stock market

Market News

S&P 500 Futures Show No Signs of Recovery, Extend Three-Month Low

/ September 25, 2023

Monday morning witnessed a shift in U.S. stock futures‘ fortunes as they relinquished their early gains. Here’s a concise breakdown of the events: To recap Friday’s performance, the Dow Jones Industrial Average (DJIA) recorded a loss of 107 points, equating to a 0.31% decline, landing at 33,964. The S&P 500 (SPX) also experienced a decline of 10 points, equivalent to a 0.23% drop, reaching 4,320, while the Nasdaq Composite (COMP) registered a 12-point fall, or 0.09%, closing at 13,212. Last week painted a bleak picture for the S&P 500, as it recorded a 2.9% decrease, marking its worst week since the period ending March 10 and hitting its lowest level since June 9. Monday’s market lacked significant catalysts; however, the tentative resolution of a writers’ strike provided a boost to media companies like Paramount Global (PARA, -4.96%) and Netflix (NFLX, -1.13%) during premarket trading. Additionally, President Joe Biden announced plans to show support for the United Auto Workers strike against the Big Three automakers during his visit to Michigan. Nonetheless, the primary narrative in recent times has been the rapid ascent of long-term interest rates. Technical strategists at Bank of America noted that while they lack conclusive evidence that the upward movement in the 10-year yield is complete, it is beginning to appear stretched. The yield on the 10-year Treasury (BX:TMUBMUSD10Y) increased by 5 basis points to 4.49%. China’s housing crisis returned to the spotlight, with Evergrande (3333, -21.82%) shares plummeting as the company abandoned a $35 billion debt restructuring plan. Additionally, shares of China Aoyuan Group experienced a sharp decline on Monday, marking their first day of trading in over a year. In Hong Kong trade, the Hang Seng (HK:HSI) skidded 1.8%. John PaulJohn Paul is the founder of DayTradeToWin, a trading education and software company established in 2008, supporting traders worldwide. His expertise focuses on price action-based futures trading strategies and structured market analysis. DayTradeToWin delivers trading education, indicators, and software tools designed to help traders apply disciplined, rule-based decision-making across global futures markets. He is the creator of multiple trading methodologies, including the Sonic System, Atlas Line, and Trade Scalper, which help traders identify structured opportunities in markets such as the E-mini S&P 500 (ES), Nasdaq (NQ), crude oil (CL), and gold (GC). Official website: https://daytradetowin.com daytradetowin.com

Market News

Dollar’s Recent ‘Golden Cross’ Spells Trouble for Stock Traders

/ September 23, 2023

The U.S. Dollar Extends Its Winning Streak for the 10th Week in a Row, the Longest Since 2014 In a significant development, the U.S. dollar has achieved its first “golden cross” since July 2021, raising the possibility of further upward momentum and potential challenges for the stock market. As we approach the end of the week, the 50-day moving average of the ICE U.S. Dollar Index (DXY), a key measure of the dollar’s strength against a basket of major currencies, with a strong emphasis on the euro, stands at 103.15. Notably, this surpasses the 200-day moving average, which registers at 103.11. The index itself concluded the week at 105.56, reaching its highest level since March 10, 2023, a day that witnessed the collapse of Silicon Valley Bank, triggering a brief surge in safe-haven assets like the dollar. Over the course of the week, it edged up by 0.2%, marking its 10th consecutive weekly gain, a streak not seen since the 12-week run ending in October 2014. The “golden cross” formation materialized when the 50-day moving average closed above the 200-day moving average, a widely recognized signal among technical analysts that often implies an emerging trend in a particular direction. Conversely, a “death cross” occurs when the 50-day moving average crosses below the 200-day moving average. In the case of the U.S. dollar, a “death cross” occurred on January 10. Subsequently, the dollar trended downward for the following six months, ultimately hitting its lowest point in 2023 on July 14. Since then, it has been on a sustained uptrend, a trajectory that some currency experts believe has the potential to continue, especially after the Federal Reserve revised its interest rate forecasts to remain above 5% through 2024. Based on analysis by Dow Jones Market Data, following a golden cross, the dollar typically continues to rise during the subsequent three months, posting an average gain of 1.9% and trading higher approximately 79.2% of the time. Performance becomes more mixed over a one-year horizon, with the dollar trading higher 58.3% of the time and averaging a gain of 1.5%. Drawing from a previous golden cross on July 29, 2021, the dollar index surged by approximately 25%, advancing from around 91 to nearly 115 in late September 2022, when it reached its highest level in two decades, according to FactSet data. However, some analysts have issued caution about the dollar’s ascent, particularly in conjunction with rising Treasury yields, which could pose additional challenges for the stock market. On Thursday, the S&P 500 experienced a drop of more than 1.6%, marking its most substantial single-day decline since March 22, as reported by Dow Jones Market Data. Jeffrey deGraaf, a technical strategist at Renaissance Macro Research, remarked in a note to clients, “A new cycle high in yields and a golden cross in the dollar are strong headwinds for the market.” John PaulJohn Paul is the founder of DayTradeToWin, a trading education and software company established in 2008, supporting traders worldwide. His expertise focuses on price action-based futures trading strategies and structured market analysis. DayTradeToWin delivers trading education, indicators, and software tools designed to help traders apply disciplined, rule-based decision-making across global futures markets. He is the creator of multiple trading methodologies, including the Sonic System, Atlas Line, and Trade Scalper, which help traders identify structured opportunities in markets such as the E-mini S&P 500 (ES), Nasdaq (NQ), crude oil (CL), and gold (GC). Official website: https://daytradetowin.com daytradetowin.com

