Stock Market Outlook Turns Cautious As Bears Re-Emerge

The S&P 500 Index fell by 0.30% on Tuesday, as any chance for a stimulus package approval before the election was effectively shut down. Market breadth outside of technology-oriented stocks has been weak; 76% of the stocks in the S&P 500 finished lower on Tuesday.

The NASDAQ Composite bucked recent market weakness and rallied by 0.64% on Tuesday; FAANG stocks all closed higher.

The Dow Jones Industrial Average has a bearish intermediate posture and closed well below its falling 30-day moving average.

Despite the bearish intermediate postures in the other indices, the Russell 2000 is clinging to a Bullish Intermediate Confirmation signal.

Foreign bonds and emerging markets stocks are some of the strongest areas among the various asset classes; REITs are struggling.

Stock Market Video – News, Analysis & Insights for October 28th

China and India are carrying the strength in emerging markets; many European stock markets (ie: Germany, France, Italy) are very weak within developed markets.

Our trade application example featured selling a bull put spread on Apple Inc (AAPL) due to its bullish Near-Term Divergence; they report earnings in a couple days so this trade was intentionally set up with defined risk in case bad news trumps the technical set-up.

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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