Weekly Market Outlook (2/13/23)

WEEKLY MARKET OUTLOOK

FOR THE WEEK OF FEB. 13, 2023

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Bull Case: Despite the recent pullback, bulls are still in control with a higher low assuming that price holds above the prior swing low at 4027.75. There is still a strong daily supply zone starting at the 4148.75 level, which will not be considered to be cleared unless price breaks above 4218. Above this level, there is untested daily supply at 4279.50.

Bear Case: Bears will need to keep price below the 4113-4100 level and break the prior swing low at 4007. Below this, the next strong demand zone is at 3945, which would also line up with the daily chart trend lines.

SUPPORT AND RESISTANCE

Apple Inc. (AAPL) 30m

Tesla Motor Co. (TSLA) 30m

Invesco Trust (QQQ) 30m

Alphabet Inc. (GOOG) 30m

Amazon.com Inc. (AMZN) 30m

BITCOIN (BTC) 30m

EARNINGS RELEASE CALENDAR

FOR WEEK OF FEB 13

NEWS RECAP

Feb 6 - Feb 12

Big Tech Prevails

Despite a slowdown in their growth and innovation, tech giants, such as Apple, Microsoft, Amazon, Facebook, and Alphabet (Google), continue to dominate the stock market, remaining among the largest companies in the world. There are various factors that have contributed to big tech’s success, including their ability to reinvest profits back into the business, their strong focus on customer service, and their ability to develop new products and services that are in demand. These companies have established a strong foothold in the industry and will continue to be a major force for the foreseeable future, unlikely to be disrupted any time soon.

New CEA Data Could Contribute To Lower Fed Rates

The new White House wage data released by the Council of Economic Advisers (CEA) suggests that the pressure on supercore inflation is decreasing. This data showed that average hourly wages of private-sector employees have increased at the slowest rate since the start of 2021.The slowdown in wage growth could give the Federal Reserve some breathing room while they evaluate the inflationary pressures. The slower wage growth implies that the inflationary pressures may not be as intense as anticipated, giving the Fed the chance to maintain low-interest rates for a longer period without risking an inflation surge.

China’s AI Advances

The prevalence of ‘ChatGPT clones’ in China is rapidly increasing and could have potential implications for the labor market and wider society. These AI chatbots are designed to simulate the conversation and behavior of humans when responding to inquiries or requests. Companies are increasingly using them to answer customer service queries and even generate content, which could lead to the displacement of human workers. The implications of this technology must be carefully considered in order to ensure the safety and sustainability of the labor market and wider society.

Rumor Has It, The SEC Wants To Ban Crypto Staking

There is much speculation about the rumor that the SEC is considering banning cryptocurrency staking, or the process of locking up crypto assets in order to earn rewards, for retail investors.The rumors gained momentum after SEC Chairman Gary Gensler stated that cryptocurrencies allowing staking options could be classified as securities under the Howey test. Many believe that crypto staking is one of the most important sectors in the cryptocurrency industry and allows investors the freedom to control their digital assets rather than going through banks and other centralized entities. A ban on crypto staking may result in a decrease in users, a decrease in the value of existing crypto assets, and a decrease in liquidity.

Housing Market Outlook Remains Uncertain

The average rate on the 30-year fixed rate mortgage has risen slightly from 6.09% to 6.12%. Although this increase is only small week over week, the rate on a 30-year mortgage is up over 65% from February 2022. The outlook on the housing market for the rest of the year remains uncertain, as the full economic effects of the pandemic are yet to be uncovered and the Federal Reserve attempts to gain control of inflationary pressures.