Market Commentary & Analysis December 4, 2019

The S&P 500 market fell as much as 1.4% yesterday after Trump proposed it might be more beneficial if a trade agreement with China paused until after the next year's election. 

Stock market trimmed losses in the afternoon session, though, as a BTD (buy-the-dip) mindset gave the broad benchmark index negative 0.7% for the day. 

The DJI Average index posted -1.0% loss, the Nasdaq Composite index print with -0.6% drop, and small-cap Russell 2000 index -0.3% also ended well off its session low. 

The adverse market bias built up before the open as Trump talked to reporters in London at the NATO summit. President may or may not have been applying a negotiating ploy. 

Nevertheless, the negative calling headlines naturally gave the players a reason to take profits off the table, considering the risk that remains concerning a deal and the December 15 tariffs levies. 

Many traders and investors followed-through selling ensued quickly following the open, though selling influence was held in check for the rest of the trading session. 

The vulnerability was seen primarily in the cyclical sectors, particularly in the S&P 500 energy sector, posting -1.6% and financials sector showing -1.3%. The Dow Jones Transportation Average sector fell whopping 2.2%. 

Conversely, the real estate sector posted +0.7% return and utility sector with +0.5% were the lonesome market sectors to close in positive territory, most of all due to the refuge in United States Treasuries which carried the yields sharply lower. 

The Two-year note's yield fell eight basis points to close at 1.54%, and the Ten-year yield sank 13 basis points to finish at 1.71% lower. The United States Dollar Index (DXY) faded by 0.1% to close at 97.73. West Texas Intermediate crude oil rose 0.6%, or $0.325, to finish at $56.24 per barrow.

Market action

We did get excited about market action handling the 12th Phase which could be frantically up - perhaps based on the end of the China trade war, or something utterly global positive event. 

As usual, I got passionately bullish as soon as the Key Sup $3.075 was hit; however, I've seen enough wealth go 'Poofy' from being excessively eager; however, we know from experience about the strength and power of Key Supports within Trade Selector Signal market envelope.  

Even though, if the S&P 500 market decline and close for the next few trading days below that support level, we could possibly drop much further, how far down? Well, there is support target down as low as Key Sup $3.035 and Key Sup $2,988 - take the money, be diligent, and be safe.

S&P 500 Market

Click the Image to Enlarge

Precious metals and Bitcoin

Gold gapped down a bit on Monday session and then reversed the trend convincingly, breaking above the Mean Resistance $1,472 in movement really, As Silver breaks Mean Resistance of $17.15.

While Bitcoin sidestepped a significant breakdown on Tuesday, it has had a hard time to get above Mean Resistance $7,755. Notwithstanding its determination, it is quietly stuck under its declining intermediate-term retracement trend. 

The crypto coin is also nearing its Key Support $6,910, and the broader downtrend (Inner Coin Dip $6,000) in its trading market continues to be intact. The resumption of downtrend migration shows that risk is high here.

On a separate market front

Touching a different market show, the United States Trade Representative suggested that $2.4 billion of French import goods be taxed as much as 100% in answer to France enacting a new digital tax law that ostensibly targets American technology companies. 

The Wall Street Journal published that this amounts to no more than 5% total of the imported goods from France last year.

On the corporate news front, it was relatively quiet; however, a notable account involved Cleveland-Cliffs, which posted -0.90, or -10.7% drop due to consenting to buy AK Steel for $1.1 billion in an all-stock deal.

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