December 23, 2020

Stock Futures Trade Flat, Bitcoin Back Above 23K

Stock Futures Trade Flat, Bitcoin Back Above 23K

President Trump said that he is going to ask Congress to change the stimulus aid bill, which was passed earlier this week, and this has made investors ever so confused.

He wants the lawmakers to change the stimulus cheques to $2000 from $600. Traders are also keeping a close eye on the new variant of coronavirus and how this is sparking further stricter lockdowns.     

Asian Markets 

The Asian stock market traded mostly In the positive territory today. The Nikkei index advanced 0.33%. The Shanghai index increased by 0.76%, while the HSI index jumped higher by 0.69%. The ASX index soared by 0.66%.

Dow Jones and S&P 500: Market Breadth

The Dow Jones’ market gained further strength as the rally continues. 87% of the Dow Jones stocks traded above their 200-day moving average. 

The S&P 500 stock breadth is maintaining its momentum. 87% of the shares traded above their 200-day moving average. 

Dow Jones Futures Today

The Dow Jones futures are trading almost flat today. In terms of economic data, investors will be looking at the personal income, common personal spending and unemployment claims data.

In addition to this, we also have the crude oil inventory data due later on today.  The forecast for personal income is -0.3%, for personal spending -0.2%, unemployment claims 882K.  

The Dow Jones futures closed in negative territory for the third consecutive day and they are set to record more losses today.

The Dow Jones index has pierced the lower line of the Bollinger band on the daily timeframe and this shows that the price has gone too far too fast.

However, the Dow Jones is still maintaining its upward trend as the price is trading above the 50, 100 and 200-day simple moving averages on the daily timeframe. As for the intraday timeframe i.e the 30 minute, the Dow Jones has moved above the 20-day simple moving average but it still needs to conquer 50 and 100-day simple moving averages.

No surprise crosses above these moving averages, the bull trend will begin. The near term support level is at 29,315 while the resistance is at 30,205.

The S&P 500 futures, which represent the broader stock market, have reported four consecutive days of losses. Since December 20th, the price is consistently making lower highs. The fact that the S&P 500 index is failing to break above the highs of 3711 shows that there isn’t enough momentum in this trade.

In addition to this, the 30-minute timeframe shows that the S&P 500 index is failing to break above the 30, 50 add 10- day simple moving averages. If the price is above these moving averages on the 30-minute timeframe, the chances are that the S&P 500 index will revisit the low formed on December 21st.

As for the RSI, it is moving away from the overbought zone on the daily timeframe. This means that the S&P 500’s price is no longer overbought. The near term support is at 3596 while the resistance is at 3711.     

Stock Market Rally

The S&P 500 stock index closed further away from its record high yesterday; the index advanced by 0.21 %. The energy sector led the index lower- 9 out of 11 sectors closed lower. 

The Dow index failed to secure any gains yesterday; the Dow stocks moved the index lower by 0.67%. 6 shares advanced while 24 shares closed lower. 

The NASDAQ composite, a tech-savvy index, closed higher by 0.22% yesterday. 

S&P 500 Leaders and Laggards: Paycom and CartMax

Paycom stock contributed the biggest gain, soaring 4.39%. CartMax stock was the largest drag; it fell by 8.09%. The S&P 500 stock index is up 9.6% so far this year.

Dow Jones Leaders and Laggards: Salesforce and Goldman Sachs

Salesforce provided the biggest help for the Dow Jones; it advanced by 2.08%, while Goldman Sachs was the largest decliner, it fell by 2.68%. 

Bitcoin 

Bitcoin has once again moved above the 23,000-price level, which is positive as it shows that bulls are still committed to make new highs this year. The BTC/USD made a high of 24,037 today; the previous high was at 24,118. If the Bitcoin trades above the yesterday’s low, which is at 22,390, it is highly likely that we will take out the all-time high formed on December 21st.