Why is the S&P 500 Approaching A New ATH ahead of the FOMC Meeting?

What an incredible week! We've witnessed outstanding performance from the S&P 500, Nasdaq, and gold, with all three near or hitting new all-time highs. Key factors driving this rally include the CPI report, Nvidia's Blackwell announcement, and a decline in initial jobless claims.

Oracle, SMCI, Broadcom, Adobe, Boeing, JPM and Moderna may have directly benefited your portfolio or caught your eye. However, as you know, the market's most important aspect is always looking ahead."

The FOMC meeting is approaching, and major indexes are nearing new all-time highs. Many believe this is a precursor to a more significant market move. As for the underlying reasons, while everyone has their own theories, I think the market is attempting to price in a soft economic landing with various potential scenarios.

Investors in semiconductor and pharmaceutical companies, especially Nvidia and Eli Lilly, are exhibiting a level of enthusiasm and price appreciation reminiscent of the dot-com bubble. However, many of these same investors have also experienced the deep, prolonged downturns seen in companies like Super Micro Computer and Micron Technology. Meanwhile, there's a striking consensus among investors regarding commodities, precious metals, and bonds. The sharp decline in oil prices, coupled with gold reaching new all-time highs and falling interest rates, suggesting a widespread belief among sophisticated investors that a recession is imminent or that the economy is facing significant challenges.

In contrast, retail investors often find themselves caught in a volatile market, experiencing frequent price swings and potential losses. For example, Donald.J.Trump Media, DJT Media experienced wild price swings on Friday. Retail investors, emboldened by his promise not to sell restricted shares, flocked to the stock. However, all three of my key indicators flashed clear and unambiguous sell or short signals, so I stayed on the sidelines. I can only imagine the sheer devastation this intraday plunge must have caused for countless retail investors. The stock plummeted as much as 15% in a single hour, which was nothing short of catastrophic.

Next week, I will be bringing you the latest market fluctuations and their analysis. Meanwhile, we will be scouring for clues to prepare for the Fed's upcoming rate decision.

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