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Monday Video ahead of close- Charts of interest

Monday Technical Video

https://stme.in/1Sux4z7ZJ0

 

S&P could stall out near Aug 7 highs-  First area to sell into bell- 2862-3-   

 

S&P has continued to push higher post Europe’s close, but NASDAQ 100 remains negative for the day as Technology is down, and AAPL, AMZN, TSLA, Fb and TWTR are all lower.

Breadth is higher by around 2.5/1 positive, but most of the strength is being seen in Energy, Industrials, Staples and Materials which  are all up +0.60-+.75% on the day

TECH is lower, and Utilities, while Staples are unchanged.    Today will mark the first day since February that TD Sequential sells have occurred on the SPX, while also VXX, the leveraged VIX ETF

Bond yields have started to breakdown in larger fashion, not adhering to the counter-trend buys shown late last week and on a close would reach the lowest yield level since May

A breakdown in Yields would support the contrarian case of being long Treasuries given the massive negative sentiment, and this larger trend from Feb is showing increasing signs of giving way.  Gold, silver rallying from very oversold state..

 

S&P-  hourly-   See that prices are now within striking distance of Aug 7 highs.. and 2862-3 is a big level.  Above there is little until 2874.  But thought that markets very well might peak out again with S&P at August highs-  2862-3-

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US Dollar rolling over , now its fourth straight trading day down 

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TNX down what’s thought to be an important area.. but no real evidence of this stalling out and turning back higher.

2.82 is important and under  would allow for a quick test of July lows of 2.80%. 

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NFLX, while attempting to push up. Still looks early to bottom out-  The area at 329-334 looks important and until over 334, its right to sell into gains

The downtrend from the last month is still very much intact, and no evidence of exhaustion is present like what happened at prior lows and highs

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Friday Technical Video, charts of interest- REITS breaking out

Friday Technical Video

https://stme.in/IQdIDES5wP

 

Key points headed into weekend

 

S&P likely bullish up into 2860-5 into early next week based on yesterday and today

VNQ-  REITS breaking out and generally a very defensive tone all week-  BUY UTES, REITS.  Avoid TECHNOLOGY

Dollar breaking down-  UNDER 96.31 is negative

EURUSD expect to move higher up to 1.1509-1.155

Gold, Crude stabilizing and trying to bounce

VIX breaking 13 into weekend is a temporary negative for implied volatlity. Expect VIX to move down to 11.50-12 then likely turns back up mid-next week

 

 

S&P made 4 straight hours of closing well up off its lows on hourly charts-   of course, this wasn’t important today until S&P got above 2847

This helped prices extend

 

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VNQ-  the REIT ETF.  Breaking out to highs for the year today

The LONGS listed in todays report- VNQ,  VER, VTR, WELL, are all REIT PLAYS.  And extending.

Many more participating today now that prices have broken out-  and should continue to be attractive

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VIX-  A negative break of 13 in what many would agree is an hourly Head and Shoulders pattern from earlier this week

Pullback to near 12 is likely-  This could be an area to buy implied volatlity mid-next week

 

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LINKS

 

Link to Thursday’s Technical Webinar- discussing SPX, NDX, XLF, XLI, XLK, Europe

https://stme.in/L3MxzJPlkq

 

My Real Vision Interview on markets and MHK being a housing related Short

https://www.realvision.com/snapshot-home-wrecker?utm_source=Mark%20Newton&utm_medium=Social&utm_campaign=43328_CONREF_JS_SMT_RV_W1_MNewton

 

My Bloomberg interview from Wednesday- talking SPX and no evidence of contagion from EM stress

https://www.bloomberg.com/news/videos/2018-08-15/what-the-recent-risk-off-sentiment-means-for-market-technicals-video

 

 

Have a Great weekend all

 

 

Mid-day Thursday Video, charts of interest- Links to Webinar, and Bloomberg Interview from yesterday

Thursday mid-day Video- Short- 5 min-  SPX, TUR

https://stme.in/o29zgoEBVM

 

Link to Thursday’s Technical Webinar- discussing SPX, NDX, XLF, XLI, XLK, Europe

https://stme.in/L3MxzJPlkq

 

Link to My Bloomberg Interview with Abigail Doolittle, 8/15/18- - Discussing whether EM carnage could lead to contagion in US

https://www.bloomberg.com/news/videos/2018-08-15/what-the-recent-risk-off-sentiment-means-for-market-technicals-video

 

 

 

Markets have risen above the last couple days highs, while bond yields have also risen and a minor bounce in both WTI and the Metals.   So nearly opposite of what happened yesterday on all.

Breadth is a much stronger 4/1 positive today.. and while structural issues remain with the indices and with sectors like industrials, financials, these have made sharp snapbacks today that are adding 1%

Staples and Telecom are the best performing sectors, though all 11 sectors are positive which is the first time in the last couple weeks we’ve seen some broad-based strength.

Being above 2843 keeps near term trend positive while any pullback back down under 2825 would put bearish scenario right back on the front burner.

Unfortunately the last month has been largely range-bound with huge spikes in both directions, so a source of concern for both bulls and bears given the lack of any real trend.

