Indexes Find Support As Oil Swings Wildly; Teradyne, Caterpillar, Sphere In Focus

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0:25Justin Nielsen:Good afternoon, everyone, and welcome to Stock Market Today for Monday, March 9th. It's Alyssa Coram here. And some wild swings in the market today, key levels to look at, some interesting headlines and charts to discuss. So joining me now to do just that is my colleague, Justin Nielsen. Justin, what do you have for us today?

0:44Alissa Coram:Well, gosh, I mean, besides the whiplash, we'll just take a look at a few stocks that were looking pretty attractive in terms of how they are handling things. So we'll take a look at Teradyn, Caterpillar, and Sphere. So a little bit of everything, industrial, chip, and entertainment.

1:02Justin Nielsen:Okay, let's do it. And first, let's take a look at the major indexes to discuss what went down in the market today or what went up. We had a reversal. Look at that. The Nasdaq finding support. You're right on both counts. Exactly. The Nasdaq finding support right at the 200-day line, at least for now, up 1.4 % on the day. Meanwhile, the S &P 500 was up 0.8 % on the day. Didn't come quite down to that 200-day, but a major upside reversal here for the S &P as well. The Dow up 0.5 % on the day, and the Russell 2000 up 1.1%. Markets really started moving when news broke that President Donald Trump said that the war in Iran would end, quote, soon.

1:55Justin Nielsen:So a lot of movement on that with oil, Justin. I mean, it was getting quite stratospheric here, but falling rapidly after that commentary came out. I can take a look at an intraday chart here just for folks to see when that news dropped. It was already starting to fill the gap, but then you really saw a big move down on those headlines. So news-driven market here, Justin. What do you make of it?

2:27Alissa Coram:Yeah, I mean, just wild, wild stuff. And so this is where you have to be very careful, because look, we were talking about this on IBD Live this morning, you know, where the indexes were coming down, especially the NASDAQ. It's just that kind of picture perfect area, right? The 200 day moving average line. There's kind of this line of support that it had around twenty two thousand five hundred that it was holding and it kept on diving below it. But then buyers would come in each and every time for all of these upside reversals. The problem with these upside reversals lately has been they don't stick.

3:00Alissa Coram:You know, you get an upside reversal and maybe you get a few days of progress and then you roll over again. So one of these times it will stick, but you also have to protect yourself from the case in which it doesn't, you know, because you never know. certainly over the weekend. And, you know, you pointed out how wild oil was. I mean, that's not even taking into consideration the futures market when it was up even more, you know, forget intraday, but up over the weekend. So just some really wild movements. And this is one of the problems that you have with a headline driven market. You know, the headlines are coming at you fast and furious, especially the way that the market went.

3:40Alissa Coram:I mean, And it was reversing. It was kind of making progress, but it was really an acceleration in the last 45 minutes of trade. So it's not one of those markets that you really want to take your eye off of if you're still invested. And if you're not invested, if you've gone to cash, then I think it's still a market that you don't want to take your eye off of because, again, there could be a turn at any moment. And while we don't need to get ourselves back in at a bottom, you want to be very aware of what's happening so that if we do get a follow through, if we do get that evidence that the market has turned, you're not caught flat footed.

4:19Alissa Coram:You know, what does that mean? It means that you have a watch list ready. You've identified stocks that have been holding up. And in a case like this, you might be identifying stocks that maybe came down to their 50 day moving average lines and got support. It's a little bit sometimes hard to be buying on the weakness. But when you start seeing the bounces and take that step back to the overall trend that a lot of these stocks and indexes are in, even like the weekly chart or a monthly chart on the NASDAQ, it's a very different picture. You know, kind of this sideways action, you know, really kind of looks more like a consolidation of this longer term uptrend.

4:59Alissa Coram:And that doesn't look quite as bad. right? It's certainly not the wiggles and wobbles that we feel on a daily basis. So, again, I think the big thing here is you've got to be careful. We have been in a sideways market. And while there were a lot of temptations before because of things that were working, the last couple weeks kind of turned that around where just a lot of things weren't working. The things that were were kind of coming off the bottom and looked really bad. So now we'll see if we can get a reset here and get a normal, normal type of rally eventually.

5:37Justin Nielsen:And on this weekly chart of the NASDAQ, you can see the black line, the 40 week, so 200 day on the daily, 40 week on the weekly. And you can see how important that level is, whether we bounce and it could lead to a rally or if you lose that that's when you tend to see a lot more pain, it seems like. Justin, that's what Webby and I were talking about on Friday's show. So we're definitely not out of the woods yet, but it is really interesting to see the support where we got it, where you have the news line up with the technicals. I do think that that is pretty interesting, and we have seen that play out historically.

