Market Report

Update of material financial information.
December 17, 2023

1 Macroeconomic Environment:

Week ending:

Markets ended upbeat after the consumer price index remained contained in the month of November and the Fed meeting ended Wednesday did not adopt any tightening measures on money circulation . Instead, Fed policymakers encouraged expectations of interest rate cuts through 2024.

In addition, the Industrial Production Index came in in line with projections. All of this injected optimism into prices, which rose or remained at higher levels than in the rest of 2023.

It is relevant to state that the Reverse Repos, with which the FED injects liquidity to the system, remain at optimal levels, which gives volumes better than the average negotiated in the last months.

The ETF’s that group Corporate Bonds rise in price, lowering yields as can be seen in the chart of the week:

TESLA, the big producer of electric cars in the USA, Europe and China, announces the recall of 25 million vehicles to repair the safety software that controls the autopilot or self driving.

This practice is common when a vehicle suffers a malfunction in any brand anywhere in the world, but in the USA the regulations are the most demanding.

Shares in the SP500 index are up 2.45%:

And, again important , broke the 4,700 resistance.

Next Week

We will see data related to income and personal consumption expenditures, durable goods and consumer sentiment. Also permits for new home construction, as well as the consumer spending index, excluding energy and food.

For the Fed’s next monetary policy meeting, expectations remain high that interest rates will remain unchanged for 45 days from now, on January 231, 2024.
89.3 what not versus 10.7 what yes, expectations of rate hikes by this date.

CME FedWatch Tool

2 Micro

Market price volatility fell 1.76% on the week, however, declines of up to 5% were seen on Tuesday, touching fundamental support levels in equities. Keep an eye on this index.

CBOE Volatility Index
VIX:Exchange

Oil prices declined without significant changes. Only on Tuesday it dropped but recovered its current level.

3 Building a long-term portfolio

The two energy focused funds that we follow every week followed the trend of the underlying asset, Crude Oil.
This week the energy ETF markets moved like this:

The ProShares UltraShort Bloomberg Bloomberg Crude Oil, SCO which works with short crude oil futures contracts, is up +3.69% in one week, with volatility.

Meanwhile, the United States Oil Fund USO, which contains in addition to crude oil futures, has futures in natural gas, diesel and gasoline, with less volatility, remained stable as the underlying asset rises 0.58%.

The arbitrage between the prices of both funds was +3.11% weekly difference.

4 Running an algorithm or method to generate cash flow on a long term portfolio or with money in the account.

We look at volumes, volatility, technical analysis on short and long term support and resistance charts.

Our favorite strategy.

The Magnificent 7, AAPL, TSLA, MSFT, GOOGL, AMZN and META, up +1.24% . Microsoft and Google were down only slightly, while the others rose, with Tesla standing out, adding 3.96% to its market value during the week. Incidentally, it is one of the companies with the highest stock market Beta, 2.26%.

5 Analysis of results from last week’s forecast

Our forecast for higher prices last week came true. Assumptions about the CPI and the Fed meeting contributed.

The SP500 broke the support marked at 4700 at 2021.

As volatility falls, prices of listed assets continue to strengthen.
The 10-year bond rises and as a consequence its yield falls to 2.36%.

Gold +1.54%.
OIL Unchanged
10 Year Bond +2.36% SPY
SPY +1.93%.

Bitcoin , up 1.80% on the week.

6 Forecast for the week ahead:

We will compare and hypothesize with the yields of oil , Gold, SPY, crude oil and the 10 year Bond.

Ending the year with liquidity coming in , no worse news than what is already known about conflicts, we will see some profit taking with less volatility and a moderate price rally to close out the year.

We will use our method for stocks in ranges of 4,700 support and 4770 resistance on the SP500 for entries in and exits. Watch for.

Weekly performance of the US $1,000 investment challenge, over 13 weeks:

The portfolio is yielding 14.48%, still rising. Equivalent to 45.90% annualized. We are helped by the upside, the investment is only purchases in growth instruments. Soon we will change the portfolio by adding assets that point downwards, which is predictable in the markets and will happen at some point.

Venezuelan market

Dollar price vs Bs
BCV : Bs 35,64 +0,04
Unofficial : Bs 37.35 -0.33

Another modest slide in the official exchange rate.
the parallel rate retreats. Patterns change, the alert public…
December inflation to be published in January should give a big surprise, we see it much lower than November.

The Caracas Stock Exchange

Variable Income::

OPERATIONS NOMINAL AMOUNT (BS.S) CASH AMOUNT (BS.).
124 1,411,607 5,862,699,41

5 Up
6 Down
17 Equal

Fixed Income:

TRADES TRADED SECURITIES CASH AMOUNT (BS.)
9 4.209,357,5 4.206,919,76

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For inquiries about our Algo daily entries, please write to : editor@petroleumworld.com

NOTE: We do not recommend investments, we only give our opinions.

For special courses or investment management contact : editor@petroleumworld.com

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Raul Torrealba Ramos, B.A. in Administration and Accounting, Universidad Católica Andrés Bello, Caracas; Lawyer, Universidad Metropolitana, Caracas, is an experienced financial analyst since 1990. The views expressed are not necessarily those of EnergiesNet.

Editor’s note: This article is published as an opinion and is not recommended for investment. All comments submitted and posted on EnergiesNet do not reflect either for or against the opinion expressed and is not an endorsement by EnergiesNet or Petroleumworld.

EnergiesNet.com 17 03 2023

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