Market News

S&P 500 Futures Show Strength Following Fed’s New Rate Stance

/ September 22, 2023

U.S. stock index futures showed mainly positive movements on Friday, which was a change from their previous trend following the Federal Reserve’s recent announcement about a higher interest-rate forecast for the next year, made on Wednesday. What’s happening In English, the paragraph can be paraphrased as follows: Last Thursday, the Dow Jones Industrial Average decreased by 370 points, representing a decline of 1.08% and reaching a value of 34070. Likewise, the S&P 500 went down by 72 points, equivalent to a 1.64% decline, and settled at 4330. The Nasdaq Composite also experienced a drop of 245 points, resulting in a 1.82% decrease, and ended with a final value of 13224. The S&P 500 has experienced a decline of 2.8% in the past three days. What’s driving markets Stocks seemed to find stability on Friday after two consecutive days of decline sparked by the Federal Reserve’s announcement. The Fed chose to keep its policy interest rates unchanged, however, it raised its projected rates for 2024 by 0.5%. On Thursday, new data revealed a surprising decline in the number of individuals seeking unemployment benefits, which suggests a strong employment market. As a result, the 2-year Treasury yield attained its highest point since 2006, while the 10-year yield reached its highest level since 2007. Saxo Bank analysts mentioned that the impact of the recent statement by the U.S. Federal Reserve, indicating a prolonged period of high interest rates, is still ongoing. As a result, Wall Street witnessed its biggest drop in half a year, with the yield on the 10-year government bonds hitting 4.5% for the first time since 2007. Moreover, the chances of future interest rate cuts have decreased to only 75 basis points. Reports suggest that both the S&P 500 and the Nasdaq 100 closed at levels of technical support, potentially resulting in a minor rebound despite the prevailing bearish trend. After a busy week of central bank decisions, the Bank of Japan decided to keep its loose monetary policy stance the same. This caused the dollar to become stronger compared to the yen, with the USDJPY exchange rate increasing by 0.41%. The initial purchasing managers index reports for the manufacturing and service sectors will be included in the economic calendar of the United States on Friday. S&P Global will be providing these reports. Furthermore, Fed Gov. Lisa Cook will give a speech at a conference centered around artificial intelligence. Companies in focus John PaulJohn Paul is the founder of DayTradeToWin, a trading education and software company established in 2008, supporting traders worldwide. His expertise focuses on price action-based futures trading strategies and structured market analysis. DayTradeToWin delivers trading education, indicators, and software tools designed to help traders apply disciplined, rule-based decision-making across global futures markets. He is the creator of multiple trading methodologies, including the Sonic System, Atlas Line, and Trade Scalper, which help traders identify structured opportunities in markets such as the E-mini S&P 500 (ES), Nasdaq (NQ), crude oil (CL), and gold (GC). Official website: https://daytradetowin.com daytradetowin.com