6:18Justin Nielsen:I'm always fascinated by that. whenever you have those stars aligned that can be very powerful, but different scenarios, of course, in each circumstance. But do you think that, you know, we are on follow-through day watch. So for those who are not familiar, today is day one of a rally attempt, and we want to see that low hold, ideally a couple of days of progress, And then we want to see a notable gain with volume heavier than the prior session. And then that might be the time to start putting more money to work, Justin, aside from perhaps some probing positions for the risk tolerant here in the meantime.

7:05Justin Nielsen:Right. But buyer beware.

7:07Alissa Coram:Yes, absolutely. And one more thing to add there. I'm not sure if I caught it or not, but we generally, as you said, this is day one. we generally wait until day four before we even look for that follow-through day because we want that evidence that not only can you hold, but you can hold for multiple days, right? And I always think of it back in the geometry days, right? You, in order to make a line, you need two points. So point one is this day one, point two is our follow-through day. And if that starts looking like, oh, okay, now we've got a line that shows a potential uptrend, doesn't mean it's going to work, But we at least have something to trade off.

7:44Alissa Coram:And certainly, I think what these upside reversals have given us, and remember, there have been a few of these rally attempts that have quickly failed. But what this does give us is an area where we know we're wrong. But as you said on IBD Live this morning, if we do lose the support area, it's kind of look out below.

8:05Justin Nielsen:Mm-hmm. So we'll have to be nimble in the meantime, but very interesting action here today. So that's a look at the NASDAQ. Anything else that you want to add on the indexes, Justin, before we move on?

8:17Alissa Coram:Well, I think, again, one of the things that was pretty incredible was the Russell 2000, because the Russell 2000 was down, you know, I think the worst at its lows. It was down. And again, this is not even counting the futures, because the futures, I mean, I think things were all down like 2 % or more, except for oil, of course. But, you know, the Russell 2000, during the normal trading session, this was down about 2.5%. So for this to go to close up with a 1%, you know, a 1 % gain is pretty strong. And remember, the Russell, you know, the Russell 2000 was one of those areas that seemed like it was getting a lot of that, you know, kind of rotation benefit before.

9:03Alissa Coram:But now that we kind of lost the 50-day moving average line, and if you go back to the daily chart on this one, we, you know, we lost the 50-day moving average line and it started coming in really sharply. But here again, we didn't have a 200-day moving average line in this case. But if you kind of draw that line to the left, you see, oh, So, lo and behold, there's this 2480-68. There's kind of the resistance area from back in October, November. So, again, these lines are, they act as resistance at first and then they become support. So far, what we have had is that buying coming in. I also want to mention that EQAL and RSP, because we were paying a lot of attention to these equal weighted, you know, indexes.

9:51Alissa Coram:EQAL came back. Not as strong in terms of its move up today, but the fact that it was kind of getting above Friday's high, I think, was pretty impressive. And of course, this is the Russell 1000 equal weighted ETF. And RSP, again, not necessarily a huge move in terms of its gain today, but RSP, which is the equal weighted S &P 500, that was also a nice reversal today and, you know, showing up. So, again, that does speak to a little bit of breadth, you know, coming in. It wasn't just the MAG-7, although the MAG-7, in this case, if you look at MAGS, that was up over 1%. But you could also see some areas of potential resistance for the MAG-7.

10:36Alissa Coram:Okay, there's that 200-day moving average line kind of looming as a spot where it might hit resistance. Same thing for RSP. You have the 50-day moving average line in that case where it's come back up to that line. So now we'll have to see if it can punch up through it.

10:54Justin Nielsen:And let's take a look at some of the sector and thematic action out there, Justin. First, let's go to SMH representing the chip sector up 3.6 percent today. That's a move.

11:08Alissa Coram:Yeah, it certainly is, especially after kind of a pummeling last week. You know, it was interesting. We've been talking about how bad software looked and IGV has just been in this major downtrend, whereas, as has a lot of tech, whereas SMH was really holding up very nicely comparatively. But last week it was this flip-flop where SMH was really getting hurt. IGV was coming back from the dead and it was a big flip-flop. But today, certainly you're seeing more of that power in the chip space, whereas software, I mean, yeah, it was off its lows, but it was kind of a ho-hum day and still down at the end of the day for the IGV software ETF.

11:54Justin Nielsen:Mm-hmm. Exactly. So I'll pop that up real quick. Okay. Elsewhere, let's take a look at GDX, the gold miners, an upside reversal at a key level here.

12:05Alissa Coram:Yeah, 50-day moving average line, 100. You know, remember, we did have quite the move here from the last breakout in December, and it really got pummeled again. Silver was worse, but this certainly had its trouble, you know, as it came down. But, you know, gold has looked different, you know, whereas silver looked like it has, you know, it was kind of broken and had a lot of work to do. This was looking a lot better. And if you look at GDX, which was the gold miners, that actually was getting back into new high territory. So it was able to kind of shake off that ugliness from the start of the year.

