Stock Market Breadth: Dow Loses Momentum

Over in Europe, we have seen some life being breathed back into car sales. The number released today was better than the expectation. However, investors are primarily worried about a regional lockdown. The threat of a national lockdown remains real as well. If a national lockdown does occur in Europe and the U.K., it will destroy many businesses.  

The Asian stock market closed the week in negative territory. The Shanghai index declined 0.07%. The Korean KOSPI stock index also moved lower by 0.66%, while the Nikkei index declined 0.41%. The ASX All Australian 200 fell 0.54%.

The Dow Jones’ market breadth continued to lose momentum yesterday. 70% of the Dow Jones stocks traded above their 200-day moving average.  

The S&P 500 stock breadth also lost some steam yesterday. 71% of the shares traded above their 200-day moving average. This is a change of -2% from a day earlier.  

The Dow Jones futures are trading lower by 53 points. Yesterday, the U.S. Unemployment Claims data confirmed that the U.S. labour market had taken a U-turn again, and more Americans are filing for jobless claims. This shows that the U.S economy is in desperate need of another stimulus package; however, the lawmakers aren’t moving forward.

In terms of economic data today, it is all about the U.S. Consumer Sentiment data. The anticipation is to see a minor weakness in this number; however, it is possible that we may actually see a huge downward shift. If the Consumer Sentiment data misses the forecast by a small margin, it is unlikely to have a massive influence on the markets.

The Dow Jones futures have started to move higher, well above the 50-day SMA on the daily time frame. Yesterday’s candle indicates that there is still huge buying pressure, and bargain hunters are still very active in the market. As long as the price continues to trade above the 50, 100 and 200-day

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