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Indices to Watch Sampler June 21, 2021

The New York Stock Exchange will open on Monday, June 21, 2021, and the more you know, the better. Robert Knight, Head Trader at TurboTrading, wrote "Indices Watchlist Sampler" below to keep traders informed. TurboTrading members get this report on the weekend, plus our Stocks to Watch List the night before trading days. Take a free TurboTrading 1-Week Trial, or become a paid TurboTrading Member. Here is the free sample:

June 21, 2021

SPY: After making new highs last week the SPY sold off sharply on fears Fed would raise rates sooner than expected. In 4 days the SPY dropped close to 3%. It traded below the 50 day m.a. and intermediate rising channel line. It was down on massive volume. But it was also a quadruple witching hour. Key support around 4100 then 4040. We will see if it bounces of the 50 like it has the past 5 times this year. Chart could go either way right now. So be cautious.

NDX: The NDX is now the strongest of the indices. It was off .81% on Friday but right at ATHs. Friday was an inside day for the index. Chart remains strong. But it is a negative divergence from the other indices.

DOW: Big negative divergence with the Dow Industrial and the DJ Transportation to the NDX. The DOW is off 4.5% from the double top ATH. It has broken down through the 50 day m.a. and out of the intermediate channel line. It is right near key support at 33,260. Below that and it could traded to 32000. Some of the key down components are also leading economic indicators (ie. CAT). Selling off so sharply does not bode well for the world economies.

DJ Transportation: Like the DOW, the Trannies have sold off sharply from a triple top breaking key support levels and the long term channel line. Trannies are off 9.8% from the top. Support at 14300 and 13700. This move by the Trannies is a very negative divergence. Chart has turned bearish. We'll see if it leads all markets lower.

IWM: The ETF for the Russell 2000 remains in a large consolidation pattern. It did put in a double top last week. Key support $219 and $208. A break below $208 would be very bearish. For now the chart remains neutral and could go either way. Next 2 weeks could be very tale telling for the markets.

FAS: It is concerning in the ferocity of the financials selling off. The FAS ETF is down 24.2% from the double top put in in May and early June. It has broken down through the rising channel line and the chart now is bearish. Support $93.50 and $85. If it fails to hold the $93 level it could be a harbinger of things to come. Financials tend to be a leading indicator of market direction.

LABU: The biotech ETF remains in a rising channel after breaking out of a major down trend. Support at $66 and then $62. The ETF was down over 70% from its highs so may not have much room to go lower. But if there is a general market sell off, biotechs will follow suit. For now, the chart remains bullish.

SMH: The semiconductor ETF made a triple top last week and was down 2.9% on Friday. It is in a large consolidation pattern trading between $225 and $260. For now the chart remains neutral. Near term support at $241 and $234.

GUSH: Oil remains in a very strong bull market but the oil stocks got crushed the last few days. They are off 18% in the last week. It looks like they are throwing the baby out with the bath water. Key support for GUSH around $78. We'll see if the oil stock sell of prognosticates a demise for the commodity or if it will provide a strong buying opportunity as the oil stock sell off maybe uncalled for.

NUGT: Gold and gold stocks were crushed last week. The NUGT sold off 28.4% in the last 2 weeks. Fears of inflation have fallen and gold bullion sold off sharply. Combine that with a soft market and it is no wonder the NUGT has turned so bearish.

Technical Indicators: Markets are decidedly oversold with the McClellan Oscillator at -146. Now, only 37% of stocks are above their 40 day moving average. VIX has turned neutral from bullish at 20.70. Maybe we get another day or two off sell off before we get a significant bounce.

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