Indices to Watch Sampler November 29th, 2021
Want to find out what Robert Knight thinks the markets will do on Monday, November 29th? 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 29th, 2021
SPX: The SPX double topped over the last two weeks, and then on Friday a major sell off through the 20 day m.a. and lateral support. Market ended down 2.27%. Key support at 4545. It most likely goes down to test that level. Negative Covid news is the catalyst but Fed tapering is the real cause. This will be offset by strong economic numbers. It will be a fight between the bears and the bulls the next week to give us clear direction.
NDX: The NDX also was down over 2% on Friday after trading to new ATH on Monday. Support $15,900 and 15,700. Chart remains in a long term rising channel. It is too early to tell if this a change in direction for markets. We'll have to see how it reacts around the support levels.
DJIA: The Dow looks to have made a head and shoulders pattern and broke the neck line on Friday (bearish). It is down 4.8% from the ATH made a few weeks ago. This move is a strong negative divergence to the other major indices having clearly broken the trend line and lateral support. Key support at 33,900. A continued sell off could drag other markets lower.
DJTA: Trannies also had a sharp reversal on Friday, down 3.63% on the day. It did hold key support at 16,170. If it fails to hold here then 15,800 level is next. Overall, for now, the chart remains bullish.
IWM: The ETF for the Russell 2000 sold off sharply (4.39%) on near record volume. It is down 9.4% from the early November highs. It has broken down through major support levels. Next support $218 area then $212. The small cap and mid cap are probably oversold on the short term and could have a bounce. But the chart neutral at best trading back into the 9 month consolidation range. I t now has tremendous overhead and, if it holds support, need to consolidate for sometime to work out the overhead resistance.
FAS: The financial sector ETF closed down 10% on the day on near record volume. It has broken down through the 20 and 50 day m.a. and key support at $130. Next support around $123. It is very negative for markets to have the financials sell off like this. The chart is neutral at best.
LABU: We remain very bearish on the biotech sector as it tagged our $41 target on Friday. It is in a strong down trending channel. $37.50 and $33.50 next down side targets. We continue to avoid this sector.
SMH: Of all the sectors, the semiconductors remain the strongest. The chart is in a strong rising channel and held support on the 20 day m.a. It was down 2.9% on Friday but on average volume. But if the rest of the markets continue to sell off the SMH will not be able to withstand the selling pressure. Support $291.65 and $283.50.
GUSH: Oil is down $20 from the recent highs and the oil stock weakness is compounded by the overall market sell off. It closed down 14.35% on Friday. There is support at $90 and $80. Chart is bearish now.
NUGT: Bullion is down nearly $100 from the recent highs and the recent market rout compounds the sell off. A big engulfing bar on Friday probably is a harbinger of things to come. It is on key support so we will see if it holds next week.
Technical Indicators: Stocks are in an oversold position after Friday's market rout. Only 36.6% of stocks are above their 40 day moving averages and the McClellan Oscillator is at -140.17. VIX had its 4th largest 1 day percentage gain up 54%. Interestingly enough, after such a surge in the fear index, markets tends to trade higher over the ensuing weeks and months. Over 30 would be very negative for markets. We may still get one more push to the down side before we get a strong bounce going into the year end.
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