Stock Market Indicators Improve As Buyers Return

The S&P 500 Index rallied strongly for the second straight day on Tuesday, as much of the COVID Omicron variant news subsided over the weekend. The 2.07% move in the S&P 500 was the second best day of the past year (the best day since March 1st); 86% of index components closed higher.

The S&P 500 now has a weakly bullish posture for the first time this month and is trading back above its rising 30 day moving average.

The robust move was not isolated to the S&P 500, however. In fact, speculative growth stocks led today’s rally even more than staid blue chips.

The NASDAQ Composite was up 3.03% and it now has a weakly bullish intermediate posture and is trading above its rising 30 day moving average. The Dow Jones Industrial Average was today’s laggard (+1.4%), but it too now has a weakly bullish intermediate posture (despite a falling 30 day moving average).

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The Russell 2000 was up 2.28%, but due to extreme recent selling, it continues to have a strongly bearish posture and is underperforming other indices.

Long-term U.S. Treasuries fell 0.81% as money moved from bonds back to stocks; despite the two-day set-back, strongly bullish postures still persist. The 10-Year Treasury Yield rallied to 1.48%; while they are now well off of Friday’s lows, the chart still features a strongly bearish posture.

The U.S. Dollar (+0.04%) was effectively flat on Tuesday, so we didn’t see major movement out of gold (+0.35%). Oil has been a bit more aggressive in the past week; it closed higher by 2% today and has been up 3 of the 4 days since its oversold cluster signal.

Our trade application example featured buying stock in Clearway Energy (CWEN) as a bullish bounce swing trade due to it bouncing up and off its rising 30 day moving average and its Near-Term posture shifting back to bullish.

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

Stock Market Outlook Video (for December 8) – News and Analysis

Twitter:  @BrandonVanZee and @MarketScholars

The author may have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author and do not represent the views or opinions of any other person or entity.