The New Administration Took Over, What Changed?

2025-01-27 10:30:00 ET

Summary

• The SPY and DIA have the strongest confirmation of a bullish breakout, so we’d expect these to hold the range high on a pullback. However, the market’s broad trend is more reliable when at least the SPY and QQQ are in sync, and that’s not completely true yet.
• Retail investor sentiment as reported by AAII shows the bulls bounced back over the past week, jumping to 43% from 25% while bears dropped to 27% from 34%, bringing the bull-bear spread back into positive territory.
• Earnings season intensifies this week with over 300 companies and over 90 S&P members reporting, including 4 of the Magnificent 7. The animal spirits and the charts may be bullish, and they can provide levels to manage trade risk, but actual earnings results and forward guidance are what matter most.
• The TLT chart would suggest that the long bonds may have found at least a temporary level to base. For stock traders concerned that new policies could push rates higher in a market with the momentum of higher rates, this price action is a sigh of relief.

By Geoff Bysshe

It’s been a volatile start to the year, with an abundance of expectations placed on what the new administration would do in its first weeks, days, and even hours of power.

We’re off!

This year, our January Calendar Range lined up with the inauguration, which sets up good inflection points for trading and analysis. In short, anything trading above or below the year-to-date high or low as of January 16th would suggest that it’s potentially changed significantly....

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