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Today’s Summary
Monday, May 16th, 2022
Indices: Dow +0.08% | S&P 500 -0.39% | Russell 2000 -0.52% | Nasdaq 100 -1.16%
Sectors: 4 of the 11 sectors closed higher. Energy led by a wide margin, gaining +2.64%. Consumer Discretionary lagged, falling -2.16%.
Commodities: Crude Oil futures rose +3.36% to $114.20 per barrel. Gold futures gained +0.32% to $1,814 per ounce.
Currencies: The US Dollar Index fell -0.27%.
Crypto: Bitcoind moved lower by -4.19% to $29,980. Ethereum dropped -5.36% to $2,030.
Interest Rates: The US 10-year Treasury yield fell to 2.886%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
Yo, Charts – ‘Nuff said pic.twitter.com/SXUP9JDCeb
— da Chart Life (@daChartLife) May 16, 2022
Today’s Chart of the Day was shared by John Roque (@daChartLife). It’s a ratio chart of the Energy sector vs. the Tech sector. The Energy sector continues to be the only place to hide, closing at multi-year highs on both an absolute and relative basis today. It’s up more than 50% year-to-date, while the next best sector (Utilities) is up less than 1%. On the other hand, the beloved Tech sector is down more than 22% over the same period. As dramatic as the rotation into Energy has already been, John points out that it could be in its early innings. This sector was shunned by investors over the past decade, as they preferred the more innovative, ESG-friendly stocks that we’re outperforming. Now that those stocks are underperforming, will investors chase performance in the only sector that’s working?
Quote of the Day
“In a bear market, you have to use sharp countertrend rallies to sell.”
– Bruce Kovner
Top Links
IPOs Rarer and Hurting – Bespoke
Bespoke takes a look at the cooling of the IPO market.
This Chart Says More Downside For S&P 500 – StockCharts.com
David Keller explains that market breadth is suggesting further weakness for the S&P 500.
No Love for Stocks or Bonds, Commodities Hang Tight – Potomac Fund Management
Dan Russo highlights the few pockets of strength within the market.
The Best Days – The Weekly Trend
In this podcast, David Zarling and Ian McMillan discuss some of the most important technical developments to be aware of right now.
Microstrategy Stock Crash Gets Crypto Bulls Attention, Key Support Test In Play! – Kimble Charting Solutions
Chris Kimble points out that Crypto stock, Microstrategy ($MSTR), is testing long-term support after a 90% decline.
Top Tweets
Daily Market Mood: Risk-Off/Mixed
Failed bullish reversal for stocks as bonds mainly climb.
That said, it was a low volume day as $VIX fell to 27… could be ground for $SPX first up week in 7 but if not… longest wkly lose streak since 2001.
Turnaround Tuesday anyone?
— Abigail Doolittle (@TheChartress) May 16, 2022
#NQ_F, 1h
Every drop into a new local low results in an aggressive dip buying… Yet, NQ continues to fade all of the rallies. Still, dip buyers continue to buy trying to time the market's bottom.
Amazing environment. pic.twitter.com/yqBIS5GDQ3
— Yuriy Matso (@yuriymatso) May 16, 2022
Nasdaq 6-week losing streaks of 1%+ and recessions: pic.twitter.com/RVLEswyBMc
— Bespoke (@bespokeinvest) May 16, 2022
The S&P 500 is down 6 weeks in a row:
* Longest since 2011 and hasn't hit 7 since 2001.
* 3- and 6-mo returns are muted, but a year out is more avg.
* Previous 6 wk losing streaks to fall >-10% (like now) saw nice returns going out a year. Up avg 19.2% w median return of 29.2%. pic.twitter.com/bEDAY16PTx— Ryan Detrick, CMT (@RyanDetrick) May 16, 2022
Not yet at halfway point of year, NASDAQ 100 is having its worst year since 2008
[Past performance is no guarantee of future results] pic.twitter.com/U2Mn3TOR25— Liz Ann Sonders (@LizAnnSonders) May 16, 2022
Value Line Geometric Index finished last week where it began 2021 & 2018 – It's been quite the roller coaster ride for the median stock. pic.twitter.com/kw9E71P3HS
— Willie Delwiche, CMT, CFA (@WillieDelwiche) May 16, 2022
Editors field stories they think readers want to read.
And what do they want to read about? Bear markets.
Last week, there were over 8,200 articles printed about them, the 2nd-most of any week in a decade (the furthest date in Bloomberg's database). pic.twitter.com/b5rIcMBpBc
— Jason Goepfert (@jasongoepfert) May 16, 2022
#VIX Implied vol. could still remain muted until 6/9 based off of adherence to 50 day cycle. pic.twitter.com/NkEyvX9OFw
— Nautilus Research (@NautilusCap) May 16, 2022
No need to overcomplicate it with fancy narratives and laser eyes… pic.twitter.com/vUy1UlRgp2
— Dan Russo, CMT (@DanRusso_CMT) May 16, 2022
If I had a dollar for every time time I read "Value is Dead" in the last several years, I wouldn't be worried about the markets anymore. Same as it ever was… pic.twitter.com/nzhe14WJAY
— Jay Kaeppel (@jaykaeppel) May 16, 2022
Large Cap Energy versus Large Cap Tech still working…$XOM $AAPL $XLE $XLK pic.twitter.com/IRyz07Ploi
— Ian McMillan, CMT (@the_chart_life) May 16, 2022
Gasoline futures settle above $4.00 for the first time ever $RB_F $UGA pic.twitter.com/M2PxKbT8Td
— Mike Zaccardi, CFA, CMT (@MikeZaccardi) May 16, 2022
Crude Oil breaking higher again as well. $CL_F $USO pic.twitter.com/yMBerGIC75
— Greg Harmon, CMT/CFA, President Dragonfly Capital (@harmongreg) May 16, 2022
Here's a fun chart. Coal vs Green energy from Election Day 2020. $BTU $TSLA $PBW pic.twitter.com/FMN3GfbieT
— R R (@ATMcharts) May 16, 2022
You’re all caught up now. Thanks for reading!