Summary: A great earnings season is keeping investors bullish even ahead of an anticipated announcement from the Fed on bond purchase tapering and interest rate hike timing. The result was another day of record-setting in the major indexes.
Notes
Ideas always welcome in the comments. Errors will be amended as comments on TradingView or corrected inline in my blog.
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Tuesday, November 02, 2021
Facts: +0.34%, Volume lower, Closing Range: 92%, Body: 75% Green
Good: Higher high, closing range, mostly green body
Bad: Advance/decline ratio
Highs/Lows: Higher high, Higher low
Candle: Small upper and lower wicks around a 75% green body
Advance/Decline: 0.7, more declining stocks than advancing stocks
Indexes: SPX (+0.37%), DJI (+0.39%), RUT (+0.16%), VIX (-2.32%)
Sector List: Materials (XLB +1.14%) and Real Estate (XLRE +0.94%) at the top. Consumer Discretionary (XLY -0.67%) and Energy (XLE -0.94%) at the bottom.
Expectation: Sideways or Lower
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Market Overview
A great earnings season is keeping investors bullish even ahead of an anticipated announcement from the Fed on bond purchase tapering and interest rate hike timing. The result was another day of record-setting in the major indexes.
All four indexes we track closed at record highs. The Nasdaq gained +0.34% for the day. The candle is almost entirely green body as the index rallied in the morning, pulled back a bit, and then rallied again in the late afternoon. The closing range is 92%, and the green body covers 75% of the candle. Volume was lower than the previous day, and there were more declining than advancing stocks.
The Russell 2000 (RUT) finally closed above the March high after months of moving up and down within a fixed range. It tapped the top and bottom of the range five times before closing above it today, gaining +0.16%. The S&P 500 (SPX) advanced +0.37%, and the Dow Jones Industrial Average (DJI) climbed +0.39%.
Nine of the eleven S&P 500 sectors closed the day with gains. Materials (XLB +1.14%) and Real Estate (XLRE +0.94%) performed the best today. Consumer Discretionary (XLY -0.67%) and Energy (XLE -0.94%) were the only two sectors to decline. Consumer Discretionary gained 14% in October and was due to pull back from its record close yesterday.
API Weekly Crude Oil Stock came in at 3.6 million barrels compared to the forecast of 1.6 million barrels.
The US Dollar Index (DXY) gained +0.24% for the day. US 30y, 10y, and 2y Treasury Yields declined for the day. High Yield (HYG) and Investment Grade (LQD) Corporate Bond prices rose. Silver and Gold prices dropped as the dollar rose. Timber, Copper, and Aluminum futures continue to recede.
The put/call ratio dropped to a very bullish level of 0.486. The CNN Fear & Greed index is in the Extreme Greed range.
Microsoft (MSFT) had another record close with a +1.14% gain today. Amazon (AMZN) was the only of the four largest mega-caps to decline today. Apple (AAPL) and Alphabet (GOOGL) are trading above their key moving average lines (21d EMA, 50d MA).
Pfizer (PFE) topped the mega-cap list with a +4.15% gain after beating expectations and raising its outlook. Alibaba (BABA) continues volatile trading, ending the day at the bottom of the mega-cap list with a -4.27% loss.
Tesla (TSLA) was also near the bottom, declining -3.03% today. The EV stock is still doing very well since the Hertz purchase announcement.
The majority of stocks in the Daily Update Growth List declined today, but there were some winners. MongoDB (MDB) was at the top of the list with a +4.03% gain. The stock was at the bottom of the list yesterday. The worst losers for the day were Chinese fintech companies UP Fintech (TIGR) and FUTU Holdings (FUTU).
AVIS (CAR) became the latest meme stock with a retail frenzy causing a short squeeze and sending the stock soaring over 200% midday before ending the day with a +108% gain.
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Looking ahead
Wednesday morning will kick off with the ADP Nonfarm Employment change report. Non-Manufacturing purchasing managers index data will come after the market opens. Crude Oil Inventories will also be available in the morning.
The biggest news for the day will be the Fed's statement after their two-day meeting. The statement will include a decision on bond purchase tapering and the timing of future interest rate changes. The event is scheduled for 2 pm.
Earnings tomorrow will include Novo Nordisk (NVO), Qualcomm (QCOM), CVS (CVS), Booking (BKNG), Humana (HUM), Marriott (MAR), Roku (ROKU), Electronic Arts (EA), Etsy (ETSY), CDW (CDW), MGM (MGM), Fox Corp (FOX), Qorvo Inc (QRVO), Hyatt (H), Fastly (FSLY), and Fisker (FSR) among many reports. Check your portfolio for earnings events.
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Trends, Support, and Resistance
The Nasdaq continued to march higher today, having no declines for the past seven sessions.
The five-day trend line points to another +0.48% gain for Wednesday.
The trend line from the 10/4 low and the one-day trend line point to a lateral move of +0.06% for tomorrow.
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Wrap-up
I thought today might be the start of a pullback as investors anticipate the Fed's decision. There is still likely to be some reaction to the Fed's statement tomorrow. Can the earnings optimism keep the bulls around, or will tomorrow be the first day in seven sessions with a decline?
