Big earnings this week could pave the way for a rebound

The S&P 500 Index has been edging lower for nearly a month, accompanied by a rise in volatility. From its all-time highs in late March 2024, the SPX has declined about 5.6%, which begs the question of a rebound. Interestingly, this week, several big names, including Alphabet, Meta Platforms, Microsoft, and Tesla, are reporting their earnings for the first quarter of 2024. If these results are generally good, then there is a significant chance that SPX will recover some of the losses. However, if earnings fail to fulfill investors’ expectations and there are notable downgrades to future forecasts, it could spark more fear among investors and rekindle volatility in the market.

Illustration 1.01

The picture above shows the daily graph of SPX and two simple moving averages, the 20-day SMA and the 50-day SMA. The yellow arrow indicates an impending bearish crossover between these two moving averages, which represent resistance levels to watch out for in the case of a stock market rebound.

Technical analysis gauge
Daily time frame = Bearish
Weekly time frame = Bearish
*The gauge does not necessarily indicate where the market will head. Instead, it reflects the constellation of RSI, MACD, Stochastic, DM+-, ADX, and moving averages.

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DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor or any other entity. Therefore, your own due diligence is highly advised before entering a trade.

Comment:

Despite missing analysts' expectations, Tesla soared more than 12% after announcing its results for the first quarter of 2024. Today, more big names are revealing their earnings, including AT&T, Boeing, Ford Motors, International Business Machines, Meta Platforms, and Thermo Fisher Scientific.