 

New longs to consider:   SQ, TNDM MNST, LH, MDT, AMH, GRMN

Shorts:  use bounces in CVS, PCRX, CZR, WYNN, LVS, WYND, MAR, SDRL, ITW to sell

 

 

 

XLK-   Not the best picture of stability, but trends held where they needed to yesterday and now today’s snapback

2 areas of support-  72.15.. and then 70.32

 

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TUR-  Bounce tentative.  Mnuchin saying US will put more tariffs on Turkey causing 3% decline today in TUR, as this has turned back lower, despite some stabilization in most of the world in EM

 

 

 

 

Mid-day technical Video, Charts of interest- BLOOMBERG TV today 4:20pm EST

1. Wed mid-day Technical Video

https://stme.in/PNhoHQJY11

 

2. My Sit-down with Real Vision interview from 7/31..  warning of market tipping point.  And also suggesting MHK as a technical short for Housing

https://www.youtube.com/watch?v=gGfd3YEi_6w&feature=youtu.be

 

3. I will be on BLOOMBERG TV with Abigail Doolittle.. today at 4:20 EST

 

Decline has been contained for now into mid-day.  But likely we see further selling given what’s happening in Europe.     The break of 2820 led quickly down to near 2800 but markets have tried to stabilize-   Bond yields have pulled back.. the Dollar is still higher, Gold and Crude are weakening and the Metals stocks have been hit very hard.-  Breadth which started out at 4/1 has lessened to around -2.5/1  while volume still much heavier into Down stocks vs up-  and at 4/1 down.. is creating a TRIN of 1.75.  high

Energy being very hard hit.  But noticeable that TECH is down 1.3%.. along with discretionary-  2 of the former leaders-  IF NASDAQ 100 and COMP break 7158 and 7600 respectively.  Than US market should experience a quick 4-5% loss into end of August.    Note,  EUROPE breaking down today with DAX, IBEX and Italy’s FTSEMIB on the brink.

Stay defensive.  Favor Utilities.  Staples. And avoid Tech, Fins, Industrials 

 

THESE LEVELS ARE IMPORTANT FOR THE DAYS AHEAD

SPX- 2798-2800 key- Under on a close leads to 2745-52, then 2700-8- the latter being a 50% retrace and edge of channel support

NASDAQ COMP-  7600-   under leads to 7200 into late Aug

NDX-  7158-  UNDER leads to 6830-7

DJIA-  UNDER 25120 leads down to 24350

 

 

SPX cash-  Area at 2750 is near the bottom of this channel.  I think this will be revisited.. but do not expect a larger move down

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DJIA quite a bit weaker and has already violated early Aug lows-  NASDAQ of course showing divergence in NOT making a new high over July.

Now down to key levels.  I think DJIA should weaken down to 24350

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Massive divergence between US and Europe and Asia right now.  But this doesn’t necessarily signal that US has to join suit in turning down to join the others

This divergence can continue.  Still right to expect Europe to underperform

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EUROPE is weakening worse than US.  With breakdowns in SX5e and now today the DAX and also SPANISH IBEX breaking

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Mid-day Technical Update, Technical Video for Tuesday, Charts of interest

 

Tuesday Mid-day Technical Video

https://stme.in/ov41maM4WP

 

 

A minor positive to have recouped intra-day highs made early this am.   Futures managed to press up to just under yesterday’s highs but stalled out as Europe came to a close.

This will be key for this afternoon-  2843.75-   OVER this afternoon would lead to 2850-3 into tomorrow without too much trouble-  Reversals back down under 2826 would also be respected.. and lead to 2800

Breadth is just over 2/1 positive, down from earlier 3/1..but a halfway decent A/D reading…  and Discretionary, Industrials showing strength.   Energy is the only “down” sector today

The Dollar is now positive again.. which as of now, is not adversely affecting EM..  as many of the currencies and markets have stabilized and trying to rally. But good to keep a close eye on these

The Precious metals trade thus far has not worked and Leading economic Industrial metals like Copper have completely broken down

 

 

My Interview with Real Vision on Growth vs Value from July 31, and signs of Growth rolling over.

https://www.youtube.com/watch?v=RFEX6LO-Zuk

 

 

S&P made minor progress up to yesterday’s highs, and since has stalled-  Above 2843.75 would be key and likely result in short-covering

 

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S&P-   prices held uptrend line support this am.   And have tried to bounce.

VERY important to continue to show strong followthrough as momentum, per MACD.. has turned negative given 4 straight down days

Any failure here would allow for a move down to 2800

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Copper breaking down today after over a month of stabilization.   This will cause positive momentum divergence.  As this held for some time before breaking

So important to watch.. but based purely on today.  This is a negative

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EEM-  Move lower from 7/25 looks nearly complete and Counter-trend buys per Demark are now present.. but not confirmed.

2 key areas to watch.  Either a move back OVER 43.46 should be followed and is a BUY -  UNDER 42.36 allows for a final pullback to 41.60  and this likely marks a good trading low

So important to watch given that many currencies and EM stocks have gotten stretched of late

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Mid-day Technicals- Reversal now down to challenge key 2820 area in S&P

Monday mid-afternoon Technical Video

https://stme.in/8x1DWimwa1

 

 

This morning’s reversal puts S&P within striking distance of breaking trendline support from early July which could happen today UNDER 2820.

This should result in a pullback to test 2798-2800 which has held from mid-July and meaningful to the larger trend. 

Breadth is now negative by 2.5/1 margin and Materials, Energy and Financials are the worst performers.. all down more than -0.75%.   Tech/Telco the only bright spots and stocks like AAPL still largely ignoring whats happening in the rest of the world-  For XLK-  breaks of 72.82 would be reason for concern and/or a pullback in the NASDAQ down to earlier lows- For now, 7390 has held on NQ..  but the 2 key areas to watch are 7268 and then 7166.  Under the latter would be quite bearish and suggest immediate acceleration.- 

 

A few key developments:

Transports , Industrials and Financials have moved back down under prior breakout highs from June, casting some doubt on the recent breakout

Airlines in particular have made 2 bearish days down.  And UNDER 103.31 would be a technical negative in the short run

Aerospace and Defense has rolled over.. and stocks like TXT, NOC remain vulnerable.

