This Stock Watchlist is just part of Robert Knight's daily commentary on stock indices and market trends. The evening before each NYSE trading day, subscribers to TurboTrading's Day Trader or Swing Trader memberships receive the Stocks to Watch list. This valuable insight is just one of of the membership benefits at TurboTrading.
March 29, 2021
SPY: The index reversed on Thursday and had huge follow through on Friday trading just 5 points short of ATHs. It broke out of the declining channel. The indicators were in an extremely oversold position and so we will see if this is a short squeeze before the weekend or the start of the next wave up. The SPY did bounce off of lateral support and the 50 day m.a. Let's see what next week brings either follow through or a double top.
NDX: The NDX is not as strong as the SPY and failing to confirm the ATH. It is at the apex of a wedge pattern. This could be a V bottom right hand extension pattern. But it is below the 50 day m.a. Key resistance around 13200. For markets to move higher, the NDX does not necessarily have to confirm the ATH of the SPY. But for now, it is a negative divergence.
DOW: DOW also surged on Friday breaking out of the down trending channel and closing at a nominal new ATH close. It remains in a strong rising channel. The DOW, the Trannies and SPY are all confirming a major buy signal in here. They may leave the tech heavy NDX behind for awhile.
DJ Transportation: Trannies traded through and closed at ATHs on Friday. This move is a major buy signal for markets as it confirms the SPY and DOW moves. It is near the top of the longer term channel. But as it accelerates perhaps we have to adjust the trend lines to a steeper angle to get the real picture. Target for the Trannies is 15,000 for starters.
IWM: Many of the mid cap and small cap stocks got hammered the last month as shown by the IWM sell off. It did trade down to triple bottom support at the $205 level. It reversed on Thursday and had follow through on Friday. But it is just under the 50 day m.a. It has support at $218 area. Next level of resistance at $230. It does remain in a strong rising channel and perhaps this is the wash out we needed for markets to head higher now.
FAS: The FAS after tagging our $100 target from $50 entry sold off sharply with markets. It did find support around $83. I was looking for an $80 support level for an entry but it surged on Thursday and had big follow through on Friday. It does remain in a strong rising channel and looks to be starting the 5th wave of a massive 5 wave move. Near term targets $105 and $110.
LABU: Biotechs are getting absolutely hammered From mid-February, the biotech ETF is down over 63%. It is in a bearish down trending channel. It may have found support here around $70. But it looks like it is in a 3rd wave of a 5 wave move to the downside. If it fails here, the bottom of the channel and lateral support is around $61. We'll watch to see if the overall bull market can pull it back higher.
SMH: Semiconductors may have broken the wedge pattern to the upside on Friday. The 20 day m.a. never did cross the 50 and the ETF is trading above both of them. It is in a strong rising channel and did bounce of the bottom rising channel line. Resistance around $250. Through that level and I think we will the start of the next big up leg for the sector. It should lead the way for the markets as new technologies shift into high gear. The only caveat is the world wide chip shortage and how it may stunt the growth.
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