Stocks opened weak, but quickly found their footing as the major index ETFs worked their way higher the rest of the day. The Nasdaq 100 ETF (QQQ) gained 1% with strength in Microsoft, Intel, Apple and Amazon. Gains in the broad market ETFs were smaller with the S&P 500 ETF (SPY) gaining .44% and the Russell 2000 ETF (IWM) advancing just .29%. Eight of the nine sectors were up with XLE, XLB and XLK leading. XLU was the lone decliner. Despite a positive day on Monday, selling pressure could return sooner rather than later. First, note that Treasuries held their ground on Monday and remain in an uptrend as TLT forms a small triangle. Second, the gain in the materials sector may be fleeting because the Shanghai Composite ($SSEC) is down over 2% after a miss on the PMI. Third, the Euro is weak overnight and the Euro Currency Trust (FXE) could break support at 129 today.
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Key Reports and Events (all times Eastern):
Tue - Apr 23 - 09:00 - FHFA Housing Price Index (AMGN, AAPL, JNPR)
Tue - Apr 23 - 10:00 - New Home Sales
Wed - Apr 24 - 07:00 - MBA Mortgage Index (EMC, MMM, QCOM, PG, XLNX)
Wed - Apr 24 - 08:30 - Durable Good Orders
Wed - Apr 24 - 10:30 - Oil Inventories
Thu - Apr 25 - 08:30 - Jobless Claims (AMZN, ALTR, XOM)
Thu - Apr 25 - 10:30 - Natural Gas Inventories
Fri - Apr 26 - 08:30 – GDP (CVX, TYC, WY)
Fri - Apr 26 - 09:55 - Michigan Sentiment
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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