Stocks End Week Mostly Higher
This was a constructive week on Wall Street, stocks opened lower but closed higher for most of the popular indices. A subtle, yet important, sign of strength is to see a market open lower but close higher in any given period. All things being equal, the longer the period, the stronger the ramification for the market. So, the fact that the major indices opened lower last week, which was shortened holiday week, but closed higher on a weekly basis, is a bullish sign. Separately, if you look at a monthly chart, it is on track to do close to the same thing as next week will be the last week of February. Stepping back, the action is very constructive as buyers quickly showed up and are doing their best to quell the big drop we saw earlier in the month. As long as February’s lows hold, the bulls remain in control of this market.
Thur & Fri Action:
Stocks rallied sharply on Thursday as the yield fell on the 10-year note. In corporate news, Chesapeake Energy jumped nearly 20% after reporting earnings while shares of Roku plunged nearly 20% after they released earnings. Separately, shares of Netflix (NFLX) and Amazon.com (AMZN) hit fresh record highs. Stocks rallied on Friday as investors showed up and continued buying stocks to end the week on a positive note.
Market Outlook: Market Bouncing
The market is bouncing back after a steep 10% pullback. The big level of support to watch is February’s low and then the 200 DMA line for the major indices. For now, as long as that level holds, the longer-term uptrend remains intact. As always, keep your losses small and never argue with the tape. Want To Learn How To Invest? Sign Up For 1-on-1 Sessions With Adam Sarhan.