ChartSmarter Friday Game Plan 1/13/17

Markets staged decent reversals Thursday as the Nasdaq’s 7 session winning streak came to an end. It did however CLOSE at the top of its daily range, something it has done for the last 7 sessions, a bullish trait (it was the second straight day it finished well off intraday lows and Thursday was off by 1.2% early on). It also bounced almost precisely off the round 5500 number, and recorded a bullish hammer candle. Headed into Friday it is higher by .5%, adding on to last weeks respectable 2.6% advance. The S&P 500 recorded nice bounce as well Thursday, but recorded a bearish harami candle, and for the week thus far is lower by .3% demonstrating slight bifurcation. It was interesting to see the super sized weakness in the financials as the XLF was the worst performing group, even after a Fed official indicated he was in favor of 3 rate hikes this year due to a pick up in economic activity. Most likely it was some profit taking ahead of many getting ready to report earnings shortly. Utilities, healthcare and staples were the leading sectors Thursday as a risk off feeling fell over the benchmarks (utilities and healthcare were the only major S&P sectors to gain ground today, albeit both rising just .1%). The Russell 2000 surrendered .9% and this chart has captured many a forecasters attention, and perhaps for good reason. It touched the top of that astonishing 15 session winning streak today from last November. Talk about tight ranges the markets have endured recently, to gauge the risk on feeling of the averages perhaps one can look at the HYG. The high yield corporate bond ETF has CLOSED the last 6 sessions all within just 8 pennies of each other. It just might give clues as to where the markets are headed next.