• Investing
  • Stock
Round Table Thoughts
  • Economy
  • Editor’s Pick
Home Stock Mastering Stock Market Turbulence: Essential Insights for Investors
Stock

Mastering Stock Market Turbulence: Essential Insights for Investors

by April 9, 2025
by April 9, 2025 0 comment
Share
0
FacebookTwitterPinterestWhatsapp

Tariff turmoil continues sending the stock market into a turbulent spin. Tariffs went into effect at midnight, which sent equities and bond prices lower. Then before 1:30 PM ET Wednesday, President Trump announced that China would be slapped with 125% tariffs and the reciprocal tariffs are on pause for 90 days.

This was a huge turning point for the market. Without skipping a heartbeat, buyers rushed in and accumulated equities, especially large-cap growth stocks. The S&P 500 closed higher by 9.52%, the Nasdaq was up 12.16%, and the Dow was up 7.87%. Small and mid-cap stocks also saw substantial gains. 

Wednesday’s turnaround may have been the biggest one-day point gains in history for some of the broader stock market indexes but let’s look at the charts to see a clearer picture of what’s going on with this whacky stock market. 

A View of the Broader Stock Market

From a long-term perspective, the uptrend in the S&P 500, Nasdaq, and Dow are still intact. The weekly charts of the three indexes are also encouraging. But the daily charts are not yet screaming buy signals. Let’s start with the daily chart of the Nasdaq.

FIGURE 1. DAILY CHART OF NASDAQ COMPOSITE. The index has hit the resistance of its 21-day exponential moving average and breadth indicators in the lower panels show some breadth indicators are improving but not enough to suggest a bottom in the index.Chart source: StockCharts.com. For educational purposes. 

The Nasdaq touched its 21-day exponential moving average (EMA), which could be the first resistance level for it to overcome. The three breadth indicators in the lower panels—Nasdaq Composite Bullish Percent Index (BPI), NASDAQ Advance-Decline Line, and percentage of stocks trading above the 200-day moving average of the Nasdaq—are improving slightly but they are not showing signs of bullishness. 

Wednesday’s best-performing S&P sector was Technology followed by Consumer Discretionary. Rotation into these sectors implies risk-on investing. However, since the Nasdaq’s daily trend is still down, don’t let your emotions guide your investment decisions. Look for confirming signals before entering any long positions. 

The S&P 500 daily chart is not much different (see below). The index came close to touching its 21-day EMA. If the index opens higher on Thursday, watch this EMA closely. A break above it would be a positive move but there still needs to be a series of higher highs and higher lows for an uptrend to be established. 

FIGURE 2. DAILY CHART OF THE S&P 500 INDEX. It’s worth watching the 21-day EMA in the S&P 500. If the index breaks through that level and starts showing signs of an uptrend and the market breadth indicators suggest increasing bullish participation, it may be time to think about adding positions. But, we’re far from that point. Chart source: StockCharts.com. For educational purposes.

The market breadth indicators in the lower panels are showing some signs of improvement. The percentage of stocks trading above the 200-day moving average of the S&P 500 is at 31.80, which is encouraging but you want to see it at or above 50%. Like the Nasdaq, the S&P 500 is showing no clear signs of an uptrend, so tread carefully.

Replace the symbol in either of the above charts with $INDU and you’ll see that the Dow is in a similar position as the Nasdaq and S&P 500. 

Bonds to the Rescue?

Although equities showed a lot of movement on Wednesday, don’t lose sight of the shenanigans in the bond world. The 10-year U.S. Treasury yields rose as high as 4.47% but pulled back and closed at 4.40%, which is still relatively high. The iShares 20+ Year Treasury Bond ETF (TLT) closed 3.24% higher. 

This price action in TLT is worth watching closely. Bond prices fall when yields rise and Wednesday started out with stock and bond prices falling. This is unusual since bond prices usually rise when stocks fall. There was a lot of bond selling taking place the previous night which may have been due to the unwind of the basis trade by hedge funds. Since we’re technical analysts, instead of getting into the nitty gritty details of this hedge fund strategy, let’s analyze the five-year weekly chart of TLT.

FIGURE 3. FIVE-YEAR WEEKLY CHART OF TLT. This bond ETF has been in a downward trend for the last five years. Has its time come or will it linger in the depths of the abyss for longer? Chart source: StockCharts.com. For educational purposes.

Bond prices have been trending lower over the past five years and showing no signs of a reversal. Although TLT came off its lows, it still has a long way to go before showing modest signs of an uptrend. 

