September 2024 Monthly Asset Class Report

Kris Kristofferson, John Ashton, Dikembe Mutombo, and now Pete Rose. Dame Maggie Smith – ladies, first, I guess – went a few days ago. It’s been a rough few days for us 80s kids.

But with Powell’s 50 basis point cut, and it’s looking like another one’s on the way, let’s let the good times roll while we’ve got some time left. Because Jay’s not only bringing the punch bowl. It looks like he’s bringing the keg, too.

The SPX hit a new monthly all-time high, as did gold. Silver looks like it’s finally on the verge of breaking $33 for good. That leads us to the amber waves of $35 and $38.

Bitcoin looks like it’s in the middle of a bull flag (I’ll explain later), while Ether looks like it’s got one foot in the grave and the other on a banana peel.

But bonds continue to puzzle me. Maybe the market believes inflation is dead, the damn fools. Because bonds look good right now.

But the big story is the dollar. As someone sitting in Europe, I cannot for the life of me figure out why you’d rather own euros than dollars. But right now, I owe Alan Knuckman dinner because he said the dollar index would fall below 100 before it rallied to 115. I thought he was crazy. He was correct.

The dollar isn’t about to get stronger anytime soon. That’s excellent news for assets priced in dollars.

Except for oil, for some reason. That chart is uglier than a drunk carpenter’s thumb. We’re heading down there, as well. Enormous American supply and a crappy world economy will do that to you.

Without further ado, let’s get to the charts.

S&P 500

***New Monthly Closing High of 5,762.48***

Up, up, and away! We’re still hitting record after record in the SPX. This isn’t the time to sell. I thought it might be after Powell cut 50 bps instead of 25 bps, but that was incorrect. This market looks like it has a way to go.

I still target 6,000.

Nasdaq Composite

We’re getting closer to establishing new all-time highs in the Nasdaq. After an abysmal first week of September, it rallied the rest of the month.

Again, you don’t want to be a seller here. It’s giving no other indication other than going up.

Russell 2000 (Small caps)

The Russell didn’t do much this month, but that’s fine. It’s been holding up well. We’re still in a bullish trend, even if we look a bit toppy from time to time.

The US 10-Year Yield

We’re hanging around the 3.80% level. It’s surprising, as the dollar has fallen out of bed after Powell’s cuts. I expect this to come down further in the coming months, as assets get bid up.

Dollar Index

Now that the Fed is in a cutting cycle, you’d think the USD would’ve fallen more. It hasn’t cratered yet, but we’re in for a big dump soon.

First, we’ll see 99.50, then 94.50. As a person who lives in Europe, this is utterly beyond me. But hey, no one said currencies were easy.

USG Bonds

We hit our 99 target from last month. The new target is 102.90.

Honestly, I don’t like bonds with the inflation picture the way it is - no, we’re not out of this mess yet. But we must first listen to the charts.

Investment Grade Bonds

The next target is 132, though I doubt we’ll reach it. Still, there’s no reason to be short… yet.

High Yield Bonds

We broke the target of 79 this past month.

Our new upside target is 85.

Real Estate

VNQ was up again this month. The target is still 116.

Energy: West Texas Intermediate (Oil)

We fell another $5 this month. Forget a rally here. The next target is $61.

Base Metals: Copper

The ascent wins! Dr. Copper is looking at a big rally now. We’ve already got up to $4.55. I’d look to clear $5.20 first. Then, the big target of $8.50 may be in play.

Precious Metals: Gold

***HIGHEST MONTHLY CLOSE OF 2,659.40***

We hit the $2,609 target. We’re now looking at $2,759.

With the Fed cutting rates before inflation has been tamed, we’re still nearer the beginning of a bull market than at an end.

Precious Metals: Silver

Ok, we’re close to the breakout we need. Once we breakthrough $33, which may take a while, the next stop is $38. From there, $50 will be much easier to hit.

Cryptos: Bitcoin

I don’t like the lower highs and lower lows on this chart, but this may be one big bull flag.

From Investopedia: They are called bull flags because the pattern resembles a flag on a pole. The pole results from a vertical rise in a stock, and the flag results from a period of consolidation. The flag can be a horizontal rectangle but is often angled away from the prevailing trend, as in this example.

Cryptos: Ether

Ether has broken down. I’m unsure what the problem is, but ETH is considerably weaker than BTC.

We could see ETH hit $1,950 from here. The charts are targeting a woeful $790.

Trad Asset Class Summary

Like the last two months, the big loser was the USD, down another 1.22%.

Commodities and the SPX were up nicely at 4.45% and 4.22%, respectively.

The long bond was, again, as flat as a pancake, moving up only 25 basis points.

Crypto Class Summary

Dogecoin, Ripple, and Bitcoin were up double digits in September. Ether and Litecoin were up single digits. Monero, the most secretive coin, was down 8.94%.

Wrap Up

SPX, Bitcoin, gold and silver… and even bonds… look amazing.

Stay away from oil and Ether – you’ll catch your death there.

Finally, let’s take a moment, courtesy of the Twitterverse:

Have a wonderful day!