Weak open, weak close, everything else was fine
by
, 11-30-2016 at 01:33 AM (1111 Views)
Stocks opened lower on Tuesday but caught a bid early, and despite a late fade, held onto to modest gains. The Dow added 24-points while the Nasdaq led, but the Nasdaq gave back about 2/3 of its midday gains by the close.
The catalyst today may be the OPEC meeting where a decision on their production deal may be revealed. Oil has been pulling back as the meeting date approached, and the chart has been deteriorating since the peak in October. Will we see a "buy the news" reaction after the recent "sell the rumor" decline?
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The November jobs report is being released this Friday morning and estimates are looking for a gain of 180,000 jobs and the unemployment rate to remain 4.9%.
Sorry about the downtime yesterday, and possibly more later today. I have had the techs avoiding working on the servers during IFT trading hours, so if there is any more downtime today it will be after the IFT deadline. Unfortunately when you update, upgrade, or enhance, you tend to get days of setbacks, downtime, and frustration.
The SPY (S&P 500 / C-fund) pushed lower early on Tuesday but bounced back, however it made a lower high and a lower low for a second straight day. There's nothing wrong with a 2 to 3 day dip in a bull market, and if this chart wants to pullback to test the prior horizontal resistance line, the dip could look to test the 218 area. After that support gets thinner.
Ditto for the DWCPF (small caps / S-fund) which was flat, but it also has an open gap that could look to get filled if the rally doesn't resume.
The EFA (I-fund) had a solid day as the dollar has pulled back slightly in recent days. I mentioned the 50-day EMA getting close to crossing below the 200-day yesterday. It's just a penny apart now but sometimes when the 50 falls below the 200, you get a short-term relief rally that eventually fails. We saw that last year in August into September.
The weekly chart of the SPY has not yet been able to get above some key resistance levels, which makes for a good place for a pullback, but the closer we get to mid-December, the less the bears will put up a fight.
The AGG (bonds / F-fund) rallied again as we may be seeing the dead-cat bounce that we've been waiting for. The only question is whether the open gaps have a chance to get filled. This chart is broken but sometimes bear market rallies can be pretty strong.
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Thanks for reading. We'll see you back here tomorrow.
Tom Crowley
Posted daily at TSP Talk - Market Commentary
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