Indices to Watch Sampler November 22nd, 2021
Want to find out what Robert Knight thinks the markets will do on Monday, November 22nd? As TurboTrading's Head Trader, Mr. Knight is qualified to offer this public sample of his "Indices Watchlist." Note: Paying members get this report and much more. Get a free TurboTrading 1-Week Trial, or become a paid TurboTrading Member to get the Stocks to Watch List. Here's the free sample:
Indices to Watch November 22nd, 2021
SPX: The index tested all time high again on Friday but backed off at the close. It is at the apex of an ascending triangle (bullish). Overall, the index is in a strong rising channel. With many of the FAANG stocks trading to new ATHs I would expect SPX to break out through resistance at 4718 area. Targets 4750 and 4800 before year end.
NDX: The NDX gapped up and traded to new ATHs on Friday. The index is in a strong rising channel on the short term and in a huge rising channel over the longer term. Look for continuation to 16800 and 17000 before year end.
DJIA: There is a negative divergence with the DOW stocks and SPX/NDX. The Dow failed to hold support at 35631 break out level. It has support on the 50 day m.a. at 35485 and then 35160. On the short term it is at the bottom of a rising channel. Much below 35000 would be very negative for markets. Let's see if it holds support.
DJTA: After breaking out to new highs and confirming a major Dow theory buy signal the index has made an orderly pull back. It has bounced of the 20 day m.a. and is mid channel of a short term down trending channel. Key support at 16200. A break below that would be negative for markets. Overall, the chart remains bullish.
IWM: there is little breadth to this market at the moment. Small cap and mid cap stocks are getting hammered. Definitely a negative divergence with SPX and NDX trading to ATHs. IWM failed to hold support at the $234.50 break out level. $230 is next support. But the broader market is showing signs of being over sold and I would look for a ounce in here. Failure under $230 changes the story.
FAS: The financial sector ETF was in a trading range between $140 and $150. But last week it broke down and traded to $130 support. It bounced off both lateral support and the rising channel line. A break below $130 would be negative for markets and, perhaps, a harbinger of overall market direction.
LABU: The biotech sector remains bearish having broken $51 support. $47.50 area is next support. Under that it is going to $41. For now, we are avoiding biotechs except for special situations.
SMH: The semiconductor ETF traded to new ATH on Friday and is in a powerful rising channel. Of course, NDX stocks are the main drivers. But even the mid and small cap semis are strong. I think the rest of the market will catch up to semis as the bull market will continue into February. Look for $320 and $330 as targets.
GUSH: We had a good run with oil stocks but now the E&P have rolled over and turned bearish. It has broken down through key levels. Support at $90 and $80. For now we are avoiding the sector as you have a double whammy; weaker commodity price and weaker IWM.
NUGT: The senior gold miners are in a rising channel and look to be forming the 4th wave of a five wave pattern. Bullion prices are strong but IWM is weaker dragging the ETF down. It needs to hold $53. Target $64. With fears of inflation, I think bullion prices remains strong and we should see a 5th wave move up over the next month.
Technical Indicators: The indicators are decidedly weak. Only 49% of stocks are above their 40 day m.a. and the McClellan Oscillator is reading oversold at -117.6. The divergence is the VIX which is made up with the SPX. It remains bullish under 20. The good news, for the bulls, is that markets are oversold. The caveat is, they are not extremely oversold so we still have room to the down side for the overall market. The next few days should give us an indication on direction of small and mid cap stocks. The big names remain bullish.
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