Markets had another listless day of trading, customary for the slow months of August. The Nasdaq eked out a gain, and the S&P 500 was lower fractionally. The Nasdaq’s daily chart for the past month looks excellent, ever since the 6/24 low just below 3300. It has advanced on strong volume, while pulling back on light trade, but does remain about 200 handles above its 50 day SMA. The technical picture for the S&P 500 looks just as solid. Looking over some sectors, today I viewed the builders, which I have been negative on for some time. The XHB however, and this is still early and yet to be confirmed with the all important price, but it has the beginnings of a potential bullish reverse head and shoulders formation. The chart still does look bearish, but the group has become so hated that a move up could be in the cards soon. Perhaps they will take a cue from the mobile home maker WGO that hit a multi year high today in big trade, taking out a short consolidation above 25.
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