Ahead of the long weekend, it is rare for the markets to make big moves. Normally we will see choppy action and low volumes. The chart below shows a typical Friday ahead of the long weekend. Historically Memorial Day Weekend sees a big jump in driving.
The chart below shows the tight trading range the index is in. I am expecting a move lower into the close today but it won’t setup Tuesday’s open. That will happen depending on events over the weekend on the trade issues, if any new ones develop. The chart also shows Williams %R which measures volatility, is fairly even. New York has traded just 1.7 billion shares and the NASDAQ just 1 billion by 2:40 PM. These are very low numbers.
SPX May 24 2019
On New York new highs are 117 and lows are at 80 while on the NASDAQ new lows are at 101 and new highs just 48. Next week looks choppy again to end the month. May is known as the worst month of the year historically for stocks. This year has certainly not been great but overall, December and November last year were far worse. May 2019 so far has been primarily sideways with plunges and then rallies back but in general the markets are still trading within easy reach of their old highs. A catalyst is needed and trade resolutions with China would go a long way to jump-starting the rally further. At this time, I think it could be months before anything definitive comes on the trade talks with China.
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Disclaimer: There are risks involved in all investment strategies and investors can and do lose capital. Trade at your own risk.