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Morning Commentary


By Charles Payne, CEO & Principal Analyst
1/20/2023 9:44 AM

The market stumbled out of the gate, and mostly meandered, until Fed Vice Chair Lael Brainard spoke about staying the course at the University of Chicago Booth School of Business. Then, her comments on wages stoked buying that lifted major indices off the lows. The notion that wages are not driving a 1970s-style wage-price was welcomed by investors who have been worried the Fed is poised to go too far. But the intra-day rally fizzled.

Yesterday, by the close, only three sectors were higher, and Industrials (XLI) turned lower on the year.

Key Resistance & Forget Earnings

Once again, the rally stalled at 61.8, that same Fibonacci retracement point, which in a. In a recent January edition of ‘Payne’s Perspective,’ I wrote about this being the ultimate upside test. So, closing above this number will be a major buy signal.

It’s been a tough week for earnings, with only 46% beating on sales and 41% on earnings. After the close, Netflix (NFLX) joined the ‘miss’ column with earnings of $0.12 against the consensus of $0.44. But shares rallied by 7%.  

The all-important net subscribers grew to 7.7 million, almost double the 4.4 million expected, and that sent shares soaring.

Portfolio Approach

We are adding a new position to Communication Services in our Hotline Model Portfolio this morning.

Today’s Session

It is a mixed market this morning.  The Dow is down, while the S&P 500 is relatively flat.  The action is once again in the Nasdaq, helped in large part by Netflix. 

Oil is up with WTI trading at $80.42 a barrel.  Gold is moving higher yet again, and is now $1927 an ounce.  The greenback is up slightly, and off recent lows.  Year to date, the dollar is down 1.3%, on top of the 7.7% it lost in the 4th quarter.  The 10-year treasury is up a bit to 3.45%.

CP, I'm really surprised that a smart guy like you is into the Fibonacci scam. There is a "Fibonacci explanation" for everything so that means it predicts exactly nothing. Like a broken clock that's correct twice a day - only by accident. Be careful. Good luck, T in Tx

T&T in Tx on 1/20/2023 10:45:12 AM

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