After sharp declines into mid April, stocks rebounded over the last three weeks and the S&P 500 SPDR (SPY) came within 1% of its March high. This March high acts as a benchmark high that chartists can use to compare performance. Stocks and ETFs trading above their March highs are leading and showing relative strength.

Current leaders include the Consumer Staples SPDR (XLP), Utilities SPDR (XLU), Aerospace & Defense ETF (ITA), KBW Bank ETF (KBWB), Copper Miners ETF (COPX), Infrastructure ETF (IFRA) and Water Resources ETF (PHO). The CandleGlance chart below shows all hitting new highs here in May. All six are also in clear uptrends.

The CandleGlance chart above shows XLU with a cup-with-handle breakout at 66 in late April. This signal was featured in ChartTrader on April 30th. Despite a strong extension on this breakout, XLU is a concern because it is trading some 13% above its 200-day SMA. The next chart shows XLU with the Percent Above MA (1,200,1) indicator. XLU was more than 13% above its 200-day SMA in February 2020 and April 2022 (dashed lines). This ETF is getting frothy and ripe for a correction. This indicator is part of the TIP Indicator-Edge Plugin for StockCharts ACP.

This week at TrendInvestorPro (ChartTrader) we featured tradable patterns in Vertex Pharma (VRTX), Union Pacific (UNP), the Home Construction ETF (ITB), Lennar (LEN) and CrowdStrike (CRWD).  We continue to monitor short-term breadth during this rebound and update our 14 indicator Composite Breadth Model every Tuesday. Click here to learn more.

ChartTrader – Correction within Uptrend for SPY/QQQ, Symbols: TLT, XLV, XBI, KBWB, IGV, CIBR, SKYY, SOXX (Premium)

The Fed has come and gone, but earnings season remains in full swing and SPY is in corrective mode. This is not an ideal time for stock setups and signals. Volatility is above average and I prefer to avoid setups in stocks with upcoming earnings reports. As such, today’s report focuses on ETFs

ChartTrader – Correction within Uptrend for SPY/QQQ, Symbols: TLT, XLV, XBI, KBWB, IGV, CIBR, SKYY, SOXX (Premium) Read More »

ChartTrader – Correction within Uptrend, Oversold Bounce within Correction, Symbols: TLT, $TNX, XLU, XLP, PBJ, URA, SOXX, TXN ADI, MCHP (Premium)

Volatility is on the rise as we saw outsized declines into mid April and breaks below the 50-day SMAs for SPY and QQQ. Both rebounded the last six days and they are approaching the underside of their 50-day SMAs, which may turn into resistance. Overall, the long-term evidence remains bullish for stocks, but the short-term evidence

ChartTrader – Correction within Uptrend, Oversold Bounce within Correction, Symbols: TLT, $TNX, XLU, XLP, PBJ, URA, SOXX, TXN ADI, MCHP (Premium) Read More »

ChartTrader – Defensive Sectors Lead, Offense Lags, Correction Underway, Correction Lessons from META and NVDA (Premium)

Some 75% of stocks in the S&P 500 and Nasdaq 100 report earnings in the next three weeks. Ugh! META reported last night and the stock fell around 13% in after hours trading. Microsoft (MSFT) and Alphabet (GOOGL) report after the close today. AMZN reports on April 30th, Apple

ChartTrader – Defensive Sectors Lead, Offense Lags, Correction Underway, Correction Lessons from META and NVDA (Premium) Read More »

ChartTrader – Finding Clues to Signal an End to the Correction, Tech ETFs Lead Lower, Defensive ETFs Hold Up (Premium)

Stocks were hit with strong selling pressure in April, but the weight of the evidence remains bullish. This means the decline is viewed as a correction within a bigger uptrend. Most stock-based ETFs and stocks will remain under pressure as long as SPY and QQQ are in corrective mode. I am marking

ChartTrader – Finding Clues to Signal an End to the Correction, Tech ETFs Lead Lower, Defensive ETFs Hold Up (Premium) Read More »

ChartTrader – Outsized Declines, Bearish Breadth Thrusts, Oversold Conditions and Correction Targets (Premium)

Stocks were hit with strong selling pressure here in April. This selling pressure triggered outsized declines and bearish breadth thrusts. The uptrend, which began with the November breakout, has been derailed. Even so, the longer term indicators are still bullish and this is considered

