Summary: Stocks weren't sure what to do on Thursday, but Bonds sold off as investors continue to digest what Fed actions may be in store for later this year.
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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Thursday, April 7, 2022
Facts: +0.06%, Volume lower, Closing Range: 72%, Body: 12% Green
Good: High closing range
Bad: Lower high, lower low, dip below 50d MA
Highs/Lows: Lower high, Lower low
Candle: Thin green body above a long lower wick
Advance/Decline: 0.48, more than two declining stocks for every advancing stock
Indexes: SPX (+0.43%), DJI (+0.25%), RUT (-0.35%), VIX (-2.49%)
Sector List: Health (XLV +1.92%) and Energy (XLE +1.31%) at the top. Real Estate (XLRE -0.82%) and Communications (XLC -0.87%) at the bottom.
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Market Overview
Stocks weren't sure what to do on Thursday, but Bonds sold off as investors continue to digest what Fed actions may be in store for later this year.
The Nasdaq recovered from an intraday dip to close +0.06% higher. The candle has a 12% body in the upper half of the candle. It's above a long lower wick that formed in the first half of the day as the index plunged below the 50d MA. Prices recovered in the afternoon before the Nasdaq hit resistance at the 21d EMA and formed a short upper wick before close. The closing range was good at 72%, but there were more than two declining stocks for every advancing stock.
The S&P 500 (SPX) was the best index today, advancing by +0.43%. The Dow Jones Industrial Average (DJI) climbed by +0.25%. Small-caps did not do well with the Russell 2000 (RUT) declining by -0.35%. The VIX Volatility Index fell by -2.49%.
Seven of the eleven S&P 500 sectors gained. Health (XLV +1.92%) and Energy (XLE +1.31%) were at the top of the list. Real Estate (XLRE -0.82%) and Communications (XLC -0.87%) had the biggest losses.
The weekly Initial Jobless Claims were less than forecast. 166,000 claims were counted against the expectation of 200,000.
The US Dollar index (DXY) continued higher, climbing by +0.13% today. US 30y, 10y, and 2y Treasury Yields all rose. The gap between the 10y and 2y continues to widen. High Yield (HYG) and Investment Grade (LQD) Corporate Bond prices fell for another day. Brent Oil dipped below $100 but then closed the day just above that mark.
The put/call ratio (PCCE) declined to 0.799. The CNN Fear & Greed index moved back toward Neutral. The NAAIM Money Manager Exposure Index rose to 83.41 from 79.72 the previous week.
Three of the big six mega-caps ended the day with gains. Tesla (TSLA) gained +1.10%, followed by Microsoft (MSFT) and Apple (AAPL) which gained +0.62% and +0.18%.
Pfizer (PFE) was the top mega-cap, followed by other Health sector stocks. Pfizer gained +4.33% today. Pfizer announces the acquisition of ReViral, a respiratory virus drugmaker. At the bottom of the mega-cap list was Alibaba (BABA).
Chewy (CHWY) was the top stock in the Daily Update Growth List. Chinese stocks dominated the bottom of the list with Ehang Holdings (EH) falling by -7.17% to land at the bottom of the list.
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Looking ahead
The World Agricultural Supply and Demand Estimates report, published by the USDA, will be published at noon tomorrow.
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Trends, Support, and Resistance
The Nasdaq dipped below the 50d MA mid-day before recovering and finding resistance at the 21d EMA before close.
If the one-day trend line continues, that would mean a +0.38% gain on Friday.
The trend line from the 3/29 high and the five-day trend line point to -0.98% and -1.47% declines.
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Wrap-up
The market is still sorting out what interest rate hikes and the balance-sheet runoff means for the rest of 2022. If the bond market is an indication, then we will likely see more volatility in equities, especially with growth stocks. Higher yields and the strengthening US dollar will especially put pressure on large multinationals that depend on repatriated revenues.
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=-
Thursday, April 7, 2022
Facts: +0.06%, Volume lower, Closing Range: 72%, Body: 12% Green
Good: High closing range
Bad: Lower high, lower low, dip below 50d MA
Highs/Lows: Lower high, Lower low
Candle: Thin green body above a long lower wick
Advance/Decline: 0.48, more than two declining stocks for every advancing stock
Indexes: SPX (+0.43%), DJI (+0.25%), RUT (-0.35%), VIX (-2.49%)
Sector List: Health (XLV +1.92%) and Energy (XLE +1.31%) at the top. Real Estate (XLRE -0.82%) and Communications (XLC -0.87%) at the bottom.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Overview
Stocks weren't sure what to do on Thursday, but Bonds sold off as investors continue to digest what Fed actions may be in store for later this year.
The Nasdaq recovered from an intraday dip to close +0.06% higher. The candle has a 12% body in the upper half of the candle. It's above a long lower wick that formed in the first half of the day as the index plunged below the 50d MA. Prices recovered in the afternoon before the Nasdaq hit resistance at the 21d EMA and formed a short upper wick before close. The closing range was good at 72%, but there were more than two declining stocks for every advancing stock.
The S&P 500 (SPX) was the best index today, advancing by +0.43%. The Dow Jones Industrial Average (DJI) climbed by +0.25%. Small-caps did not do well with the Russell 2000 (RUT) declining by -0.35%. The VIX Volatility Index fell by -2.49%.
Seven of the eleven S&P 500 sectors gained. Health (XLV +1.92%) and Energy (XLE +1.31%) were at the top of the list. Real Estate (XLRE -0.82%) and Communications (XLC -0.87%) had the biggest losses.
The weekly Initial Jobless Claims were less than forecast. 166,000 claims were counted against the expectation of 200,000.
The US Dollar index (DXY) continued higher, climbing by +0.13% today. US 30y, 10y, and 2y Treasury Yields all rose. The gap between the 10y and 2y continues to widen. High Yield (HYG) and Investment Grade (LQD) Corporate Bond prices fell for another day. Brent Oil dipped below $100 but then closed the day just above that mark.
The put/call ratio (PCCE) declined to 0.799. The CNN Fear & Greed index moved back toward Neutral. The NAAIM Money Manager Exposure Index rose to 83.41 from 79.72 the previous week.
Three of the big six mega-caps ended the day with gains. Tesla (TSLA) gained +1.10%, followed by Microsoft (MSFT) and Apple (AAPL) which gained +0.62% and +0.18%.
Pfizer (PFE) was the top mega-cap, followed by other Health sector stocks. Pfizer gained +4.33% today. Pfizer announces the acquisition of ReViral, a respiratory virus drugmaker. At the bottom of the mega-cap list was Alibaba (BABA).
Chewy (CHWY) was the top stock in the Daily Update Growth List. Chinese stocks dominated the bottom of the list with Ehang Holdings (EH) falling by -7.17% to land at the bottom of the list.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Looking ahead
The World Agricultural Supply and Demand Estimates report, published by the USDA, will be published at noon tomorrow.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Trends, Support, and Resistance
The Nasdaq dipped below the 50d MA mid-day before recovering and finding resistance at the 21d EMA before close.
If the one-day trend line continues, that would mean a +0.38% gain on Friday.
The trend line from the 3/29 high and the five-day trend line point to -0.98% and -1.47% declines.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Wrap-up
The market is still sorting out what interest rate hikes and the balance-sheet runoff means for the rest of 2022. If the bond market is an indication, then we will likely see more volatility in equities, especially with growth stocks. Higher yields and the strengthening US dollar will especially put pressure on large multinationals that depend on repatriated revenues.
Stay healthy and trade safe!
