Stock market outlook remains uncertain about price volatility


The S&P 500 Index moved more than 1% (up or down) for the fourth straight session on Tuesday. This is the first time this has happened since November. And stock market futures for Wednesday look volatile again …

While the S&P 500 sold a bit at the close, it still managed a decent 1.05% gain on Tuesday and almost wiped out Monday’s losses. 73% of the S&P 500 components closed higher, with some of the only consistent sales occurring in the real estate and utilities sectors.

Despite Tuesday’s rally, the S&P 500 continues to have a strongly bearish intermediate position according to the Market Forecast technical indicator.

The Dow Jones Industrial Average also rallied (+ 0.92%) causing a slight change in intermediate posture from strongly bearish to slightly bullish. The Dow Jones Industrial Average got a green arrow on the stochastic indicator.

The NASDAQ Composite was the biggest winner of the index for the day with a 1.25% snapback, but this is likely due to the fact that it has been the worst performer in recent weeks. The Russell 2000 was the smallest winner of the day (+ 0.49%); it continues to have a weak bearish position and is the only index with a rising 30-day moving average.

Commodities and currencies …

Bitcoin rose 5% and suddenly finds itself with a 3 month breakout and a strongly bullish middle posture. The US dollar and Treasury yields remain correlated; both closed higher and continue to have strong bullish positions. Gold fell 0.47% in the shadow of the strength of the dollar, but it remains in its weakly bullish position (despite a falling 30-day moving average).

Oil has been one of the leaders in this market; it closed for the fourth consecutive session and reached multi-month highs with a strongly bullish posture. Energy and Financials advanced in the most recent sector selector and ranks # 1 and # 2, respectively.

Commodities have clearly outperformed stocks and bonds since August 20 according to our ratio charts.

Our sample trade application exhibited a bullish swing on Dynavax Technologies (DVAX) due to its short-term bullish divergence and rebound from its rising 30-day moving average.

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Stock Market Outlook Video (for October 6) – News and Analysis

Twitter: @BrandonVanZee and @MarketScholars

The author may have a position in the titles mentioned at the time of publication. All opinions expressed here are solely those of the author and do not represent the views or opinions of any other person or entity.

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