Key week for results: Tesla, Netflix or ASML, Javier Molina, senior market analyst for eToro
Despite the uncertainty in the market, the SP500 has hit new all-time highs, the first time in the last two years. Since the lows of October 2022, it has accumulated a revaluation of 38%. All this in an environment where expectations of recession have decreased and where interest rates are expected to fall. In this context, it will be very important to balance the amount of cuts to justify the recent appreciation in shares, without reaching an excessive amount that could suggest a recession.
However, the impact of the sharp increase in interest rates on companies is beginning to be reflected in smaller companies. And although the largest ones appear to be relatively protected, they will all face higher interest costs right now. Therefore, in an environment where recession expectations are decreasing and where fund managers seem to be less concerned about the discipline of corporate balance sheets, the analysis that these increases in the cost of financing will have on different companies should not be left aside. More than ever, it is time to look towards healthy companies, without high financing and with solid balance sheets.
In the next week:
- Big tech enters second busiest week of earnings, from TSLA, NFLX to ASML and SAP, as it looks for a back-to-back rally.
- The Bank of Japan and ECB will keep interest rates unchanged ahead of the Fed on January 31, with focus on upcoming interest rate changes.
- Focus on US data with fourth quarter GDP growth likely strong again, up to 2.4%, while the Fed's favorite PCE inflation would remain below 3%.
Key technical levels
THEY ARE NOT INVESTMENT RECOMMENDATIONS. Only comments from a technical informative point of view.
1.- S&P
From a technical point of view, the SP500 hits a new all-time high and surpasses that resistance zone that we marked at 4780-4800 points. At this point, we need confirmation signals to think about an upward stretch that can go towards 4900 points.
To do this, we will be attentive to the following days and the key is not to lose 4730 points and 4700 as relevant support. As long as we are above the trend remains intact. We see certain bearish divergences in an environment where consumer confidence is recovering, and investor sentiment is approaching the zone of extreme euphoria.
IBEX-35
From a technical point of view, loss of the support that we marked at 10,000 points, 9930 did not hold up as a valid reference and, although we have the bearish objective delimited at 9700 points, the index seems to rest at 9800 points. That is now the first area that should not be missed and the bullish objective then passes through 9930 points. If I surpass them, I return to 10,000 points. Failure to do so will mark a clear sign of wanting to go find the 9700 points indicated. The results season begins with the banks in the lead.
3.- BITCOIN (BTC)
From a technical point of view and a week after the release of the BTC cash ETFs, the selling pressure continues, the rotation in instruments such as the GBTC towards the IBIT and a feeling of certain activity in the Altcoins. However, we may have entered that consolidation zone that we indicated between 40,000USD as a support zone and 44,300USD as resistance. Losing that support would mean going after 37,700-38,000USD. Exceeding 44,300 means trying again to attack the granite wall and current bitcoin ceiling of 48,000 – 48,500 USD.
This content is for informational and educational purposes only and should not be considered investment advice or an investment recommendation. Past performance is not an indication of future results. CFDs are leveraged products and carry a high risk to your capital
Source: Territorioblockchain.com