ChartTrader – Outsized Declines, Bearish Breadth Thrusts, Oversold Conditions and Correction Targets (Premium) Read More »

ChartTrader – Downside Participation Expands, SPY Breaks, QQQ Holds, Yields Rise, SOXX Joins ITB and XRT (Premium)

SPY fell 3.6% so far in April and is below its 50-day SMA for the first time since October. This looks like the start of a pullback because downside participation expanded significantly, just as it did in mid August. Some 83% of S&P 500 stocks were above

ChartTrader – Downside Participation Expands, SPY Breaks, QQQ Holds, Yields Rise, SOXX Joins ITB and XRT (Premium) Read More »

ChartTrader – ATR-SAR Holds for SPY/QQQ, Beaks for XRT/ITB, Yields Rise, Breakouts Fail for ADI/MCHP (Premium)

Weakness is spreading as the 10-yr Treasury Yield rises above 4.5%. Even though the rise is not that sharp, the market is re-pricing interest rate expectations going forward. This is especially visible in the Consumer Discretionary sector and Small-caps. Selling pressure increased markedly over

ChartTrader – ATR-SAR Holds for SPY/QQQ, Beaks for XRT/ITB, Yields Rise, Breakouts Fail for ADI/MCHP (Premium) Read More »

ChartTrader – 4wk HL% Triggers, but Short-term Evidence Still Bullish – Symols: FAN, PRNT, BR, MCHP, NBIX, NTNX, NVDA (Premium)

The weight of the long-term evidence remains bullish, but the short-term evidence is starting to turn as the 4-wk High-Low Percent indicator combo turned bearish. I consider this strike two against the short-term bulls. Strike one was the gap down

ChartTrader – 4wk HL% Triggers, but Short-term Evidence Still Bullish – Symols: FAN, PRNT, BR, MCHP, NBIX, NTNX, NVDA (Premium) Read More »

ChartTrader – ST Evidence Bullish, IWM Lags, Symbols: XLE, XLC, XLK, IGV, SKYY, CIBR, AMD, FTNT, LLY, HPE – (Premium)

Stocks fell on Tuesday and then recovered somewhat on Wednesday. Overall, SPY is leading the market with the strongest short-term uptrend. QQQ stalled since March 1st, but this is just a consolidation within a bigger uptrend.

ChartTrader – ST Evidence Bullish, IWM Lags, Symbols: XLE, XLC, XLK, IGV, SKYY, CIBR, AMD, FTNT, LLY, HPE – (Premium) Read More »

ChartTrader – Long and Short Term Uptrends, Watching TLT and $TNX, Symbols: CPER, URA, XBI, VRTX, REGN – (Premium)

The weight of the evidence is bullish for the long-term and the short-term. Long-term, the Composite Breadth Model is positive. Short-term, 4wk High-Low Percent for the S&P 500 and Nasdaq 100 remains net bullish, while SPY and QQQ continue to stair-step higher.

ChartTrader – Long and Short Term Uptrends, Watching TLT and $TNX, Symbols: CPER, URA, XBI, VRTX, REGN – (Premium) Read More »

Overbought Conditions Reflect Strength and Said Strength Drives Momentum Rotation Strategies

Momentum and trend strategies are off to a roaring start here in 2024. More often than not, these strategies buy leading stocks that appear overbought. Buying stocks that appear overbought often goes against our “gut feel”, but overbought conditions reflect strong buying pressure and this is clearly

Overbought Conditions Reflect Strength and Said Strength Drives Momentum Rotation Strategies Read More »

ChartTrader – Bull Run Extends, Symbols: MDY, URA, GPN, ADSK, DDOG, SWK, VRTX – (Premium)

The bull run continues with the S&P 500 SPDR (SPY) surging 2% the last three days and hitting another new high. Four of the eleven sectors hit new high (Finance, Industrials, Communication Services and Materials). We also saw new highs in several economically sensitive groups: Home Construction ETF (ITB), Retail SPDR (XRT)

ChartTrader – Bull Run Extends, Symbols: MDY, URA, GPN, ADSK, DDOG, SWK, VRTX – (Premium) Read More »

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