Stocks were all over the place last week and ended mixed. The major index ETFs swooned on Monday, but recovered with a surge on Tuesday and strong open on Wednesday. A little profit taking took hold on Thursday-Friday as stocks gave some back at the end of the week. Overall, the major index ETFs finished mixed with the Russell 2000 ETF (IWM) edging higher and the S&P 500 SPDR (SPY) closing the week fractionally lower. The sectors were also mixed with the Consumer Discretionary SPDR (XLY) falling 1.88% and the Technology SPDR (XLK) gaining 1.22%. How's that for a split? Weakness in the Home Construction iShares (ITB) and Retail SPDR (XRT) weighed on the consumer discretionary sector as both ETFs sharply. Tech ETFs provided a lift with the Networking iShares (IGN) and Semiconductor SPDR (XSD) gaining over 2% for the week. We also saw strength in the materials sector as the Copper Miners ETF (COPX) surged over 5%, the Gold Miners ETF (GDX) gained 6% and the Metals & Miners SPDR (XME) advanced 2.64%. As the PerfChart below shows, the year-to-date intermarket picture is a bit strange because gold, the Dollar and Treasuries are up in January. Stocks (SPY) and the Euro are down, as is oil. It is a light week on the economic front, but a heavy week for earnings. AMD, IBM, AMTD, DAL and VZ report today.
**This chart analysis is for educational purposes only, and should not
be construed as a recommendation to buy, sell or sell-short said securities**
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Key Reports and Events (all times Eastern):
Tue - Jan 22 - 07:00 - MBA Mortgage Index
Wed - Jan 23 - 08:30 - Initial Claims
Wed - Jan 23 - 09:00 - FHFA Housing Price Index
Wed - Jan 23 - 10:00 - Existing Home Sales
Wed - Jan 23 - 10:00 - Leading Indicators
Wed - Jan 23 - 10:30 - Natural Gas Inventories
Wed - Jan 23 - 11:00 - Crude Inventories
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.
