Rumbles in the stock market  likely loom ‘later’ this year; but unlikely now. I think that summarizes where things stand. There is also an inflow of capital to U.S. markets; which reflects the global expectation of ‘American growth’.We’ll see; but basically the high S&P reflects optimism for a ‘fresh breeze’ to sustain or levitate big stocks (which already did very well during Biden; who had even more ‘billionaires’ supporting him than Trump did; although Trump’s were more overtly visible personalities, because they related to technology).This is a lockstep move for S&P; hence Friday’s concentration on big-caps.How this breaks down was a fairly broad or inclusive rally; but impacted by yields as that suppressed enthusiasm; and we did a double-bottom intraday (my yellow line often underlined that on the charts of the S&P or NYA) and of course broke that to the upside this week, as suspected given basic moods.That ‘buy the dip’ mood prevailed during the Expiration Thursday & Friday; so we’ll see if that plays-out next week; starting when trading resumes Tuesday. I believe that the smaller stocks (which is where capital risk basically is going), for now, gravitated towards wherever highest ‘open interest’ was on Expiration and as we suggested, leaves most of those patterns irrelevant going forward.I refer mostly to overall patterns; not Friday’s Expiration action; so mostly rally resumptions are the goal. It may seem too basic a forecast; but many traders, hedge funds, and bankers probably want to see a record higher S&P to start Trump 2.0’s first days in Office. We’ll see and if that’s also the small-cap case.Market X-ray: sort of a ‘bifurcated’ Expiration Friday; with S&P strong, to hold the primary Index above breakdown (recall double-bottom days ago) ahead of Inauguration. Risks could return further out; but for now we think Wall Street will want a good reception to the new ‘business friendlier’ Administration.So barring existential disruptions; I think higher next week; especially for the small stocks (including Quantum and AI tickers) that struggle during January Expiration, or gravitated towards their nearest round-number strike prices. In the overall picture; the favorable ‘financial’ action reflects the environment as is presumed to be in position to benefit from capital flowing into the economy.Also expect a deregulation ‘trade’; a tailwind for Border Security, and more.Plus, for ‘social media’ (as the Zuck brouhaha denotes), it’s seemingly about ‘free speech’ versus ‘approved speech’. That goes to the core of the matter. I don’t know if Zuck is just following Musk (Meta trailing X); or actually has had an epiphany to go back to free speech. But I do know the role of journalism: to challenge power, not blend into the background. Hard to sort out in this rough news internet age; but beats a controlled message, which is what a lot of folks are fed up with.True accountability needs more voices willing to stand out, not fall in line; and I mean among actual journalists; not just oft-manipulated protestors or biased reporters. By the way, Israeli authorities did a final sign-off on the ceasefire deal,; and hostages did start being released as soon as Sunday; a day before President Trump (whose emissary took part in the negotiations) had demanded. We’ll see if the Hamas terrorists comply with the procedures.Finally, there was another late-breaking story; and not exactly encouraging (if it’s a message to Team Trump just before Inauguration). Iran’s leaders are in Moscow and signed what’s dubbed: a Comprehensive Strategic Partnership Treaty. The Kremlin hails it as bringing relations with the Islamic Republic to a new level, enshrining both countries’ status as strategic partners (yes that’s worrisome however it actually may push a Saudi-Israeli deal closer).I believe the decision to move the Swearing-In Ceremony indoors really was about the weather, more than Security concerns; but both aspects surely are mitigated by doing so. The last ‘indoor’ Inauguration was many years ago; that of President Ronald Reagan. Doing Trump 2.0 indoors is additionally kinder on visitors of course; given the hours they would be suffering outdoors.I’m not going to discuss policy issues, the Fed, or the global situation more for now; everyone is aware of the opportunities, challenges, and dynamic status of a couple issues (ranging from Middle East peace to yea or not for TikTok).Bottom line: We have MLK Day coinciding with Inauguration; and no trading on Monday. So enjoy the long weekend and we’ll be back Tuesday suspecting higher smaller-cap prices, versus this past week’s expected effort to ‘bounce’ off the S&P’s double bottom and numerous approximate 50-DMA’s as well.It was necessary to sustain the S&P ‘Index’ field; so money focused on that; and may find its way back to ‘actual’ value or speculative growth tickers in days ahead. Our thanks to Joe Biden especially for the ‘chip’ agendas; and a lot of expectation for benefits accruing from the new Administration, given as investors could benefit, regardless of their personal political preferences.More By This Author:Market Briefing For Monday, Jan. 13, 2025
Market Briefing For Monday, Jan. 6, 2025
Market Briefing For Monday, Dec. 30, 2024