ChartSmarter Wednesday Game Plan 7/29/15

Markets experienced a nice bounce back Monday after 5 straight down days for the Nasdaq and S&P 500. Is it a dead cat bounce or perhaps the beginning of a new leg up? The next week or so should answer that question. The Nasdaq rose 1% recouping its 50 day SMA. The S&P 500 gained 1.2% and for the third consecutive session outperformed the Nasdaq and that could be something to watch going forward. We have acknowledged that the Nasdaq has been the clear leader and will be interesting to witness if there is any relevant sector rotation. The 3 best sectors Tuesday were among the most beat up calling into question the real validity of the move. Energy, materials and industrials were among the winners. Of course all kinds of commodities have been under assault but an interesting, tasty on coffee looks like it may be looking for a possible move north. JO, a coffee ETF, is lower 17 of the last 24 weeks and 43% over the last one year period. We are fond of the round number theory and the fund is back to the round 20 figure where it found support previously the week ending 11/8/13. Not long after that the ETF went on a furious 7 week winning streak between the weeks ending 1/31/14-3/14/14 which rose 60%. It is oversold and more than 50% off recent 52 week highs. Perhaps you could say it needs a jolt, pun intended.