NASDAQ Composite (.IXIC) higher as hopes of a U.S.-China trade deal and an improving domestic economy boosted risk appetite

NASDAQ Composite (.IXIC) higher as hopes of a U.S.-China trade deal and an improving domestic economy boosted risk appetite

NASDAQ Composite (.IXIC) higher as hopes of a U.S.-China trade deal and an improving domestic economy boosted risk appetite

Technology stocks pushed Wall Street’s three main indexes to record highs on Monday, as hopes of a U.S.-China trade deal and an improving domestic economy boosted risk appetite.

Washington and Beijing said on Friday they had made progress in defusing an economically damaging trade war, with U.S. officials indicating that a deal could be signed this month.

Adding to the upbeat mood, Commerce Secretary Wilbur Ross said on Sunday licenses for U.S. companies to sell components to China’s Huawei Technologies Co would come “very shortly”.

Eight of the 11 major S&P 500 sectors were higher, with the energy sector .SPNY gaining the most as oil prices rose, while technology shares .SPLRCT provided the biggest boost on the back of a rally in trade-sensitive chip stocks.

Investors also took comfort from data on Friday that showed U.S. jobs growth slowed less than expected in October.

A report on Monday, however, showed new orders for U.S.-made goods fell more than expected in September and business spending on equipment was slightly weaker than initially thought, suggesting that manufacturing remains soft amid the ongoing trade war.

At 10:11 a.m. ET the Dow Jones Industrial Average .DJI was up 131.44 points, or 0.48%, at 27,478.80, the S&P 500 .SPX was up 13.58 points, or 0.44%, at 3,080.49 and the Nasdaq Composite .IXIC was up 44.55 points, or 0.53%, at 8,430.95.

Technical Indicators

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 8,088.57.

The projected upper bound is: 8,654.57.

The projected lower bound is: 8,239.08.

The projected closing price is: 8,446.83.

Candlesticks

A black body occurred (because prices closed lower than they opened).
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 10 rising windows in the last 50 candles–this makes the current rising window even more bullish.

Momentum Indicators

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.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 88.5627. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 2 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 67.50. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 107 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 154.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 11 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 16 period(s) ago.

Rex Takasugi – TD Profile

NASDAQ COMPOSITE closed up 46.802 at 8,433.200. Volume was 3% above average (neutral) and Bollinger Bands were 24% wider than normal.

Open     High      Low     Close     Volume___
8,445.5048,451.3718,421.2958,433.200 555,693,120
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 8,267.18 8,077.41 7,866.60
Volatility: 12 17 19
Volume: 499,084,064 522,280,032 555,241,792

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.

Summary

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 7.2% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect volume flowing into and out of .IXIC at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on .IXIC and have had this outlook for the last 12 periods.

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