Mid-Week Market Outlook: Late January Hiccup, Then Higher

Brandon Van Zee

The S&P 500 (NYSEARCA: SPY) fell 1.42% today traders displayed negative sentiment regarding the China/U.S. trade skirmish resolution.

There was also a largely negative tone from some high profile financial influencers at the Davos World Economic Forum.

All four major U.S. stock market indices fell today but they all continue to have strongly bullish Market Forecast intermediate postures and “3 Green Arrows” signals using daily candles.

All four major stock market indices currently have bearish crossovers on the 10-40 weekly exponential moving average chart, but the 10 week exponential moving average has been curling higher recently.

The VIX Volatility Index (INDEXCBOE: VIX) was up nearly 17% today; that was its biggest daily increase of 2019 and reminds traders that fear can creep up at any given time.

Gold (NYSEARCA: GLD) was up today and remains above a rising 30 day moving average.

Mid-Week Stock Market Video – January 22, 2019

 

Some additional insights from today’s stock market outlook video:

  • Most major foreign stock markets continue to have bullish intermediate postures, but they largely fell in price today with some of the bigger losers being Australia, Brazil, and China
  • All U.S. sectors have a bullish intermediate posture, but the Utilities were the only sector positive today, once again highlighting that sector’s usefulness on a risk-off type of day
  • According to the Sector Selector, the Technology sector’s ranking has trended up in the last three weeks and is now sitting with its highest ranking (3rd) over the last 3 months
  • Our trade application example focuses on that improving Technology sector with a bull put spread on Broadcom (AVGO), which has shown relative strength versus the general market since late October

 

Get market insights, stock trading ideas, and educational instruction over at the Market Scholars website.

Twitter:  @BrandonVanZee and @Market_Scholars 

Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.

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