Banking

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Technically speaking, the major U.S. benchmarks have whipsawed to start the new year, pulling in respectably from recent record highs.

Against this backdrop, the S&P 500 has reversed to its former December range, though amid a downturn that has inflicted limited damage in the broad sweep.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Before detailing the U.S. markets’ wider view, the S&P 500’s
US:SPX
 hourly chart highlights the past two weeks.

As illustrated, the S&P has pulled in to its range after briefly tagging record highs.

Tactically, notable resistance matches last week’s gap (3,723). Tuesday’s early session high (3,722.5) has registered nearby.

Conversely, significant support matches the November peak (3,646).

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Similarly, the Dow Jones Industrial Average
US:DJIA
 has pulled in to its range after briefly tagging record highs.

Still, the index has initially maintained major support (29,964), an area matching the mid-November range top, also detailed on the daily chart.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Meanwhile, the Nasdaq Composite
US:COMP
has sold off from its range top.

This was the lone major U.S. benchmark not to conclude 2020 with a record high.

But here again, the index has maintained notable support (12,607), an area matching its breakout point, also detailed below.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Widening the view to six months adds perspective.

On this wider view, the Nasdaq is digesting the late-2020 rally to record highs.

Though the index formed a bearish engulfing pattern to start January — the long red bar, engulfing the prior session’s range — the downturn has been underpinned by the breakout point (12,607). Limited damage has been inflicted.

Delving deeper, the November peak (12,244) is followed by the 50-day moving average, currently 12,128, and the late-November breakout point (12,074). A sustained posture atop this area signals a bullish intermediate-term bias.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Looking elsewhere, the Dow Jones Industrial Average also registered a bearish reversal to start the new year. The index has pulled in to its former December range.

Against this backdrop, the index has maintained support matching the mid-November range top (29,964).

Delving deeper, the Dow’s former record high (29,568) — established last February — is followed by the 50-day moving average, currently 29,388.

Likely last-ditch support (29,127) closely matches the November gap. The Dow’s bullish intermediate-term bias is intact barring a violation.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Meanwhile, the S&P 500 has started 2021 with a bearish engulfing pattern.

In its case, Monday’s downturn (long red bar) encompassed the range of the prior session, as well as the prior week’s range.

Still, the downturn has been underpinned by the 20-day moving average, currently 3,700, a widely-tracked near-term trending indicator. The S&P has not closed under the 20-day since Nov. 2.

The bigger picture

As detailed above, the major U.S. benchmarks are off to a less-than-stellar 2021 start.

Each index registered a bearish reversal to start the new year, selling off respectably from recent all-time highs.

But on the positive side, each index has initially maintained notable support. The single-day downdraft has lacked material follow-through early Tuesday, thus far inflicting limited damage in the broad sweep.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Moving to the small-caps, the iShares Russell 2000 ETF
US:IWM
 is digesting its late-2020 rally to record territory.

The small-cap benchmark has initially maintained first support (191.50) detailed previously. On further weakness, a deeper floor, circa 185.40, closely matches the November peak.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Similarly, the SPDR S&P MidCap 400 ETF
US:MDY
 is digesting a December rally to record highs.

Here again, the MDY has maintained first support (410.70) even amid a strong-volume first-day-of-the-year downturn.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Looking elsewhere, the SPDR Trust S&P 500
US:SPY
 has pulled in to its former December range.

Tactically, the former breakout point — the 370.80-to-371.07 area — pivots to resistance. Conversely, the SPY has maintained a deeper floor matching the mid-November range top (364.40).

Beyond specific levels, Monday’s internals registered as conspicuously tame despite the strong-volume downturn. Consider that declining volume surpassed advancing volume by about a 2-to-1 margin on both the NYSE and Nasdaq.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Placing a finer point on the S&P 500, the index has also pulled in to its former December range.

To reiterate, notable resistance matches last week’s gap (3,723) a level also defining the weekly low.

Tuesday’s early session high (3,722.5) has effectively matched resistance.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

More broadly, significant support spans from 3,633 to 3,646, the latter matching the November peak.

On further weakness, the 3,588-to-3,594 area — detailed previously — closely matches the ascending 50-day moving average, currently 3,596.

Delving deeper, the October peak (3,550) continues to mark last-ditch support, an area partly defining the S&P’s late-2020 double bottom.

