Daily Chart Report ? Friday, November 6th, 2020
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Today’s Summary
Friday, November 6th, 2020
Indices: US Stocks ended this stellar week on a quiet note, with the indices closing slightly lower. The Dow Jones Industrial Average slipped 67 points or 0.24%. The S&P 500 and Nasdaq were more or less unchanged (0.03% and 0.04%, respectively.) The Russell 2000 underperformed, falling 0.96%.
Sectors: Consumer Staples led, gaining 0.46%. Energy lagged, dropping 2.16%.
Commodities: Crude Oil futures fell 3.35% to $37.49 per barrel. Gold futures rose 0.25% to $1,952 per ounce.
Currencies: The US Dollar Index fell 0.43%.
Interest Rates: The 10-year US Treasury yield moved higher to 0.817%.
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 Alfonso Depablos (@AlfCharts). It’s a weekly chart of the Nasdaq 100 ETF, $QQQ over the past 3.5 years. $QQQ climbed 9.32%, marking the 2nd best week for the ETF over the past decade. As Alfonso points out, price closed at an all-time weekly high for the first time in more than two months. When price is in unchartered territory like this, Fibonacci extensions are one of the only tools we have to identify potential resistance levels. For whatever mysterious reason, price is often attracted to these levels like a magnet. Now that we’re decisively above the 261.8% extension of the 2000-2002 decline, the next logical price target is the 423.6% extension around $446, which is about 50% higher from current prices. In a comment to The Chart Report, Alfonso said, “This is definitely not bearish action for stocks, and the 261.8% extension now offers you a well-defined risk level.”
Quote of the Day
“A smile happens in a flash, but its memory can last a lifetime.”
– Bertrand Russell
Top Links
The Failure of Ungrounded Investment Narratives – Disciplined Systematic Global Macro Views
Here’s a good read from Mark Rzepczynski on the dangers of following narratives. The last two paragraphs are absolute gold.
Welcome to the Best 3 Months of the Year! – All Star Charts
JC Parets offers his perspective on seasonality.
The Election, Metals, and Uncertainty – Fibonacci.com
Tarek Saab gives a brief analysis of the precious metals space.
Stock Market Video Analysis for Week Ending 11/6/20
In this quick video, Brian Shannon reviews this week’s price action and lays out some levels of interest to keep an eye on next week.
Why We’re Blind to Probability – Collaborative Fund
Here’s a good read from Morgan Housel about our inability to fully understand probabilities.