Stock Market Rallies But Bulls Have Hurdles To Clear

The S&P 500 Index rallied 0.84% on Tuesday while closing near the highs of the day. As well, oil prices finally cooled off and key earnings reports were positively embraced.

Despite the decent day, the Market Forecast intermediate posture is still strongly bearish on the S&P 500 (and the 30 day moving average is falling).

All four major U.S. stock market indices are trading below their falling 30 day moving averages.

The Dow Jones Industrial Average is the only major stock market index with a strongly bullish intermediate posture (all others are still strongly bearish).

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The Russell 2000 was the Tuesday’s biggest gainer (+1.63%), but it also has the weakest intermediate reading (the faster they fall, the sharper they bounce).

The NASDAQ Composite rallied 1.28% and closed with a bullish engulfing candle, but still has a strongly bearish intermediate posture.

Long-Term U.S. Treasuries fell in response to rates; they continue to have a bearish posture, but produced their third straight oversold cluster signal.

Oil cooled off while gold rose 0.31%; both continue to have bullish intermediate postures and are trading above rising 30 day moving averages.

Bitcoin has had a very nice bounce over the past few sessions; it’s back to a weakly bullish intermediate posture and is trading above its falling 30 DMA.

Financials moved up to second place in the rankings of the Sector Selector; Discretionary replaced Technology at the bottom of the rankings. Financials and Staples continue to look relatively strong and are the only other two sectors with strongly bullish intermediate postures.

Energy continues to be the strongest sector from an intermediate perspective, despite being the worst performer today (-2.15%).

Our trade application example featured selling a cash-secured put on Clorox (CLX) due to it being back to a historically-attractive dividend yield zone after its stock price had one of its worst days in its history after reporting earnings last week.

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

Stock Market Outlook Video (for February 9) – 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.