Summary: The market responded positively to jobs data released in the morning, sending indexes higher and boosting growth sectors. The unemployment rate dropped more than expected while non-farm payrolls May started to accelerate.
Notes
Ideas always welcome in the comments. Errors will be amended as comments on TradingView or corrected inline in my blog.
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Friday, June 4, 2021
Facts: +1.47%, Volume lower, Closing range: 91%, Body: 87%
Good: Held morning gains throughout day for a higher high and higher low
Bad: Lower volume
Highs/Lows: Higher high, higher low
Candle: Mostly green body with a tiny upper wick, no lower wick, small gap up
Advanced/Decline: 1.04, About the same number of advancing and declining stocks
Indexes: SPX (+0.88%), DJI (+0.52%), RUT (+0.31%), VIX (-8.87%)
Sectors: Technology (XLK +1.92%) and Communications (XLC +1.43%) were top. Real Estate (XLRE +0.09%) and Utilities (XLU -0.15%) were bottom.
Expectation: Higher
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Market Overview
The market responded positively to jobs data released in the morning, sending indexes higher and boosting growth sectors. The unemployment rate dropped more than expected while non-farm payrolls May started to accelerate.
The Nasdaq gained +1.47% for the day on lower volume. The high closing range of 91% and green body covering 87% of the candle represent morning gains that turned into a steady hold near intraday highs in the afternoon. There is no lower wick and a small upper wick. There were about the same number of advancing stocks as declining stocks.
The S&P 500 (SPX) is nearing all-time highs again with a +0.88% gain today. The Dow Jones Industrial Average (DJI) gained +0.52%. Small caps did not do quite as well, but the Russell 2000 (RUT) still had a +0.31% advance.
The VIX volatility index declined -8.87% to its lowest close since April.
Growth sectors soared back to the top of the list today. Technology (XLK +1.92%) and Communications (XLC +1.43%) were top, outperforming the broader S&P 500 index. Defensive sectors, including Real Estate (XLRE +0.09%) and Utilities (XLU -0.15%), moved to the bottom of the list.
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Economic Indicators
The US Dollar (DXY) declined -0.39%, retracing from yesterday's big gain.
The US 30y, 10y, and 2y Treasury yields all declined. The spread tightened considerably between long-term and short-term bonds.
High Yield Corporate Bond (HYG) and Investment Grade Corporate Bond (LQD) prices advanced.
Silver (SILVER) and Gold (GOLD) advanced after yesterday's decline, reacting again to the dollar.
Crude Oil (CRUDEOIL1!) advanced again, continuing to set new highs not seen since 2018.
Timber (Wood) advanced.
Copper (COPPER1!) and Aluminum (ALI1!) advanced.
Bitcoin (BTCUSD) declined -5.95%. Ethereum (ETHUSD) declined -5.79%.
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Investor Sentiment
The put/call ratio rose to 0.586. The put/call ratio (PCCE) is a contrarian indicator that shows overly bullish or overly bearish investor behavior. The 0.7 level is considered normal. Below that level is overly bullish.
The CNN Fear & Greed index is just to the fear side of neutral.
The NAAIM investment manager exposure index is 82.27.
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Market Leaders
Microsoft (MSFT) gained +2.07%, cruising back above both its 21d EMA and 50d MA. Alphabet (GOOGL) advanced +1.96%, trading above its key moving average lines. Apple (AAPL) gained +1.90% but hit resistance at its 21d EMA. Amazon (AMZN) gained +0.60% but is still well below the moving average lines.
Tesla (TSLA), Nvidia (NVDA), Salesforce.com (CRM), and ASML Holding (ASML) topped the mega-cap list today. Only a handful of mega-caps declined for the day, including Johnson & Johnson (JNJ), Nike (NKE), Home Depot (HD), and United Health (UNH)
Most of the stocks in the daily update growth list gained for the day. Ehang Holdings (EH) gained nearly 20%. MongoDB (MDB) gained over 15% after an earnings surprise for the first quarter. UP Fintech (TIGR) and Sumo Digital (SUMO) were the other two in the top four. At the bottom of the list was Crowdstrike (CRWD), which disappointed investors with earnings. Also declining for the day were Lemonade (LMND), Etsy (ETSY), and Fastly (FSLY).
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Looking ahead
There is not much economic news on the calendar for Monday.
Marvell (MRVL) and Vail Resorts (MTN) are the most significant earnings reports for Monday.
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Trends, Support, and Resistance
The Nasdaq rose back above the moving average lines and the 13,700 area today.
The one-day trend-line and the trend-line from the low on 5/13 both point to a +0.61% on Monday.
Following the five-day trend-line would result in a -0.79%.
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Wrap-up
We waited all week for the labor market data, with investors getting skittish yesterday with anticipation. The response to the new numbers was positive and brought the index back to nearly where we began the week. Hopefully, the exuberance will continue into next week, and we can start moving toward new highs.