Market News

Dollar Surge Rattles U.S. Stock Futures

/ September 21, 2023

The interest rate on the 10-year Treasury note has reached the highest level it has been in 16 years. On Thursday, the futures for U.S. stock indexes saw a substantial decrease. The opening of the Dow Jones Industrial Average was expected to be down by 200 points. This decline was influenced by rising Treasury yields and a stronger U.S. dollar, causing additional pressure on the stock market. How are stock-index futures trading Yesterday, the Dow Jones Industrial Average (DJIA) fell by 77 points or 0.22% to a level of 34,441. Similarly, the S&P 500 (SPX) experienced a decrease of 42 points or 0.94% to reach 4,402. Additionally, the Nasdaq Composite (COMP) witnessed a decline of 209 points or 1.53%, with a closing value of 13,469. What’s driving markets Based on the Federal Reserve’s recent statement, it seems probable that U.S. stocks will persist in their decline, as the intention is to keep interest rates higher for a longer duration. Additionally, it is anticipated that there will only be one more rate hike within the year. The Federal Reserve’s projections, known as the “dot plot,” and the hawkish comments made by Powell during the press conference, had an impact in driving up Treasury yields to their highest level in 16 years and causing the US dollar to reach its highest value in more than six months. These factors were viewed as detrimental to the stock market. The rise of the US dollar was additionally supported by the Bank of England’s choice to maintain the current interest rates on Thursday. Moreover, American investors analyzed fresh economic data on Thursday. The number of people in the United States who applied for jobless benefits fell to 201,000 in the previous week, reaching the lowest level in the past eight months. After the press conference on Wednesday, Stephen Innes, who is a managing partner at SPI Asset Management, remarked that Powell’s suggested policies appeared to have a significantly negative impact on the American stock market. In a note, it was noted by Innes that the narrative has changed, with interest rates hitting record highs and affecting the stock markets. This connection between interest rates and the stock markets leads to a more intricate trading atmosphere, as any rise in rates brings a certain amount of disturbance to the American equity market. The interest rate on the 10-year Treasury note, with the ticker symbol BX:TMUBMUSD10Y, rose to 4.474%. This increase of 10 basis points marked its highest level since late 2007. It is important to note that bond prices and yields have an inverse correlation. Additionally, the ICE U.S. Dollar Index DXY, which gauges the strength of the dollar against a selection of other currencies, climbed by 0.5$, reaching a value of 105.63. Companies in focus John PaulJohn Paul is the founder of DayTradeToWin, a trading education and software company established in 2008, supporting traders worldwide. His expertise focuses on price action-based futures trading strategies and structured market analysis. DayTradeToWin delivers trading education, indicators, and software tools designed to help traders apply disciplined, rule-based decision-making across global futures markets. He is the creator of multiple trading methodologies, including the Sonic System, Atlas Line, and Trade Scalper, which help traders identify structured opportunities in markets such as the E-mini S&P 500 (ES), Nasdaq (NQ), crude oil (CL), and gold (GC). Official website: https://daytradetowin.com daytradetowin.com

Market News

Fed Focus: U.S. Stock Futures Up as Powell Prepares to Speak

/ September 20, 2023

U.S. stock futures are on a modest uptick as traders eagerly await the Federal Reserve’s decision and Chairman Powell’s remarks. In the meantime, oil prices have pulled back from their recent 10-month highs, and Treasury yields have eased from multi-year peaks. Current State of Stock Futures: Market Performance from Tuesday: Market Outlook: U.S. markets are exhibiting a subdued tone as traders brace themselves ahead of the Federal Open Market Committee’s policy decision, slated for 2 p.m. Eastern time. This year, the S&P 500 has made significant gains, partly fueled by expectations that the Fed’s monetary tightening will conclude without causing significant harm to the economy. Tom Lee, Head of Research at Fundstrat Global Advisors, highlights that “Investors are naturally apprehensive that Wednesday’s FOMC press conference could trigger higher interest rates and a consequent sell-off in stocks.” Traders are currently pricing in a 99% likelihood that the Federal Reserve will maintain rates within the 5.25%-5.50% range, according to the CME FedWatch Tool. Nevertheless, there’s a 29% chance of a 25-basis-point rate hike to a range of 5.50%-5.75% at the subsequent meeting in November. Recent robust U.S. economic data and this week’s surge in oil prices have raised concerns about lingering inflationary pressures, potentially necessitating the central bank to maintain elevated borrowing costs. Thierry Wizman, global FX and interest rates strategist at Macquarie, suggests that the surge in oil prices could make the FOMC more hesitant to convey a dovish stance. Consequently, traders will closely monitor the Fed’s release of its “dot plot” forecast for policy interest rates at 2 p.m., as well as Chair Jerome Powell’s press conference at 2:30 p.m., for any market-shaping information. Stephen Innes, managing partner at SPI Asset Management, points out that yields on 10-year U.S. Treasuries are reaching new cycle highs, and investors seem inclined to maintain their dollar positions, signaling a hawkish direction. Matthew Raskin, strategist at Deutsche Bank, notes that traders’ primary focus will center on the Fed’s economic projections and the “dot plot.” Any shifts in these indicators will be closely analyzed for implications, with the degree of these shifts and Powell’s interpretation of them playing a pivotal role. Companies in the Spotlight: John PaulJohn Paul is the founder of DayTradeToWin, a trading education and software company established in 2008, supporting traders worldwide. His expertise focuses on price action-based futures trading strategies and structured market analysis. DayTradeToWin delivers trading education, indicators, and software tools designed to help traders apply disciplined, rule-based decision-making across global futures markets. He is the creator of multiple trading methodologies, including the Sonic System, Atlas Line, and Trade Scalper, which help traders identify structured opportunities in markets such as the E-mini S&P 500 (ES), Nasdaq (NQ), crude oil (CL), and gold (GC). Official website: https://daytradetowin.com daytradetowin.com

