Morning review：
Dear friends, I am Don Adam Perera, and I am delighted to join you all in our community this beautiful morning to delve into the potential impact of the August Consumer Price Index (CPI) on the stock market, explore the trajectory of the stock market, and identify the leading market trends.
Through today’s discussion, we will collaboratively develop effective strategies to respond to market fluctuations and achieve stable profits.
1.What is the status of the Consumer Price Index (CPI) data release? How does it impact the stock market?
2.How is the current market sentiment changing, and what trends can be discerned in the stock market right now?
3.How are the stocks in our investment portfolio performing, and how should we adjust our investment strategies?
I will be sharing information on these topics.
In the world of investing, policies always play a guiding role, while economic data acts like a barometer for the stock market. The release of each piece of economic data can cause price fluctuations in the investment market, thereby directly affecting the profit and loss of the stocks we hold.
Therefore, we can use the timing of these economic data releases to gain insights into both short-term and long-term main trends in the market. By meticulously analyzing these key economic indicators, we can not only anticipate potential market changes but also formulate investment strategies more scientifically to address various future scenarios.
The Consumer Price Index (CPI) data released today is crucial for us. The CPI is an important economic indicator that measures inflation or deflation levels by assessing price changes in a basket of consumer goods and services, including transportation, food, and healthcare. This index reflects changes in the cost of living and plays a vital role in understanding the economic condition.
It’s important to note that the Federal Reserve will hold its September monetary policy meeting next week. In this context, today’s CPI data is especially crucial as it will provide key indicators of economic health for the meeting, aiding policymakers in deciding whether interest rate adjustments are needed to manage economic heat. The outcomes of these data will directly influence the Fed’s decisions on rate cuts, thereby significantly impacting global markets.
Today’s released CPI data is:
The unadjusted CPI annual rate for August was recorded at 2.5%, declining for the fifth consecutive month and reaching its lowest level since February 2021. The actual data, which was below the market expectation of 2.6%, indicates an unexpected easing of inflation pressures, typically a positive signal for the markets. For the stock market, the continuation of this trend could bolster investor confidence that moderate economic growth will not lead to overheating, thus supporting stock market performance.
Meanwhile, the core CPI annual rate is 3.2%, which aligns with market expectations and is consistent with last month’s data. The stability of core CPI, which excludes the volatile prices of food and energy, may also help market participants better assess the underlying trend of inflation.
Overall, the declining trend in CPI and the stability of core CPI provide some reassurance to the market, thereby having a positive impact on the stock market.
Now, let’s focus on the shifts in market investors’ sentiments and identify potential trajectories for the market.
The VIX trend is negatively correlated with stock indices.
Through the 15-minute VIX trend chart, it is clear that the VIX price is fluctuating and declining, indicating that current market investor sentiment is relatively stable, which has a positive effect on today’s stock index performance. Our main focus remains on optimizing the investment portfolio and seizing opportunities in the market.
Let’s now focus on the performance of the three major stock indices: The Dow Jones Industrial Average is currently showing a fluctuating pattern, sitting near the white trend line, with the market waiting for a clear direction to emerge.
The Nasdaq Composite is exhibiting an upward momentum, positioned near the yellow trend line, and showing signs of gathering strength to challenge this yellow line. Should it successfully hold above this line, we have reason to believe that the market will welcome a new upward trend.
As for the S&P 500, it is also near the white trend line, engaged in a tug of war between bulls and bears, awaiting further direction confirmation. Overall, the trends of these three indices still maintain an upward trajectory.
In summary, although the market is currently in a state of watchfulness and competition, the overall environment has not changed and remains favorable for us to seize real trading opportunities.
Now let’s focus on the stocks in our investment portfolio and explore the trajectory of stock prices.
Currently, NVDA has once again sounded the charge, actively challenging the yellow trend line. This momentum indicates that NVDA has gathered enough strength for a counterattack, and the market is waiting for it to break through and stabilize above the yellow trend line.
Once NVDA successfully breaks through and holds above the yellow trend line, this will greatly strengthen market confidence and attract more capital, suggesting that the market may show a stronger side. At this time, we may encounter the opportunity for a one-sided trend market, bringing the possibility of profits for investors.
Therefore, considering the current market performance and NVDA’s technical position, I believe now is an appropriate time to continue holding or even increase our position.
Currently, TSLA is overall in an upward trend, lingering near the white trend line in the short term as the market waits for further direction.
Once TSLA successfully breaks through and stabilizes above the white trend line, it will be a clear signal of the bulls’ confidence and determination to rebound. At that time, it will be the best moment for us to fully seize the opportunity with this stock. Therefore, I recommend continuing to hold TSLA shares and patiently waiting for further confirmation of the market direction.
Recently, after a short-term price retracement to the previous strong support platform, the stock price has begun to show signs of stabilization and rebound, sending us positive market signals.
