A textbook failure at the 50-day moving average on Monday by the NASDAQ Composite and the S&P 500 Indexes resulted in a gap-down and break lower yesterday, but not without some wild and crazy intraday volatility. More news on the trade front combined with comments from Fed Head Jerome Powell about the need to start growing the Fed’s balance sent the market flying in both directions. But in the end, the NASDAQ closed at its intraday lows on higher volume.
This morning we were treated to a futures gap-up driven by news that China was allegedly open to a narrower trade deal whereby they would agree to buy more agricultural products if the U.S., agrees to hold off on more tariffs. That doesn’t sound like much of a deal to me, but it was enough to spark a gap-up move in seeming contradiction to yesterday’s ugly sell-off.
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