Turbo Trading's Indices to Watch Report for the week starting August 14, 2023, has been posted. Robert Knight, MBA, discusses $DJIA, $DJTA, $FAS, $GUSH, $IWM, $LABU, $NDX, $NUGT, $SMH, $SPX, and Technical Indicators. Note: Paying members receive this report and much more. Get a free TurboTrading 1-Week Trial, or become a paid TurboTrading Member to receive the Stocks to Watch List. Here's the free sample:
Indices to Watch August 7, 2023
SPX: After trading to key resistance at 4600 (lateral resistance and top of the channel) the index has pulled back to support around 4450 (lateral support and bottom of the rising channel). This move up from 3800 level could very well be leg 1 (5-wave move up) of the new bull market. This current pullback from 4600 would be leg 2. You wouldn't want to see if go much below 4400 though to maintain the upward momentum. Look for SPX to trade to new ATH before year-end. Chart remains bullish.
NDX: Mimicking the SPX, NDX traded to key resistance at 16000 (lateral resistance and top of the channel) and now pulling back in orderly fashion. Support 14785 area (lateral support and rising bottom channel line). This rising channel also looks like wave 1 of a 5 wave move to the upside. We are now in wave 2 pullback. Chart remains bullish in a strong rising channel. look for NDX to test ATHs before the end if the year.
DJIA: After breaking out of an 8-month reverse H&S pattern the index traded up to key resistance near 36000. It is now bull flagging mid channel between 34600 break out and 36000 resistance. Chart remains bullish. Look for it to trade to new ATH before year end.
DJTA: The Trannies traded to resistance at 16700 (3700 point move) before backing off. Support just under 16000. The Trannies confirmed the break out of the Dow. Markets are bullish. Look for the Trannies to trade to new ATH before year end.
IWM: The broader market ETF broke out over the key resistance at $190 and traded to resistance near $200. It pulled back to $190 support (lateral support and rising bottom channel line). The chart also made a "Golden Cross" in mid-June. It really needs to get over $200 with momentum to show the broader markets are going higher rather than continued chopfest.
FAS: The financial sector continues to lag with the FAS being hemmed in by the declining tops line. It is trading just under its 200 dma and on lateral support at $67. It probably needs a couple more weeks of consolidation before showing a direction. Chart is neutral at the moment.
LABU: The biotech ETF remains range bound from the $4.30 double bottom from 1 year ago to $7.75 and $9.50. Chart looks like it will test that $4.25 level again. It would be very negative if it broke that level. Chart is neutral at best. But if it does turn around and get dragged along in the current bull market through $9.50 that would be a powerful break out and should have a major move to the upside. But until then it remains a chopfest.
SMH: The Semis made a double top at a nominal new ATH. It is in a strong rising channel coming from $84 in Oct. 2022. It has made a sharp reversal looking to trade down to the rising channel bottom line around $143. A failure there and it could fill the gap to $134 (but that would be pretty drastic). This pullback from ATHs is wave 4 of a 5-wave move to the upside. Look for SMH to trade to new ATHs before year-end.
GUSH: Demand remains strong and Saudis cut supply by 1m B/D. As such prices remain strong and oil stocks continue to trend higher. The 50 ema is crossing up through the 200 ema (Golden Cross) as it turns up. The ETF has broken the long-term declining tops line trading through our $155 target. Next resistance around $1640.50. Chart is bullish.
NUGT: Gold stocks are testing support at $32. Below that the next level is $29. The 50 ema has crossed down through the 200 dma (death cross). Most likely it tags $29. Failure there could take it to $22/$20 range. Chart is bearish.
Technical Indicators: 50.5% of stocks are above their 40 dma (down from 75% in July). The McClellan Oscillator has recovered from an oversold reading around -120 to -64.54. VIX remains bullish at 14.84. With no fear in the market, it looks like participants are buying the dips as a lot of money remains on the sidelines. Being oversold at key support levels bodes well for a bounce in here.
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