All told, a garden-variety pullback — or healthy consolidation phase — seems to be underway to start the new year. Still, the downturn has initially lacked material follow-through, inflicting limited real damage.

Broadly speaking, the S&P 500’s intermediate-term bullish bias is intact barring violation of the areas detailed above. The 3,550 area marks likely last-ditch support.

Also see: Charting a bullish backdrop as the S&P 500’s wild 2020 ride concludes.

Tuesday’s Watch List

The charts below detail names that are technically well positioned. These are radar screen names — sectors or stocks poised to move in the near term. For the original comments on the stocks below, see The Technical Indicator Library.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Drilling down further, the SPDR Gold Shares ETF
US:GLD
 has come to life technically.

As illustrated, the shares have gapped atop trendline resistance, rising amid increased volume to start 2021. The breakout signals a trend shift.

Underlying the upturn, the GLD’s relative strength index (not illustrated) has registered its best levels since early August, improving the chances of longer-term follow-through.

Tactically, the trendline pivots to support, an area closely matching the bottom of the gap (178.40). The prevailing rally attempt is intact barring a violation.

More broadly, the shares are well positioned on the 10-year chart, rising from a continuation pattern hinged to the sharp mid-2020 break to record territory.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Moving to U.S. sectors, the VanEck Vectors Semiconductor ETF
US:SMH
 is acting well technically.

As illustrated, the group has rallied to the range top, briefly tagging record highs amid increased volume. An intermediate-term target projects to the 232 area.

Conversely, a well-defined floor matches the December range bottom, circa 210.40. The prevailing uptrend is firmly-intact barring a violation.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Initially profiled Dec. 1, Cirrus Logic, Inc.
US:CRUS
 has edged slightly higher and remains well positioned.

Technically, the shares have reached 11-month highs, rising to start the new year despite a down market.

The upturn punctuates an orderly December range — a continuation pattern — hinged to a massive double bottom defined by the June and September lows. (See the one-year chart.) A near- to intermediate-term target projects to the 88 area.

Conversely, the breakout point (83.10) pivots to support. A sustained posture higher signals comfortably bullish bias.

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

FireEye, Inc.
US:FEYE
 is a well positioned large-cap cybersecurity name.

The shares initially spiked two weeks ago, rising amid a sustained volume spike after the December cyber-hack.

The subsequent flag-like pattern has formed amid decreased volume, placing the shares 16.8% under the December peak.

Tactically, the post-breakout low (20.76) closely matches gap support (20.80). The prevailing rally attempt is firmly-intact barring a violation.

More broadly, the shares are well positioned on the five-year chart, sustaining a break atop major resistance matching the 2018 peak (20.61).

Charting a bull-trend whipsaw, S&P 500 absorbs pullback from record highs

Finally, Wheaton Precious Metals Corp.
US:WPM
 is a large-cap Canada-based gold and silver miner.

As illustrated, the shares have reclaimed the breakdown point (44.00) as well as the 50- and 200-day moving averages to start the year. The strong-volume upturn places trendline resistance under siege.

Tactically, the 50-day moving average, currently 43.15, has marked a recent inflection point. A breakout attempt is in play barring a violation.

Still well positioned

The table below includes names recently profiled in The Technical Indicator that remain well positioned. For the original comments, see The Technical Indicator Library.

Company

Symbol* (Click symbol for chart.)

Date Profiled

Check Point Software Technologies

CHKP

Jan. 4

Synaptics, Inc.

SYNA

Jan. 4

Ceridian HCM Holding, Inc.

CDAY

Jan. 4

Lumentum Holdings, Inc.

LITE

Dec. 23

Sunrun, Inc.

RUN

Dec. 23

ShockWave Medical, Inc.

SWAV

Dec. 23

JPMorgan Chase & Co.

JPM

Dec. 22

Coupa Software, Inc.

COUP

Dec. 22

PagSeguro Digital Ltd.

PAGS

Dec. 22

Ballard Power Systems, Inc.

BLDP

Dec. 21

LivePerson, Inc.

LPSN

Dec. 21

United Therapeutics Corp.

UTHR

Dec. 21

Shopify, Inc.

SHOP

Dec. 18

CyberArk Software Ltd.

CYBR

Dec. 18

Apellis Pharmaceuticals, Inc.

APLS

Dec. 18

iShares Silver Trust

SLV

Dec. 17

Calix, Inc.

