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Today’s Summary
Monday, October 19th, 2020
Indices: US Stocks kicked off the week on a sour note with the Dow Jones Industrial Average falling 411 points or 1.44%. The S&P 500 and Nasdaq dropped 1.63% and 1.65%, respectively. The Russell 2000 slightly outperformed but still closed lower by 1.24%.
Sectors: All 11 sectors closed lower. Utilities led but still slipped 0.84%. Energy lagged, falling 2.12%.
Commodities: Crude Oil futures inched lower by 0.15% to $41.06per barrel. Gold futures rose 0.28% to $1,912 per ounce.
Currencies: The US Dollar Index fell 0.32%.
Interest Rates: The 10-year US Treasury yield moved higher to 0.769%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
S&P 500 15 Minute Chart update: Resistance is supposed to become support. ?#SPX500 #Stockmarket #Stocks pic.twitter.com/tqV1PcEZB1
— Mike Moses, CMT (@DominickMike) October 19, 2020
Today’s Chart of the Day was shared on Twitter by Mike Moses (@DominickMike). It’s a 15-minute candlestick chart of the S&P 500 over the past two months. One of the most basic concepts in Technical Analysis is the Principle of Polarity. This is the simple idea that former resistance tends to act as support. As you can see, price is currently retesting a former resistance level around 3425. This level acted as a ceiling for the majority of September, but we finally broke above it in early October. According to the Principle of Polarity, this former resistance level should act as support here. If it fails to hold, it would be a red flag that more downside lies ahead. Either way, the outcome from this retest will provide us with valuable information, so keep an eye on how price behaves around this key level throughout the week.
Quote of the Day
“The harder I work, the luckier I get.”
– Samuel Goldwyn
Top Links
Rocketing Restaurants – Bespoke
Bespoke points out that the S&P 1500 Restaurants Index is trading at record highs.
Bull Market Will Continue into 2021: Strategist – Fox Business
Ed Clissold of Ned Davis Research explains why he thinks the S&P 500 will hit a record high before year-end.
Stock Picker’s Market – Momentum Monday
Howard Lindzon, and Ivanhoff highlight the strongest stocks, trends, and themes across the markets.
Indecision – The Weekly Trend
In this podcast, David Zarling and Ian McMillan discuss some of the major technical developments to be aware of right now.
Stocks Touch Session Low Amid Stimulus Uncertainty – Yahoo Finance
Ryan Detrick offers some valuable perspective on the market ahead of the US election.
Top Tweets
Ran-dumb:$COMPQ's down 5 in a row but its not even off -5% and it closed within -10% of its ATH daily close.
Here are all priors since 1990.
If we bend to the 20 day on the index, i'll buy your shares of $QLD. pic.twitter.com/b84e7bbiJu
— Steve Deppe, CMT (@SJD10304) October 19, 2020
QQQs finally filled last Monday's gap. pic.twitter.com/2B0W4JbXQO
— Walter Deemer (@WalterDeemer) October 19, 2020
well here we are…$NQ_Z $QQQ pic.twitter.com/wkCkc55lLu
— J4 (@J4_doji) October 19, 2020
Intermediate term defensive posture continues to make sense with the $SPY below the declining 5DMA (orange) and the VWAP from last week's gap.
Just below, the first level of interest (potential support) is the MTD VWAP (light blue) this is also prior band of resistance pic.twitter.com/PYwGECtsN1
— Brian Shannon, CMT (@alphatrends) October 19, 2020
Here's your Modern Day Dow Theory: Not exactly in downtrends pic.twitter.com/x8DWlNszx1
— J.C. Parets (@allstarcharts) October 19, 2020
A lot of attn. on the shift in Nasdaq 100 COT position. But Commercial Traders are also not overly bullish on Russell 2000 right now, holding a rather heavy net-short position. $IWM pic.twitter.com/owdvRsB9YP
— Andrew Thrasher, CMT (@AndrewThrasher) October 19, 2020
The 1mo/3mo #VIX spread inches towards inversion and is at its narrowest level since late June. The S&P500 is testing neckline support (~3425) of the inverse head and shoulders pattern, while the 50-day MA (~3400) offers intermediate trend support. Big tests ahead yet $SPX pic.twitter.com/sk9cpA4xio
— Michael McKerr (@MikeMcKerr_TDA) October 19, 2020
#Aerospace #Defense – Seasonal tendency for relative out-performance last 3-months of election year. pic.twitter.com/BXvRXUiBt4
— Nautilus Research (@NautilusCap) October 19, 2020
4 of the 10 largest % moves since Black Monday we're this year. https://t.co/21A3QUwCbR
— Dr. Phil Pearlman (@ppearlman) October 19, 2020
Oh look, that basket of the most shorted stocks is at a record
RIP shorts (again) pic.twitter.com/Rg3fQvxAk7
— Sarah Ponczek (@SarahPonczek) October 19, 2020
The only thing people love more than pizza is claiming that the stock market is a bubble and it's '99 all over again.
And yet, the S&P 400 has drifted sideways for two and a half years since its early 2018 highs, trading only ~8% above its avg. price over the past 689 sessions. pic.twitter.com/d7fzm9mywr
— Grayson Roze (@GraysonRoze) October 19, 2020