Below are highlights from the NDW Morning Update Video for the morning of 10/21.

Below are highlights from the NDW Morning Update Video for the morning of 10/21. Access the video on the NDW Morning Update Video page. 

• Tuesday’s (10/20) trading action was largely positive as many major assets gained ground throughout the day. Leading the way to the upside were small caps (RUT), the equal weight S&P 500 (SPXEWI) and the Dow Jones Industrial Average (.DJIA) which all picked up over 1% for the day.
• In terms of notable chart changes, the upside action for the Russell 2000 saw the index return to a column of Xs on its default chart to a chart reading of 2780. Despite this, the recent exhale has seen (RUT) rattle off a string of sell signals and return to a negative trend. All that to say, keep a watchful eye over small cap exposure as we wrap up October.
• Other changes included a reversal back into X’s for long-duration bond fund (TLT) as rates cooled slightly. Despite the short-term uptick, fixed income-particularly those areas further out on the curve- remain laggards when compared to other areas of the investable universe.
• Near-term participation has continued to improve. The percentage of S&P 500 stocks trading above their 50-day moving average (^TWSPX) has climbed back up over 50% recently… a net positive as near-term breadth expands. While the recent exhale has left some damage to more intermediate/long-term readings, an uptick in positively contributing stocks is certainly a good thing.
• The closing bell today (10/21) ushers in earnings for several household names. The likes of META (META), Tesla (TSLA) and Lam Research (LRCX) report after close. Each name earning a technical “Hold” rating (3/5) according to NDW’s technical attribute rating system heading into their respective calls. Looking out to Thursday, Valero Energy (VLO, 5/5’er) is a standout.