Crude has slipped down under 66 and OIH now weak for the last 8 of 10 days-  WTI looks technically bearish for a pullback to 64 in the short run, just above June lows

Gold/Silver have both pulled back to undercut the recent stabilization.  Casting doubt yet again on these stabilizing with Dollar gains

Healthcare ETF, XLV. -  Breaking uptrend and after being one of the strongest ETF in the last 30 days.. second only to Financials. As of now.. +2.38%.  looks to weaken

S&P-   Pullback down to 2820 important.. UNDER this leads straight to 2800 without too much trouble

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S&P-  earlier bounce looks to have failed.  And a move under 2820 given the extent of this 20 point bounce, should allow for downside acceleration

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XLV-  Healthcare.. one of the better performing sectors in the last month. Now rolling over on schedule given the recent counter-trend sell

Additional weakness here likely

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Technical Thoughts 1 hr prior to CLOSE- Indices churning near yesterday's highs, Breadth negative- CRUDE with huge pullback to key support- Airlines bullish- Technical Video and Charts of interest

Wed Technical Video-  5 min on SPX, Nasdaq 100, Crude and Airlines

https://www.youtube.com/watch?v=iIeQxZeWmmE

 

One hour ahead of the close, we’ve seen barely much price action out of US equity indices, which remain flatlined and are set to record mildly positive gains for today in S&P and Nasdaq while negative for DJIA

Breadth is still negative on the day, and also more volume in Down than Up stocks.   After the last week of gains, stocks look to be having difficulty pressing up with as much momentum and the stallout in breadth is noticeable.   Energy, Utilities are the biggest laggards today, while Tech and Financials are gaining the most ground, but just up +0.44%

Both KBE, KRE showing decent gains +0.60-.70%, while XOP within Energy down -1.4% and this area has continued to have difficulty in making much headway.

Not much happening with the US Dollar though we’ve seen gains reversed and now lower, while bond yields have also pulled back from earlier highs. 
The bigger mover in the commodity space centers on WTI Crude, lower by over 3.5% and is weighing on commodities- Crude down to make-or-break levels.. so the next few days will have importance here.     Metals have stalled in their decline and arguably trying to bottom out, yet not much progress thus far. 

S&P churning near highs. But this won’t be a negative until 2835 is taken out at a minimum.   Above 2861 will allow for a quick move to 2867-75 which could be an important area heading into tomorrow/Friday if reached.

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S&P Daily-   Still treading water up near highs-  and up at upper edge of Bollinger just below January highs.

Still no real evidence of any reversal. Though breadth has gotten worse in not confirming this rally

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NASDAQ 100 still diverging but within striking distance of late July highs

NAZ has been higher now for 7 straight days

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Airlines benefitting after the breakout last month was consolidated.  Now some of these names are showing good strength with Crude lower

Stocks like DAL, LUV, UAL, AC.CN all look bullish technically for another 2-3 days and could be considered trading longs

XAL itself has not made the same move.. and stocks like AAL which are big laggards.. are weighing down.   But still expect a bit more strength out of this sector

Aug 8 4.jpg

Mid-day Comments- MID, SML at new highs- TSLA halted- Mid-day Technical Video, and charts of interest- TSLA technicals discussed

Tuesday mid-day technical video:

https://www.youtube.com/watch?v=ogu93wwlpRc

 

Continuation of gains today has helped XLF officially break out to the highest levels since March and has put S&P now within 25 points of all-time highs made back in January.  NASDAQ 100 is within 35 points of late July highs, but still showing divergence with S&P.  DJIA now has joined S&P and highest since late February.  Additionally, the S&P Mid-cap index and SML – S&P Small cap index have broken back out to new highs today..  (MID at 2016, exceeding June/July highs as well as Jan highs of 2001.48.  ) -    The near-term trend is certainly stretched near-term, but looks likely to climb into tomorrow/Thursday before any peak.   This would represent a perfect 180 day cycle from the February lows, and important time-wise.  

Energy showing good gains and the only sector up more than 1%, while Industrials and Financials both strengthening and higher than 0.75%, while the former leaders. The Defensive sectors.. are down-  Staples, Utilities, REITS.   Heatlhcare lagging and some evidence of this sector stalling out and peaking.

ENERGY LONGS TO CONSIDER:   COP, MPC, MUR, ANDV

FINANCIAL LONGS TO CONSIDER:   ICE, NDAQ, V, SPGI

SPX-   4 hr chart-  240 min bars.. since early July shows the extent that stocks have rallied in the last 4 days.

Some bullish action out of Financials and industrials.. but  still quite stretched here.   Former all-time highs lie about 25 points higher from late January and are important as resistance

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XLF-   gains at highest since March today.  However, sub-sectors like KRE, KBE have not broken out.. so this remains some selective longs like Berkshire, BlackRock, Franklin, Discover, Lincoln all up more than 1.5%.

However, lots of weakness /underperformance within the insurance names-   CINF, AIG, RE

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Industrials is now turning up sharply and very well could join Financials to make a minor breakout, just at a time when indices have gotten quite stretched.

Aug 7 3.jpg

TSLA-   Odd news today regarding Elon Musk tweeting today about possibility of going private and creating a special fund for current investors to be able to stay in TSLA if it does so

TWTR has been halted.. as of now.

