Monday, November 25th, 2019
Indices: US stocks kicked off the week on a positive note with the Dow Jones Industrial Average advancing 191 points or 0.68%. The S&P 500 and the Nasdaq closed higher by 0.75% and 1.32%, respectively. The Russell 2000 was the strongest of the major averages, jumping 2.13%.
Sectors: Technology led, gaining 1.46%. Utilities were the only sector to close lower, slipping 0.33%.
Commodities: Crude Oil futures inched higher by 0.24% to $57.91 per barrel. Gold futures fell 0.58% to $1,455 per ounce.
Currencies: The US Dollar Index was flat.
Interest Rates: The US 10-year Treasury yield fell to 1.759%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
— Michael Kahn, CMT (@mnkahn) November 25, 2019
Today’s Chart of the Day was shared on Twitter by Michael Kahn (@mnkahn). It’s a daily bar chart of the Small-Cap Russell 2000 index ETF, $IWM. Michael points out that Small-Caps are breaking out from a key resistance level today. As you can see from the chart, the $160 level has been a brick wall for $IWM. Price tested and failed at this level several times this year. $IWM is still trading about 6% below the all-time high that it made in August 2018; however, today’s breakout is a big win for the bulls. Small-Caps spent the majority of 2019 underperforming their Large-Cap peers. This underperformance became a significant part of the bear case for US equities. Bulls typically want to see Small-Caps leading as it demonstrates risk-appetitie among investors. There’s not much resistance for $IWM until it reaches the former highs around $170-173. Last month, we highlighted the fact that Small-Caps tend to pick-up strength around this time of year. It seems as though the stars are aligned for Small-Caps to head higher in the near-term.
Quote of the Day
“Outstanding people have one thing in common: an absolute sense of mission.”
– Zig Ziglar (Motivational Speaker)
Small Caps Break Out to New High for the Year in Positive Sign for the Whole Stock Market – CNBC
In this piece, several respected Technical Analysts share their thoughts on today’s breakout in the Russell 2000 index.
History Says Improving Stock Market Sentiment Can Be Bullish – Chris Ciovacco
As stocks move higher, some are worried that sentiment has improved too quickly. Chris Ciovacco uses historical data to show that improving sentiment can be constructive.
Huge Underperformance of Consumer Discretionary – Bespoke
Here’s a short note from Bespoke, where they discuss the recent weakness of the Consumer Discretionary sector.
Big Banks Hold Big Breakouts and this Laggard May Play Catchup – StockCharts.com
Arthur Hill of StockCharts.com takes a look at some of the big bank stocks, including; $BAC, $C, and $GS.
Market and Sector Trend Summary – Baird
In this research note from Baird, they analyze the relative strength, momentum, and breadth of all 11 sectors of the S&P 500.
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Top 10 Tweets
That upside push in the final minutes takes the S&P 500 YTD price gain to precisely 25.00%.
One might ask why, but this now seems a market where the answer is "Why not?" pic.twitter.com/W6HNlsBu1G
— Michael Santoli (@michaelsantoli) November 25, 2019
Technical work continues to improve for the Russell 2000 and it’s this close to breaking out above its May 2019 high.
We like that our momentum indicator for it (bottom panel) is now in positive territory. pic.twitter.com/UKpFJOXAYc
— Wolfe Daily Howl (@WolfeDailyHowl) November 25, 2019
— TomAspray (@TomAspray) November 25, 2019
— Willie Delwiche (@WillieDelwiche) November 25, 2019
— Strategas (@StrategasRP) November 25, 2019
This would be the first VIX close with an 11 handle since the day Powell said "long way from neutral" pic.twitter.com/43ZxqLb0Dm
— Luke Kawa (@LJKawa) November 25, 2019
The past 7 years have seen minimal realized volatility during Thanksgiving week, ex 2018 and 2012. Our options team expects this year to mirror the 2013-2017 range where the SPX was fairly quiet. To benefit from the status quo, we suggest buying the $VXX Nov29th 16.5 puts for .26 pic.twitter.com/vHqQwpKpfC
— Cornerstone Macro (@csm_research) November 25, 2019
— Peter Brandt (@PeterLBrandt) November 25, 2019
As I posted last week, I think the 5-yr trend line in #bitcoin from 2015 is key. Bulls really want to see it hold, and thus far it has. But the Maginot line for bulls is the 200 week moving average (in red) at ~$5,000, imo. It has always held. $BTC #XBT #crypto pic.twitter.com/MBGxtar8B3
— Tarek I. Saab (@FibLines) November 25, 2019
One of the misunderstood aspects of investing is how big big-caps are.
The largest 5% of the Russell 3000 comprises 64% of its value.
The smallest 50% makes up about 2.5% of the index.
— Eddy Elfenbein (@EddyElfenbein) November 25, 2019
You’re all caught up now. Thanks for reading!