SGT Chart Book

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Some highlights from last week’s trading activity:

U.S. stocks notched up a winning week, led by the Nasdaq Composite’s best day on Friday in more than five months. The tech-heavy index jumped 2%, its biggest one-day percentage gain since May 26th. The S&P 500 rose 1.6%, and the Dow Jones Industrial Average added 1.2%. All three indexes finished the week higher, with the Nasdaq up 2.4%.

 

Putting some of these moves into perspective, analysts continue to emphasize that the market strength is very narrow, citing performance of the so-called magnificent seven stocks. The S&P500 equal weight index is now down 1.7% YTD, approximately 17% less than the S&P500.

 

Friday’s gains followed a down day on Thursday that put an end to the S&P 500’s shot at its longest winning streak since 2004. The S&P 500 had risen for eight consecutive sessions, while the Nasdaq had recorded nine straight positive trading days.

 

Federal Reserve Chair Jerome Powell on Thursday kept the market on its toes, saying that it was too early to declare victory against price pressures and leaving the door open for further interest-rate increases.

 

A weak government sale of longer-term debt, meanwhile, pushed up bond yields and weighed on stocks.

 

The bond market stabilized on Friday, with the benchmark 10-year Treasury yield settling at 4.62%

 

After Fed officials kept rates unchanged at their policy meeting earlier this month, traders had priced in higher odds that the central bank could start cutting rates early next year. Investors/Traders seem to ignore the University of Michigan’s preliminary November survey results, released Friday, which showed weak consumer sentiment and higher inflation expectations.

 

Late Friday, Moody's Investors Service has downgraded the outlook on the U.S. government's ratings from stable to negative. The Friday decision underscores growing apprehensions about the nation's ability to manage its finances in an environment of escalating interest rates and substantial deficits.

 

Gold was down for the second week off over 3% for the last week.

 

Crypto bulls are back seeing Bitcoin reaching an 18-month high, news of ETF approval helping.

 

Next week on the economic releases will see on Tuesday the announcement of the latest US CPI, the next data point for the Fed and markets to digest.

USA30

We have left in the trendline off Covid lows to illustrate that while the break would expect further selling, failed attempts provided valuable information to chart watchers.

USA100

Break out above the well-defined down channel.

USA500

Testing trendline resistance. On a similar note, the US100 has broken above.

Apple

Breaks the series of lower highs:

US10 YEAR

Consolidation seen after the previous week’s aggressive sell off.

DXY

The chart shows the yearly range. All eyes on US interest rates…

EURUSD

The hourly chart showing some short-term levels to watch.

USDYEN

Up channel to watch, the BOJ could make traders nervous at these levels.

GOLD

Gold doesn’t seem to like it above $2,000, as we head back to the breakout levels. Still have to remember that it was trading just above $1,800 before the attacks on Israel.

USOIL

Oil closed the week below the October gap after the terrorist attacks on Israel. Interesting trendline resistance capped the upside.

BTCUSD

The rally in BTC continues with a test of $38k.

Until next week, happy trading.
SGT Trade Desk

Disclaimer: Trading Desk Observations are not trade recommendations. The purpose of these charts is to bring to your attention potential chart patterns you may wish to monitor.

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