A nice downside break after the phony follow-through day of two Wednesdays ago has been followed by two days of a rally in the NYSE-based indexes. Overall, however, the market appears to be stuck in a chop-zone that lies well off the early-October highs and the late-October lows.
The Dow Jones Industrials is currently the leading index on a relative basis since it is the only major market index to sit above its 200-dma. Last week it was the only one to regain its 50-dma but has since given it up on a sharp downside break that carried below the 200-dma before the index regained the line on Thursday.
Friday’s rally occurred on higher options expiration volume, but only carried to the mid-point between the higher 50-dma and the lower 200-dma. Intraday volatility remained the rule of the day, as more comments from various members of the Trump Administration, including the President, regarding the trade war with China has sent the indexes flying to and fro over the past few days.
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