The recent performance of the American stock market has captured the attention of investors as it rebounded significantly on Monday, reversing much of the losses experienced last WednesdayThis upward movement has seen major indices including the Dow Jones and S&P 500 reclaim their positions within an upward channel, from which they had briefly fallenThe Dow Jones managed to maintain its mid-to-long-term upward trend line, while the S&P 500 has now returned to its rising channelThis marks the potential for a halt in the downward trend and signs of recovery in both indices.

In contrast, the Nasdaq, which had earlier avoided a fall from its channel, found support and is now undergoing a period of fluctuating gainsThe Nasdaq Golden Dragon Index, representing Chinese stocks listed in the United States, saw a modest recovery on Monday after witnessing sharp declinesThis index had been slightly stuck on its upward trajectory but showed signs of stabilizing around its mid-to-long-term trend line, suggesting a potential for sustained support moving forward.

However, not all sectors are experiencing such positive outcomes

The S&P Real Estate and S&P Biotechnology indices have been on a long-term upward trend but faced recent resistance and have broken through crucial support levelsThis has resulted in short-term downward trends, although they manage to rebound with indications of halting lossesUnfortunately, these sectors have yet to break through the downward trend lines, leaving them in a precarious position.

Similarly, commodity markets such as gold and silver futures have shown volatility, initially trending upward before experiencing significant pullbacksSadly, these trends have included breaking through essential short-term upward trend lines, signaling bearish activityIn recent days, however, there has been some stabilization, with gold remaining close to crucial support levels while silver successfully retains its long-term uptrend support.

Moreover, crude oil futures have been in a downward spiral, nearing their lows and creating a symmetrical triangle pattern as they oscillate around key support zones

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The future direction of oil remains unclear as the market grapples with this ongoing turbulence.

Looking at the longer-term trends, the oil and gas sector has found itself at an impasse with prolonged lateral movement, encountering resistance midway through an earlier upward connectivityA few years have seen this means of trading bound tightly in horizontal ranges, with a recent unexpected decline breaking through earlier support levelsAs of the last couple of days, there have been rebounds into the support areas, hinting at possible upward movements.

On Wall Street, the close was promising, with all major indices ending the day in positive territoryThe Dow Jones Industrial Average and Nasdaq Composite both recorded three consecutive days of gainsThis can be attributed to many of the so-called "magnificent seven" tech stocks rallying during a lackluster trading holidayThese large-cap stocks are especially influential in shaping market trends, and their performance was particularly pronounced during a week when many investors were on holiday.

Trading volume on U.S

exchanges totaled about 12.76 billion shares, which is lower than the average of 14.89 billion shares traded over the past 20 sessionsDespite this reduced activity, tech stocks like Meta Platforms, Nvidia, and Tesla witnessed substantial gains, with increases ranging from 2.3% to 3.7%. Similarly, other major players like Apple, Amazon, and Alphabet also experienced an upswing, further contributing to the market's positive momentum.

The continued rise in the Nasdaq Composite and Dow Jones Industrial Average has resulted in a third consecutive climb for both indices, with the S&P 500 also joining this streakSpecifically, the S&P 500 index rose by 43.22 points or 0.73%, ending at 5,974.07 points, while the Nasdaq Composite gained 192.29 points, or 0.98%, closing at 19,764.89 pointsThe Dow Jones Industrial Average roundly increased by 66.69 points or 0.16%, reaching 42,906.95 points.

Despite robust upward trends since November of last year, the markets are facing a challenge in October, particularly following the Federal Reserve's forecast indicating only two rate cuts in 2025, with each cut expected to be a modest 25 basis points—fewer than the four cuts suggested in September

Last Wednesday's message from the Fed, which hinted at slowing the pace of rate cuts, spurred a sell-off that rippled through the markets.

Northlight Asset Management's Chief Investment Officer Chris Zaccarelli noted that despite these fluctuations in trends as investors recalibrate their rate expectations, the preference for technology and tech-driven stocks remains robustHe stated, "What we see today is a microcosm of what we've observed throughout the year; while we saw some rebounds in the past few weeks, the trend has returned to its historical form."

In addition to benchmark indices soaring, the S&P 500's 11 sectors reflected similar bullish sentiments, with eight sectors closing higher on Monday, notably the communication services segment, which showcased a healthy increase of 1.4%.

Seasonally, the markets are confined within a historically strong period as well, commonly referred to as the “Santa Claus rally.” Data shows that since 1969, the S&P 500 has averaged a rise of 1.3% during the final five trading days of the year plus the first two of the following year, indicating a traditional robust period for investors.

Zaccarelli feels that the conditions for such a rally are ripe this year, as the current upward movement may suggest that investors are holding their positions rather than selling for capital gains tax purposes.

In other stock news, Qualcomm's shares surged by 3.5% after a jury ruled that its processors had obtained proper licensing under agreements with Arm Holdings, despite Arm's plans to seek a retrial that may potentially reverse the decision sparking a 4% drop in its stock price.

Walmart's shares fell by 2% following allegations from U.S