NASDAQ Composite (.IXIC) investors digest Fed comments
U.S. stocks eased further from recent record highs on Thursday as energy shares dropped along with oil prices and investors continued to digest comments by Federal Reserve Chairman Jerome Powell.
The energy index was down the most among the major S&P sectors, falling 1.71% and extending its recent slide. U.S. oil prices slid more than 2 percent on fears of oversupply.
Powell’s comments on Wednesday that a decline in inflation this year could be due to transitory factors dampened some investors’ hopes that the U.S. central bank could move later this year to cut interest rates, market watchers said.
Traders lowered their bets on a rate cut this year following Powell’s comments, and stocks fell, but many investors said the Fed’s stance makes sense.
“I don’t think reasonable investors are looking for a rate cut at this moment. And the good economic conditions don’t necessarily point to a rate hike either,” Forrest said.
The S&P 500’s recent run to record highs also may be giving investors reasons to pause.
Stocks have “done extremely well and pockets of the market are overdone,” said Quincy Krosby, chief market strategist at Prudential Financial in Newark, New Jersey. “Usually when the market moves that quickly, a little bit of caution comes in.”
The index has rallied more than 16 percent this year and is entering a period of the year traditionally known as being difficult for equities over the next six months.
On the day, the Dow Jones Industrial Average fell 122.35 points, or 0.46%, to 26,307.79, the S&P 500 lost 6.21 points, or 0.21%, to 2,917.52, and the Nasdaq Composite dropped 12.87 points, or 0.16%, to 8,036.77.
Declining issues outnumbered advancing ones on the NYSE by a 1.43-to-1 ratio; on Nasdaq, a 1.05-to-1 ratio favored advancers.
Overall, the bias in prices is: Upwards.
The projected upper bound is: 8,212.06.
The projected lower bound is: 7,883.39.
The projected closing price is: 8,047.73.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 26 white candles and 24 black candles for a net of 2 white candles.
A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
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 23.4716. This is not an overbought or oversold reading. 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 58.94. 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 sell 2 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 -20. This is not a topping or bottoming area. The last signal was a sell 2 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 sell 1 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed down -12.868 at 8,036.772. Volume was 7% below average (neutral) and Bollinger Bands were 49% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 8,084.49 7,787.49 7,527.79
Volatility: 10 14 25
Volume: 521,285,184 570,703,744 576,704,128
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 is currently 6.8% 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 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 78 periods. our momentum oscillator has set a new 14-period low while the security price has not. This is a bearish divergence.
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