Market Outlook™ – 01/27/20
Today’s Market Outlook:
On a second consecutive day of strong volume and bigger-than-average trading range, the S&P 500® fell more than 51 points to close with its biggest loss since December 3 – surpassing Friday’s decline. Not surprisingly, the momentum and near-term lines fell into oversold territory. But, the momentum line avoided extreme levels and the near-term line stayed high inside the lower reversal zone. As a result, the oversold short-term conditions combined with a persistent strong bullish intermediate posture suggests there may be a quick bounce in equities to fill in this morning’s opening gap over the next few days. Long-term Market Sentiment remains strongly bullish. The Russell 2000® still shows a weak bearish intermediate posture but its near-term line is setting up a potential bullish near-term divergence.