The Bottom Line 

Wednesday’s big turnaround didn’t change the big picture. We’re not out of the woods yet. And there’s more excitement to look forward to — the March CPI on Thursday morning and earnings season kicks off on Friday. A note about earnings — we probably won’t see much of an impact this quarter but keep your ear open for any chatter on how tariffs will affect profitability. 

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.

You Might Also Like
  • Last Week’s Pullback is a Buying Opportunity!
  • Consumer Spending Remains Strong – Here Are 3 Stocks For Your Watch List
  • When These Levels Break, The S&P 500 Is Going To Explode Higher
  • Small Caps & Value Sectors are Booming (For Now)
Share
0
FacebookTwitterPinterestWhatsapp

previous post
Key Levels for the S&P 500: Has It Bottomed?
next post
Stock Market Volatility: Pain Points, Bright Spots, and Strategies

You may also like

Earnings Season Has Started EXACTLY As I Would Have Expected

January 16, 2023

The Finances Look Good For Equity Trend

November 25, 2024

What Does it Take to Build EV Charging Stations?

July 31, 2023

The SCTR Report: Carvana Stock Makes It To Top of...

August 5, 2024

How To Buy Meta at a Bargain: An Options Strategy...

February 15, 2024

Dow Stocks Outperform! Here’s Why

June 22, 2024

The Great Rotation of 2023 Continues: Latest Updates and Insights

August 12, 2023

The Ord Oracle August 15, 2023

August 16, 2023

Where is the Market Finding Joy?

March 20, 2023

Retail Stocks Caught in Limbo: Will RTH Break Free and...

June 6, 2024

    Stay updated with the latest news, exclusive offers, and special promotions. Sign up now and be the first to know! As a member, you'll receive curated content, insider tips, and invitations to exclusive events. Don't miss out on being part of something special.


    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Nvidia results spark global chip rally

      May 30, 2025
    • Boeing to resume airplane deliveries to China next month, ramp up Max production, CEO says

      May 29, 2025
    • Nuclear Power Trio: OKLO, SMR, and CCJ in Focus

      May 29, 2025
    • Analyzing SIL, USO, and NVDA: Could These Bullish Patterns Trigger?

      May 29, 2025
    • E.l.f. Beauty to acquire Hailey Bieber skin care brand Rhode in up to $1 billion deal

      May 29, 2025

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be...

      June 27, 2024 2,763 views
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as...

      August 9, 2024 2,470 views
    • 3

      Biden appointee played key role in recruiting Chinese...

      June 25, 2024 2,449 views
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful...

      July 10, 2024 2,428 views
    • 5

      Harris VP pick spent years promoting research facility...

      August 29, 2024 2,306 views

    Categories

    • Economy (7,009)
    • Editor's Pick (2,104)
    • Investing (538)
    • Stock (2,578)

    Popular Posts

    • 1

      Trump-era China sanctions ended by Biden may be revived under new House GOP bill

      June 27, 2024
    • 2

      Walz’s honeymoon with China gets fresh scrutiny as Harris camp blasts ‘lying’ critics

      August 9, 2024
    • 3

      Biden appointee played key role in recruiting Chinese businesses to Delaware: ‘Longtime friends’

      June 25, 2024
    • 4

      Shein’s global ambitions leaves some cybersecurity experts fearful of Chinese spy threats

      July 10, 2024
    • 5

      Harris VP pick spent years promoting research facility that collaborated with ‘Chinese military company’

      August 29, 2024

    Latest News

    • Nvidia results spark global chip rally

      May 30, 2025
    • Boeing to resume airplane deliveries to China next month, ramp...

      May 29, 2025
    • Nuclear Power Trio: OKLO, SMR, and CCJ in Focus

      May 29, 2025

    Categories

    • Economy (7,009)
    • Editor's Pick (2,104)
    • Investing (538)
    • Stock (2,578)

    Disclaimer: RoundTableThoughts.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2024 RoundTableThoughts.com. All Rights Reserved.

    Round Table Thoughts
    • Investing
    • Stock
    Round Table Thoughts
    • Economy
    • Editor’s Pick

    Read alsox

    Oil & Gas Equipment & Services...

    March 15, 2024

    S&P 500 Under Pressure, Can Strong...

    November 2, 2024

    Growth is Alive and Kicking for...

    May 23, 2024
    Sign In

    Keep me signed in until I sign out

    Forgot your password?

    Password Recovery

    A new password will be emailed to you.

    Have received a new password? Login here