Commentary: Paul Ebeling on Wall Street, Stocks Soaring on Positive Vaccine News from Moderna

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The Dow Jones Industrial Average is soaring after Moderna (NASDAQ:MRNA) announced that its COVID vaccine has a 94%+ efficacy rate, and President Trump refuses to concede, there is no President-elect. Sunday, President Trump announced that it will do whatever it takes to make America Great again, as 10’s of thousands of supporters flooded Washington DC and marched in his favor. The world is taking notice.

Moderna Inc, a part of President Trump’s Operation Warp Speed, said Monday its experimental vaccine was 94.5% effective in preventing COVID based on interim data from a late-stage clinical trial, becoming the 2nd US company in a wk to report results that far exceed expectations, the stock is running, as are the futures at this writing.

Last week’s action

Tech stocks showed relative strength. The specter of another lockdown was blamed for the market’s weakness Thursday, but this is a consolidation of the strong gains. America can function until a vaccine is out without needing to resort to lockdowns. History has shown that to be the case.

The indices are working through a consolidation of the last leg North to test the old highs, the back-and-fill action is the market sets up the next move North as we saw Friday with all time highs marked.

The NASDAQ technicals

The NAS’ movement is a mix of the PHLX Semiconductor Sector (SOX) and the S&P 500, it is working laterally at the Top end of its 3-month range. After the opening surge last Monday faded, there was a test of the 10-Day EMA. Now, it is working laterally and trying to put together a higher low and move up. While the NAS has the makings of that move, it is having a hard time getting traction, due to the fact that some of the mega-caps are unable to put together a move that holds. 

What to expect this week

More political show this wk as bombs are expected to be dropped on the alleged election fraud in the battleground states. That analysts predict will confirm President Trump’s election victory and confirm him President-elect.

Value, cyclical, and small-cap stocks are taking the lead, the S&P 500 and Russell 2000 extending the record closes of Friday, while many of the stay-at-home stocks have slipped lower.

In addition, longer-dated Treasury yields have edged higher on the hope that a vaccine will improve economic growth prospects in Y 2021. 

HeffX-LTN’s overall technical analysis of the benchmark US stock market indexes is Bullish with a Very Bullish for the wk beginning 16 November 2020.

Monday’s economic data will be limited to the Empire State Manufacturing Survey for November (consensus 14.0) at 8:30a ET. 

This is a very volatile market, so pay attention, it is your money, so your responsibility. And always take what the market gives.

Have a healthy week, Keep the Faith!

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