Daily Market Update for 12/16

Original Chart

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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Thursday, December 16, 2021

Facts: -2.47%, Volume lower, Closing Range: 12%, Body: 87% Red
Good:Volume lower, higher high, higher low
Bad: Deep red day, close below 21d EMA , 50d MA, and 15,200 support
Highs/Lows: Higher high, Higher low
Candle: Mostly red body with short lower wick
Advance/Decline: 0.55, almost two declining stocks for every advancing stock
Indexes:SPX (-0.87%), DJI (-0.08%), RUT (-1.95%), VIX (+6.64%)
Sector List: Financials ( XLF +1.26%) and Materials ( XLB +1.02%) at the top. Consumer Discretionary ( XLY -2.21%) and Technology ( XLK -2.83%) at the bottom.
Expectation: Lower

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Market Overview

Investors seemed to rethink their positioning after the Fed updated the public on bond tapering and interest rates. Growth stocks and big tech saw the biggest losses, while cyclical sectors benefited. Some new fears of lockdowns around Omicron may also have contributed to the sell-off.

This update is much shorter than normal due to travel this week.

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Trends, Support, and Resistance

The index dropped below the trend line from the 10/22 high. If it returns to that trend line , expect a +0.38% gain.

The five-day trend line points to a -0.65% decline.

If the one-day trend line continues, we could see another -2.91% decline tomorrow.

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Wrap-up

Expect volatility to end the week as investors react to central bank updates around the world. We thought the Santa Rally was starting early, but it seems we’ll have to endure a few days of institutional repositioning before the holidays.

Expecting Lower for Friday.

Stay healthy and trade safe!

Comments

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