Markets began the week in the red and never were able to gain any momentum with the complete session trading in the negative. The Nasdaq was the hardest hit as the tech rich benchmark surrendered .9%. Once again it was the resilient Russell 2000 that ended the day slightly in the green, up .1%, and confirming the theory that trends tend to stay in motion more likely than they are to reverse. It did record only its second spinning top candle since the powerful surge off the 1350 level on 8/18. These candles tend to predict a softening of the previous trend, so perhaps the risk on feel it has been projecting could be halting. The Nasdaq found support today at its rising 50 day SMA and the S&P 500 did retest its 2491 cup base trigger from 9/12 (keep a close eye on this Fridays finish as it could complete a very bullish 3 week tight pattern at all time highs). The Dow did successfully retest its own cup base trigger of 22180 taken out on 9/14. Advantage bulls.
Looking at individual groups Monday it was the energy names that were the best performer with the XLE higher by a very respectable 1.4%, and it was backed up by the weak sectors of the utilities and staples as the XLU and XLP rose by .9 and .7% respectively. The XLE is now on an eleven session winning streak and today jumped back above its 200 day SMA. The ETF is looking for its first 6 week winning streak in over 5 years depending on Fridays CLOSE. The XLP did put a stop to its 4 day losing streak which lost a combined 2.6%. The XLU put up a stop to a 6 day losing streak, its first since a 7 day slump between 6/27-7/6.
One has to respect the recent move the industrials group has made. The XLI continues to impress following the 69.68 breakout trigger above a cup base on 9/18. It has acted well POST breakout and that is just what you want to see. Below is a name in the sector and how we profiled ACM in our Wednesday 9/20 Game Plan. Today it rallied 2.6% and it has gained ground 4 of the last 5 weeks with three of those advances adding more than 3.3%. Pertaining to the round number theory it registered a bullish hammer candle off the 30 figure on 8/21, the middle of a bullish morning star pattern and looks poised now to be magnetically pulled to the 40 number that was resistance last December. Investors can look to add to this resurgent name above a cup base trigger of 40.82.