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Today’s Summary
Tuesday, October 27th, 2020
Indices: US Stocks were mostly lower in today’s session. The Dow Jones Industrial Average fell 222 points or 0.80%. The S&P 500 slipped 0.30%, while the Nasdaq rose 0.64%. Small-Caps underperformed, with the Russell 2000 dropping 0.90%.
Sectors: 9 of the 11 sectors closed lower. Communications led, gaining 0.64%. Industrials lagged, dropping 2.19%.
Commodities: Crude Oil futures moved higher by 2.62% to $39.57 per barrel. Gold futures rose 0.33% to $1,912 per ounce.
Currencies: The US Dollar Index was flat.
Interest Rates: The 10-year US Treasury yield fell for the third straight day to 0.768%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
#Bitcoin rises to its highest level since early 2018! pic.twitter.com/yw1zO4tzLc
— jeroen blokland (@jsblokland) October 27, 2020
Today’s Chart of the Day was shared on Twitter by Jeroen Blokland (@jsblokland). It’s a chart of Bitcoin over the past three years. The crypto crowd has been crawling out of their parents’ basement over the past few weeks as Bitcoin breaks above levels not seen in years. Not surprisingly, everyone is looking for a macro narrative or reason to explain this move. However, us chart watchers don’t really care about why price is behaving the way it is. The only reason Bitcoin has our attention right now is that price is breaking out of a multi-year base within a long-term uptrend. That’s it! It is really that simple. With Bitcoin currently trading firmly above the $13k level, a retest of the 2017 highs around $19-20k within the coming months is a real possibility.
Quote of the Day
“Bitcoin is like anything else: it’s worth what people are willing to pay for it.”
– Stanley Druckenmiller
Top Links
The Long View in Crypto’s Big 2 – The Rotation Report
Aaron Jackson breaks down his outlook on Bitcoin and Ethereum.
Relative Reversals – Bespoke
Bespoke takes a look at some of the recent changes in sector trends.
Opportunity in Software! – Chaikin Analytics
Dan Russo of Chaikin Analytics shares his thoughts on Software stocks after the group sold-off hard yesterday.
Betting on the Banks – CNBC
In this clip from CNBC, Chris Verrone of Strategas Research offers his technical perspective on Interest Rates and Regional Banks.
My Interview With Jack Schwager – Author of Market Wizards – Technical Analysis Radio
Here’s a good conversation with the Author of Market Wizards, Jack Schwager, and JC Parets. They discuss the traits that most successful traders have in common.
Top Tweets
The $SPX has not logged a 1% gain in 11 sessions, which now is the 2nd longest streak of 2020 (16 from 2/6 – 2/28).
There have been 2 declines of least 1.5% over the last 7 days…
What’s next?
— Frank Cappelleri (@FrankCappelleri) October 27, 2020
With the S&P sitting at its Q1 highs… which way do we go from here? $SPY
We should have a much better idea soon as mega-cap tech earnings roll out this week… almost 25% of the index is comprised of $GOOGL $MSFT $AMZN $AAPL $FB which all report in the coming days pic.twitter.com/1wD5wUft6J
— Steven Strazza (@sstrazza) October 27, 2020
Tech broke below its 50-day MA yesterday after software put in a pot'l double top & semiconductors failed to hold the September high.
These two industries are important for tech and the market as a whole. Watching if they are able to hold their own 50-day MA on further weakness pic.twitter.com/xUBOIMqWJO
— Andrew Thrasher, CMT (@AndrewThrasher) October 27, 2020
The most critical Equity chart I'm watching (updated):$NDX Volatility formed an extremely tight pivot at its rising 200d.
Even more important: yesterday MAY have been the initial launch out of the pattern. Watching this very closely. pic.twitter.com/IuLw1XrRlf
— Macro Charts (@MacroCharts) October 27, 2020
Similar to pre-2016 election, VIX curve has inverted. pic.twitter.com/tPyJqPMUJH
— Strategas (@StrategasRP) October 27, 2020
DAX. Horizontal support broken, moving averages trending lower, volume rising, infections increasing, lockdowns looming. DOWN! EURJPY down as well. pic.twitter.com/WE8WCk1sg3
— James Brodie CMT (@jamesrbrodie) October 27, 2020
German Stonks have some work to do as long as it's below 12330. In search of demand.$DAX pic.twitter.com/LLJd9fZ10G
— David Zarling, CMT (@AdaptivCharts) October 27, 2020
Here's a huge base, nine years in the making…
Take notice of the price today. If gold is above the 2011 highs, I don't see any overhead resistance in place outside of profit-takers.
Risk management doesn't get much more defined than this.$GOLD $GLD $IAU pic.twitter.com/wATfgCnTFN
— Adam D. Koós, CFP®, CMT (@AdamKoos) October 27, 2020
Gold has not provided a hedge against recent equity volatility. Bitcoin, meanwhile, has crushed it. pic.twitter.com/UR5Jdk5sBm
— Lisa Abramowicz (@lisaabramowicz1) October 27, 2020
BIG area here for #bitcoin pic.twitter.com/mYbvgSLwW5
— Greg Rieben (@gregrieben) October 27, 2020
There is a possibility that Bitcoin $BTC could register its highest monthly closing price EVER
A few days and a few hundred dollars away pic.twitter.com/qUs3GL7qfQ
— Peter Brandt (@PeterLBrandt) October 27, 2020