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Today’s Summary
Wednesday, March 25th, 2020
Indices: US Stocks closed higher with the Dow Jones Industrial Average gaining 496 points or 2.39%. The S&P 500 rose 1.15%, while the Nasdaq slipped 0.45%. The Russell 2000 closed higher by 1.26%.
Sectors: Industrials led, gaining 5.26%. Communications lagged, falling 1.54%.
Commodities: Crude Oil futures were more or less unchanged and continue to trade at $24.31 per barrel. Gold futures dropped 1.56% to $1,643 per ounce.
Currencies: The US Dollar Index fell 0.82%.
Interest Rates: The US 10-year Treasury yield rose to 0.869%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
$AMZN is one of the most constructive looking charts in the stock market, that uptrend is your stop. pic.twitter.com/9bgNh7o3Ls
— Dan Nathan (@RiskReversal) March 25, 2020
Today’s Chart of the Day was shared on Twitter by Dan Nathan (@RiskReversal). It’s a chart of Amazon ($AMZN) over the past five years. Amazon has held up relatively well throughout the recent decline. Both Amazon and the S&P 500 last closed at an all-time high on February 19th. As of today’s close, Amazon has fallen from those highs by about 13% while the S&P 500 has fallen twice as much (26.89%). Dan points out the stock’s multi-year uptrend remains intact despite the historic sell-off in the broader market. Amazon is one of the most important stocks in the market. It is by far the largest component in the Consumer Discretionary sector, and it’s the third-largest component in the S&P 500. There aren’t a whole lot of positives to the market right now. However, As Dan points out, it’s undoubtedly “constructive” to see one of the biggest players in the market exhibit relative strength and maintain its long-term uptrend.
Quote of the Day
“Being able to respond to the changing future is a good thing; being surprised by the changing future is not.”
– Annie Duke (Professional Poker Player)
Top Links
What Do You Do Now? – The Irrelevant Investor
The S&P 500 is up more than 10% in just the past two days. However, it’s still more than 26% below its February highs. In this piece, Michael Batnick offers some advice to investors in volatile market environments.
Failure of Coutertrends Are Not a Sign of A Strengthening Market – Andrew Thrasher
Andrew Thrasher emphasizes that we need short-term rallies to hold their gains, rather than failing at resistance as they have been.
Historic Bounce in Gold at Key Fibonacci Level – Fibonacci.com
Tarek Saab of Fiboacci.com shares his thoughts on Gold and the Gold/Silver ratio.
Improving Breadth Suggests a Near-Term Bottom – All Star Charts
Steve Strazza argues that the recent improvement in breadth suggests the S&P 500 has found a near-term bottom.
Weighing the Downside vs. Upside Risks in the Market – The Korelin Economics Report
In this podcast, Portfolio Manager, Dana Lyons discusses how he navigates volatile market environments, and he weighs the potential risk vs. reward of this market.
Saturday, March 28th, 8 AM ET – 6 PM ET.A Free Live Virtual Conference On Technical Analysis
The 4th Annual Charting Summit brings together an elite group of professional technicians who will explain to their market process and show you exactly how to apply their methods in the current market environment to control risk and increase profitability.
Top 10 Tweets
I can see the S&P 500 making it to around 2700 on this snap back.
— Jeffrey Gundlach (@TruthGundlach) March 25, 2020
Longest consecutive sessions without back-to-back gains in the history of the S&P, charted.
28 is the magic number where 7 epic streaks — including this one — stopped. pic.twitter.com/Hp9Mk2srs9
— Luke Kawa (@LJKawa) March 25, 2020
The market's "best players" have NOT broken the December 2018 lows on an equally-weighted basis while the S&P 500 has.
Another positive divergence to add to the list. pic.twitter.com/FrWDvSmwCa
— Tom Bruni, CMT (@BruniCharting) March 25, 2020
Imagine if we get through this whole thing without $QQQ breaking trend. pic.twitter.com/mYetGiYtnz
— David J DeVito, CMT (@Tactical_Charts) March 25, 2020
A consequence of the recent decline. pic.twitter.com/vPzwn0ec8x
— Strategas (@StrategasRP) March 25, 2020
One way we measure financial stress in the system is thru cross asset correlations. When all assets (commodities), otherwise unrelated, trade in unison, it's usually a reflection of funding pressures which result in 'bid-wanted' for most everything. We're there. pic.twitter.com/ZFjjOCgb7r
— RenMac: Renaissance Macro Research (@RenMacLLC) March 25, 2020
As of right now, we have back-to-back green Heikin Ashi candles on the Daily chart. If we can close with this, it's another positive sign for the bulls, at least over the short term. pic.twitter.com/Fge7ndEYvG
— Ian McMillan, CMT (@the_chart_life) March 25, 2020
Volatility: Stocks vs. Bonds, who's right? pic.twitter.com/wii48xFtr3
— Lawrence McDonald (@Convertbond) March 25, 2020
Who else is watching this epic failed breakdown in Soybean Oil? It makes for a good trade if you wanna stay clear of equities. Prices are headed a lot higher if we're above $26 imo pic.twitter.com/zDAu8qGk3h
— Louis (@haumicharts) March 25, 2020
This is what doubling off your low looks like. pic.twitter.com/ZW7Ca2Vgq8
— Eddy Elfenbein (@EddyElfenbein) March 25, 2020