Market News

Fed’s ‘Hawkish Pause’ Looms Large Over Wall Street

/ September 19, 2023

The S&P 500 closed at approximately 4,450 points. Brent oil experienced initial gains but eventually fell after briefly reaching $95 per barrel on Monday, raising concerns about inflation. Apple Inc. witnessed a rise in stock value, whereas Tesla Inc. witnessed a decline due to Goldman Sachs Group Inc. reducing their earnings forecasts for the electric car company. The yield on 10-year Treasury notes decreased slightly, while the yield on two-year notes remained above 5%. Starting with the Federal Reserve on Wednesday and ending with the Bank of Japan two days later, significant meetings will occur involving half of the Group of 20 nations to decide on monetary policy. The central banks of developed economies may attract additional scrutiny as global policymakers adapt to the idea proposed by US officials at the Jackson Hole conference in August, indicating that interest rates may likely stay higher for a longer duration. Traders will be watching the dot plot summary of economic predictions carefully as the Federal Reserve is expected to keep interest rates stable this week. The main concerns revolve around whether policymakers will stick to their forecast of a 0.25% increase by the year-end and how much easing they anticipate for 2024. The previous projection in June indicated an expected decrease of 1 percentage point. Megan Horneman, the head of investment strategy at Verdence Capital Advisors, anticipates that the Federal Reserve will pause its interest rate hikes for now and adopt a more careful approach. However, Horneman believes that the futures market will still respond and raise the chances of another rate hike by the end of the year. Horneman expresses worry about a potential rise in inflation, particularly if energy prices begin to impact overall costs. As a result, she suggests that the Federal Reserve may need to indicate that they are not yet done with increasing rates. David Kelly, the chief global strategist at J.P. Morgan Asset Management, anticipates that the Federal Reserve will stick to a strong position, indicating possible increases in interest rates until 2023. Nonetheless, Kelly also recognizes the chance of a slower and more gradual method of relaxation in the coming years. Despite these intentions, there is a worry that if there is an economic downturn, the Fed may have to adopt a more forceful and rapid approach to easing. Kelly recommends having a diverse investment portfolio, emphasizing a careful approach to stocks and a focus on long-term fixed income investments. This is necessary because there is a growing chance of an economic decline as monetary tightening continues. Lisa Shalett, a specialist in Morgan Stanley Wealth Management, states that even though certain investors are hopeful about the advancements in headline inflation, a crucial indicator closely observed by Fed Chair Jerome Powell suggests an extended period of elevated interest rates. The speaker noted that the US stock markets are eagerly predicting a favorable scenario where interest rates rise to their peak and both the economy and corporate earnings experience a resurgence. However, she is skeptical about the argument that growth will accelerate and profit margins will expand, which is the optimistic viewpoint. Instead, she believes it is more probable that US stocks will remain relatively stable over the next six to nine months, with only minor fluctuations in earnings and market multiples. Paul Nolte, who works at Murphy & Sylvest Wealth Management, notes that the current two months, known for their relative weakness, are aligning with his expectations and following the usual pattern. Nolte claimed that according to the playbook, there will be a continued decrease in the upcoming weeks until October’s middle or end, and thereafter, a surge by the year’s end. This surge is anticipated due to the expected rise in earnings during this quarter. Typically, when earnings increase, stock prices also tend to rise. Nonetheless, numerous stocks in the market are already valued quite high compared to past norms, so there may not be ample space for additional growth. John PaulJohn Paul is the founder of DayTradeToWin, a trading education and software company established in 2008, supporting traders worldwide. His expertise focuses on price action-based futures trading strategies and structured market analysis. DayTradeToWin delivers trading education, indicators, and software tools designed to help traders apply disciplined, rule-based decision-making across global futures markets. He is the creator of multiple trading methodologies, including the Sonic System, Atlas Line, and Trade Scalper, which help traders identify structured opportunities in markets such as the E-mini S&P 500 (ES), Nasdaq (NQ), crude oil (CL), and gold (GC). Official website: https://daytradetowin.com daytradetowin.com

Scroll to Top