Technically this has consistently been choppy, but structurally a lot more sound than many investors have been willing to give this credit for

Getting up above 374 would allow this to climb up to near 419-420 in a breakout.  And ironically the Demark stopout for one of the exhaustion signals lies right near this 419 area which is the price that Musk had mentioned would be a possible area where this might be taken private

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Safe Havens rule.. while tech Fins struggle- Friday technical Video- Charts of interest

Friday Technical Video-   SPX, NQ, XLF, XLU, PM discussed

https://www.youtube.com/watch?v=BY8YxBYQkus&t=6s

TECHNICAL LONGS I like given today’s movement specifically:   PM ( I own),  HSY, CPB, CL, SJM..  SVM, AG, NEP, ES..

Technical shorts-    MHK, GM, WHR, LVS, WYNN

Very uninspiring market to say the least.. Mild rally attempt but Industrials down.. and Tech unchanged.. IT’s been all the Defensives.. which have ruled all week-  Utilities, Staples, REITS.  We’ve seen XLU breakout of its triangle today.   While Staples continuing to outperform Discretionary.  A very defensive theme

Financials “Positive” is a bit misleading in S&P 500 financials index and XLF.. as KRE is down 1%.. and KBE lower by 0.50%. Treasury yields have backed down and nearly given up the entire breakout from 2 days ago.. so the week is largely unchanged for Treasuries and doesn’t give much confidence for the Financial trade.. XLF still below downtrend from January while XLI has also struggled.-  MOVEMENT ABOVE 28.35 in XLF and above 76.98 in XLI would be a positive..  for now.. these sectors remain under pressure

BOTTOM LINE-  Despite relative weakening in Tech and FANG names.  S&P has not rolled over.. and still important to see a move back down UNDER 2824 even in the short run.. with under 2798 being problematic.

NASDAQ has stalled out and underperformed S&P since June.. and FANG index vulnerable. Yet for now the Sector rotation has helped to save the day and hold stocks afloat.

SHARP Rally yesterday failed to backtrack. Still grinding higher.. though key sectors not really participating. Breadth is barely positive today.   For now, doesn’t seem at levels to short into the close.  Well have to let this play out. But the movement without any breadth while Defensive stocks are all leading is a concern given the structure. First warning sign for S&P FUTURES is 2824.. so 13 handles down.

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XLU broke out of its triangle today-   Not as sexy as AAPL and FB..  but it looks better technically right here.

Additional gains for the Utilities.  I would favor the Multi-s such as NEP and ES.

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SILVER bottoming?   Silver futures with daily DEMARK buys..  starting to show evidence of trying to turn higher. 

We’ll see,  this whole Precious metals space has been a difficult area.  Sentiment is very negative on metals  while seasonality is kicking in

Some mild evidence of this trying to bottom.  And would begin to chip away at buying dips.. looking to add on confirmation of this turning up

SLV and AGQ are interesting.    Gold miners still look a bit early

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NYSE FANG index-    Equal dollar weight of AAPL, GOOGL, AMZN, TSLA, NVDA, FB, NFLX, BABA, BIDU, TWTR

See the June peak, and selloff and failed rally attempts.   A much different picture than when hearing about AAPL 1 trillion market cap as this hits 207

Volume heavier on declines.. and momentum sloped negative.   Have to be VERY selective on what to own here.

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Violent snapback looks to be largely short-covering and tech gains- breadth flat- Mid-day thoughts and Charts

BUY XLU, XLP

AVOID/SHORT :  XLF, XLI, XLK

Tough market.  Every time prices seem to be on the edge of a larger decline, we see huge snapback rallies, and despite it being on low volume or poor breadth (Less than 3/2 positive) or Short covering  (Goldman’s Most Short Rolling index up 1.50% today), it still complicates the picture a bit more but serves to get more shorts OUT of the market when the technical picture really hasn’t improved that much at all.

Financials and Industirals are still having difficulty at key trendlines and are both DOWN today.  Discretionary has fallen for 8 of the last 11 days, with Auto, Casino and housing weakness, while the Staples continue to look quite attractive as do the Utilities, technically.    Technology managed to hold where it needed to initially and now has snapped back.. though momentum is negatively sloped and the group remains vulnerable to a larger pullback.  Yet, stocks like AAPL, AMZN, NFLX, FB are all up 1% or more, and important to see some evidence of this trade dying before calling for the larger top in Tech.   All that can be said for now is that Tech has lost quite a bit of momentum and this group remains paramount to thinking themarket can either rally, or decline given its 26% weighting in SPX.   At present, momentum does not support the idea of a push back to new highs for Tech, but that this bounce is completing a symmetrical “right” shoulder type move and should end in the days ahead and give way to a pullback down to recent lows.  

Some charts below to put this into perspective

S&P- HOURLY-   Rally should find resistance between 2830-7

Aug 2 1.gif

NASDAQ-   Still tough to think this early sharp rally has any real staying power and should be growing near resistance at 7385-7400 as part of an ABC type bounce after the 5 wave decline

Aug 2 2.jpg

S&P has undercut overnight 2806.50 lows which is a negative for Futures- Mid-day Thoughts

Into mid-day. Markets are growing more negative as S&P has just taken out the overnight lows in the last 20 mins, which is a negative.  And while intra-day momentum is showing divergence..  On a close under 2806.50 allows for a more meaningful pullback to get underway.

Breadth has been POSITIVE today thus far..but has gotten more FLAT into mid-day .  Most of this selling has been NASDAQ and Technology related, but hasn’t really affected other sectors too meaningfully just yet, but slowly but surely we’re seeing signs of other sectors turning negative-  Financials are now flat and 8 sectors lower.. only 3 positive.   Energy, Mats and  Telecom. 

