SGT Chart Book

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Highlights From Last Week:

  • Markets continue to watch the growing geopolitical tensions in the Middle East.
  • The yield on the 10-year Treasury note breached 5% for the first time in 16 years in on Monday before settling at 4.846% on Friday.
  • Bonds and yields are in the driver’s seat right now for markets,” said one technical strategist.
  • The sharp move up in bond yields has triggered volatility across the markets. The S&P 500 and Dow Jones Industrial Average are on track to finish October with three consecutive months of losses, the worst such stretch since the three months ending March 2020.
  • The week also saw big swings in technology to the oil giants. Shares of companies that investors cheered for much of the year—and that had sent major indexes soaring—were particularly hard-hit.
  • Rising bond yields have been painful for some of the smallest stocks in the market. The Russell 2000 index of small companies slumped 2.6% for the week and closed at its lowest level since November 2020.
  • The S&P 500’s gains for the year stand at 7.2%, down from the near 20% advance the index in the summer.

Releases of Data:

In addition to US corporate earnings, two significant pieces of economic data highlighted the strength of the U.S. economy: Gross domestic product (GDP) grew at a 4.9% annual rate in the third quarter, double the second quarter’s number and the personal-consumption expenditures price index, the Fed’s preferred inflation gauge, rose 0.4% in September from the prior month, the same pace as in August.

Next week, we get the latest jobs report. Some investors said that more positive news on the economy might be bad news for investors concerned about interest rates, and how long they will stay elevated. FOMC also is in the calendar this coming Wednesday.

USA30

Break below the uptrend line extending from 2020 Covid lows.

USA100

Breach of trendline support:

USD500

Breach below the trendline support of the recent rally opens up the downside for testing of longer-term support around 4020.

US10YEAR

After making new highs above 5%, market saw aggressive selling. Trendline support to be watched carefully.

Gold

Aggressive rally after breaking trendline resistance saw mild pull-back before closing out the week above $2,000 per ounce. We had no idea our $1,800 buy zone would provide for a $200 rally.

DXY

Seeing a pullback in the $ index to trendline support. Many comments suggesting the USD$ should be higher based on the fundamentals of the markets.

USOIL

The chart below focuses on the hourly price movements since the initial attacks.

BTCUSD

BTC benefits from the latest turmoil reaching above $35,000.

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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