Forecast Friday 📈 (S&P500 > 5,000🎉)
Median 15 day forecast: SP500 ▲+0.8% | BTC ▲+3.0% | 10Yr Treasury Yld ▲+4.3% | VIX Volatility ▲+1.5% (as of 2/9/24)
I don’t know what to think about this market, and neither does the model. But that’s ok! Let’s take a look:
Some notes on this week’s Matched Correlation Market Model:
The S&P500 broke 5,000 points! Last time I published the model, it was pretty confident that index would keep running higher. The market was also waiting for inflation data revisions, which came in almost the same as initial publication. There were large revisions upwards in 2022 that spooked the Fed last year, so the market was paying more attention to revisions this year. The Citi Group Economic Surprise Index turned back positive for the U.S. (meaning economic data continues to be better than expected).
Bitcoin is doing its thing again… 🚀🚀🚀 The model has low confidence in the direction, but it did predict a +7% run last time, and here we are at +11%. Maybe I should start taking my own investing advice?
The 10-Year Treasury Yield model has very low confidence (poor robustness score). The chart, to me, indicates a drop in yield is more likely in the short-term. Homebuyers would really appreciate getting those mortgage rates back below 6%…
The VIX Volatility Index is also giving a poor signal, but the model is expecting an increase. The VIX is currently in a weird saw-tooth pattern, and the model probably thinks this will continue.
Note: This is for informational purposes only and is not intended to be personal financial advice; be cautious — there is always risk involved with financial decisions!