Yields have pulled back from earlier highs while the Dollar has begun to gain ground on the downside today, losing -0.40%.  This BOJ meeting approaching and hopes for signs of the end of easing are really the only thing keeping Stocks from staging a larger pullback and have helped yields early on.  But this now seems to be fading

Technology is down nearly 2% on the day, while Discretionary is also lower by 0.60%+, while Energy is positive with near 2% gains in both XOP and OIH, while XLE is up a milder 0.54%

 

Overall, its right to be defensive UNDER 2806.50. favoring Staples.. Utilities.. while not rushing to buy Technology/FANG, and/or Industrials

Aggressive traders can be short under 2806.50 with initial targets down at 2789-90

 

S&P getting under 2806.50 is a negative.. This breaks the flat trend from early July

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S&P getting under last Friday’s lows on a close would point to a move down to 2789, and under this leads to 2736, then 2684-6.

july 30 2.jpg

XBI breaking trendline support from April, and a test and break of early July lows looks likely

DRG- Pharmas acting much better near-term as might be expected, then Biotech as stocks lose ground and Pharma would be favored.

XBI below likely will reach 90

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SOX steadily weakening after INTC’s drop last Friday.  We see key areas for SOX near 1328- UNDER this leads down to at least a retest of early July, but likely lower under 1250

july 30 4.jpg

 

 

Technology, Financials near tipping points as Equities reach 6-month point from Jan peaks

July 27, 2018
Mark Newton CMT, Newton Advisors, LLC- Contact: info@newtonadvisor.com

S&P 500 ETF Trust SPDR (SPY)-  
282.91, 282.49, 281.47, 276.28-.52, 275.62         Support
283.93, 284.53, 285                                              Resistance


LINK TO TECHNICAL WEBINAR from yesterday-  https://www.youtube.com/watch?v=YoiTNDUL7As

 

SPX - (1-2 Days)- Bearish-  Technology should be in the process of peaking and risk/reward looks poor for Equities into next week at current levels.  However, trend will need to show more damage for any sort of meaningful pullback to get underway.  Still avoiding Tech and Financials, favoring Healthcare and Energy-  UNDER 2879 would lead down near 2800.  Today should prove important for a change of trend.  The next 24-48 trading hours should shed some light as to the effectiveness of thins scenario.  

SX5E- EuroSTOXX 50Bearish-  Prices have been rallying for a full month and now just below Triangle resistance from late January.  Expect stalling out and downturn in SX5E- 3650 is a stop for Shorts

HSCEI- Mildly bearish-  Pullback possible after 4 straight days of gains and evidence of bottoming process at work.  expect some backing and filling, but this is likely buyable into next week

Trading Longs:  VXX, QID,  SOXS, DG, K, XOP, NBIX, LLY, BAX, AEE, TSG, TWLO, SSTI, TIF, BURL,VEEV, KFY, ETSY, ACN, ADP

Trading Shorts:  SMH, ON, LRCX, AMAT, ON, LUV, ALK, AAL, GE, VOD, VIAB, NFLX, FITB, EBAY, XLK, OIH, MDR, SMH, AMBA, PCAR EWJ


TECHNICAL THOUGHTS


ACTION PLAN-  

Long XRT with targets at 52, with stops at 49.50
Long XLP with targets 54.60-55, stopping out under 52.07
Long XLV targeting 89, and raising stops to 86.35

Short IYT, with targets at 185, stops at 195.90
Short XLF with targets at 26-26.50 and stops above 28.20 on a close (CLOSE)

Short SMH with targets at 96.10 & stops on shorts at 107.84- Press shorts under 103.71
Looking to buy Gold at 1200-1210 late this week, and buy GLD at 113.50-114.50

Upside should prove limited-

The Equity trend has been positive for a full month.  Just in the last couple weeks we've seen evidence of breadth non confirmation and some signs of Technology stalling out, most notably with Semis and FANG stocks turning lower (FB, NFLX taking the lead, while AMZN is UP in after-hours trading Thursday thus far) Investors have pressed their bullish bets as sentiment has grown increasingly more positive, while today lies 180 calendar days from our January peak, a cycle that can't be taken lightly given the degree of importance in the high from late January.   While DJIA has followed through higher, above June highs in the last couple days, we've seen sectors like Financials and Industrials both get up to key areas of trendline resistance.   Overall, it should be right to sell into Tech, Financials and Industrials Friday into next week, while favoring Energy to follow-through higher and also increasingly favoring commodities to work again after a dismal June and most of July.   Counter-trend Sells appeared after Wednesday's close in the S&P 500 Information Technology sector (Demark) and while this still needs to be confirmed, the upside for Tech after this recent snapback looks poor from a risk/reward basis.  

The key technical catalyst which should be watched carefully in the next 24-48 hours is whether Treasury yields start to turn down sharply, as this has occurred prior to several other market pullbacks.   Financials have reached "DO-or-DIE" resitsance, and should likely stall out and turn down as well.  While AMZN is up in post-market trading on Thursday, the stock had shown quite a few signs that gains could prove limited near-term, so keeping an eye on this for possible reversals in Technology and continued pullbacks in Discretionary also looks important.  Overall, the next 3-5 days does not seem ideal to press long bets, but longs should be still concentrated largely in Energy and Healthcare.  


Additional charts and thoughts below.

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AMZN Technicals-  Upside likely proves limited from here-  Amazon charts are showing the same warning signs that were present in Facebook prior to earnings.  (AMZN post earnings was higher in trading, but the key will be as of Friday's close)   Evidence of negative momentum divergence, counter-trend sells and extreme overbought conditions were present heading into AMZN earnings Thursday.  We have seen a distinct slowing down in the stock since mid-July, so further upside from here might prove difficult technically.   Bottom line, while the stock remains trending higher and in an uptrend (and Yes.. fighting trends is often not for the faint of heart), the risk/reward looks poor and one could consider selling with plans to buy back technically on pullbacks to 1647, with breaks of the eight-month trend leading down to 11607 or below to 1567.