With the upcoming rate cut decision by the Federal Reserve, we anticipate a global investor wealth feast, which will provide opportunities for earning excess profits. Rate cuts usually lower investment costs, stimulate market liquidity, and positively impact the cryptocurrency market and related stocks like MSTR.
Therefore, given the current market environment and the upcoming changes in macroeconomic policy, we choose to continue holding MSTR stock and patiently wait for further market developments.
Dear friends, the recent stock market has left a deep impression on us. In our community, many friends have experienced severe price fluctuations and the associated stress. I want to say that facing significant price volatility in the investment market is inevitable, and it is actually a good thing.
For those who have been through major ups and downs in the stock market, they often remain calm in the face of severe price fluctuations, with a composed and steady heart. For those who are new to the stock market, such volatility is not only a challenge but also an opportunity to train and enhance their ability to handle unexpected situations.
These experiences not only teach us how to seize opportunities amid market fluctuations but also help us strengthen our mental resilience and improve the decisiveness and accuracy of our decisions. During this process, please remember, you are not alone. On the journey of investment, we at New World Asset Management will always be your safe harbor. We will stand by you through thick and thin, face the market’s challenges together, and move forward to find opportunities for success in this challenging market.
Therefore, during our investment journey, if you are unsure about the future trend of your stock positions, I strongly recommend you to send your stock details to my assistant, through our New World Quantitative 4.0 Expert and Investment Advisor System, we can provide you with objective analysis and develop the most professional trading strategies, in addition, my assistant will also help you to In addition, my assistants will help you track your positions in real time. Whenever there is any change in the market, we will notify you as soon as possible to ensure that you are able to respond in a timely manner. The aim of this service is to make your investment trading process easier and more efficient.
This is also the teaching philosophy of the 10th New World Quantitative 4.0 financial investment training course organized by New World Asset Management – the interests of clients come first, aiming at enhancing the participants’ professional knowledge and trading skills through systematic education and practical exercises, strengthening their practical trading abilities and helping them realize excessive profit returns. Through systematic education and practical exercises, we aim to improve the participants’ professional knowledge and trading skills, enhance their practical trading abilities, train the best in the financial investment market, and help them realize excessive profit returns. We hope that through the success stories of our community friends, we can further promote and publicize New World Asset Management, and increase its visibility and attractiveness in the market.
In addition, our long-term goal is to accumulate rich client resources, increase the scale of asset management, and strive to be on par with the world’s leading asset management organizations such as BlackRock, Pioneer Group, Morgan Stanley, Fidelity Investments, and so on. We at New World Asset Management aim to embark on a NASDAQ listing within the next three years.
Therefore, in order to enhance the learning atmosphere of our community and to stimulate your passion for learning and investing, we at New World Asset Management have set up a special reward system. Every community member who has accumulated 100 points through active participation is eligible to participate in our weekly Friday afternoon lucky draw.
I encourage you to actively participate in community interactions in various ways, such as: checking in with your assistant every day, taking good notes in class, actively answering the quizzes set by the community, as well as actively putting forward useful suggestions and opinions on the development of the community, and so on, all of these are ways to obtain points, and when you have accumulated 100 points, you are eligible to participate in the fun-filled Friday raffle.
In this way, we hope to further enhance the cohesion of the community, and at the same time, we also hope to bring you more fun and rewards through the raffle. Let’s work together, participate actively, enjoy the learning process, and look forward to winning wonderful prizes in the weekly raffle.
Dear friends, we will continue our journey of investment and learning shortly. The focus this time will be on sharing knowledge about the MACD divergence pattern. I hope every member of our community pays close attention to the sharing, understands the application of the MACD divergence pattern, and actively participates in the discussion. See you later.
Dear friends, that concludes this morning’s share. I encourage everyone to actively answer the following questions to earn corresponding raffle points:
1.What is the CPI data? (10 points)
2.How can community members earn raffle points? (20 points)
Closing commentary：
Dear friends, I am Don Adam Perera. Today, all members of our community have come together to face the severe fluctuations in the stock market. We will explore the underlying logic of stock price retracements together and find the best time to adjust and optimize our investment portfolios.
At the same time, we are also looking forward to the Producer Price Index (PPI) data that will be released tomorrow, which will be an important indicator for us to further measure inflation changes. By analyzing this data, we can better understand the potential magnitude and pace of future rate cuts by the Federal Reserve, thus providing support for our investment decisions.
1.What are the reasons for the retracement of the three major stock indices?
2.How should we respond to the current severe market fluctuations?
3.What are the applications of the MACD divergence pattern at the bottom during stock trend movements?
I will be sharing information on these topics.
In today’s trading, we witnessed a period of extreme volatility in the stock market. The August Consumer Price Index (CPI) showed that inflation has narrowed for the fifth consecutive month, with a decrease that exceeded market expectations. This result led investors to reassess the potential magnitude of rate cuts by the Federal Reserve, subsequently triggering a significant retracement in the three major stock indices and severe price fluctuations in most stocks, momentarily plunging the market into a panic-selling atmosphere.
