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Good evening StockBandits!
Sunday evening weakness in the futures markets indicated a poor start for US stocks after the weekend, but an overnight reversal to the upside and some positive economic data painted a much different picture by the time the stock market opened. [Read more…]
Stocks stumbled last week with the bounce from the prior week quickly getting sold. The failure created a lower high for the S&P 500, the DJIA, and the RUT, turning the short-term direction downward. Across the board, we saw declines of 1.5 to 2.1%, which was certainly a change of pace for this market after such persistent strength.
As we head into a new week of trading, it’s time once again to take a look at the indexes and the key levels they’re dealing with. This will impact how individual names move, so it’s where every new trading week begins.
NAZ – The NAZ gave up 61 points last week with a feeble Monday lift to new multi-year highs followed by heavy price action into the remainder of the week. It established a lower short-term low (red line) as it broke below 4004 from early this month and ultimately finished right at 4000. Next level to watch is 3966 from October, as a break below that could see profit-taking accelerate.
SP500 – The S&P saw a minor advance last Monday which stopped shy of the 1813 high to make a lower high, then rolled over hard to test the 1775 area where it ultimately finished the week. This has been a big level going back to October as we’ve seen it serve as both resistance and support in Q4. A downside break would open the door to 1746 as next lateral support.
RUT – The RUT led the way lower last week as cash got raised aggressively in small-caps. That brought a lower high and a lower low with a 2.1% decline in this index. It’s now 40 points off its recent high, and just a short distance from the next lateral level of 1096 where support was found in mid-November. The late-week bounce wasn’t impressive, and I’d expect to see 1123 serve as resistance now that we’ve seen such a decisive break below that level.
DJIA – The DJIA shed 264 points last week as a poor finish to Monday’s advance segued into a hard selloff mid-week. That brought about a test of the September high and now leaves this index with both a lower high and a lower low. Upside has been rare over the last couple of weeks, with the jobs report rally the prior Friday standing out like a sore thumb in what has otherwise been persistent weakness.
Take a trial of the Stock Pick Service to get my trades.
Trade Like a Bandit!
Jeff White
Good evening StockBandits!
The market struggled last week across the board with the major indexes shedding 1.5% to 2.1%. The bounce from the end of the prior week was completely erased, and downside volume picked up. [Read more…]
Good evening StockBandits!
The warning signs were there, and today we got another pullback. The shift to safety (gold & bonds) and intraday equity weakness on Tuesday, paired with a lack of follow through to Friday’s big rally, set the stage for some selling if the bulls didn’t get in gear. [Read more…]
Good evening StockBandits!
The indexes took a breather today with mild pullbacks across the board. Interestingly, there was a bit of a flight to safety as both gold and bonds popped to add to their recent lifts from short-term lows. [Read more…]
Good evening StockBandits!
The market showed some letup today as Friday’s strong rally saw no real follow through to speak of. [Read more…]
The Thanksgiving rally saw no follow through this past week as the indexes took a break. A highly-anticipated jobs number on Friday did produce a pop, but it wasn’t enough to overcome what had been given back the rest of the week, so ultimately each of the key indexes finished lower. The bulls point to mild profit-taking, while the bears are hoping it’s the beginning of the end (again). It should be fun to see it all play out.
One other note I’d like to point out right now is that it’s December, and as the month progresses there are always a few cross-currents which aren’t present the rest of the year. We have the usual window-dressing here at the end of the quarter, but beyond that are fund redemptions, index rebalancing, tax-related sales, all paired with some lighter holiday volume that’s sure to come. Keep that in mind the next few weeks and tread a little lighter than usual because of it.
This week I’m going to mix it up just a bit and look at 4 main index ETF’s. These of course resemble the key indexes, so taking note of the price action taking place there will also affect how individual stocks move.
QQQ – The NAZ 100 ETF is still trending higher, and in fact just made a new multi-year high in Friday’s session. This daily chart does highlight a rising wedge pattern, and price is nearing the apex. These patterns often resolve lower as even a lateral move in price will bring a break of the lower trend line first. In order to negate this pattern, QQQ and the NAZ 100 will need to accelerate higher and actually break out above the upper trend line.
SPY – The S&P 500 ETF is sitting in a high-level channel as it bases and digests the rally off the October low. Price turned higher within the range on Friday and now isn’t far from upper resistance. A breakout through $181.75 could spark a measured move of $4.25 (height of the range), taking this ETF to the $186 area on the next move. Price needs to first clear the highs in order to set that move in motion.
IWM – The RUT 2000 ETF bounced Thursday and Friday, yet still finished some $1.66 below the recent high. That leaves it roughly 1.5% shy of the highs. There’s a lateral level that has been respected from both sides since October which stands at $111.50, and currently price is back above that level after multiple tests last week. Also note the higher lows in place over the past few weeks which point to ongoing buying of weakness.
DIA – The DJIA ETF resembles the S&P as it sits in this high-level channel pattern digesting the rally off the October low. $161.58 is the current high, with support at $157.80 (former resistance). That makes a $3.78 trading range, which could eventually produce a measured move if price breaks out to the upside. For now, there’s room on both sides of price before either boundary would be threatened, so more time may be needed before we see a decisive exit from this range.
Take a trial of the Stock Pick Service to get my trades.
Trade Like a Bandit!
Jeff White
Good evening StockBandits!
The market took a breather for much of last week with multiple declines on the heels of the Thanksgiving rally. [Read more…]