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Technology reversal seems near-  Can AMZN manage to hold its post-market gains on Thursday, or should this stock reverse- Technology showing some evidence of trying to peak out-  The next 1-2 days will be important in confirming this, but it looks right to sell into many Technology stocks, with thoughts that the S&P 500 INfo Tech index pulls back to near 1250 from its current 1290.  Semis, as mentioned in yesterdays' report, should also be vulnerable, despite Thursday's lift in the group. 

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 Treasuries look like a BUY between now and mid-August-  Treasury yields have reached areas that should allow for a pullback in the days ahead.   10-YR YIELDS managed to successfully form TD SELL SETUPS, the same formation that occurred at the prior highs back in May when yields dropped precipitously, and should also be at a crossroads where further yield gains prove difficult.  This could set the stage where Financials also turn down, with XLF up against former highs at key trendline resistance.  So a reversal in both yields and Financials is what to watch for between today and early next week.  I like buying Treasuries here, expecting yield pullbacks to near 2.83 at a minimum, with preferred targets down near 2.76%. 

Mid-day technical Thoughts- WEBINAR starts in 10 min-

For those that cannot make webinar.. I am happy to forward a link for the replay.. and can do a quick 5 min Video which is shorter to watch

 

Technical Analysis Video Webinar, 15 mins.  Today 1pm EST- https://join.startmeeting.com/info69336

  Dial-In Number (United States): (701) 801-1211, Access Code: 840-955-999

 

 

 

 

 

Stocks not doing much just past Europe’s close.  Minor rally back in S&P while NASDAQ still down -0.50%.   DJIA should be mentioned for finally joining SPX and NDX in getting over June highs, a minor positive for this

Breadth is 3/2 positive while volume more flat.-    JUST IN THE LAST 24 hours.. we’ve seen a confluence of COUNTER-TREND SELLS on the S5INFT index-  TECHNOLOGY.  And TNX-  10yr yields..  and also XLF- Financials.. while both XLF and XLI are challenging their respective trends from January.  So a BIG area for the market heading into tomorrow.

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S&P HOURLY-    2833 important for traders.  Then 2813-4.   Under that leads to a test of 2789-92 area

Any move towards 2849 should be sold into today’s close.. 2852-5 impt on upside above 2849 for futures

 

 

 

 

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OIH showing some promising signs today after having been beaten down over the prior weeks

Like owning this for a bounce on the ability of this to hold above 25 by today’s close

 

 

 

 

S&P 500 INFO TECH index..  is getting counter-trend sells today-    My thinking is that TECH will turn down in the days ahead.

Its right to position out of Tech near-term..

 

 

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YIELDS-  10yr .. also showing evidence that a turn back lower can happen-    I like buying TREASUREIS today.   TY.. and betting on yields going lower

 

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Exiting AMZN LONGS by close-  consider Shorting- 

 

AMZN showing the SAME kind of negative momentum divergence and overbought conditions above long-term uptrend that FB did

I like taking profits in AMZN before earnings and for aggressive traders.. like shorting for a move down to  1647-8  while under that is definitely possible on extreme move and should watch 1567, 1413

 

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Reversal not harmful thus far- S&P still ok unless 2810 breached with 2789 bigger line in the sand

Tuesday Mid-day market video

https://stme.in/tOP5TXoZQ2

 

 

Markets extended up to first resistance.. as shown below.  Just over 2830  and have pulled back after Europe’s close

This won’t be problematic to the trend unless 2811 is breached.   NASDAQ is still lower on the day by -0.20%   and breadth is largely flat -   Just barely more advancing than declining names

Not much action out of bonds, nor US Dollar.. and CRUDE extending gains up 1.50% in a bullish move that should lead up to 70.50-71.  Note the last couple days dropped into the close.. so holding gains today would be a positive-   This has helped the Energy sector to lift by 1.50% and outside of Materials is the only other sector up more than 1%.   Both discretionary and Utilities, REITS dropping

 

Bottom line.   Today is a VERY weak rally.   And while it looks early to sell after S&P successfully got above 2818 and up above 2830.   Its something to make note of that the NASDAQ is so weak and hardly any breadth on this rally attempt in recent days

 

 

S&P HOURLY-  See 2830-4 held initially.   There can be a push back higher most likely into tomorrow/Thursday  but would be something to flatten out into ahead of 7/27

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XOP looks to be a good risk/reward to buy after initial pop and then settling over the last hour.

Movement up to 43.50-44 looks possible

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Monday Mid-day Technical Update- S&P nearing important 2810 level

Monday Mid-day Technical Video

https://stme.in/JvZXU6bajM

 

 

Link to last Thursday’s Technical Webinar

https://stme.in/lnSOjY8ZbO

 

 

2-3 day trend

Stocks neutral-  OVER 2810.50 bullish.  UNDER 2789 bearish

Bond yields nearing peak-  2.98-3% should hold- Buy Treasuries with yields in this range Wed-Thur

 

New Technical Long ideas:  TWLO, QTWO, INFO, VICR, SSTI, CSLT, BZUN

 

Just past mid-day we’ve seen S&P gradually turn up a bit more following Europe’s close, which saw most European Bourses down fractionally.

