NASDAQ Composite (.IXIC) closes above 9,000 for first time as rally rolls on
Stocks ended higher Thursday, hitting record highs as the market rallied into the end of 2019.
The Dow closed 105 points higher, while the S&P 500 climbed 0.5%. The Nasdaq finished about 9,000 for the first time, rising nearly 0.8% to 9,022.
The three major averages all hit new all-time highs. Amazon led the gains, jumping more than 4% after the e-commerce giant said the holiday shopping season broke all records. Trading volumes remained thin this week.
Stocks have been piling up records as the market wraps up 2019. The S&P 500 has risen 3% this month and 8.6% this quarter, bringing the year-to-date gains to 29%. The benchmark has a good chance at scoring a historic year: It is now less than 1 percentage point from posting the best annual performance since 1997.
U.S. weekly jobless claims decreased 13,000 to a seasonally adjusted 222,000 for the week ended Dec. 21, the Labor Department said Thursday. The number is slightly higher than estimates of 220,000 in a Dow Jones poll of economists.
Markets in Europe, Australia and Hong Kong remained closed Thursday for the holiday. Trading volumes were muted in the U.S. with the SPDR S&P 500 ETF Trust (SPY) trading about 23.5 million shares Thursday, well below its 30-day volume average of 60 million shares.
In a shortened Christmas Eve session Tuesday, the S&P 500 finished flat and the Nasdaq rose to another record. The tech-heavy index also posted its ninth consecutive record close for the first time since 1998.
Investors have been adding more risk after the U.S. and China announced they have reached a phase one trade agreement earlier this month. The two countries are in the process of translating the deal, aiming to sign it in early January.
In a regular press briefing on Thursday, the Chinese Commerce Ministry said China is in close touch with the U.S. on signing the initial trade pact. President Donald Trump said Tuesday the deal is “getting done,” adding there will be a signing ceremony with Chinese leader Xi Jinping.
Stocks typically get a boost this time of the year during the so-called Santa Claus rally period. In the final five trading days of the year and the first two tradings days of the new year, the S&P 500 has posted a 1.3% gain on average since 1950, according to the Stock Trader’s Almanac. This year’s period began Tuesday.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
By the way, prices are vulnerable to a correction towards 8,604.37.
The projected upper bound is: 9,175.24.
The projected lower bound is: 8,904.49.
The projected closing price is: 9,039.86.
A big white candle occurred. This is generally considered bullish, as prices closed significantly higher than they opened. If the candle appears when prices are “low,” it may be the first sign of a bottom. If it occurs when prices are rebounding off of a support area (e.g., a moving average, trendline, or retracement level), the long white candle adds credibility to the support. Similarly, if the candle appears during a breakout above a resistance area, the long white candle adds credibility to the breakout.
During the past 10 bars, there have been 6 white candles and 4 black candles for a net of 2 white candles. During the past 50 bars, there have been 28 white candles and 22 black candles for a net of 6 white candles.
A rising window occurred (where the top of the previous shadow is below the bottom of the current shadow). This usually implies a continuation of a bullish trend. There have been 13 rising windows in the last 50 candles–this makes the current rising window even more bullish.
Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 96.7614. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 17 period(s) ago.
Relative Strength Index (RSI)
The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 80.98. This is where it usually tops. The RSI usually forms tops and bottoms before the underlying security. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 17 period(s) ago.
Commodity Channel Index (CCI)
The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 124.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 17 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 8 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed up 69.507 at 9,022.391. Volume was 27% below average (neutral) and Bollinger Bands were 29% wider than normal.
Open High Low Close Volume___
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 8,865.06 8,523.25 8,091.83
Volatility: 6 10 18
Volume: 642,286,336 548,603,968 554,041,152
Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.
NASDAQ COMPOSITE gapped up today (bullish) on normal volume. Possibility of a Runaway Gap which usually signifies a continuation of the trend. Four types of price gaps exist – Common, Breakaway, Runaway, and Exhaustion. Gaps acts as support/resistance.
NASDAQ COMPOSITE is currently 11.5% above its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect moderate flows of volume into .IXIC (mildly bullish). Our trend forecasting oscillators are currently bullish on .IXIC and have had this outlook for the last 48 periods. Our momentum oscillator is currently indicating that .IXIC is currently in an overbought condition.
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