However, the situation quickly took a dramatic turn. After an initial sharp decline, the three major stock indices—the Dow Jones Industrial Average, the Nasdaq Composite, and the S&P 500—all experienced an exhilarating “V” shaped reversal. Most individual stocks also displayed a strong rebound trend. Such market performance once again confirms the unpredictability of the stock market and showcases the strong reactions of market participants when faced with uncertainty.
As investment guru Warren Buffett says, “Be greedy when others are fearful.” Opportunities in the market often emerge during declines, while risks accumulate during rises. Therefore, when the market retraces, it is not a time for us to panic, but a time for excitement. It’s the best time to look for entry opportunities and seize the chance to buy at low prices.
Dear friends, in our investment journey, the severe fluctuations of the stock market are a reality we must face and adapt to. I always hold this belief: all of our community members should learn to adapt to these fluctuations and not let short-term price movements affect our confidence and long-term expectations for the stocks we hold.
In the current context where the Federal Reserve is about to implement a rate cut policy, both our overall market trend and the trends in the stocks within our portfolio show no issues. Therefore, what we need most right now is sufficient patience to wait for the market to develop. Price fluctuations in the market are normal, and we should not judge the trends of stocks based solely on short-term ups and downs, but should view these changes from a long-term value investing perspective.
In the stock market, volatility is inevitable; it tests our patience and strategic vision. Most importantly, we need to stay calm, stick to our investment strategy, and maintain confidence in our decision-making process.
Therefore, I encourage everyone, regardless of market changes, not to be easily influenced by short-term fluctuations. Let’s continue to follow our own investment principles, addressing each market challenge with an open mind and a professional approach.
Dear friends, I hope that everyone in our New World Asset Management community comes not only to seize opportunities for wealth but more importantly to learn investment methods and skills, and to enhance your practical trading abilities. This will lay a solid foundation for you to become masters in the investment field in the future.
Remember, continual learning is the key step toward our success. I hope each community member values our daily shares and through ongoing learning, gradually builds and perfects their own trading system. In this process, we must not only learn how to operate but also keep an open mind to new knowledge and seize every opportunity to learn and grow.
Let’s begin our learning journey today, focusing on the MACD divergence pattern at the bottom, a key pattern that has been successfully integrated into the New World Quantitative 4.0 investment decision system. Now, let’s delve into the world of New World Quantitative 4.0 again to understand how the MACD bottom divergence pattern helps us identify potential turning points in the market. Please note, I will go into detail on how to use MACD in tomorrow’s session.
1.What is the MACD bottom divergence pattern?
MACD bottom divergence occurs when the stock price hits a new low, but the MACD indicator does not make a new low, instead making a relative high. It is a common reversal signal in technical analysis, typically appearing at the end of a price downtrend, indicating that the trend may soon reverse upwards. The appearance of this pattern suggests that although the price continues to fall and makes new lows, the downward momentum of the market is beginning to weaken, hinting that the bulls may soon return, providing us with a potential buying opportunity.
Understanding and applying the MACD bottom divergence pattern can help us more accurately capture the market bottom and the upcoming price rebound, which is valuable for finding entry points and optimizing investment strategies.
2.Optimal buying position
After confirming the formation of the MACD bottom divergence pattern, wait for the MACD lines to form a golden cross before buying to confirm the reversal of the trend.
As shown in the chart: Analyzing the price trend of NEM from January to May 2024, we can clearly see through the chart analysis that the price oscillates and refreshes lows in the A-B segment. Meanwhile, the MACD indicator does not make new lows but shows a relatively horizontal state in the A1-B1 segment without following to make new lows. This forms a very obvious MACD bottom divergence pattern. Such divergence typically suggests that the current downward momentum is weakening, and the market may be about to undergo a trend reversal.
After further confirming this pattern, especially when the fast line crosses above the slow line in the MACD indicator, forming a golden cross, this marks a definitive shift in market momentum. Subsequently, the price experiences a unilateral uptrend.
Dear friends, today we have learned how to identify the MACD bottom divergence pattern. I hope everyone can master this important technical analysis method. Please take every community share seriously and make detailed notes, as this will help you gradually build and perfect your own investment system.
Tomorrow, I will meet with you all again in our community. We will jointly analyze the impact of the Producer Price Index (PPI) on the stock market and how this data will inform the Federal Reserve’s decision to cut rates. We will also continue to optimize our investment portfolio, seeking and securing solid profit opportunities.
Thank you all for your active participation today. I hope you continue to maintain your enthusiasm and focus for learning. See you tomorrow.
That concludes today’s session. I hope everyone actively answers the following questions to earn raffle points and accumulate enough for this Friday’s drawing.
1.What is the MACD bottom divergence pattern? (15 points)
2.Where is the optimal buying position for MACD? (15 points)