Dow Jones futures edged lower overnight, accompanied by S&P 500 and Nasdaq futures. Bitcoin, on the other hand, soared above $100,000 and continued its upward trajectory. This significant movement in the cryptocurrency market was further influenced by Federal Reserve chief Jerome Powell's remarks about bitcoin being "digital gold."

Unraveling the Overnight Market Dynamics

Stock Market Rally and Earnings

The stock market rally witnessed a strong Wednesday, with all major indexes reaching new highs. Salesforce.com (CRM), Marvell Technology (MRVL), and other tech stocks led the way with strong earnings. Software stocks, in particular, showed remarkable strength. The Dow Jones Industrial Average rose 0.7%, the S&P 500 index gained 0.6%, and the Nasdaq composite jumped 1.3%, all hitting record highs intraday. The small-cap Russell 2000 also climbed 0.4%, approaching all-time levels.During this rally, tech growth stocks thrived while energy and commodity plays retreated. Homebuilders faced challenges even with falling Treasury yields. U.S. crude oil prices fell 2% to $68.54 a barrel, and the 10-year Treasury yield initially rose to 4.19% before falling four basis points to 4.18% after hitting 4.28% intraday. The ADP Employment Report and the ISM services index for November came in lighter than expected.

Nvidia Stock and Its Potential

Nvidia (NVDA) stock rose 3.5% to 145.14, reclaiming the 21-day moving average and a 140.76 buy point. MarketSurge indicates that investors could use the 150 level as an add-on entry above the recent trading range. Additionally, Nvidia is likely benefiting from Marvell's 23.2% gap-up to a record high following earnings. NVDA stock, which rebounded this week from the 10-week line, has been consolidating since late June. Despite its significant move since late 2022, Nvidia has a relatively low forward price-earnings valuation due to its continued growth. Perhaps the AI leader is ready for another run, similar to its late October breakout. Getting above the trading range will be crucial.

Key Earnings and After-Hours Action

SentinelOne (S), nCino (NCNO), Synopsys (SNPS), AeroVironment (AVAV), and American Eagle Outfitters (AEO) reported Wednesday night. All these stocks fell solidly to sharply in after-hours action. Synopsys, SentinelOne, and nCino are likely to undercut or at least test their buy points.Among growth ETFs, the Innovator IBD 50 ETF (FFTY) popped 1.15%, the iShares Expanded Tech-Software Sector ETF (IGV) jumped 3.9% with Salesforce stock being the No. 1 holding and Confluent, HubSpot, SentinelOne, and nCino also in IGV. The VanEck Vectors Semiconductor ETF (SMH) gained 1.7% with Nvidia stock as the No. 1 component and Marvell also in the ETF. Chip-design software maker Synopsys is in both IGV and SMH. ARK Innovation ETF (ARKK) rallied 3.1% and ARK Genomics ETF (ARKG) advanced 1.7%. However, the SPDR S&P Metals & Mining ETF (XME) fell 1.45%, the SPDR S&P Homebuilders ETF (XHB) sank 1.5%, the Energy Select SPDR ETF (XLE) slumped 2.4%, and the Health Care Select Sector SPDR Fund (XLV) lost a fraction. The Industrial Select Sector SPDR Fund (XLI) rose 0.4%, while the Financial Select SPDR ETF (XLF) declined 0.4%.It's important to note that overnight action in Dow futures and other markets doesn't necessarily translate into actual trading in the next regular stock market session. Investors need to stay engaged and work on their watchlists to identify setups and take advantage of market opportunities. Reading The Big Picture every day helps stay in sync with the market direction and leading stocks and sectors.Please follow Ed Carson on Threads at @edcarson1971 and X/Twitter at @IBD_ECarson for stock market updates and more.