Markets cashed in a very reputable week Friday with both the Nasdaq and S&P 500 extending their winning streaks to 7 sessions. For the week the Nasdaq jumped 2.1% and negating the prior weeks questionable spinning top candle and has now outdid the S&P 500 five of the last 6 weeks. The S&P 500 did register a nice weekly gain of 1.4% and cleared the 2400 in fine fashion. On a YTD basis the Nasdaq remains in comfortable control with a gain thus far of 15.4% compared with the S&P 500’s advance of 7.9%. Interestingly the best weekly performer was the defensive utilities, with the XLU jumping 2.5% and has gained better than the S&P 500 for 2017 higher by 9.9% and the ETF CLOSED above a 53.12 weekly cup base trigger that is 11 months in duration and sports a very solid 3.1% dividend yield. The runner up for the week was the staples sector adding almost 2.1% edging out the technology group. Lagging once again was energy with the XLE losing 2.2% and now 15% off most recent 52 week highs. With a diverse group of industries joining the party, the important transports have come alive. It is being pushed north by both the rails and the airlines. The IYT illustrates this as the ETF registered its best weekly gain in 7 months rising by 3.5%, after bouncing off its 200 day SMA the previous week. The fund recaptured its 50 day SMA on Thursday and one can initiate a position above a 167.87 double bottom trigger. Below is the chart of best in breed rail play which is chugging along which we profiled in our Wednesday 5/17 Game Plan. The stock is now higher by 50% YTD and it is still mentioned as a takeover target. Its recent performance makes it look that event has already taken place.
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