Daily Chart Report ? Friday, February 28th, 2020
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Today’s Summary
Friday, February 28th, 2020
Indices: US stocks had their worst week since 2008. The Dow Jones Industrial Average closed lower by 357 points or 1.39% in today’s session. The S&P 500 fell 0.82%, while the Nasdaq managed to close flat (0.01%). The Russell 2000 was the weakest of the major indices, falling 1.43%.
Sectors: Technology led, gaining 0.76%. Utilities lagged, falling 3.34%.
Commodities: Crude Oil futures moved lower by 2.33% to $45.26 per barrel. Gold futures had their worst day since 2013, dropping 3.58% to $1,587 per ounce.
Currencies: The US Dollar Index moved lower by 0.39%.
Interest Rates: The US 10-year Treasury yield fell to a record low of 1.163%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
Today’s Chart of the Day was shared on Twitter by Adrian (@highlevelTrader). It’s a chart of the S&P 500 going back to the 2009 lows. The blue indicator on top is a 5-day moving average of the CBOE put/call ratio. This indicator is used to gauge short-term sentiment in the S&P 500. When traders purchase more protective puts than calls, the ratio spikes higher, signaling fear among market participants. On the other hand, when traders buy more speculative calls than puts, the ratio falls, indicating optimism among market participants. Like most sentiment indicators, the put/call ratio is most useful when it’s at an extreme. Prior to this week’s sell-off, several technicians warned that the market was due for a pullback because the put/call ratio was extremely low. The ratio has now jumped to 1.276 amid this week’s bloodbath. The green vertical lines mark the instances where the put/call ratio spiked above 1.2. As Adrian points out, readings above 1.2 are often found near bottoms. This is evidence that the S&P 500 may be due for a bounce in the near-term. As Warren Buffett once famously said, “Be fearful when others are greedy and greedy when others are fearful.”
Quote of the Day
“One of the funny things about the stock market is that every time one person buys, another sells, and both think they are astute.”
– William Feather (Publisher)
Top Links
A Historic Week for Stocks – Macro Charts
Last Friday, Macro Charts released a detailed blog post outlining several reasons that stocks could sell-off in the near-term. In this post, he follows-up on some of those reasons and explains what to expect going forward.
An Extreme in Extremes – SentimenTrader
In this note, Jason Goepfert offers some good insights into this week’s sell-off.
What the Technicals Are Saying About Oil, the Won, and 10-Year Yield – Bloomberg
Paul Ciana of Bank of America made an appearance on Bloomberg to discuss the technical outlook for Crude Oil, the Korean Won, and US Treasury Yields.
Stock Market Technical Analysis 2/28/20 – AlphaTrends.net
In this video, Brian Shannon breaks down this week’s price action and lays out some levels of interest to keep an eye on next week.
How Does the Stock Market Bottom? – The Irrelevant Investor
Michael Batnick of Ritholtz Wealth Management examines the bottoming process that stocks typically go through after crashes like the one we saw this week.
Top 10 Tweets
You’re all caught up now. Thanks for reading!