CA - SPY: Up 14 Weeks Out Of Last 15 - I'm Out

2024-02-09 12:30:00 ET

Summary

• The S&P 500 Index has risen sharply from the October 2023 lows based on expectations of lower interest rates.
• However, the Fed has changed the tune, and the financial conditions have started to tighten.
• SPDR® S&P 500 ETF Trust - SPY - is currently influenced by the GenAI theme, ignoring the broad market conditions, which is unsustainable.
• Thus, I am downgrading SPY from Buy to Hold.

The rally continues

The SPDR® S&P 500 ETF Trust ( SPY ) has been up 14 weeks out of the last 15 weeks, and is now up 21.37% from the October 22nd low to the February 8th high. This is a very rare occurrence - since the end of World War II, the S&P 500 Index ( SP500 ) has been on a similar winning streak only 4 times (during 1949-1950, 1957-1958, 1962-1963, and 1970-1971). ...

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