How To Start Off 2023 The Right Way

It’s a holiday week in the U.S., which typically means lighter trading volume. This year has been different in almost every way, so will this week be different? The chart below is the SPY and shows the 50-day moving average of volume; since early November, we’ve been mostly below that line. I’d like to see the rally on increasing volume, not decreasing, but for now, that means I don’t expect too much to happen this week.

That said, there are a lot of reports to cram into the shortened trading week, including FOMC meeting minutes.

Before we get to the reports of the week, I wanted to invite you to watch the replay of the co-founders of Traders Reserve with a big announcement that can impact your trading in 2023.

Put this year behind you and start off on the right path next year by answering one simple question. What’s the question, you ask? Go watch the video and find out!

Let’s check the reports of the week and see what might be in store for traders.

There are so many reports to get to, so I don’t have a trading idea for the day, but come back tomorrow and I’ll have a trading strategy and idea you can use prior to the upcoming holiday.

Tuesday – Loretta Mester Speaks – 11 am EST – She’s the chief executive officer of the Federal Reserve Bank of Cleveland. Last week several other Fed members spoke and all had the same story – inflation is difficult to defeat and it’s a long road ahead. There were a handful of daily dips last week during their speeches.

Wednesday – Durable Goods Orders – 8:30 am EST – Durable goods are new orders placed with domestic manufacturers for factory hard goods. The consensus is a 0.3% increase month-over-month. Last month there was a 0.4% increase, so while this month may still show an increase, it’s less than before. The report is better if you exclude transportation.

Wednesday – Jobless Claims – 8:30 am EST – The market is expecting an increase in jobless claims this week. The 4-week moving average is also expected to increase up to 221k. A 4-week average below 300k is still a positive sign for the job market.

Wednesday – PMI Composite Flash – 9:45 am EST – The Purchasing Managers’ Index service numbers are expected to show a continued level of contraction with a reading of 48 out of 100. The manufacturing index numbers are expected to be flat at a reading of 50 out of 100. Overall, this shows a weakening in the economy, but relatively neutral.

Wednesday – New Home Sales – 10 am EST – New home sales are expected to fall for the fourth straight month.

Wednesday – Consumer Sentiment – 10 am EST – The University of Michigan’s Consumer Survey about current conditions and expectations of future conditions is looking grim lately with a score of 55 out of 100. The silver lining is that the market is expecting to see an increase from last month’s 54.4 reading.

Wednesday – FOMC Minutes – 2 pm EST – This ought to be interesting given that the Fed meeting minutes will be released a few hours before the market takes off for the Thanksgiving holiday. We already know they decided to raise rates by 75 basis points during their Nov. 1-2 meeting, but is there anything else in the meeting minutes that will make the market react?

Thursday – Markets Are Closed

Friday – Markets Close at 1 pm EST.

If you have any questions, comments, or anything we can help with, reach us at any time.
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Jeff Wood

Editor, Filthy Rich Dirt Poor
Coach, Options Testing Lab

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