Stocks gave up early gains and had a disappointing close to Tuesday’s trading session. A lack of follow-through buying when the indexes need it most continues to hold the stock market back.
The S&P 500 Index fell by -0.22% on Tuesday but continues to have a strongly bullish intermediate posture. The Dow Jones Industrial Average has a weakly bullish intermediate posture and is trading above a rising 30 day moving average
Both the S&P 500 and Dow Jones Industrial Average have bullish intermediate confirmation signals; however, neither one is considered to be an ideal set-up.
The NASDAQ Composite fell -0.03% and it still has a weakly bullish intermediate posture. The Nasdaq is looking quite precarious just underneath its falling 30 day moving average.
The Russell 2000 fell 0.97% and has a strongly bearish posture; the index rejected the falling 30 day moving average and engulfed the previous two candles as it closed near the lows.
The U.S. Dollar continues to weaken (-0.12%), which has helped push gold (+0.91%) to new multi-month highs with its strongly bullish intermediate posture.
Interest rates fell strongly to their support level from a couple weeks ago; Long-Term U.S. Treasuries closed higher by 0.93% and feature a weakly bullish posture.
Bitcoin rose 2%, an inconsequential amount for that speculative asset; although it now has a weakly bullish posture, $47,000 remains a strong resistance level.
After a long period of outperformance, Materials now have a weakly bearish posture (yet remain well above a rising 30 day moving average).
Real Estate (+0.28%) hit an all-time intraday high; this is quite the accomplishment considering the extreme challenges the COVID pandemic created for the sector.
Our trade application example featured selling a bear call spread on the Russell 2000 ETF (IWM) due a rejection of the falling 30 day moving average, a bearish engulfing pattern, a bearish near-term divergence signal, and an intermediate posture shift back to strongly bearish
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Stock Market Outlook Video – News, Analysis, & Insights – May 26
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.