12:45Alissa Coram:And now it's come down to the 50 day moving average line. This is exactly where you'd like to get support. I mean, it did come down fairly steeply, you know, below that line, but we closed above it. So I don't want to say no harm, no foul, because it certainly could cause some harm. But the fact that it closed where it did is certainly encouraging.

13:07Justin Nielsen:And I feel like historically you can get some of these, you know, if you're comparing gold to the gold miners, you definitely have a little bit more octane in the miners, right? Right.

13:16Alissa Coram:And that can work to your benefit, but it can also work to your detriment, depending on which way things are going.

13:22Justin Nielsen:Yeah. OK, let's take a look at Bitcoin. How did that fare as the headlines played out today? Not a whole lot of oomph here, Justin, was up 1.4 percent on the day, but it's not like this was leading in any way here. It's still trying to find a bottom.

13:41Alissa Coram:Exactly. So, again, I think there's still work here to be done. And, you know, there's there is certainly and we can go to the monthly chart or even put up the the grayscale. Yeah, GBTC, you know, that just to show a little bit more history. So, look, you know, GBTC shows that there there could be more pain here. So it's not necessarily time to get excited. But one of the things that you could look at is where, again, if you draw that line to the left, it is getting kind of support at an area that seems, you know, like you'd want it to get support at. So we'll see on that one.

14:19Justin Nielsen:Yeah. OK. And we did pull up the USO chart earlier just to show that move in oil still for the month, a very hefty gain. But it has come off quite a bit with the headlines that broke in today. session. While we're looking at this, we also want to take a look at some oil-related ETFs, the first being XOP, Exploration and Production.

14:46Alissa Coram:Yeah, very interesting, again, because we were looking at these, and certainly last week, it was all about the explorers and producers. You know, we have three different groups, the Canadian, the international, and the U.S. explorers and producers in our 197 industry groups, and those were kind of the winners last week. field services, OIH, those were kind of, those have been struggling a little bit. They really were kind of taking a ramp up after the Venezuela, you know, issue where Maduro was removed. But, you know, over the last couple of weeks where oil has really moved, field services came in.

15:25Alissa Coram:But look at the upside reversal there on the field services today versus what was happening with the explorers and producers. So again, it's important to kind of recognize it's not just oil, but, you know, the price of oil, but what's kind of the exposure? There's very different movement between the explorers, producers, field services, drillers, refiners, and sometimes the transport and shipping areas, pipelines. So, you know, just be very cognizant of what you own. And it's also important to kind of sometimes separate the oil from the natural gas, because a lot of these groups are oil and gas, and you sometimes need to know which one so that you know where things are going.

16:06Alissa Coram:But just to put some numbers for the move in oil, you brought up USO, which is an oil ETF. But in terms of the actual price of the oil futures, you know, they got all the way up to like one, almost 120, I think over the overnight. Yeah, I think this was like yesterday, yesterday evening, they got up to 120. And where they're at right now is 87. That's a pretty dramatic move in a single day. And again, this is one of those things where you might have been saying, oh, well, this is the slam dunk play. But again, with these headlines, I think you have to be very careful. There's no such thing.

16:47Justin Nielsen:Right. Kind of what you were saying before the show, got dunked on or slammed. Yeah. We're right ahead of March Madness, right?

16:55Alissa Coram:So, yeah, we'll see how SMU does. I noticed that they're on the bubble. They really kind of came under the... Yeah.

17:03Justin Nielsen:But I think, Justin, this is playing because IBD looks at market history. That gives us an edge, right? We know that in these news driven scenarios and when something goes vertical like this, it doesn't last forever. And so your risk is elevated, especially with something so news driven. So you need to really be careful and manage risk. So not a surprise to see this happen.

17:29Alissa Coram:And this is where kind of buying right will solve a lot of your selling issues. Because imagine if you had bought this, I mean, we have a line right there, a line of resistance, that green dash line. Imagine if you had bought as this crossed that area of resistance, you know, initially versus if you had bought because you just were afraid you were missing out on the move. you know so a buy a buy there on at USO in the 85 area and again remember that doesn't necessarily translate to the futures prices that we're seeing right now but you know in that area is very different than buying let's say last week at as it crossed 100 and you just maybe were panicking like oh my gosh this is this is the easiest trade ever and yeah exactly FOMO fear of missing out and so you know if you would bought early you're in a very different position you could even hold on to this and maybe weather a storm, but you certainly don't have to.

18:25Alissa Coram:And this is also where selling into strength. Scott St. Clair on Ivy Live this morning has mentioned, you know, we were calling him the roadrunner because he's just being a little bit quicker, not letting things hurt him, you know, and being quick in that kind of case. Taking profits is one way to do that and survive.

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19:13Alissa Coram:Yeah. So again, a lot of times we talk about how easy it is after the fact where, oh, look at these opportunities that you had to buy this as it, you know, based or as it pulled back to the 50 day moving average line. The problem is when these 50 day moving average line pullbacks happen, you're a lot of times not in the mood for