The expectation for tomorrow is Sideways or Lower.
Stay healthy and trade safe!
Notes
Ideas always welcome in the comments. Errors will be amended as comments on TradingView or corrected inline in my blog.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Tuesday, November 02, 2021
Facts: +0.34%, Volume lower, Closing Range: 92%, Body: 75% Green
Good: Higher high, closing range, mostly green body
Bad: Advance/decline ratio
Highs/Lows: Higher high, Higher low
Candle: Small upper and lower wicks around a 75% green body
Advance/Decline: 0.7, more declining stocks than advancing stocks
Indexes: SPX (+0.37%), DJI (+0.39%), RUT (+0.16%), VIX (-2.32%)
Sector List: Materials (XLB +1.14%) and Real Estate (XLRE +0.94%) at the top. Consumer Discretionary (XLY -0.67%) and Energy (XLE -0.94%) at the bottom.
Expectation: Sideways or Lower
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Overview
A great earnings season is keeping investors bullish even ahead of an anticipated announcement from the Fed on bond purchase tapering and interest rate hike timing. The result was another day of record-setting in the major indexes.
All four indexes we track closed at record highs. The Nasdaq gained +0.34% for the day. The candle is almost entirely green body as the index rallied in the morning, pulled back a bit, and then rallied again in the late afternoon. The closing range is 92%, and the green body covers 75% of the candle. Volume was lower than the previous day, and there were more declining than advancing stocks.
The Russell 2000 (RUT) finally closed above the March high after months of moving up and down within a fixed range. It tapped the top and bottom of the range five times before closing above it today, gaining +0.16%. The S&P 500 (SPX) advanced +0.37%, and the Dow Jones Industrial Average (DJI) climbed +0.39%.
Nine of the eleven S&P 500 sectors closed the day with gains. Materials (XLB +1.14%) and Real Estate (XLRE +0.94%) performed the best today. Consumer Discretionary (XLY -0.67%) and Energy (XLE -0.94%) were the only two sectors to decline. Consumer Discretionary gained 14% in October and was due to pull back from its record close yesterday.
API Weekly Crude Oil Stock came in at 3.6 million barrels compared to the forecast of 1.6 million barrels.
The US Dollar Index (DXY) gained +0.24% for the day. US 30y, 10y, and 2y Treasury Yields declined for the day. High Yield (HYG) and Investment Grade (LQD) Corporate Bond prices rose. Silver and Gold prices dropped as the dollar rose. Timber, Copper, and Aluminum futures continue to recede.
The put/call ratio dropped to a very bullish level of 0.486. The CNN Fear & Greed index is in the Extreme Greed range.
Microsoft (MSFT) had another record close with a +1.14% gain today. Amazon (AMZN) was the only of the four largest mega-caps to decline today. Apple (AAPL) and Alphabet (GOOGL) are trading above their key moving average lines (21d EMA, 50d MA).
Pfizer (PFE) topped the mega-cap list with a +4.15% gain after beating expectations and raising its outlook. Alibaba (BABA) continues volatile trading, ending the day at the bottom of the mega-cap list with a -4.27% loss.
Tesla (TSLA) was also near the bottom, declining -3.03% today. The EV stock is still doing very well since the Hertz purchase announcement.
The majority of stocks in the Daily Update Growth List declined today, but there were some winners. MongoDB (MDB) was at the top of the list with a +4.03% gain. The stock was at the bottom of the list yesterday. The worst losers for the day were Chinese fintech companies UP Fintech (TIGR) and FUTU Holdings (FUTU).
AVIS (CAR) became the latest meme stock with a retail frenzy causing a short squeeze and sending the stock soaring over 200% midday before ending the day with a +108% gain.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Looking ahead
Wednesday morning will kick off with the ADP Nonfarm Employment change report. Non-Manufacturing purchasing managers index data will come after the market opens. Crude Oil Inventories will also be available in the morning.
The biggest news for the day will be the Fed's statement after their two-day meeting. The statement will include a decision on bond purchase tapering and the timing of future interest rate changes. The event is scheduled for 2 pm.
Earnings tomorrow will include Novo Nordisk (NVO), Qualcomm (QCOM), CVS (CVS), Booking (BKNG), Humana (HUM), Marriott (MAR), Roku (ROKU), Electronic Arts (EA), Etsy (ETSY), CDW (CDW), MGM (MGM), Fox Corp (FOX), Qorvo Inc (QRVO), Hyatt (H), Fastly (FSLY), and Fisker (FSR) among many reports. Check your portfolio for earnings events.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Trends, Support, and Resistance
The Nasdaq continued to march higher today, having no declines for the past seven sessions.
The five-day trend line points to another +0.48% gain for Wednesday.
The trend line from the 10/4 low and the one-day trend line point to a lateral move of +0.06% for tomorrow.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Wrap-up
I thought today might be the start of a pullback as investors anticipate the Fed's decision. There is still likely to be some reaction to the Fed's statement tomorrow. Can the earnings optimism keep the bulls around, or will tomorrow be the first day in seven sessions with a decline?
The expectation for tomorrow is Sideways or Lower.
Stay healthy and trade safe!
