Thursday, April 2nd, 2020
Indices: US Stocks closed higher in today’s session with the Dow Jones Industrial Average gaining 470 points or 2.24%. The S&P 500 and Nasdaq finished up 2.28% and 1.72%, respectively. The Russell 2000 underperformed the other major indices but still gained 1.29%.
Sectors: All 11 sectors closed higher. Energy led significantly, rebounding 9.16%. Consumer Discretionary lagged but still closed higher by 0.37%.
Commodities: Crude Oil futures had a historic day, surging 24.67% to 25.30 per barrel. Gold futures moved higher by 1.98% to $1,635 per ounce.
Currencies: The US Dollar Index gained 0.63%.
Interest Rates: The US 10-year Treasury yield rose to 0.609%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
Today’s Chart of the Day was shared with us in a note by MarketShark. We call this chart pack, “The Good, The Bad, and The Ugly.” The Nasdaq ETF, $QQQ, is “The Good” because it is the only one whose long-term uptrend remains intact after last month’s historic crash. The S&P 500 ETF, $SPY, is “The Bad” because it broke its long-term uptrend line, which is now acting as resistance. There is still hope for $SPY if it can confirm a failed breakdown this week by closing back above that long-term uptrend line. Lastly, the Dow Jones Industrial Average ETF, $DIA, is “The Ugly” because its the only one of the three trading below the December 2018 lows. Also, its long-term uptrend has been broken for weeks now.
Quote of the Day
“The stock market is the best place to spot emerging trends”
– Howard Lindzon (Venture Capitalist)
Sector Relative Strength – Bespoke
Bespoke takes a look at how each of the 11 sectors have performed, relative to the S&P 500.
Why the Market Doesn’t Need to Plummet Further Amid Coronavirus – Yahoo Finance
In this article, Joe Fahmy explains why he remains optimistic on US Stocks despite the coronavirus pandemic.
Keeping Your Winners – MurphyCharts
Shane Murphy discusses some of the challenges of trading in this market environment and points to a few technical developments worth keeping an eye on.
Chart Summit 2020 Review With JC and Strazza – Technical Analysis Radio
In this podcast, JC Parets and Steve Strazza highlight some of the key themes from this past weekend’s 4th annual Chart Summit event.
What a Month – A Simple Strategy – GK Trading
Gregory Krupinski shares a simple trend-following strategy to help swing traders navigate this volatile market environment.
Top 10 Tweets
1- no one knows what is next for the market
2- trend is lower and until that reverses odds favor more downside
3- know your timeframe
4- don't be stupid with your money
5- when in doubt, cash is a position
— Brian Shannon, CMT (@alphatrends) April 2, 2020
— BostonCharts (@bostonchaahhts) April 2, 2020
Some big picture asset allocation trends:
1) Stocks are breaking down relative to bonds
2) Stocks have been in a relative uptrend vs. commodities since 2013
3) Commodities are in a downward trend relative to bonds, indicating deflationary pressure$SPX $VT $BND $TLT $CRB $USB pic.twitter.com/9ogLwKzSvC
— Aazan Habib, CFA, CMT (@aazanhabibCMT) April 2, 2020
If you told me that $SPX would be -25% off its highs in just over a month and the chart of $SOX:$SPX would look like this i’d have laughed in your face for 12 minutes straight. pic.twitter.com/Zdj2U48mhh
— Steve Deppe, CMT (@SJD10304) April 2, 2020
GS High Beta Momentum Index vs $SPX now 60% above 200 DMA
This index goes long high-beta high momentum and short high-beta low momentum. By far the widest spread in at least a decade. pic.twitter.com/31QBfzcNb6
— Jonathan Krinsky,CMT (@jkrinskypga) April 2, 2020
Emerging Markets just suffered the most aggressive selling purge on record (like almost everything else).
Flows are starting to turn up again.
— Macro Charts (@MacroCharts) April 2, 2020
This level needs to hold for the bulls. Basic TA tells us the more times a level is tested, the higher the likelihood it breaks, and you do NOT want to own equities if this ratio breaks down. Similar charts of equities relative to $GLD and $TLT have already broken down. $SPY $JXY pic.twitter.com/EqgtIDTSYQ
— Louis (@haumicharts) April 2, 2020
— Charlie Bilello (@charliebilello) April 2, 2020
So here's the chart of Crude I'm watching.
If we're above 20.50, I think the near-term bias is to the upside and longs can see how this mean reversion develops. pic.twitter.com/T99jq5B72s
— Tom Bruni, CMT (@BruniCharting) April 2, 2020
A reminder on what a 25% move up looks like *after* a more than 70% drop.
Charts > Headlines pic.twitter.com/a6ZWP4hUHA
— Scheplick (@scheplick) April 2, 2020