Stock Market Outlook Brightens on Persistent Buying

The S&P 500 rallied 1.61% and proved out the theory that the day after the tax filing deadline has tended to be more bullish than bearish over the years.

It was a broad-based rally with 88% of its components closing in the green; Energy stocks were the only major group to sit out Tuesday’s bullish party. With the advance, the S&P 500 intermediate posture is back to strongly bullish and its trading above its rising 30 day moving average.

All four major U.S. stock market indices had an aggressive, above-average range day with persistent buying throughout the session.

The Dow Jones Industrials bounced higher by 1.45%; it is also back to a strongly bullish intermediate posture and trading above its rising 30 day moving average.

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The NASDAQ Composite was Tuesday’s biggest winner (+2.15%), but it remains below its rising 30 day moving average and has just a weakly bullish posture. The Russell 2000 rallied 2.04%; it has a weakly bullish posture and is trading below its rising 30 day moving average.

The U.S. 10-Year Treasury yield rallied to multi-year highs and closed at 2.91%; it continues to have a strongly bullish intermediate posture. Long term U.S. Treasuries fell to multi-year lows and closed with yet another oversold cluster (daily, weekly, and monthly).

The U.S. Dollar rallied 0.22%; it has had just one down day in the last 13 trading sessions and is considered strongly bullish.

Gold fell a fairly aggressive 1.51%; not only did that move its posture to bearish, but it is now trading below a falling 30 day moving average. Oil struggled today as well (-4.41%); but it continues to hang on to its bullish posture and is a hair above its falling 30 day moving average.

Bitcoin benefitted from the “risk-on” mindset of Tuesday’s rally; it closed above $41,000 and has a weakly bullish posture.

Energy continues to be at the top of the Sector Selector rankings, but it was the only sector that closed lower today (-0.81%).

Tuesday’s best sector was Consumer Discretionary (+2.90%), led by strength in Amazon and Tesla.

The Communications sector rallied 1.99% on Tuesday, but it is expected to be under pressure Wednesday due to Netflix’s abysmal earnings release afterhours.

All sectors except Financials and Health Care have a bullish intermediate posture according to the Market Forecast technical indicator.

Our trade application example featured buying shares of Lindsay Corp (LNN) as a bullish swing trade due bouncing up and off its rising 30 day moving average, which has resulted in bullish Near-Term and Intermediate postures.

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

Stock Market Outlook Video (for April 20) – 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.