On the 60-minute chart, SPY edged higher on Thursday and moved to the top of its resistance zone. Broken support, the early November highs and the 61.80% retracement mark resistance in the 143 area. Even though the bigger trend may be down, this short-term upswing remains in play as the bulls refuse to buckle. The Raff Regression Channel captures this upswing and I am marking key support at 139.
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The 20+ Year T-Bond ETF (TLT) plunged in mid November and found support at the upper end of a big support zone. TLT bounced on Monday morning and then stalled the rest of the week. There is a minor support level at 124.5 and a break below this level would provide the first clue that the mid November decline was continuing. Key support remains at 124.
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The US Dollar Fund (UUP) edged lower as the stock market edged higher. The current swing is down, but there is potential support in the 21.9-21.95 area from broken resistance and the 50-61.80% retracement zone. Resistance is set at 22.05 and it would take a break above this level to reverse the current downswing.
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The US Oil Fund (USO) is dangerous within this consolidation as it gyrates above/below the 32 level. Strength in US and European stocks should be positive for oil. Weakness in the Dollar should be bullish as well. Should these intermarket trends continue, oil could just break resistance at 33 to reverse the short-term and medium-term downtrends.
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The Gold SPDR (GLD) took a big hit on Wednesday and broke support at 167. This decline was rather surprising because the Dollar remained subdued and stocks rebounded. GLD failed at the 61.80% retracement and broke wedge support to signal a continuation lower. Broken support turns first resistance at 168. A quick move above this level would negate the breakdown.
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Key Reports and Events:
Thu - Nov 29 - 10:00 - Pending Home Sales
Fri - Nov 30 - 08:30 - Personal Income/Spending
Fri - Nov 30 - 09:45 - Chicago PMI
Charts of Interest: Tuesday and Thursday
This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think for ourselves when it comes to trading our own accounts. First, it is the only way to really learn. Second, we are the only ones responsible for our decisions. Think of these charts as food for further analysis. Before making a trade, it is important to have a plan. Plan the trade and trade the plan. Among other things, this includes setting a trigger level, a target area and a stop-loss level. It is also important to plan for three possible price movements: advance, decline or sideways. Have a plan for all three scenarios BEFORE making the trade. Consider possible holding times. And finally, look at overall market conditions and sector/industry performance.
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The US Dollar Fund (UUP) edged lower as the stock market edged higher. The current swing is down, but there is potential support in the 21.9-21.95 area from broken resistance and the 50-61.80% retracement zone. Resistance is set at 22.05 and it would take a break above this level to reverse the current downswing.
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The US Oil Fund (USO) is dangerous within this consolidation as it gyrates above/below the 32 level. Strength in US and European stocks should be positive for oil. Weakness in the Dollar should be bullish as well. Should these intermarket trends continue, oil could just break resistance at 33 to reverse the short-term and medium-term downtrends.
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The Gold SPDR (GLD) took a big hit on Wednesday and broke support at 167. This decline was rather surprising because the Dollar remained subdued and stocks rebounded. GLD failed at the 61.80% retracement and broke wedge support to signal a continuation lower. Broken support turns first resistance at 168. A quick move above this level would negate the breakdown.
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Key Reports and Events:
Thu - Nov 29 - 10:00 - Pending Home Sales
Fri - Nov 30 - 08:30 - Personal Income/Spending
Fri - Nov 30 - 09:45 - Chicago PMI
Charts of Interest: Tuesday and Thursday
This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think for ourselves when it comes to trading our own accounts. First, it is the only way to really learn. Second, we are the only ones responsible for our decisions. Think of these charts as food for further analysis. Before making a trade, it is important to have a plan. Plan the trade and trade the plan. Among other things, this includes setting a trigger level, a target area and a stop-loss level. It is also important to plan for three possible price movements: advance, decline or sideways. Have a plan for all three scenarios BEFORE making the trade. Consider possible holding times. And finally, look at overall market conditions and sector/industry performance.
About the author:
Arthur Hill, CMT, is the Chief Technical Strategist at TrendInvestorPro.com. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London.
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