On Friday the popular averages again closed mixed. Nevertheless, the Nasdaq Composite reached all-time intraday and closing highs. The pandemic continues to surge, resulting in more lockdowns of businesses. The Biden administration is aggressively addressing these matters. Cabinet confirmation hearings appear to be progressing fairly smoothly in the Senate.
Above is my three-month chart for the S&P 500 ETF (SPY). The SPY's 50-day simple moving average gave way on October 26 during a big selloff amid heavy trading volume and an elevated VIX. The dumping continued into the end of the month. Market bottoms often occur in late October, setting up a run into April. The panic selling amid heavy trading volume in late October may have been a precursor of a significant bottom.
The nice up move on November 2 amid more bad pandemic news turned my outlook arrow green. The continuation pushed the SPY well above its 50-day SMA, leading to an all-time closing high on November 16. After that there was some hesitancy which briefly had me concerned.
Then the SPY holding at or near earlier tops, along with good news on vaccines and the presidential transition, quickly restored my arrow to green. After the SPY hit a number of record highs there was a dip, before a bounce commencing mid-December. On January 8 for a second day it reached all-time intraday and closing highs. Last week there may have been some risk aversion preceding a three-day weekend amid threats of political moreviolence. Then a pop upward came on Tuesday and all-time intraday and closing highs on Wednesday and Thursday. Thursd
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