Markets began the new week on the soft side, but remember it is not where you start but were you finish. Futures were weak premarket, the opposite of what they were almost every day last week and I felt it was a chance for the bulls to step up. We know healthy markets tend to start shaky and end firm, and bear markets start strong and finish fragile. The Nasdaq and S&P 500 dropped .9%, and tomorrow could be the Nasdaq’s first 3 day losing streak since mid June, just to give a perspective of how solid the benchmark has been. Taking a look at the weekly chart of the Nasdaq to get a longer term perspective the candlesticks again have given foreshadowing at highs and lows. At the present moment the Nasdaq is testing the highs of the week ending 7/24/15 which registered a bearish dark cloud cover candle at prior all time highs. More recent this year on the weekly, the week ending 2/19 completed a bullish morning star pattern, 7/1 a bullish engulfing candle, and last week recorded an indecisive spinning top candle CLOSING right at the round 5300 level. One normally likes to see a breakout work out right away, but given the year long cup base we have seen with the Nasdaq, perhaps it can be given some slack as to its recent stalling action. The next couple weeks should give some clarity whether we can keep extending gains from here, or if the chart is a long term double top at all time highs. Monday all major S&P sectors lost ground with the utilities “acting” the best with a loss of .3% for the XLU. Dropping the most severe were the financials with the XLF surrendering 1.6%, and of course these two groups often act as polar opposites with investors searching for yield with interest rates at historic lows. The XLF once again proved how the round numbers could be difficult to burst through especially if it coincided with problems in the past. Looking at the round 20 number which halted the funds progress the weeks ending 9/2-9 which both traded as high as 20.01, it was precisely where it ran into trouble last November-December with 3 weekly CLOSES just above 20. The ETF to its credit has been making higher lows, the weeks ending 8/28/15, 2/12/16 and 7/1/16 which could be viewed as a long term ascending triangle formation. Monday however it did undercut its 50 day SMA, so that theory may have to be put on hold for awhile. Speaking of the round numbers in todays Game Plan below is the chart of healthcare play NVRO and how it was profiled, with an entry just above one of the most important round numbers, par. It extended its winning streak to 9 today and showed good relative strength on a weak tape.

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