ChartSmarter Tuesday Game Plan 4/26/16

Markets began the week with a slightly frosty tone with the Nasdaq posted a .2% decline, and its 4th drop on the last 5 Mondays, albeit none of the 3 prior drops fell by more than .5%. The tech rich benchmark has been turned back at the UNCH for YTD and some warnings signs could be perking up. It is still above the 50 RSI number, but the index today CLOSED below the centerline between the 2 bands for the first time since the rally began in February. Additionally it has recorded a bearish MACD crossover (see chart below). Given the mediocre losses of the averages, the S&P 500 slipped .2%, 8 of the 10 major S&P sectors lost ground for the session. The only ones to move higher was the defensive staples group (discretionary eked out a fractional advance), whose members of the arena were hit pretty good last week. One has to only look at the charts of a KMB which slumped 7% last week. Plenty of warnings was given with candlesticks with a bearish shooting star on 4/11 from all time highs and quickly followed up by a bearish engulfing candle on 4/13. Bulls have been feeling better about themselves with the big weekly loss last week in the XLU of more than 3%. It had not put in that soft of a weekly performance since the week ending 11/6/15 when if lost 3.4%. Best in breed names in the sector like an SCG have done little to repair themselves after the 5% combined drop last Wednesday-Thursday which also cost them 50 day SMA support. Notice how on SCG it did just that on 12/10-11 before rapidly recovering that important line. Bulls on the name do not want to see an extended period of time below it as another few sessions remaining below starts to give the impression of a bear flag formation.