D&D Note (4.7.2020) ~ Rallies Built On Hope Tend To Fade ~
The S&P 500 started the day with a 3.5% gain on the back of yesterdays Hope fueled rally. Problem with having a rally not based on Fundamentals or Technicals is that they tend to always fade. Throughout the day the market drifted lower and all three major Indexes finished the day down and in the red.
DOW down -0.12%
S&P 500 down -0.16%
NASADQ down -0.33%
While New York saw the 3rd day of declining new Coronavirus cases they also saw the worse single day increase of deaths today with now 5,489 deaths up from yesterdays 4,758. The United Kingdom also had its worse day for deaths with 786. Saudi Arabia cases could hit 200,000. Israel makes restrictions more tight ahead of Passover to help prevent the spread of cases. Indonesia has a record rise is in cases rising by 247 from Monday. Singapore proposes banning all gatherings. Japan declares emergency for Tokyo. Boris Johnson the U.K. Prime Minister remains in Intensive Care Unit.
Global Covid-19 virus cases top 1.4 million and deaths exceed 81,000.
The point is there is still a lot more pain to come in the weeks ahead.
Today the VIX spiked midday then fell back down to spike again at the end of the trading session to 46.70.
In a teleconference today the former FED Chairman Bernanke said he does not see a quick V shaped recovery. However he doesn’t foresee a prolonged Great Depression like period but it will take 1-2 years to get back to normalcy.
Congress has recognized that the money allocated for Small Business Loans was not enough and are looking to vote Thursday in the Senate to re-appropriate $200 Billion to increase the SBA loan program.
Tesla (TSLA) rallied 5.03% on the day on reports they are going to be debuting a new Model 3 in China.
~ Dave James / Principal Trader and Market Strategist
D&D Investments 
Discussion
No comments yet.