On Tuesday, the Nasdaq 100 (QQQ) outperformed the opposite indexes, ending the day +1.20%, whereas different main indices closed roughly flat on the day.
From the momentum facet, our Actual Movement (RM) indicator is flirting with the decrease band. This may be seen circled within the above chart. If QQQ can clear the band, this may very well be a setup for a imply reversion kind of commerce.
Whereas this does current a possibility from an oversold foundation, the following drawback is overhead resistance in a down-trending market. Now we have already seen how simply the market can try a rally, solely to flip and break decrease the following day. With a lot overhead resistance, taking lengthy trades in equities is very dangerous. Due to this fact, we plan to deal with commodities and put most equities on the again burner.
Two commodities we’re at present watching are sugar (CANE) and gold (GLD). Every is sitting on help from the 200-day shifting common. Nevertheless, merely holding help is just not an incredible motive to take a commerce; they should present they’re able to trending upwards or present a correct reversal chart sample.
Once more, we will take a look at the momentum indicator for alerts. In CANE, RM is nearing the decrease band. If the band is examined/damaged, we may search for RM to re-enter the band for one more imply reversion commerce. Then again, GLD has not solely damaged the band, but in addition damaged by way of the 200-MA on RM. If GLD can maintain the 200-DMA in worth, we will look ahead to RM to clear its 200-MA to verify that worth and RM agree.
Whereas these could be nice symbols to commerce, timing our entries in a unstable market makes all of the distinction.
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- S&P 500 (SPY): Resistance at 410. Watching to carry present worth space.
- Russell 2000 (IWM): 182 resistance.
- Dow (DIA): 322 pivotal.
- Nasdaq (QQQ): 309-317 resistance.
- KRE (Regional Banks): 63 to clear and maintain.
- SMH (Semiconductors): 237 to clear.
- IYT (Transportation): 239 resistance.
- IBB (Biotechnology): Inside day.
- XRT (Retail): 70 resistance.
Forrest Crist-Ruiz
MarketGauge.com
Assistant Director of Buying and selling Analysis and Schooling
Mish Schneider serves as Director of Buying and selling Schooling at MarketGauge.com. For almost 20 years, MarketGauge.com has supplied monetary data and schooling to hundreds of people, in addition to to massive monetary establishments and publications reminiscent of Barron’s, Constancy, ILX Programs, Thomson Reuters and Financial institution of America. In 2017, MarketWatch, owned by Dow Jones, named Mish one of many prime 50 monetary folks to comply with on Twitter. In 2018, Mish was the winner of the High Inventory Choose of the 12 months for RealVision.
