Indices to Watch Sampler November 8th, 2021
Want to find out what Robert Knight thinks the markets will do on Monday, November 8th? 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 8th, 2021
SPX: The index makes another ATH on huge volume. It is up 7 days in a row. But, it is a spinning top candle so vulnerable for a pull back. The index is at the top of an intermediate channel. But just mid channel of the longer term trends. The index is up nearly 45% in 1 year which is a massive move for it. We are probably extended here on the short term, but the Santa Claus Rally is well under way. Look for markets to be strong into February 2022.
NDX: The index also made new ATHs, up 8 days in a row. It is at the top of the intermediate channel. But if it continues to accelerate 17500 and 18250 are targets. Support at 16000 and 15700. It is up 60% in 1 year. That is a massive move for such a large cap index. It is also vulnerable to a pull back as it is extended on the short term. But the next leg of the bull market is well underway. Look for a strong move into the beginning of next year.
DJ-30: The DOW also made ATHs on Friday, up 7 days in a row. After double bottoming at the end of September at 33800, the index is up 7.5%. The trend is very strong. 38000 and 39000 targets for early next year.
DJ-20: The Dow Transportation chart got skewed with the huge squeeze on $CAR. Now it is consolidating and flagging. But this move by the Trannies is a very strong buys signal confirmation with the SPX and DJ-20 also trading to new ATHs. Look for the next leg of the bull market to continue at least until mid- February.
IWM: The Russell 2000 ETF was consolidating for 9 months, lagging behind the major indices. But last week it surged out of that huge basing pattern and traded to new ATHs. This is a strong break out pattern. As the old saying goes, "The larger the base, the bigger the space". The measured move will but the ETF at around $300. It looks like we will now get rotation into small and mid cap stocks as they start to participate in this next leg up of the bull market. I would look for $270 and $280 by year end.
FAS: The financial sector was leading the markets higher. A very strong signal in a bull market. It broke out over the $130 level and traded to $150. It is now in a bull flag between $140 and $150. It is holding support at the 20 day m.a. Over the next 2 weeks I would expect it to break out to the upside. Targets $170.
LABU: The biotech ETF double-bottomed around $50 and last week broke out of a long-term declining channel. It traded up to $66 resistance and backed off. If it holds $58.50 and the 20 day m.a. average crosses up through the 50 then I would look to put a swing on. It needs to get through $66 with momentum. For now, the chart is neutral and could go either way.
SMH: After forming a triple bottom at $250, the semiconductor ETF has surged 20% to $300 in 1 month. With a chip shortage, it is not surprising that these stocks will have strong earnings as they can garner top dollar for their products. It is at resistance on the short term so may pull back. But this is a major break out of a base pattern. I would look SMH to trade to $325 and $350 by mid February.
GUSH: Oil remains strong and mid and small-cap stocks are breaking. The is all positive for the E&P oil stocks. For now, the ETF is hold the 20 day m.a... Targets are still $135 and $150.
NUGT: The senior gold miners broke out of a long-term declining channel and started leg one up. Last week it pulled back (leg 2). And now, with the strength of the price of gold and the mid cap market, it looks like it is starting wave 3 to the upside. It needs to get through $53 and $57 to show continuation. Look for a move to $65.
Technical Indicators: The McClellan Oscillator is at 69. It is moving up from an extremely oversold reading back in August. As well, about 70% of stocks are above their 40-day m.a. It is showing much broader participation in the markets. Yet, markets are neither overbought nor oversold. We have lots of energy available to continue to move the broader market higher. The VIX did pop some off of 15 double bottom. It traded to 16.50. But anything under 20 remains bullish.
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