S&P has important resistance into the afternoon at 2809-2810.50 right near last Friday’s highs- Above could allow for a test of 2818 and then move to 2830-45 which would be sellable intoThursday

For now.. we’ll need to see movement up above Friday’s highs to allow for a final push higher.  Conversely.  Under 2789 will continue to have importance.  This area held last night on Futures weakness, with prices bottoming a few ticks above – 2792-3 area.  So overall  2789-93 as support.   And 2810/2818 resistance

Breadth is negative by around a 6/5 margin.. while Volume is equally spread among UP vs DOWN stocks

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Huge move in  10yrTreasuries following what happened to 30yr late last week coinciding with the yield curve steepening

Yields look likely to reach 2.9860-3%, right near mid-June highs in yields.   Counter-trend indicators are 2-3 hours away while daily charts suggest another 2 days before its right to buy TY

Overall this should be a yield spike to buy dips in Treasuries.. but for now. A bit more looks likely in yields

 

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USDJPY-  For those involved in currencies, we’ve seen US Dollar pullback to test the area of the breakout in USDJPY ahead of BOJ

Whether or not they address stimulus.. when purely concentrating on USDJPY charts..  this will be an area to buy USDJPY on this pullback after the base breakout and pullback

 

 

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Bitcoin-  While the move this morning normally is thought of as being constructive.. when prices lift up above a series of former highs and begin to accelerate.. now price is just below a formidable area of resistance near 8k which represents a huge area of longer-term trendline resistance.   This will truly be the “line in the sand” so to speak as to whether BTC can begin a larger rally, or whether this will still take some time.

Note that many of the Alts have not participated in this move of late. It’s largely been BTC itself.  From a trading perspective.. I like selling out of BTC at 7750-8000 today/tomorrow and positioning in BCH- Bitcoin Cash, or Ether which I believe are better relative values..(AND ETH still might still be early) given the move here and resistance directly overhead, while the others .. at least BCH.. appears to be just emerging

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Pullback does not violate uptrend- Important charts for SPX, NASDAQ enclosed- Thursday am Technical Webinar today 1pm- Charts of interest

Thursday am Technical Video

https://stme.in/sgSX9uUYM8

 

 

Bottom line-   Today’s early pullback will be a buying opportunity for a minor push higher into early next week unless 2800 is broken (8 points away) and for S&P, the big level lies at Tuesday’slows-  for S&P futures and SPX cash this lies at 2789-  For NASDAQ 100, the key levels are Below 7393 on a close.. and under Tuesday’s 7292 is important in turning the trend down  (UNDER 7393 confirms both TD SEQ and TD Combo sells)

As of yesterday’s close, neither the NASDAQ nor DJIA had not gotten up above important resistance but the SPX had.. so this makes for further divergence potentially into next week. 

 

 

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S&P HOURLY since July 10-   This channel should have importance.. and UNDER 2800 would be the first signal of a violation.. while UNDER TUESDAYS lows.  2789.. would be more problematic.

For now.  We’re near the first real area of support for today. 2808.. and under is 2800-2

 

 

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NASDAQ 100 E-minis show the potential for a confirmed Demark sell on 2 different indicators Today on a close under 7393..  so the NASDAQ very well might peak out ahead of the SPX

And UNDER 7292 would break this uptrend and Tuesday’s lows-  Until this happens..  this area near early 7380..  is important..  and a -0.34% loss early hasn’t done much damage

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Until these Trends are violated..  I am a buyer of Retail today/tomorrow into next week.. concentrating on names like ETSY, TJX BURL, FIVE, LULU, SCVL  but for a complete list.. see this mornings Daily technical comment , sent out near 530 am

 

ETSY-   Very good price action in recent days on good volume.  I expect if this market is going to hold into next week, than Retail should be favored.   ETSY getting up over this channel trend would likely drive the stock to 50.  But a good risk/reward among the Ecommerce space

 

 

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SCVL-  Shoe carnival-  Also interesting to me as a long after breakout on good volume and intra-day weakness into the close to give back some of its gains

Still a very good move and likely to push higher into next week

 

 

 

 

 

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Tuesday's lows Remain the line in the sand for Equities

Trends remain intact despite todays selling- not damaging for now..-  TUESDAYS lows will remain the key Line in the Sand for this rally and UNDER starts the acceleration.-2789 SPX, and under 7292 problematic for NDX-  But until that happens.  The trends are still ok-   Expect to see some real disjointed behavior though into next week, as Financials up near key levels and stalling.. While FANG stocks have lagged since mid-June-  Defensive issues meanwhile have outperformed over last month.. And Breadth remains UNDER levels seen in mid-June.. So with DJIA trying to break and still UNDER June highs.. We have quite a few moving pieces and anything but a broadbased market right now- Treasury yields have reversed sharply lower from earlier yield highs and at 2.842 have formed Bearish engulfing. And should allow for yields to pullback to 2.76.  Dollar higher but showing evidence of stalling and should be close to peak.  Gold getting close to lows and downside minimal to 1200 and would buy into further weakness early next week in Precious metals-   For Equity sectors to consider-  Retail, as mentioned in early am piece.. Is the sector to overweight-near-term.. And stocks like FIVE, ETSY, TJX, M, BURL, DSW, URBN.. Are all longs on a 3-5 day basis

Newton Mid-day Technical thoughts

Mid-day Technical Video

https://stme.in/HysOjuR1gr

 

 

Just past mid-day.   US indices have pushed higher to the tune of around 0.50%, with NASDAQ moving up 1.2%.  Breadth is a paltry 3/2 positive, but 8 of 11 sectors are positive on the day, with just Energy, Telecom and REITS lower.   Materials leading the charge for today with PPG, DWDP, EMN, BLL, ALB, LYB, MOS all up 1.5% or better.  Technology also showing strength of more than 0.75% as LRCX, ADS, GLW, AMAT up 2%, while IBM, INTC, STX, CSCO all lower.   Not much snapback in Transports today, and OIH is still lower on the session..  but Healthcare strong, and this group remains one to overweight and favor.   Elsewhere,  Europe managed to rally back to positive territory by a fractional amount, while the Dollar has ripped back up 0.50% and coinciding with Gold dropping down under 1230, something which seemed to be an important area 1 week ago.  

