Indices to Watch October 23, 2023

At the opening bell on Monday, October 23, what can we expect at the NYSE? Check out this Indices to Watch Report by Robert Knight, MBA. Includes the major stock indices $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 October 23, 2023

SPX: US treasuries continue to trade lower (higher rates) putting a lot of pressure on markets. $36 Trillion at 5% interest cuts heavily into governments ability to balance budgets. Yet the economy remains strong and Feds are hawkish in regards to rates. SPX sold off sharply in the last 3 days dropping over 3% in three days. SPX closed below the 200 dma and very close to key support at 4200. Below 4200 and wave 5 of 5 wave pattern could take us to 4100. If it hold at 4200 maybe will get a year end rally. Next two weeks of earnings should give us a good idea of where markets go.

NDX: The megacap index is right on a triple bottom support at 14500 area. A break below that level and look for NDX to trade down to 14500 and maybe 13850 (200 dma). The chart has not turned bearish but we are at a critical stage for it to remain bullish.

DJIA: The Dow broke down last week and bounced back to resistance. It was rejected at 3400 and sold off the last 3 days back under its 200 dma. Support 32875 and 32600. Chart has turned bearish.

DJTA: The Transportation index has turned bearish with the Dow trading below its 200 dma in a strong down trending channel. It failed to hold 14600. Next support around 14000. Chart is bearish.

IWM: The Russell 2000 ETF failed to hold $167.35 support and looking to test the double bottom at $163. Below that would be a break down out of a 16 month consolidation pattern. It would be very bearish for markets. Next level around $152.

FAS: Like everything, the financial sector sold off down to key support at $52.50. Below that and $48 is the next stop. Failure there would be very negative for markets. Chart remains bearish.

LABU: The biotech ETF remains in a strong down trending channel after breaking out down below an 18 month consolidation pattern making new ATL. There is no bottom in sight yet. The measured move takes it to the low $2 area. Chart is extremely bearish. I would expect a 1:10 reverse split soon.

SMH: The Semis sold off over 8% last week failing to hold support at $143. Next levels around $136 (lateral support and 200 dma) and then the gap fill at $134. It has broken the neck line of a H&S pattern (bearish). We'll see if earnings' season can come to the rescue.

GUSH: The middle east conflict spiked the price of oil with a corresponding move with oil stocks. But Friday they sold off sharply below support at $41. Even if the commodity is strong, the stocks could not with stand the pressure of the overall market. Next support $37. Hard to tell the direction as increased tensions in the middle east could ignite the commodity to $100. Yet, fears of recession put pressure on the price of oil. It continues to consolidate. Over $43 would be a break out for trades to $50.

NUGT: After making a 5 wave move down from a double top at $52 the gold miner ETF bounced of $24 support. It traded back to key resistance at $34. Look for a pull back to $28 before it decides on a direction. Over $34 would be bullish. For now, the chart remains bearish.

Technical indicators: Only 18.6% of stocks are above their 40 dma and the McClellan Oscillator sits at -76.72. VIX is 21.71. VIX between 20 and 25 is neutral but markets are not oversold coming up against key support. There is energy for markets to fail here and trade lower.

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