OF DOW JONES INDUSTRIAL AVERAGE REQUIRES INTERM TEST AT 25,982 TO MAINTAIN UPSIDE. https://www.northridge123456.com/post/greenmark-101-flashed-third-buy-signal-of-dow-jones-industrial-average-on-april-23-2020-and
MORNING TICKS Major advance this morning from earnings reactions, Gilead noise, a Fed meeting, and month-end "window-dressing." Futures bid nearly 3.1 % higher that will have the Major Indices gapping up over yesterday's highs. Take note that the Nasdaq, with its Technology, Communications, and Healthcare weighted components, lagged the last two sessions. In fact, it managed to log an "outside" reversal day that can lead to a further slow down in momentum. Of course, strong earnings reactions from GOOG, GOOGL, MA, BA, and number of others are helping boost the market higher this morning.
The IWM Small Caps and MDY MidCaps have been emerging with relative strength this week. Perhaps some rotation out of the large cap names that have rallied strongly during the last few weeks and into lower tiered stocks to play "catch-up" is in play as April's month-end nears. A classic case of "a rising tide lifts all boats" scenario as portfolio managers come off the sidelines and seek out investments.
Crude is capturing a bid this morning. Lots of pessimism surrounding this commodity, yet the Energy stocks themselves exude relative strength. While crude itself will continue to struggle as long as it remains below $20, the improvements in Energy are worth noting during "oversupply/low demand" conditions.
Safe-haven Gold continues to hold up along its April range highs as the market remains uncertain and nervous. Key support along the 1650/1700 zone for now.
Bond Yields are still in a narrowing range the last few weeks. The Fed is expected to do nothing with rates and highlight the effects of their actions over the last few weeks to deal with the pandemic and economic slowdown. The US Dollar also is in a narrow range the last few weeks.
Note the VIX has been sliding back below 40 as of late, hinting that some stability is returning to the market. However, the historical "bull market" norm for this indicator is when it is below 20-25, so we are not out of the woods yet. A cautious "managed risk" approach is still prudent. Sentiment has been running quite negative the last few weeks, yet equities have been on the rise. Some money is being forced to come in off the sideline and put to work in this rally, especially as month-end "window-dressing" takes hold.
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