Home NewsStock Market News U.S. stocks continue to rise, is a bear market rebound or a bull market resurgence? | Anue Juheng- US Stock Radar

U.S. stocks continue to rise, is a bear market rebound or a bull market resurgence? | Anue Juheng- US Stock Radar

by WOOWinvest
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U.S. stocks continue to rise, is a bear market rebound or a bull market resurgence? | Anue Juheng- US Stock Radar


The Nasdaq led U.S. stocks higher on Wednesday after better-than-expected earnings from the technology sector, and economic data also improved investor sentiment.

Some analysts believe that from a technical point of view, the rebound in U.S. stocks may herald the end of the bear market in 2022. But while U.S. stocks have been rising since mid-June, the threat hasn’t gone away. Many investors worry that the recent strength in the stock market is a bear trap. “Barron’s” believes that investors can use options strategies to protect stock portfolios from stock market volatility.

Ned Davis Research analysts Ed Clissold and Thanh Nguyen wrote in a research note that while the recent rally in U.S. stocks may be just a bear market rally, the technical improvement is more like a new bull market cycle than Bear market rally.

Technical analysts pay close attention to a variety of indicators that measure the breadth of the stock market, namely the number of stocks that are rising or falling.

Two analysts pointed out that the rebound in the U.S. stock market after Fed Chairman Powell’s interest rate hike news conference triggered two rare “breadth thrust” signals. First, the ratio of stocks hitting new 20-day highs exceeded 55% for the first time since June 2020; second, the 10-day change ratio rose above 1.9 for the first time since 2021.

They point out that while the measure of “breadth of breakouts” is rarely used, it has become more frequently cited over the past 13 years amid the growing influence of ETFs, algorithmic trading and other factors.

The two analysts found that the proportion of stocks at new 21-day and 63-day highs and above the 50-day moving average was above the median not only of a bear market rally, but also of a new bull market.

Overall, the technical picture for U.S. stocks has not improved as much as it did in 2009, 2011 and 2016, but by most breadth indicators, the momentum is stronger than the beginnings of several bull markets in the late 1980s and early 2000s, they said. Time.

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