Markets began the week Monday with modest losses as the S&P 500 fell .3% the Nasdaq by .4% and the Russell 2000 by .7%. The only thing of consequence on this quiet session was that the S&P 500 filled in the gap precisely from 2/28, although it did record a doji candle which often signals a pending trend change. But as always PRICE action supersedes any candles. The Russell did bounce off its rising 50 day SMA. The only sector to gain ground out of the major S&P groups were the underperforming energy names. These names have come off a lot from there highs and one has to wonder if this will be a continuing theme, or is this group ready to resume a move upward. The XLE is lower 9 of the last 12 weeks, but has declined just 8% from most recent 52 week highs. The ETF did also for now, successfully retest its 200 day SMA, a line that is has been above since the week ending 4/22/16 (prior to that the fund was underneath its 200 day since 9/26/14 so these trend tend to play out on long time frames). The group that lagged Monday was the financials with the XLF withdrawing .8%, pun intended. It remains just 2% off recent highs, but it is hard to overlook that bearish engulfing candle last Thursday, and a move back to its 50 day SMA would be prudent, and that it currently 4% away from todays closing price. The IBB chart which we posted over the weekend CLOSED just underneath the very round 300 number and that should be a critical spot to watch going forward. If it can migrate northward from that figure it would be very positive for the group. One recent IPO that has a very good looking chart is JNCE, which we profiled in our Game Plan. Today it demonstrated excellent follow through following last weeks break above a cup base trigger of 22.92.
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