Important Powell Speech Ahead, Market Mechanics Drove Second Best November For Stocks Since 1980s

Important Powell Speech Ahead, Market Mechanics Drove Second Best November For Stocks Since 1980s

Benzinga – by The Arora Report, Benzinga Contributor.

To gain an edge, this is what you need to know today.

Powell Speech Ahead
Please click here for a chart of iShares 20 Plus Year Treasury Bond ETF (NASDAQ: TLT).

Note the following:

  • The chart shows that bonds have made an aggressive move from the lows.
  • The chart shows the upward sloping trendline indicating the steadiness of the move up.
  • The chart shows that bonds have now reached the lower resistance zone.
  • In The Arora Report analysis, prudent investors should watch if bonds break above the lower resistance zone. If they do, it will be a trigger for another leg up in the stock market.
  • The stock market has just posted the second best November since the 1980s.
  • The up move in the stock market was triggered by rising bonds as shown on the chart, but the move was amplified by market mechanics.
  • Market mechanics are very powerful. About two thirds of the up move in November is due to market mechanics. The Arora Report call of market mechanics being to the upside driving the market substantially higher that was made at the beginning of the move has proven spot on.
  • All investors should consider taking time to learn about market mechanics. Learning about market mechanics will help you extract significantly more money out of the markets. Due to their high value, Wall Street professionals keep market mechanics close to their chest. The best way to get access to Wall Street secrets is to listen to the podcasts in Arora Ambassador Club. Arora Ambassador Club has several podcasts on market mechanics and more will be coming.
  • Powell is speaking in Atlanta today. Prudent investors should watch to see if Powell pushes back on the stock market’s aggressive projections of rate cuts. If Powell endorses the stock market’s projections, expect a rip roaring rally. If Powell strongly contradicts Wall Street’s projections, expect a pullback.
  • ISM Manufacturing Index will be released at 10am. This data has the potential to move the stock market.
  • As an actionable item, the sum total of the foregoing is in the protection band, which strikes the optimum balance between various crosscurrents. Please scroll down to see the protection band.

Blind Money And Month End Buying
This morning, there are crosscurrents between month end buying and front running blind money.

  • There was aggressive month end buying at the close yesterday.
  • Some of that is being given back this morning. This is negative.
  • On the positive side, Wall Street is front running blind money. Wall Street hopes to buy stocks now and sell them to blind money at higher prices. Blind money is the money that blindly flows into the stock market on the first two days of the month without any analysis and irrespective of market conditions.

Magnificent Seven Money Flows
In the early trade, money flows are negative in Apple Inc (NASDAQ: AAPL),, Inc. (NASDAQ: AMZN), Alphabet Inc Class C (NASDAQ: GOOG), Meta Platforms Inc (NASDAQ: META), Microsoft Corp (NASDAQ: MSFT), NVIDIA Corp (NASDAQ: NVDA), and Tesla Inc (NASDAQ: TSLA).

In the early trade, money flows are negative in SPDR S&P 500 ETF Trust (ARCA:SPY) and Invesco QQQ Trust Series 1 (NASDAQ: QQQ).

Momo Crowd And Smart Money In Stocks
The momo crowd is buying stocks in the early trade. Smart money is


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