Weekend Video, Chart Notes and ChartBook Update

ETF Chart Notes for Saturday, December 21st

* These chart notes are also in the ChartBook PDF file (link above)

ETF Chart Notes for Saturday, December 21st

Weekly Performance Metrics for Core ETF List (60 ETFs)

New 52-week Highs (unadjusted data)

Major Index ETFs: SPY, RSP, MDY, IJR, IWM, QQQ, MTUM, USMV

Sector SPDRs: XLK, XLY, XLF, XLC, XLV, XLP

Equal-Weight Sectors: RCD, RGI, RHS, RTM, RYF, RYH, RYT

Small-cap Sectors: PSCC, PSCD, PSCF, PSCH, PSCI, PSCT

Industry Group ETFs: BOTZ, SOXX, IGV, KBE, KRE, KIE, IBB, XBI, IHF, IHI

Other: VIG, HYG

This Week’s Leaders: FCG +7.9%, XOP +6.71%, AMLP +5.78%, XES +4.09%, TAN +3.3%, IHF +3.02%, SOXX +2.79%, FDN +2.73%, XLC +2.61%, XRT +2.33%

This Week’s Laggards: LQD -0.57%, EFA -0.69%, ITB -1%, BOTZ -1.03%, ITA -1.53%, TLT -1.56%, REMX -1.58%, GDX -2.13%, MJ -2.29%, XME -2.43%

As you can see from the lists above, there were plenty of 52-week highs this week. SPY (large-caps), QQQ (large-cap techs), MDY (mid-caps) and IWM (small-caps) hit new highs. Six of the eleven sector SPDRs hit new highs this week, while seven equal-weight sectors hit new highs. Small-caps were not left out as six small-cap sectors hit new highs. Talk about broad strength.

SPY  extended its low volatility advance. 1-day ROC has not been below -1% since early October, ATR(2) is below 30 and %Above 20-day EMA is above 80%. Friday’s commentary focused on the immediate uptrend in SPY and made comparisons with January 2018. I also covered this in the video above.

The post breakout extensions were strong in QQQ and SPY, but less strong in IWM and MDY. Nevertheless, the breakouts held and new highs are bullish.

Both the S&P 500 Momentum ETF (MTUM) and S&P 500 Minimum Volatility ETF (USMV) surged on Friday and hit new highs. This, again, reflects the broadness of the current advance.

XLY continues to flirt with resistance from a large Ascending Triangle. The Retail SPDR (XRT) was quite strong this week and the Bollinger Bands contracted to their narrowest since October 2017 for AMZN. (article here)

XLI is holding its breakout and consolidating.

The run in Healthcare continues. XLV is up 15% since late September and up 11 of the last 12 weeks. IBB is up 23% with 12 positive weeks straight. XBI is up 26.5% with 12 positive weeks in a row. IHF is up 25.4% with 11 of 12 positive weeks. Big moves, long-term uptrends and very frothy.

XLE is challenging its falling 200-day SMA for the fifth time this year.

XLB is holding its flag breakout.

XLRE and IYT have small falling wedge patterns (8 weeks) and both are testing their rising 200-day SMAs.

FDN got a nice bounce off support the last eight days and moved above its early December high.

BOTZ, IGV and SOXX led the tech-related ETFs with new highs this week.

ITB and XHB hit new highs in late October and consolidated the last nine weeks. The Bollinger Bands are also narrowing. ITB broke its lower band on Thursday, but bounced back and this could be a classic head fake break. XHB remains within the bands. Overall, consolidations after new highs are considered bullish continuation patterns so a breakout is expected at some point.

XRT came to life this week with a triangle breakout.

ITA became oversold within a long-term uptrend this week. The ETF hit a new high in November and remains well above the rising 200-day SMA. A falling wedge formed the last five weeks and RSI(10) dipped below 30. A mean-reversion setup in the making.

GDX backed off  falling wedge resistance this week with a 2% decline. GLD, however, held firm this week and is still challenging falling wedge resistance. Ditto for SLV.

XME fell after breaking Double Bottom resistance in early December. The breakout zone around 27.5-28 turns first support to watch and RSI(10) is entering the 40-50 zone, which denotes a mild oversold condition.

TLT and AGG failed at resistance and fell the last two weeks. Both are in downtrends since September as money gravitates towards higher-risk equities and away from safe-haven bonds.

UUP hit a new high in early October and then formed a large triangle above the rising 200-day SMA. This is a consolidation within an uptrend. Furthermore, UUP reversed the downswing within this triangle with a bounce this week.

Holiday Scheduling

The NYSE and Nasdaq will close at 1PM ET on December 24th (Tuesday) and close completely on December 25 (Wednesday). Volume levels will be light next week and I do not expect much change in the overall patterns at work. This is a good time for all of us to spend some time with friends, family and loved ones. Next week TrendInvestorPro will only publish on Friday (December 27th). I will publish a condensed version of the ETF Grouping and Ranking Report, update the ChartBook and provide a video that day. Merry Christmas!!

Enjoy your weekend!

-Arthur Hill, CMT
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