Markets began the week with decent gains, however volume failed to get the memo. Trade compared with the bearish session Friday was meager. The S&P 500 outperformed the Nasdaq, a rare occasion recently, higher by .4% with the Nasdaq up by .3%. The daily chart on the Nasdaq looks like a bullish flag pattern is taking shape but volume within the potential formation is above average and ideally you would like to see just the opposite. Industrials, healthcare and financials led the way, while energy unsurprisingly lagged. Banks are looking to get back into the swing of it after some long term underperformance, and investors are looking for names in the group to benefit from higher perceived rates going forward. Looking over hundreds of charts this weekend it was obvious to see that some of the rate sensitive sectors were hit. You name it from food and tobacco, to the utilities or REITs there was no safety to be found. There were some interesting names that acted well Friday and remember it always pays to see what names shine on a dreadful tape. They will often be the better performing names going forward. Both AMTD and SCHW advanced close to 3% on strong volume and many like to use that as a gauge of the retail or not “smart” money flowing back in. I have a feeling it is going to be a long week ahead.
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