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Global Markets Are Moving — and Here’s The Juicy Part…

by | Jan 4, 2023 | Market Outlook, Stock Market Indexes

The Chinese Hang Seng and German DAX indexes are relatively stronger than the U.S. market right now, and they have been for several months. Other global markets are also stronger, which might come as a surprise to some.

This strength can be seen in a few simple ETFs. 

Check out the iShares China Large-Cap ETF (NYSEArca: FXI)…

And the Global X Dax Germany ETF (Nasdaq: DAX)…

DAX stock chart

Now compare those two with the SPDR S&P 500 ETF Trust: (NYSEArca: SPY)… What do you think? 

Here’s What’s Happening and Why It’s Important

During the second quarter of 2022, world markets began trading higher overnight more often than they traded lower.  

This is important from a historical perspective. Check out this chart from Bespoke and you’ll see that dating back to 1993, most stock market gains occur while the U.S. sleeps.

That’s worth reading again… And it’s worth taking a good look at this chart below.

It implies that on average, the SPY gaps up on a daily basis year after year. 

Now here’s the juicy part…

When that upward cycle breaks down along with the daily cash market like it did in 2002, 2008 and 2022, as shown, and then later restores itself, it points to a world shift. In other words, review the 2003 and 2009 year-end closing prices — they’re all up. 

Opportunity Is Flashing

If you’ve listened to recent editions of Ask The Pros or the WealthPress Live Roundtable, you know many of us see a bottom forming around March.

I agree, and let me add that certain stocks have likely already put in their bottoms for this go around… And they did so in July 2022 — or even January 2022 in the case of energy stocks… 

In fact, the Energy Select Sector SPDR Fund (NYSEArca: XLE) never dipped below its 2022 opening price.

XLE names aside, here’s a nice W-shaped formation for Boeing Co. (NYSE: BA) on a weekly chart, showing off its bottom in June.

How I’m Taking Advantage of It

Let me be clear… No one wins a trophy by calling a true bottom.

We’re just trying to combine knowledge, history and indicators in such a way to increase our odds for successful trading.

Like when I said on Dec. 2 — highlighted in the blue box below — that an opportunity was there in Sally Beauty Holdings Inc. (NYSE: SBH) because of professional accumulation, making the stock more attractive for retail buyers… See what happened after?

There are multiple opportunities that seem to be brewing in 2023 — let’s do this!

Trade to trade well!

On the Go Investing

WRITTEN BY<br>Celeste Lindman

Celeste Lindman

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