Russia-Ukraine War will remain at the top for a long time unless there is a new geopolitical risk. That place was Fibonacci 1.618. In the short term, my personal opinion is that as long as it stays above $72, they will read the retreat towards $72 levels as a buy zone. They will try to react towards the 87 and 92 levels. Investors should think of this as a band. The 70 to 72 levels can be read as a buying zone and the 87 to 92 band can be read as a selling zone. There is very strong support at $72 levels. I think there may be very strong sellers at $92 levels. In order to exceed 92 levels upwards, there must be a geopolitical risk or a special news flow. In order for it to fall below $72 levels, perhaps there needs to be a very strong message from the Opec side. What we will do here is to trade $ 20 in the band between 72 and 92, as a trader, in the most effective way, buy-give.
The information, comments and recommendations contained herein are not within the scope of investment consultancy. Investment consultancy services are provided within the framework of the investment consultancy agreement to be signed between brokerage firms, portfolio management companies, banks that do not accept deposits and customers. The comments in this article are only my personal comments and these comments may not be appropriate for your financial situation and risk return. For this reason, investments should not be made based on the information and comments in my articles.
