For those of you who do not know much about me, I wrote a book called Plant Your Money Tree: A Guide to Growing Your Wealth.The main thrust of the book was about market phases, of which we use 6.In the book, I use weekly charts assuming that a longer timeframe rather than a Daily one to measure the market’s next moves and the macro, is better.I also introduce the Economic Modern Family in the book.Weekly phases combined with the incredibly accurate Family index and sectors, are super useful right now.Coming into Monday, the initial sell off was significant.However, the indices and a lot of sectors popped off those lows.What now?On the weekly chart, the Russell 2000 IWM held the 200 and 50-week moving averages.
Granny Retail held the 50-WMA but is underperforming SPY and breaking the 50-WMA on momentum.
Sister Semiconductors fell to the 50-WMA precisely! However, SMH has hurdles with the momentum declining and the performance underwhelming compared to the benchmark.
Long Bonds TLT have run up but into the resistance levels of last October. Interestingly, the last time everyone called on the Fed to lower rates and were convinced recession was coming.
The Transports flashed warning ever since March when IYT underperformed the SPY and Real Motion indicated a bearish divergence.As this week continues, it will be up to 1 of 3 scenarios to help us decide what is next:
ETF SummaryS&P 500 (SPY) 540 resistance with 505 next supportRussell 2000 (IWM) Sitting on key weekly supportDow (DIA) 380 supportNasdaq (QQQ) 430 pivotal 420 supportRegional banks (KRE) 50-52 supportSemiconductors (SMH) 207 is the 200-DMA support 200 the weekly supportTransportation (IYT) 61 next support on weekly chartsBiotechnology (IBB) 140 supportRetail (XRT) 70 key supportiShares iBoxx Hi Yd Cor Bond ETF (HYG) 76.50 is the support we watched starting in May-now backMore By This Author:Divided We Stood, United We Fall
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