Proflex Market Update - Wk 48

Dear Subscribers,

Welcome to another weekly review of markets. As we enter a short holiday week, all eyes will be on whether the SPX can settle above 6000 and continue scaling new heights as the holiday season approaches. And of course, for Crypto portfolio, all eyes are on Bitcoin scaling $100k mark.

Market Recovery and SPX Nears 6000 Again

After last week’s correction, the markets have rebounded, with the S&P 500 heading back toward the 6000 mark. However, tech stocks have faced some challenges, with the broader index and small-cap stocks outperforming.

Among the MAG7, Tesla has been a notable exception, performing relatively well, while others have struggled. Google’s ongoing anti-trust case with the Department of Justice has added further pressure to the tech sector. Amazon and Microsoft are facing questions about their Capex and concerns with monetization on AI spending. The earnings did not provide the much needed boost to them either as EPS growth is not as sharp as we saw earlier this year.

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Economic Calendar Highlights: Inflation and Growth Data

The upcoming week is packed with critical economic updates, including a fresh reading on the Personal Consumption Expenditures (PCE) index, the Fed’s preferred measure of inflation. Additionally, third-quarter economic growth and housing activity reports will provide insight into the broader economy.

These updates will be pivotal for determining the rate cut path from the FOMC. With rising bond yields and a still-hot economy, the Fed may be leaning toward a pause in rate cuts. Currently, markets are pricing in a 44% chance that the Fed will not cut rates in December, up from 29% just a month ago. This week’s data could either reinforce or challenge those expectations.

Geopolitical Tensions: Escalation in Ukraine and Russia Conflict

The Ukraine-Russia war has escalated further, with the Biden administration approving attacks deep inside Russia. In response, Putin has lowered the bar for nuclear use, raising fears of an intensified conflict. This escalation comes at a time when the U.S. public, as reflected in recent election results, has shown a preference for ending the war, with Trump campaigning successfully on that agenda.

It’s concerning that the Biden administration may pursue military escalation during its final months in office, potentially benefiting the military-industrial complex at the expense of global stability.

Bitcoin Nears $100k: Inflows and Momentum Continue

Bitcoin continues its remarkable run, nearing the $100k mark as it attracts significant inflows. MicroStrategy has been a key player, raising billions through its convertible debt and stock sales to fuel massive Bitcoin purchases. Meanwhile, Bitcoin ETFs have also seen steady inflows over the past two months, adding further momentum to the rally.

This week could see Bitcoin break into the six-digit range as Thanksgiving approaches. Historically, this period is known as a FOMO week, where discussions around Bitcoin at family gatherings often lead to increased retail interest. With Bitcoin nearing this psychological milestone, it will be interesting to see how markets react in the days ahead.

Proflex All-Access Performance Hits New Highs

Proflex Growth Gazette, the flagship portfolio in All-Access, has performed exceptionally well, achieving more than 2x of S&P500 returns in consecutive years. And Proflex Crypto Pulse is having second year with triple digit returns.

This success underscores the importance of our growth-focused strategies and proactive risk management during both bullish and uncertain market periods.

As we enter the holiday season, market movements, economic data, geopolitical developments, and Bitcoin’s rally are all converging to create a dynamic environment. Stay tuned for more updates and insights as we navigate these exciting times.

Happy Thanksgiving!

Best regards,

Raman Bindlish

Editor-in-Chief,

Blockstart Research

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