Earnings season is upon us and the banks have been kicking it off. However, the kickoff has been weak, as seen in the above chart of the regional banking ETF (KRE).
With that said, if KRE can clear and hold over its 10-day moving average on both price and our Real Motion momentum indicator, we could get a rally in the banking space. Currently, Real Motion can be seen with the red dotted line sitting just under its 10-DMA at the bottom of the chart.
Last Friday, Wells Fargo (WFG) reported earnings and is now having an inside day chart pattern. Like KRE, WFC will need to clear over its 10-DMA in price and momentum. If the 10-DMA can be cleared, the support area to hold is from $45.03 to $45.77 as seen by the black lines on the above chart.
While WFC has already reported, National Bank Holdings (NBHC) reports after Monday's close. Depending on where NBHC opens on Tuesday, watch for it to clear the 10-DMA in price. On the momentum side, it has already cleared the 10-DMA showing that momentum is leading price. When it comes to risk on NBHC, a tight risk looks the best under Monday's low around $37.93.
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With oil prices rising many consumers are looking to electric vehicles to relieve their wallets at the pumps. However, there's also supply chain disruptions, inflation affecting the rare earth minerals as well as the availability and time commitment of charging stations to contend with. On the latest edition of StockCharts TV's Mish's Market Minute, Mish looks at the charts to examine the impact that the macro is having on EVs as a sector.
ETF Summary
- S&P 500 (SPY): 440 pivotal.
- Russell 2000 (IWM): 195.88 to hold.
- Dow (DIA): 343 pivotal.
- Nasdaq (QQQ): 338 minor support.
- KRE (Regional Banks): 66.85 to clear.
- SMH (Semiconductors): 237 support.
- IYT (Transportation): Watch to stay over 243. 239 support.
- IBB (Biotechnology): 128 the 50-DMA could not hold.
- XRT (Retail): Needs to clear 77.09 and hold.
Forrest Crist-Ruiz
MarketGauge.com
Assistant Director of Trading Research and Education
