Market Direction Mid Week: New Bullish Alert Rallies

The trading strategy this website uses as its signature tool is our bullish and bearish alerts. This indicator has effectively been used with accuracy since 2011. The website helps our followers stay in tune with the stock market and profits have been amazing. This post provides a mid-week update on how the stock market has preform. At the bottom of this post are the all-time numbers since the current alert was made. The current bullish alert is moving in the right direction.

Market Direction: BULLISH alert issued 4/10/2020

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U.S. stocks ended lower Wednesday, amid an onslaught of disappointing corporate earnings reports and dismal economic data resulting from the COVID-19 pandemic.

How did major indexes fare?

The Dow Jones Industrial Average DJIA, -0.82% fell 445.41 points, or 1.9%, to settle at 23,504.35. The Nasdaq Composite COMP, +0.54% slumped 122.56 points, or 1.4%, to close at 8,393.18. The S&P 500 SPX, -0.24% slipped 62.70 points, or 2.2%, to finish at 2,783.36.

The Dow on Tuesday rose 558.99 points, or 2.4%, to end at 23,949.76, while the S&P 500 finished 84.43 points higher, up 3.1%, at 2,846.06. The Nasdaq Composite Index  rose 323.32 points or 4%, ending at 8,515.74.

Of the three major indexes, only the Dow is higher for the week, up 2.9% on Wednesday.

What drove the market?

U.S. equities slumped as investors mulled corporate earnings to gauge the impact of the coronavirus pandemic. While EU and U.S. federal officials are planning to lift restrictions to help revive their economies, earnings reports are providing a harsh picture of how the pandemic is affecting business, with the global economy headed for a deep recession, according to the IMF on Tuesday.

“I think we’re in for a very rough time in the markets for the next couple of months,” Jason Thomas, chief economist at AssetMark in Los Angeles, told MarketWatch. “We are just now starting to get hard data,” he said of the pandemic’s early economic toll. “But it’s for March. What we are living through in April is much worse.”

Read:Airlines say deal on bailout includes provisions for government ownership

Investors received further evidence of the early hit to the U.S. economy with March retail sales shrinking 8.7%. Analysts surveyed by MarketWatch, on average, had forecast a 7.1% monthly fall in sales. U.S. industrial production fell 5.4% in March, the steepest decline since early 1946 as a result of the coronavirus pandemic, the Federal Reserve said Wednesday.

“Stricter lockdown measures, unprecedented layoffs and plummeting confidence have compounded into an extraordinary and multifaceted shock to consumer spending,” wrote Lydia Boussour, senior U.S. economist at Oxford Economics, following the record drop in U.S. retail sales, calling the retraction “just the beginning of the consumer pullback.”

In other data, the April New York Empire State Index dropped to a record low of negative-78.2 in April from negative-21.5 in the previous month.

The Federal Reserve’s so-called beige book report, a compilation of anecdotes on economic activity, showed a sharp and abrupt contraction in business activity through early April, with the expectation that conditions will worsen over the next several months.

“There will be winners and losers as households adjust their daily lives to ride out the storm and recalibrate their spending habits accordingly,” said Jim Baird, chief investment officer for Plante Moran Financial Advisors.

The S&P 500 index has climbed about 24% from its March 23 closing low, supported by U.S. monetary and fiscal stimulus and early signs that coronavirus cases were peaking, but is still down about 18% from its record high in February.

Read: Fannie Mae: Home sales will decline by 15% in 2020 due to coronavirus, but what will happen to property prices?

How did other markets trade?

 The swoon in global equities spurred inflows into government paper, with the yield on the 10-year Treasury note yield TMUBMUSD10Y, 0.607% shedding 13.9 basis points at 0.54%, its largest daily yield plunge since March 23, according to Dow Jones Market Data.

Crude oil prices closed at a more-than-18-year low Wednesday. West Texas Intermediate Crude for May CLK20, -1.01% fell 24 cents, or 1.2%, to end at $19.87 a barrel on the New York Mercantile Exchange. In precious metals, the price of an ounce of June gold GCM20, -0.58% fell $28.70, or 1.6%, to settle at 1,740.20 an ounce, pulling back from its highest level since 2012.

The U.S. dollar gained 0.7% against its major rivals, according to the U.S. dollar index DXY, 0.70% .

The STOXX 600 Europe index SXXP, +0.57% tumbled 3.2% on Wednesday, while Asian markets recorded modest losses.

$tockMarketDirection proprietary model is currently BULLISH. We strongly encourage you to monitor positions closely, exercise proper money management strategies and follow us at  $tockMarketDirection for ALERTS we may issue advising a change in the current market direction. Stay tuned and follow us. If you have a testimonial or comment of how this website has helped you we would like to know, email us. Share with friends.

The all-time highs since our initial recommendation to go LONG this market. Here is how the markets have performed:

Stock Market Direction Recommendation (4/10/2020)
Dow	up 321.21 points a 1.35% gain	4/14/20
Nasdaq	up 377.53 points a 4.63% gain	4/14/20
S&P 500	up 62.03 points a 2.22% gain	4/14/20

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