CALX

Dec. 17

Elastic N.V.

ESTC

Dec. 17

Cerner Corp.

CERN

Dec. 17

Universal Health Services, Inc.

UHS

Dec. 16

Tenet Healthcare Corp.

THC

Dec. 16

Sunnova Energy International, Inc.

NOVA

Dec. 16

Xilinx, Inc.

XLNX

Dec. 15

Netflix, Inc.

NFLX

Dec. 15

Toyota Motor Co.

TM

Dec. 15

Williams-Sonoma, Inc.

WSM

Dec. 15

iShares Nasdaq Biotechnology ETF

IBB

Dec. 15

SDPR S&P Regional Banking ETF

KRE

Dec. 14

Atlassian Corp.

TEAM

Dec. 14

Etsy, Inc.

ETSY

Dec. 14

Surface Oncology, Inc.

SURF

Dec. 14

Autodesk, Inc.

ADSK

Dec. 9

Monster Beverage Corp.

MNST

Dec. 9

Cimarex Energy Co.

XEC

Dec. 9

Plug Power, Inc.

PLUG

Dec. 9

F5 Networks, Inc.

FFIV

Dec. 8

Emerson Electric Co.

EMR

Dec. 8

Zscaler, Inc.

ZS

Dec. 7

Fortinet, Inc.

FTNT

Dec. 7

Kulicke and Soffa Industries, Inc.

KLIC

Dec. 7

Honeywell International, Inc.

HON

Dec. 7

Dillard’s, Inc.

DDS

Dec. 4

Caleres, Inc.

CAL

Dec. 4

Spotify Technology S.A.

SPOT

Dec. 3

Align Technology, Inc.

ALGN

Dec. 3

Valero Energy Corp.

VLO

Dec. 3

Analog Devices, Inc.

ADI

Dec. 2

Cirrus Logic, Inc.

CRUS

Dec. 1

Sonos, Inc.

SONO

Dec. 1

Dollar Tree, Inc.

DLTR

Dec. 1

Nuance Communications, Inc.

NUAN

Nov. 30

Northern Trust Corp.

NTRS

Nov. 30

American Airlines Group, Inc.

AAL

Nov. 30

Microchip Technology, Inc.

MCHP

Nov. 24

Coca-Cola Co.

KO

Nov. 24

Zillow Group, Inc.

ZG

Nov. 23

Yeti Holdings, Inc.

YETI

Nov. 23

Palo Alto Networks, Inc.

PANW

Nov. 20

Bank of America Corp.

BAC

Nov. 20

Eaton Corp.

ETN

Nov. 20

SPDR S&P Oil & Gas Exploration and Production ETF

XOP

Nov. 20

MetLife, Inc.

MET

Nov. 19

Hilton Worldwide Holdings, Inc.

HLT

Nov. 19

American Express Co.

AXP

Nov. 18

Kohl’s Corp.

KSS

Nov. 18

FleetCor Technologies

FLT

Nov. 18

Applied Materials, Inc.

AMAT

Nov. 17

Delta Air Lines, Inc.

DAL

Nov. 17

Consumer Staples Select Sector SPDR

XLP

Nov. 17

Ross Stores, Inc.

ROST

Nov. 16

RingCentral, Inc.

RNG

Nov. 13

Regions Financial Corp.

RF

Nov. 13

iShares Europe ETF

IEV

Nov. 13

Flex, Inc.

FLEX

Nov. 9

Snap, Inc.

SNAP

Nov. 9

Norfolk Southern Corp.

NSC

Nov. 9

Communications Services Select Sector SPDR

XLC

Nov. 5

Health Care Select Sector SPDR

XLV

Nov. 5

Alphabet, Inc.

GOOGL

Nov. 5

Uber Technologies, Inc.

UBER

Nov. 5

Keysight Technologies, Inc.

KEYS

Nov. 4

Harley-Davidson, Inc.

HOG

Nov. 4

Garmin, Ltd.

GRMN

Nov. 4

Pinterest, Inc.

PINS

Nov. 3

Sony Corp.

SNE

Nov. 3

8×8, Inc.

EGHT

Nov. 3

Exact Sciences Corp.

EXAS

Nov. 2

Universal Display Corp.

OLED

Nov. 2

Dentsply Sirona, Inc.

