Daily Chart Report ? Tuesday, February 4th, 2020
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Today’s Summary
Tuesday, February 4th, 2020
Indices: US stocks closed higher in today’s session with the Dow Jones Industrial Average advancing 408 points or 1.44%. The Nasdaq was the strongest of the major indices, jumping 2.10%. The S&P 500 and Russell 2000 both gained 1.50%.
Sectors: 10 out of the 11 sectors closed higher. Technology led, gaining 2.62%. Utilities were the only sector to close lower, falling 1.00%.
Commodities: Crude Oil futures moved lower by 0.92% to $49.45 per barrel. Gold futures dropped 1.54% to $1,556 per ounce.
Currencies: The US Dollar Index rose 0.16%.
Interest Rates: The US 10-year Treasury yield moved higher to 1.603%.
Here are the best charts, articles, and ideas being shared on the web today!
Chart of the Day
Today’s Chart of the Day was shared on Twitter by Walter Deemer (@WalterDeemer). It’s a daily bar chart of the highly contested electric car maker, Tesla ($TSLA), over the past year. The stock has been on an incredible rally in recent months. It hit a multi-year bottom in June, around $179 per share before surging nearly 400% to where it’s currently trading around $886 per share. The stock continues to burn through relentless short-sellers, who add fuel to the fire as they’re forced to buy-to-cover as shares move higher. Walter quotes legendary technical analyst, Bob Farrell, who once said: “Parabolic advances usually go further than you think, but they do not correct by going sideways.” In other words, the momentum from these rallies can carry the stock far higher than what anyone thinks is rational. However, once the momentum dissipates, the subsequent correction tends to be sharp and violent as opposed to a sideways consolidation, where price corrects through time.
Quote of the Day
“Stock market bubbles don’t grow out of thin air. They have a solid basis in reality, but reality as distorted by a misconception.”
– George Soros (Hedge Fund Manager)
Top Links
Greatest Short Squeeze of All Time? – The Reformed Broker
Josh Brown shares his thoughts on the massive short squeeze that’s been fueling the surge in shares of Tesla ($TSLA).
Typical February Trading: Tepid Month with Solid Mid-Month Rally – Almanac Trader
Here’s a quick read from seasonality expert, Jeff Hirsch where he takes a look at how stocks tend to perform throughout February.
Using Ratio Charts to Measure Risk Appetite in Stocks – Trend Investor Pro
Arthur Hill of TrendInvestorPro.com gives a tutorial on how to use ratio charts to assess risk appetite.
Stock Market Price Action Recap – The Trade Risk
In this video, Evan Medeiros reviews the recent price action of some of the major indices and ETFs.
Visualizing the 700-Year Fall of Interest Rates – Visual Capitalist
Here’s a fascinating visualization of the decline in interest rates dating back to the 1300s.
Top 10 Tweets
And from our Technical Research team: the stock is now +200% above its 200-day average, surpassing the 2013 highs of +186%. An unbelievable run. @verrone_chris @Todd_Sohn pic.twitter.com/qljuOre07v
— Strategas (@StrategasRP) February 4, 2020
You’re all caught up now. Thanks for reading!