Daily Market Update for 12/3
Trend lines drawn from the 10/30 bottom (24d), 11/26 (5d), and today 12/3 (1d).
If you have ideas to make the daily update better, please let me know in the comments.
I do occasionally have some errors or typos and will correct them in my blog or in the comments on TradingView. I do not have an editor and do this in my free time.
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Thursday, December 3, 2020
We ain't no legend, ain't no cause
We're just livin' for today
Facts: +0.23%, Volume higher, Closing range: 25%, Body: 10%
Good: New all-time high, higher low
Bad: Closing range below 40%, sell-off before close
Highs/Lows: Higher high, Higher low
Candle: Shooting star, long upper wick, tiny body
Advance/Decline: 1.54, more advancing stocks than declining stocks
Sectors: Energy (XLE +1.05%) and Real Estate (XLRE +0.74%) were the leading sectors. Utilities (XLU -1.04%) was the bottom sector.
Expectation: Lower
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Market Overview
The Nasdaq soared to new highs today after slightly better employment data than expected. The session was already choppy before a selloff in the afternoon caused by disappointing news about supply chain issues impacting the ability to produce vaccines. The result is a shooting star candlestick that prompts a cautious outlook for the next session. The index closed with +0.23% gain on higher volume. The closing range was 23% with a thin body of 10% at the bottom of the candlestick. There were about 3 advancing stocks for every declining stock.
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Indexes and Sectors
The Dow Jones Industrial (DJI +0.29%) and Russell 2000 (RUT +0.58%) both outperformed the Nasdaq. The S&P 500 (SPX -0.06%) ended the day with losses.
Energy (XLE +1.05%) was the leading sector with Real Estate (XLRE +0.74%) coming in second. Utilities (XLU -1.04%) was the worst performing sector of the day. Technology (XLK -0.06%) finished even with the S&P 500.
The VIX volatility index rose for the third day in a row ending the day with a +0.52% gain. It is still on a downward trending channel.
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Market Indicators
US30Y and US10Y bond yields fell for the day while the spreads tightened slightly.
Corporate Bond yields dropped while short term treasury bond yields rose for another day. Investors continue moving to riskier assets signaling at least some confidence in the economic recovery.
The US dollar (DXY -0.44%) continues to slide. It is currently at a level not seen since April 2018.
Silver (SILVER -0.26%) fell back while Gold (GOLD +0.57%) gained for the day. Crude Oil Futures (CRUDEOIL1! +0.77%) rose for a second day. Timber (WOOD +0.27%) rose for the day. Aluminum (ALI1! -1.69%) fell back from recent gains.
The put/call ratio dropped to 0.500, and still showing overly bullish sentiment. The put/call ratio (PCCE) is a contrarian indicator that shows overly bullish or overly bearish investor behavior. The 0.7 level is considered normal. As it approaches 0.60 (overly bullish) and below, watch for a possible pullback in the market.
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Market Leaders
Each of the big four mega-caps were showing gains intraday but closed the day with losses. Apple (AAPL -0.11%) and Alphabet (GOOGL -0.17%) are trading well-above their key 21d EMA and 50d MA lines. Microsoft (MSFT -0.52%) and Amazon (AMZN -0.52%) ended with equal losses. Microsoft tested its 21d EMA but found support. Amazon tested its 50d MA and found support. Other mega-caps were about split on gainers and losers. Tesla (TSLA +4.32%) was the top mega-cap performer of the day as it approaches the date to be added to the S&P500. Intel (INTC +2.18%) has had a continuous gains over the last eight days.
Growth stocks had a great day after several companies exceed expectations on earnings announcements yesterday. Zscaler (ZS +26.45%), CrowdStrike (CRWD +13.64%), ESTC (ESTC +12.59%), and Snowflake (+16.13%) all soared today following their announcements. Splunk (SPLK -23.25%) had the opposite reaction after incurring a loss in quarterly earnings.
Cloudera (CLDR +3.39%) and DocuSign (DOCU +6.11%) released earnings after market close and are up 8% and 3% in afterhours trading, respectively. Marvell (MRVL -0.22%) is down 6% after hours on a disappointing outlook in their earnings report.
Waddell & Reed (WDR +50.44%) had a huge gain after Macquarie (MIC -0.12%) announced they will acquire the wealth management company. Michaels (MIK +20.29%) retailer rose on strong earnings. Insurance company Lemonade (LMND +20.23%) popped after getting a recommend from Tom Gardner of The Motley Fool.
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Looking ahead
Tomorrow will bring more employment data including average hourly earnings, nonfarm payrolls and the unemployment rate. Analysts are expecting the change in nonfarm payrolls for November to continue downward but at a lower rate. As a result, the Unemployment Rate would be slightly better. A negative expectation breaker could further slide the US Dollar.
Big Lots (BIG +0.76%) will announce earnings before market open.
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Trends, Support and Resistance
The five-day trend line is pointing to a +0.93% while the one-day trend line is pointing to a +0.22% gain. The longer trend line from the 10/30 bottom splits the two possibilities.
Although the trendlines point to gains, the bearish end to the day today indicates the possibility of a further loss tomorrow.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Wrap-up
The day started with positive news that Initial Jobless Claims were less than expected, a good sign for a recovering economy. That trend needs to be supported by more progress toward vaccine availability to end the pandemic restrictions and lockdowns. When Pfizer announced supply chain issues in producing the vaccine, it had an immediate reaction from the market in late afternoon trading. Now that the market is closed, the news can be absorbed, and we can hope for a reduced concern as the market opens tomorrow.
Take care!
If you have ideas to make the daily update better, please let me know in the comments.
