According to my risk summation system, the days this coming week with the highest risk of a turn in or acceleration of the current trend in the DJIA are Monday January 9th possibly stretching into Tuesday morning (see Powell comment below) and Thursday the 12th.
Last week the Tuesday January 3rd risk window only tagged a dud rally, bolting out of the launch pad only to frizzle the very next day.
The summation system didn't identify next Tuesday as a risk window, but if the market is still rallying into Powell's morning speech, I would expect him to try to rain on the Wall Street parade. Also he is probably thinking that the Thursday inflation reading will show further improvement, so Powell also may try to lower expectations in front of that as well. It's tough trying to tamp down a party when you've been the one handing out free drinks and cranking up the music for years.
Santa finally rolled into Wall Street with presents galore late last week . I guess better late than never given Yale Hirsh's adage. The question now is does the rally having staying power.
I've been toying around with a way to identify risk weeks in which larger trends change instead of just risk days and minor trends. I'm still fine tuning the technique so more on this later, but based on preliminary calculations it looks like my first candidate will be the week of February 27th.
Regards,
Douglas