Wed mid-day Technical Video
Stocks largely mixed, with S&P just fractionally higher while NASDAQ down, as Technology underperformance continues
S&P has stalled near former highs, but tough to call this pattern bearish. And 2920-5 remains a key area of upside resistance.
But breadth yet again is FLAT today and slightly negative... which IS a worry. And signs of Tech/FANG names headed lower, while most of the speculation happening in Pot stocks, as names like TLRY are making parabolic movement, up 50% today alone. For NASDAQ, the lagging has been ongoing vs SPX since mid-June and 7400 is a very important area for NDX. Under would allow for more meaningful acceleration
Treasury yields continuing to press higher. With TNX now up to 3.08 and 2/10 curve up to 27 bps while Dollar shows evidence of stalling out.
Meanwhile, CRUDE is on the verge of its own large breakout above 71 and should be bought, either USO, or CL futures, or XOP and OIH for stock exposure, both of which have broken out today
A few key themes
ENERGY- CRUDE on the verge of breaking out- its right to own Energy- E&Ps and seeing more signs of Oil Services joining
METALS stocks- GDX making decent continuation move. While this has been trending down for some time, the gradual rolling over in the Dollar is bullish for this group
China starting to re-awaken- Chinese Tech stocks making minor breakout. As per CQQQ while SHCOMP and FXI confirmed Demark buys the other day- Good to start favoring a rally here
Yields pressing higher- This should favor Financials.. which look to have finally come alive today.. while most interest sensitive names have been losing ground.. as might be expected
S&P still holding up near the highs- a move up to 2925 looks likely while an breach of 2883 would be problematic
But both S&P and DJIA in better shape than NASDAQ near-term
NASDAQ 100 quite a bit weaker.. and 7400 is very important to hold for NASDQ. Under allows for a pullback to test late June lows
ENERGY working well.. and both XOP and OIH breaking out today.
Would favor VNOM, CRC, DNR, MRO, MPC, EGN, COP just to name a few. But this sector likely works well, particularly with crude over 71 (WTI)
MRO is a name I like within energy.. just starting to emerge-
Viper Energy Partners LP- VNOM- an Energy vehicle hitting new all-time highs, and something which is attractive from a trend following perspective within the group
MPC- Marathon Pete- I consider today’s pullback an attractive buying oppty- Like energy and MPC in general to outperform
Would buy into today’s weakness, technically
Conoco- COP_ Another attractive technical idea within the energy space- Expect this to challenge former highs from 2014.. and movement up to the 80s likely