I do occasionally have some errors or typos and will correct them in my blog or in the comments on TradingView. I do not have an editor and do this in my free time.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Thursday, December 3, 2020
We ain't no legend, ain't no cause
We're just livin' for today
Facts: +0.23%, Volume higher, Closing range: 25%, Body: 10%
Good: New all-time high, higher low
Bad: Closing range below 40%, sell-off before close
Highs/Lows: Higher high, Higher low
Candle: Shooting star, long upper wick, tiny body
Advance/Decline: 1.54, more advancing stocks than declining stocks
Sectors: Energy (XLE +1.05%) and Real Estate (XLRE +0.74%) were the leading sectors. Utilities (XLU -1.04%) was the bottom sector.
Expectation: Lower
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Overview
The Nasdaq soared to new highs today after slightly better employment data than expected. The session was already choppy before a selloff in the afternoon caused by disappointing news about supply chain issues impacting the ability to produce vaccines. The result is a shooting star candlestick that prompts a cautious outlook for the next session. The index closed with +0.23% gain on higher volume. The closing range was 23% with a thin body of 10% at the bottom of the candlestick. There were about 3 advancing stocks for every declining stock.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Indexes and Sectors
The Dow Jones Industrial (DJI +0.29%) and Russell 2000 (RUT +0.58%) both outperformed the Nasdaq. The S&P 500 (SPX -0.06%) ended the day with losses.
Energy (XLE +1.05%) was the leading sector with Real Estate (XLRE +0.74%) coming in second. Utilities (XLU -1.04%) was the worst performing sector of the day. Technology (XLK -0.06%) finished even with the S&P 500.
The VIX volatility index rose for the third day in a row ending the day with a +0.52% gain. It is still on a downward trending channel.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Indicators
US30Y and US10Y bond yields fell for the day while the spreads tightened slightly.
Corporate Bond yields dropped while short term treasury bond yields rose for another day. Investors continue moving to riskier assets signaling at least some confidence in the economic recovery.
The US dollar (DXY -0.44%) continues to slide. It is currently at a level not seen since April 2018.
Silver (SILVER -0.26%) fell back while Gold (GOLD +0.57%) gained for the day. Crude Oil Futures (CRUDEOIL1! +0.77%) rose for a second day. Timber (WOOD +0.27%) rose for the day. Aluminum (ALI1! -1.69%) fell back from recent gains.
The put/call ratio dropped to 0.500, and still showing overly bullish sentiment. The put/call ratio (PCCE) is a contrarian indicator that shows overly bullish or overly bearish investor behavior. The 0.7 level is considered normal. As it approaches 0.60 (overly bullish) and below, watch for a possible pullback in the market.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Leaders
Each of the big four mega-caps were showing gains intraday but closed the day with losses. Apple (AAPL -0.11%) and Alphabet (GOOGL -0.17%) are trading well-above their key 21d EMA and 50d MA lines. Microsoft (MSFT -0.52%) and Amazon (AMZN -0.52%) ended with equal losses. Microsoft tested its 21d EMA but found support. Amazon tested its 50d MA and found support. Other mega-caps were about split on gainers and losers. Tesla (TSLA +4.32%) was the top mega-cap performer of the day as it approaches the date to be added to the S&P500. Intel (INTC +2.18%) has had a continuous gains over the last eight days.
Growth stocks had a great day after several companies exceed expectations on earnings announcements yesterday. Zscaler (ZS +26.45%), CrowdStrike (CRWD +13.64%), ESTC (ESTC +12.59%), and Snowflake (+16.13%) all soared today following their announcements. Splunk (SPLK -23.25%) had the opposite reaction after incurring a loss in quarterly earnings.
Cloudera (CLDR +3.39%) and DocuSign (DOCU +6.11%) released earnings after market close and are up 8% and 3% in afterhours trading, respectively. Marvell (MRVL -0.22%) is down 6% after hours on a disappointing outlook in their earnings report.
Waddell & Reed (WDR +50.44%) had a huge gain after Macquarie (MIC -0.12%) announced they will acquire the wealth management company. Michaels (MIK +20.29%) retailer rose on strong earnings. Insurance company Lemonade (LMND +20.23%) popped after getting a recommend from Tom Gardner of The Motley Fool.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Looking ahead
Tomorrow will bring more employment data including average hourly earnings, nonfarm payrolls and the unemployment rate. Analysts are expecting the change in nonfarm payrolls for November to continue downward but at a lower rate. As a result, the Unemployment Rate would be slightly better. A negative expectation breaker could further slide the US Dollar.
Big Lots (BIG +0.76%) will announce earnings before market open.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Trends, Support and Resistance
The five-day trend line is pointing to a +0.93% while the one-day trend line is pointing to a +0.22% gain. The longer trend line from the 10/30 bottom splits the two possibilities.
Although the trendlines point to gains, the bearish end to the day today indicates the possibility of a further loss tomorrow.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Wrap-up
The day started with positive news that Initial Jobless Claims were less than expected, a good sign for a recovering economy. That trend needs to be supported by more progress toward vaccine availability to end the pandemic restrictions and lockdowns. When Pfizer announced supply chain issues in producing the vaccine, it had an immediate reaction from the market in late afternoon trading. Now that the market is closed, the news can be absorbed, and we can hope for a reduced concern as the market opens tomorrow.
Take care!
Website: drewby.com
Twitter: twitter.com/drewrobbins
All ideas are for information purposes only. I may or may not invest in the stocks discussed. Before investing in any stock, do your research and trade using your rules.
Twitter: twitter.com/drewrobbins
All ideas are for information purposes only. I may or may not invest in the stocks discussed. Before investing in any stock, do your research and trade using your rules.
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