 

Overall, the next 2 days will be important to the near-term Bearish call.   China still pretty negative technically and one can’t make much of Europe given today and remains in an ongoing downtrend.  But NASDAQ pushing back to new highs isn’t necessarily something to buy into given the last couple days of choppy sideways action as this move to new highs is not being accompanied by momentum, and Demark signals will come together tomorrow to suggest a possible high.    WHERE IS THIS THINKING WRONG?     OVER NDX 7450 on a daily close.. one would have to postpone the thinking of an immediate decline this week, while over 2820 allows for a push up into 2841-3 or higher potentially to test late Jan highs into July 26-27, and our thinking of this being a low would then turn out to be a high.  For now.  Its still early to make that call, and given some of the signals in Tech and the lousy participation in Transports and Financials, it’s still right to consider buying implied volatlity and watching carefully what happens over the next 1-2 days

 

 

NASDAQ   Pushing back to new highs looks attractive on daily charts..  though tomorrow will mark the first confluence of Daily TD Sells since the February and April lows

DJIA also not responding and still below June peaks, while most of Europe and Asia have trended lower.

 

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S&P Futures push back to new highs occurring on much lower momentum-  We’ll see if this matters or not as area at 2810-5 is important and can’t get much above 2820 without thinking this will be postponed.

But for now,  breadth is poor and momentum is diverging.. 2 key reasons why its smart not to consider joining the rally at this stage

 

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Mid-Day Update--Technical Video will resume Tomorrow- Survey- Please Fill out

2 hours to go.. we’ve seen Financials attempt to bounce thus far. But overall a mildly weaker session with Crude pulling back 4% and putting pressure on Energy names (7 of the worst 10 are Energy today)

Meanwhile, Technology is weaker and 8 sectors out of 11 are Down with only Financials, Discretionary and Telecom up

Watch Friday’s lows as initial support 2793.. as under would jumpstart a larger pullback

 

I had some issues with the video.. so will catch up with this tomorrow-   IN the meantime I sent out a Survey to clients which I hope you’ll take the time to complete. As it will help me in planning for the weeks/months ahead.  One of the things ive been requested is for the video to be put out at the NOON Hour instead of mornings  as 2 reports early is not as important as a mid-day update.  If any strong opinions on this, kindly let me know.  Thanks

 

 

For now.. the charts

 

S&P broke a minor trend.. and 2793 impt-  Friday’s lows-  UNDER this jumpstarts a pullback to 2770-3 initially

 

 

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A pretty bearish 1 day move out of WTI.. getting down under $68 and giving up more than 50% of the prior rally

7 of the top 10 worst performers today are energy-   I expect a move down to  65.50-67.  But do not expect this trend to be violated.

Therefore.. this pullback, at least initially. Should be buyable sometime this week.   The next 2-3 days should bring about a trading low

Energy names I like buying will be reviewed when most are at support.  But would take a look at HES. Which is getting close as of today

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NYFANG-  FANG stocks peaked out in June and have not been able to move to new highs-   Today thus far is down.. and if this index moves to new multi-day lows it would be important and something to pay attention to

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Mid-Day Friday Technical Update- Technical Video, Link to Yesterday's Webinar, New Buy/Sell ideas, and YOUTUBE access

Friday Mid-day Technical video-  SPX analysis, XLF and Financials relative to SPX, XLK-  5 min

https://stme.in/AjBaNoxrVB

 

Link to Yesterday’s Technical Webinar-  20 min overview of Global asset technicals

https://stme.in/KWJGLYbh4g

 

 

Attractive Buy/Sell ideas specifically based on This morning’s early movement-  which could work for the next 2-3 days:  

LONGS-  KFY, JEC, MELI, MDU, GWPH, IMMU, PCAR, ULTA, CXO, CMI

SHORTS-  UAA, C, DFS, MAT, T, SYF, WDAY, BKNG, RF, AXP

 

Stallout/reversal possible starting today/Monday-    S&P got up to resistance at 2805-2810 late last night before pulling back 10 points from overnight highs, Bond yields have been not following stocks higher and evidence of upside exhaustion in Technology,  XLK, NDX while Financials not participating-   2795 importnat in S&P Futures.. While 2770-3 is the larger area of support -  2805-2810 is still quite important for SPX near-term. -  Favor Healthcare, Energy Staples, while avoiding Financials, Technology

 

Financials attempted to snapback partially after early opening losses in WFC, C, JPM, but the group has hit new relative lows vs SPX and still one to avoid in favor of Staples, Energy and Heatlhcare

The Dollar has given back early gains, while gold is fractionally lower and Crude has moved up above $71-  10yr yields are at 2.835 while the Yield curve has flattened further down to 25bp

 

 

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S&P HOURLY chart--  Area at 2807.25 important for the next few hours today..  The early pullback found support and has bounced, so for the bulls.. getting over this 2807 and ideally over 2810 is needed, while under 2793 on the downside would likely lead down to 2770-3

 

 

 

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S&P   240 min chart-   First evidence of 4-hour charts showing exhaustion since late June,  which was confirmed this am-  Now we’ve snapped back, so the area near 2810 will be important

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XLF-  Todays early pullback to new 5-day lows is not what was needed to think Financials can turn up.   Closes down keep this trend headed lower and has potential downside into 25.75-26

 

 

 

 

 

I have Set up a YouTube Channel and invite those that enjoy Technical content to peruse and subscribe

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Have a Great weekend

Mark