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VIG NewsletterJune 15 2024 Update

VIG NewsletterJune 15 2024 Update

Will NVDA divergences lead to a market correction?

June 15, 2024

Recap

The S&P 500 and Nasdaq Composite hit fresh record highs this week and closed 1.6% and 3.2% higher, respectively. Other major indices logged declines on the week, though. The Dow Jones Industrial Average declined 0.5% and the Russell 2000 fell 1.0%. Gains in the mega-cap space played an integral role in index-level gains for the S&P 500 and Nasdaq.

The Vig Co. portfolio was down this week.

Performance (Weekly/YTD)

VIG Co. -1.04% / +13.55%

SPY +1.64% / +14.55%

VIG Co. Portfolio Holdings (Allocation).

KIAM V3. (100%)

Notes/Charts

Here are a few things we are watching.

3X Long Semiconductors Daily. You can see it moved to new highs this week. Relative Strength has moved to an overbought area. You can see the last two times this happened, in March and May we had short-term corrections in price.

Related, here is a 60-minute chart for NVDA. You can see as the price has moved higher, momentum and relative strength have moved lower. This is a bearish divergence and may lead us to a short-term correction in price. It is similar to March of this year.

On the positive side of the ledger, Interest rates continue to move lower. It looks similar to November of last year when we had a strong rally.

KIAM V3, reading all of this, has us leaning short into Monday’s session.

Plan

Have a great Father’s Day!

We will follow the math.

Note: Check out the updated App for Composer. (There is a link to it atop your Composer home page.) It works great.

Chris

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Market information from Bloomberg, ETRADE, Composer, Koyfin, and StockCharts.com.