XRAY

Oct. 27

Maxim Integrated Products, Inc.

MXIM

Oct. 21

The Travelers Companies, Inc.

TRV

Oct. 21

Micron Technology, Inc.

MU

Oct. 20

Vulcan Materials Co.

VMC

Oct. 19

ON Semiconductor Corp.

ON

Oct. 16

Ford Motor Co.

F

Oct. 15

Texas Instruments, Inc.

TXN

Oct. 15

First Solar, Inc.

FSLR

Oct. 13

Nevro Corp.

NVRO

Oct. 12

Teradyne, Inc.

TER

Oct. 12

SPDR S&P Homebuilders ETF

XHB

Oct. 9

Shake Shack, Inc.

SHAK

Oct. 9

SPDR S&P Biotech ETF

XBI

Oct. 8

Twilio, Inc.

TWLO

Oct. 8

Cloudflare, Inc.

NET

Oct. 7

Ceridian HCM Holding, Inc.

CDAY

Oct. 7

RSailPoint Technology Holdings, Inc.

SAIL

Oct. 1

Martin Marietta Materials, Inc.

MLM

Sept. 30

Abercrombie & Fitch Co.

ANF

Sept. 29

Zendesk, Inc.

ZEN

Sept. 23

Scientific Games Corp.

SGMS

Sept. 23

Crocs, Inc.

CROX

Sept. 14

Five Below, Inc.

FIVE

Sept. 10

Eastman Chemical Co.

EMN

Sept. 10

International Paper Co.

IP

Sept. 3

Anaplan, Inc.

PLAN

Sept. 2

Celanese Corp.

CE

Aug. 26

Westlake Chemical Corp.

WLK

Aug. 25

Deere & Co.

DE

Aug. 24

Expedia Group, Inc.

EXPE

Aug. 24

Johnson Controls International

JCI

Aug. 21

Canadian Solar, Inc.

CSIQ

Aug. 20

General Motors Co.

GM

Aug. 20

Starbucks Corp.

SBUX

Aug. 18

Builders FirstSource, Inc.

BLDR

Aug. 18

Steel Dynamics, Inc.

STLD

Aug. 17

Brinker International, Inc.

EAT

Aug. 13

Enphase Energy, Inc.

ENPH

Aug. 13

Nucor Corp.

NUE

Aug. 11

Freeport McMoRan, Inc.

FCX

Aug. 10

Natera, Inc.

NTRA

Aug. 10

Industrial Select Sector SPDR

XLI

Aug. 6

Penn National Gaming, Inc.

PENN

July 30

Procter & Gamble Co.

PG

July 29

SPDR S&P Metals & Mining ETF

XME

July 28

iShares MSCI South Korea ETF

EWY

July 28

Advanced Micro Devices, Inc.

AMD

July 23

Materials Select Sector SPDR

XLB

July 20

Caterpillar, Inc.

CAT

July 20

Roku, Inc.

ROKU

July 16

Cognizant Technology Solutions, Inc.

CTSH

July 16

Consumer Discretionary Select Sector SPDR

XLY

July 13

SunPower Corp.

SPWR

July 13

Walmart, Inc.

WMT

July 8

Danaher Corp.

DHR

June 24

Fiverr International, Ltd.

FVRR

June 19

HubSpot, Inc.

HUBS

June 8

Square, Inc.

SQ

June 8

SPDR S&P Retail ETF

XRT

June 3

iShares MSCI Japan ETF

EWJ

May 29

Synopsis, Inc.

SNPS

May 27

Agilent Technologies, Inc.

A

May 15

Qualcomm, Inc.

QCOM

May 12

ServiceNow, Inc.

NOW

Apr. 27

Five9, Inc.

FIVN

Apr. 24

Chewy, Inc.

CHWY

Apr. 24

Tesla, Inc.

TSLA

Apr. 23

VanEck Vectors Semiconductor ETF

SMH

Apr. 17

Okta, Inc.

OKTA

Apr. 16

Target Corp.

TGT

Apr. 16

Invesco QQQ Trust

QQQ

Apr. 14

Apple, Inc.

AAPL

Mar. 27

Nvidia Corp.

NVDA

Mar. 27

iShares MSCI Emerging Markets ETF

EEM

Mar. 19

Microsoft Corp.

MSFT

Feb. 22

* Click each symbol for current chart.

 

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