NASDAQ Composite (.IXIC) – US stocks end lower on virus fears, Dow down 1%, Nasdaq falls 1.9%
Wall Street stocks tumbled again on Friday (March 6), with petroleum producers and banks falling especially hard, as worries over the coronavirus overshadowed a strong US jobs report.
The Dow Jones Industrial Average finished well above session lows, but still lost 1 per cent 25,864.78.
The broad-based S&P 500 dropped 2,972.37, while the tech-rich Nasdaq Composite Index shed 1.9 per cent to 8,575.62.
Traders essentially ignored strong US jobs data for February, viewing the report as outdated and not representative of an economy now pressured by worries that include supply chain disruption in China, a contraction of global travel and anxiety that fear of illness will stifle the consumer-driven US economy.
Demand remained elevated for secure assets such as bonds, with the yield on the 10-year US Treasury note falling to a fresh all-time low.
Dow member Exxon Mobil slumped 4.8 per cent, while mid-sized oil producers such as Devon Energy and Apache plummeted 15 per cent or more.
Large banks such as Bank of America, Wells Fargo and JPMorgan Chase lost 4 per cent or more as investors anticipated additional stimulus moves by the Federal Reserve following this week’s surprise interest rate cut.
The beaten-down travel and tourism sector had a mixed day, with cruise ship giant Carnival down 2.6 per cent, but United Airlines and Marriott International both finishing higher.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
The projected upper bound is: 8,438.60.
The projected lower bound is: 7,422.66.
The projected closing price is: 7,930.63.
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 29 white candles and 21 black candles for a net of 8 white candles.
A falling window occurred (where the bottom of the previous shadow is above the top of the current shadow). This usually implies a continuation of a bearish trend. There have been 5 falling windows in the last 50 candles–this makes the current falling window even more bearish.
A long upper shadow occurred. This is typically a bearish signal (particularly when it occurs near a high price level, at resistance level, or when the security is overbought).
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 25.9627. This is not an overbought or oversold reading. The last signal was a buy 5 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 28.52. This is where it usually bottoms. 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 buy 5 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 -159.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 5 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 11 period(s) ago.
Rex Takasugi – TD Profile
NASDAQ COMPOSITE closed down -624.942 at 7,950.676. Volume was 90% above average (neutral) and Bollinger Bands were 242% wider than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 8,699.95 9,214.51 8,417.85
Volatility: 67 37 24
Volume: 1,055,965,952 687,526,528 586,879,808
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 down today (bearish) 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 5.5% below its 200-period moving average and is in an downward trend. Volatility is extremely high when compared to the average volatility over the last 10 periods. There is a good possibility that volatility will decrease and prices will stabilize in the near term. Our volume indicators reflect moderate flows of volume out of .IXIC (mildly bearish). Our trend forecasting oscillators are currently bearish on .IXIC and have had this outlook for the last 9 periods. Our momentum oscillator is currently indicating that .IXIC is currently in an oversold condition. The security price has set a new 14-period low while our momentum oscillator has not. This is a bullish divergence.