Chartsmarter Insights

5 Feb 2024

Technology Sector Review: 2/6/24

By |2024-02-05T16:20:10-05:00Monday|

Semis Grooving:   The semiconductors have been on a roll recently and they may be masking some underlying weakness in the broad Nasdaq as now just 42% of all Nasdaq names are above their 50-day SMA (notice it is now touching the oversold 30 RSI number but that it was not able to stem the tide going lower last August and September). The SMH has been very resilient and the WEEKLY chart below demonstrates this. Since the end of Q3 last year it has not recorded a 3-week losing streak and general NVDA has well exceeded its measured move to 600 and is now swimming near the very round 700 figure recording a bullish hammer Monday. MPWR has constructed its flag that started at the very round 400 number and was above the 640 pivot Monday, so see if this could decisively CLOSE above that level. INTC to me looks like a good risk/reward scenario after a bullish hammer candle last Friday and showed some firmness Monday. It can be bought here with a CLOSING stop below 41.50 and add to with a buy stop above a double bottom pivot of 50.40. 

2 Feb 2024

Technology Sector Review: 2/5/24

By |2024-02-02T21:21:04-05:00Friday|

Nifty Nasdaq: I am not going out on a limb here saying the Nasdaq should feel the pull toward the very round 16000 number on the MONTHLY chart below. It is just 2% from these PRICES and PRICE has memory, as it was there just more than 2 years ago. What will be interesting is how it reacts once it is there, of course, it has to do that first. That being said it is still lagging behind the S&P 500 which is at all-time highs. I am hearing the weak seasonality patterns. Concerns about breadth, the Russell 2000 never being this far away when the S&P 500 is at all-time highs, etc. Yet the markets are grinding higher. Both the semis and software are moving in the right direction and perhaps we can use the analogy of the Nasdaq chasing the S&P 500 with the IGV trying to play catch up with the SMH. Notice here that the SMH is at all-time highs while the IGV (the lime line) is still in pursuit of its own. If it can achieve one this year, notice between 2018-22 it firmly led the SMH. My favorite chart of the top ten holdings in the IGV is PANW which is bull flagging with a buy stop above 350 carrying a measured move to 420. 

1 Feb 2024

Technology Sector Review: 2/2/24

By |2024-02-01T16:30:10-05:00Thursday|

Apple Crisp:  It is mid-afternoon as I write this note for Friday's session and with AAPL reporting after the close my prediction of a sell-off could burn me (I am not involved, just a prediction), hence the "crisp". The implied move of 3% up or down in my opinion will be lower and that would shake out some of the weak holders and potentially create a new double-bottom pattern, and notice the last one that broke above a 182.20 pivot worked ok as it ran to the very round 200 number. Thursday put an end to the 6-session losing streak recording a bullish piercing line candle, but perhaps someone knows something with that prior softness before today. Compared to peer MSFT it is losing distance from the $3T market cap and is now firmly underneath Mr. Softee's. Regardless of how one feels about the name and it's losing its innovative history of the past this stock still carries a lot of weight and bulls want to see this perform. Its MONTHLY chart suggests this could be topping at the 200 area with two consecutive spinning top candles the last 2 months and another spinning top and hanging man last July and August. 

31 Jan 2024

Consumer Sector Review: 2/1/24

By |2024-01-31T18:35:22-05:00Wednesday|

Recessionary Gestures:   When many market participants tend to be very sanguine sometimes it may be wise to take the other side. I have been taught that consensus is usually correct, but when certain technical aspects take hold one can decide with more confidence regardless of their bias. Now recession chatter is very dampened, and I am no economist (or have any desire whatsoever to be) but certain developments as of late have perked my interest. Both FDX and UPS were beaten up after recent earnings reactions, the latter now at a streak of 4 consecutive losses. FDX is now below its 200-day SMA for a third time since the late October lows, and will it be too tall of an assignment to expect a quick recapture of the secular line? The ratio chart comparing the XLP to the XLY, which we have spoken about recently, is gaining steam for the former, not the best scenario for growth investors. AMZN will certainly have a say in this theme when it REPORTS tomorrow after the CLOSE, and this one may look like it's ready to roll over on the ratio chart contrasting the top holdings (against PG). 

30 Jan 2024

Healthcare Sector Review: 1/31/24

By |2024-01-30T16:18:34-05:00Tuesday|

Biotech Feels Firm:   As with an abundance of big tech firms REPORTING earnings this week, it may be wise to pivot one's attention to some overlooked parts of the market to potentially capitalize. The biotechs did record a powerful run last year in harmony with the overall market and they have since stalled. No one would fault those who are skeptical given their history, and therein may lie the opportunity. The WEEKLY chart below shows just how well the fund has been holding up at the very round 90 number. The prior 3 times it has tested that level witnessed drawdowns to 75, 72, and more recently 64 late last year, and note it started descending almost immediately. This is now the 6th week it is "glued" to 90 and I think that is encouraging for a move toward par in the near term. The period of the summer of 2022 and the present move to 90 was very similar, each taking roughly 9 weeks, and again the fact that it is keeping this altitude near the figure is a good sign. Some of the large names in the IBB are behaving themselves very well too with the AMGN bull flag, which has found support at the very round 300 within the formation. VRTX has broken above a bull flag and there has been plenty of M&A activity in the entire biotech arena. Taking a peek at the annual returns of the XBI over the last several years shows last year was the first single-digit move since 2017. Is it ready for another strong double-digit advance in 2024?