The Dow Jones Industrial Average sold strongly in the stock market today due to a resurgence of coronavirus hospitalizations in several states. Furthermore, a new wave of tariff fears also hit Wall Street on Wednesday. The Nasdaq fell below the key level of 10,000. The heavy technology index hit a new all-time high on Tuesday of 10,296.
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Some leading stocks traded in buy zones on Wednesday despite the market sell-off. Meanwhile, all eyes are on Nike (NKE), as top blue chip stocks report earnings on Thursday after market close. Read more about Nike before its earnings in the latest IBD Earnings Preview.
Today on the stock market, the Nasdaq compound fell 2.3%. Meanwhile, the S&P 500 fell 2.7% and the Dow Jones sank 2.9%. The data showed that the volume was higher on both the Nasdaq and NYSE exchanges compared to the same time on Tuesday.
The Innovator IBD 50 (FFTY) fell as much as 2.4% on Wednesday. Despite strong sales, the ETF still remains within a key buy zone outside of a handle cup base and 33.48 buy points.
Dow Jones today
The Dow Jones traded about 750 points in the afternoon. The mass sale was fueled by reports that several states are currently experiencing record levels of Covid-19 hospitalizations and new cases.
According to the Worldometer, global coronavirus cases are close to 9.4 million, with approximately 480,000 deaths. In the United States, confirmed cases have exceeded 2.4 million.
Based on MarketSmith’s graphical analysis, the Dow Jones remains below a key resistance level on the 200-day moving average. Meanwhile, the S&P 500 tested and maintained support at its 200-day moving average on Monday, and the Nasdaq compound is again below the 10,000 level.
All 30 Dow components traded lower on Wednesday. Nine of the components decreased more than 3%. The biggest declines among the blue chips were Exxon Mobil (XOM) Dow Inc. (DOW) and Boeing (BA), 4.1%, 4.44% and 4.6%, respectively.
Among the top stocks on the Dow Industrials leaderboard, Nike sold more than 2% along with the rest of the market. The company reports earnings tomorrow after the market closes. Nike, which is forming a cup base with a handle, remains only 5% below a purchase point of 104.79. The 5% buy zone reaches a maximum of 110.03.
Nike currently maintains a solid 91 EPS rating and a 90 composite rating on a scale of 1 to 99. The composite rating represents key technical and fundamental metrics in a single rating. During a confirmed bullish trend, investors should be aware that it is better to focus on growing stocks with a composite rating of 95 or higher.
On the positive side of Nike, this current base is a first-stage pattern. Outbreaks are more likely to be successful in early stage patterns.
But the relative strength line, which compares a stock’s trend against the S&P 500, lags slightly. And Dow Jones stocks maintain an RS rating of 81.
Stocks to consider: Fortinet in the purchase area
Daqo New Energy (DQ), Lakeland Industries (LAKE) and Dovecote (PLMR) Everyone made the Stocks On The Move list on the Investors.com home page. This is a great place to look for potential breakout stocks.
Among the main stocks in the leaderboard, Fortinet traded within a buy zone on Wednesday, although the shares fell.
Fortinet shares remain above a buy point of 129.05 support at the 10-week line. The stock exploded on a trend line on Monday, good for a secondary entry around 141.
According to the leaderboard analysis, “Fortinet’s profit from the point of purchase exceeds 20%, so taking profit is an option. But it is also an industry group leader, so it makes sense to leave space for work. “
Follow Rachel Fox on Twitter at @foxonstocks for more market information and comments from Dow Jones.
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