26 Nov Market Movements Today: Investors Rejoice as Stocks Rally, Bitcoin and Gold Backslide
It’s a short trading week, and the stock market is rallying. It’s clear that Wall Street liked President-elect Donald Trump’s choice of Scott Bessent for Treasury Secretary.
The broader stock market indexes closed higher, with the Dow Jones Industrial Average ($INDU) closing at a new record. The S&P 500 ($SPX) tried to meet its all-time high, but didn’t. The Nasdaq Composite ($COMPQ), meanwhile, is still struggling to close above its November 7 low of 19084.
Small caps were the best performers. The S&P 500 Small Cap Index ($SML) rose 1.80%, and the S&P 400 Mid Cap Index ($MID) was close behind, rising 1.45%. Both indexes hit a new record high.
Overall, it was a green day in the equities world, as can be seen by Monday’s MarketCarpet.
The bond market breathed a sigh of relief—Treasury yields fell, and bond prices rose. The iShares 20+ Year Bond ETF (TLT) rose about 2.59% on Monday. But the gap up in price is just a blip in the weekly chart of TLT (see below).
TLT is still trading below its 21-day exponential moving average (EMA). It’s also close to its 2023 low. One day doesn’t make a trend, but it’s worth watching this chart closely.
While stocks and bond prices rose, other assets that have been rallying lately saw significant declines. Gold prices, oil, and the US dollar experienced steep declines on Monday. Some news surfaced that a peace deal may be in the works between Israel and Hezbollah. With that in mind, investors may be less worried about geopolitical risks and have switched to a risk-off sentiment.
The daily chart of the SPDR Gold Shares (GLD) below shows the depth of Monday’s fall in gold prices.
It was a surprising reversal. After reaching a high on October 30, GLD dropped 8.30%, bounced and made up for most of that drop. But Monday’s price action gets it closer to the November low. GLD is also trading below its 25-day simple moving average (SMA), which is now starting to trend lower.
Monday was not Bitcoin’s day either. After hitting its psychological 100K level and failing to close there, $BTCUSD declined 4.46%.
The overall trend is still bullish; if it falls below its 21-day EMA, the sentiment may become bearish.
The Bottom Line
Many big moves on Monday suggested that investors may be less fearful heading into the Thanksgiving holiday. The Cboe Volatility Index ($VIX), often considered the fear gauge, is now below 15, further confirming that investors are complacent.
There are a couple of relevant events taking place this week. Tuesday is the FOMC minutes and, on Wednesday, we get the October personal-consumption expenditures price index (PCE). If either of these are vastly different from expectations, which I doubt, there may be significant shifts in the market.
Keep an eye on your StockCharts Dashboard regularly. If there are any shifts in market dynamics, that’s the first place you’ll see it.
Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.
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