Stay healthy and trade safe!
Notes
Ideas always welcome in the comments. Errors will be amended as comments on TradingView or corrected inline in my blog.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Friday, June 4, 2021
Facts: +1.47%, Volume lower, Closing range: 91%, Body: 87%
Good: Held morning gains throughout day for a higher high and higher low
Bad: Lower volume
Highs/Lows: Higher high, higher low
Candle: Mostly green body with a tiny upper wick, no lower wick, small gap up
Advanced/Decline: 1.04, About the same number of advancing and declining stocks
Indexes: SPX (+0.88%), DJI (+0.52%), RUT (+0.31%), VIX (-8.87%)
Sectors: Technology (XLK +1.92%) and Communications (XLC +1.43%) were top. Real Estate (XLRE +0.09%) and Utilities (XLU -0.15%) were bottom.
Expectation: Higher
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Overview
The market responded positively to jobs data released in the morning, sending indexes higher and boosting growth sectors. The unemployment rate dropped more than expected while non-farm payrolls May started to accelerate.
The Nasdaq gained +1.47% for the day on lower volume. The high closing range of 91% and green body covering 87% of the candle represent morning gains that turned into a steady hold near intraday highs in the afternoon. There is no lower wick and a small upper wick. There were about the same number of advancing stocks as declining stocks.
The S&P 500 (SPX) is nearing all-time highs again with a +0.88% gain today. The Dow Jones Industrial Average (DJI) gained +0.52%. Small caps did not do quite as well, but the Russell 2000 (RUT) still had a +0.31% advance.
The VIX volatility index declined -8.87% to its lowest close since April.
Growth sectors soared back to the top of the list today. Technology (XLK +1.92%) and Communications (XLC +1.43%) were top, outperforming the broader S&P 500 index. Defensive sectors, including Real Estate (XLRE +0.09%) and Utilities (XLU -0.15%), moved to the bottom of the list.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Economic Indicators
The US Dollar (DXY) declined -0.39%, retracing from yesterday's big gain.
The US 30y, 10y, and 2y Treasury yields all declined. The spread tightened considerably between long-term and short-term bonds.
High Yield Corporate Bond (HYG) and Investment Grade Corporate Bond (LQD) prices advanced.
Silver (SILVER) and Gold (GOLD) advanced after yesterday's decline, reacting again to the dollar.
Crude Oil (CRUDEOIL1!) advanced again, continuing to set new highs not seen since 2018.
Timber (Wood) advanced.
Copper (COPPER1!) and Aluminum (ALI1!) advanced.
Bitcoin (BTCUSD) declined -5.95%. Ethereum (ETHUSD) declined -5.79%.
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Investor Sentiment
The put/call ratio rose to 0.586. The put/call ratio (PCCE) is a contrarian indicator that shows overly bullish or overly bearish investor behavior. The 0.7 level is considered normal. Below that level is overly bullish.
The CNN Fear & Greed index is just to the fear side of neutral.
The NAAIM investment manager exposure index is 82.27.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Market Leaders
Microsoft (MSFT) gained +2.07%, cruising back above both its 21d EMA and 50d MA. Alphabet (GOOGL) advanced +1.96%, trading above its key moving average lines. Apple (AAPL) gained +1.90% but hit resistance at its 21d EMA. Amazon (AMZN) gained +0.60% but is still well below the moving average lines.
Tesla (TSLA), Nvidia (NVDA), Salesforce.com (CRM), and ASML Holding (ASML) topped the mega-cap list today. Only a handful of mega-caps declined for the day, including Johnson & Johnson (JNJ), Nike (NKE), Home Depot (HD), and United Health (UNH)
Most of the stocks in the daily update growth list gained for the day. Ehang Holdings (EH) gained nearly 20%. MongoDB (MDB) gained over 15% after an earnings surprise for the first quarter. UP Fintech (TIGR) and Sumo Digital (SUMO) were the other two in the top four. At the bottom of the list was Crowdstrike (CRWD), which disappointed investors with earnings. Also declining for the day were Lemonade (LMND), Etsy (ETSY), and Fastly (FSLY).
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Looking ahead
There is not much economic news on the calendar for Monday.
Marvell (MRVL) and Vail Resorts (MTN) are the most significant earnings reports for Monday.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Trends, Support, and Resistance
The Nasdaq rose back above the moving average lines and the 13,700 area today.
The one-day trend-line and the trend-line from the low on 5/13 both point to a +0.61% on Monday.
Following the five-day trend-line would result in a -0.79%.
-=x=-=x=-=x=-=x=-=x=-=x=-=x=-
Wrap-up
We waited all week for the labor market data, with investors getting skittish yesterday with anticipation. The response to the new numbers was positive and brought the index back to nearly where we began the week. Hopefully, the exuberance will continue into next week, and we can start moving toward new highs.
Stay healthy and trade safe!
