ChartSmarter Monday Game Plan 3/27/17

Markets enjoyed a decent morning run Friday only to give back all of their gains and then some in the late afternoon, but when all was said and done the averages were essentially flat. The Nasdaq has now made it 12 consecutive winning Fridays, but for the week fell 1.22% its worst drop of 2017. The S&P 500 gave up 1.44% and both of the aforementioned indexes CLOSED the week above their 50 day SMAs. The Russell 2000 was not as fortunate although a bullish hammer on Wednesday did successfully retest the area where the huge 15 session winning streak ended last November. There is not the euphoria one often looks for when calling market tops but the consensus that some kind of pullback may transpire does seem logical. Although we focus on price action and the transports have been signaling softness, retail has for awhile now too. But one has to respect how the benchmarks shrugged off the London attacks mid week and it held around Thursday when it looked like the healthcare bill was not going to be passed. I still think the ugly bearish engulfing candle on the Nasdaq in particular on Tuesday has meaning as it occurred at all time highs and the previous four session all CLOSED within less than TWO handles. Further evidence may be seen looking at where strength lied this week. It was the utilities which were the only group to advance on the week with the XLU advancing 1.3% and it was the staples which we the runner up, but still fell by .5%. The financials were by far the worst performer this week with the XLF slumping nearly 4%. Leadership is suspect and if one looks for longs as always demand best of breed, especially in this type of environment. Below is the chart of FMI and how it was presented in our Monday Game Plan last week. Healthcare has been a spot where investors have been parking their money recently.