Hello traders everywhere. Volatility is indeed the theme of the week, and you have to wonder if this is the new normal for the foreseeable future. The DOW opened over 300 pts higher only to reverse course to head as much 460 pts or 1.9% lower on the day as we head into the close where the big moves have come in the last hour of trading. The DOW will issue a new red monthly Trade Triangle if it breaks through the 26,616.71 and that would indicate it’s heading lower.
Both the S&P 500 and NASDAQ have both issued new red monthly Trade Triangles indicating that they have both entered into a short trading territory. In fact, the S&P 500 is very close to breaking through its support at the 200-day MA at 2539.03. If that’s broken, we could see the market head lower. However, we’ve seen the S&P 500 pass through the 200-day twice in recent memory only to head back higher. Will it be different this time?
Crude oil is trading below $59 a barrel for the first time in 2018. This move lower has been about the growing U.S. inventory, an ever-increasing rig count, and a rising U.S. Dollar. It was reported today by Baker Hughes that 26 rigs were added this week bringing the total count to 791 active rigs. That’s 200 more active rigs than a year ago at the same time.
Bitcoin is up on the day and trading slightly above its 200-day MA which has given the cryptocurrency a level of support at the $7,958.53. Bitcoin seems to have calmed down and moved into a sidelines mode as we end the week.
Key Levels To Watch This Week:
S&P 500 (CME:SP500): 2,872.87
Dow (INDEX:DJI): 26,616.71
NASDAQ (NASDAQ:COMP): 7,501.58
Gold (NYMEX:GC.G18.E): 1,334.80
Crude Oil (NYMEX:CL.H18.E): 64.18
U.S. Dollar (NYBOT:DX.H18.E): 90.50
Bitcoin (CME:BRTI): 11,705.00
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Hello traders everywhere. Volatility is the name of the game today after the DOW opened 567 pts lower only to reverse course and gain 367 pts before heading back into negative territory. Of course, this comes on the heels of a historic day where we saw the DOW shed over 1,150.00 (3.5%), the S&P 500 110 pts (4.6%) and the NASDAQ 250 pts (4.1%). The bulk of the selling came late in the afternoon after all three indexes broke through the 50-day moving average and when that happened traders headed for the exit in record-breaking fashion with the DOW falling over 1600 pts in that span.
I think the key thing here is to take a breath. As traders, we all knew this was coming sooner or later. There was no way that the low-volatility run to the upside was going continue without a major correction along the way. In fact, it's been two years since our last major correction to the downside. If you've been on the sidelines looking for a place to get in, now may be the time as some of the big players in the markets can be had at a discount, so take a deep breath and get to work.
And then you have Bitcoin, which broke through it's 200-day moving average to new 2018 low of 5,902.73 before backing off that low today. That's it's the lowest level since early Nov. of 2017, right before Bitcoin pandemonium hit the markets pushing it to an all-time high of 19,528.87 in December of 2017. Continue reading "Stocks Plunge Erasing 2018 Gains"
Hello traders everywhere. The DOW, S&P 500 and NASDAQ are lower on the day and ending the week lower after the 10-year yield rose quickly to 2.84%, a four-year high. This will be the first weekly loss of 2018 and the largest weekly loss in over a year. Is that a signal of things to come in February?
The U.S. economy added 200,000 jobs in January, according to the Bureau of Labor Statistics. Economists had expected growth of 180,000. Wages, meanwhile, rose 0.3% last month, in line with expectations.
The report sent interest rates higher. The benchmark 10-year yield rose to 2.84% on the back of the report, hitting a four-year high. Investors have been jittery about the recent rise in interest rates, worrying they may be rising too fast. On Thursday, the 30-year yield rose to 3.074%, its highest level since March.
The CBOE Volatility Index (VIX), the most widely followed gauge measure of stock market volatility, rose to 14.48, after having fallen in the previous two sessions.
Key levels to watch next week: Continue reading "Stocks Fall As Interest Rates Rise"
Hello traders everywhere. The two-day sell-off continues in the stock market, and it is gaining steam as we head into afternoon trading. The DOW traded lower, as much as 352 points, hammered by a rise in bond yields and a decline in healthcare companies after Amazon, JPMorgan, and Berkshire Hathaway announced that they would form an independent healthcare company to serve their employees in the United States.
This announcement has caused a wave of panic selling in the healthcare sector with Cigna (CI) leading the way by falling over 6% followed by UnitedHealth Group (UNH) falling over 4% on the day. While there hasn't been a lot of information released, it indeed was shot across the bow of the U.S. healthcare business.
The 10-year Treasury yield rose above 2.73%; it's highest level since April 2014. This rise is leading up to the Federal Reserve monetary policy decision which could help shed more light on the outlook for interest rates this year.
The Fed's ongoing two-day meeting will be watched for comments that could raise the likelihood of rates being hiked four times this year, instead of three, especially as inflation readings have firmed in recent readings.
Key levels to watch this week: Continue reading "The Stock Market Sell-Off Continues"
Hello traders everywhere. Both the DOW and the S&P 500 have hit new intra-day highs and are looking to close out the week at record highs. This latest move higher has been driven by a weaker U.S. Dollar and a strong earnings season so far.
This week has seen some overall market volatility, but a strong finish today will put the three main indexes on track for their best four-week rally since 2016.
The latest saga in the Bitcoin/cryptocurrency space continues to be a lack of regulation. One of Japan's largest cryptocurrency exchanges, Coincheck, said that about $400 million in NEM tokens were lost after the coins were sent "illicitly" outside the venue, spooking investors in a country that's still wary of digital-token exchanges four years after the collapse of Mt. Gox.
Cryptocurrency exchanges, many of which operate with little to no regulation, have suffered a series of outages and hacks amid the trading boom that propelled Bitcoin and its peers to record highs last year. What lasting effect will these continued hacks and outages have on the cryptocurrency space moving forward?
Key levels to watch next week: Continue reading "Stocks Rise On Strong Earnings"