Weekend Video – Market Remains Bullish and Mixed, Banks, Energy, Materials and Infrastructure Lead, Tech and High Beta Lag (Premium)

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Next Week's Publishing Schedule

Tuesday, 18 January: Market/ETF Commentary

Thursday, 20 January: Market/ETF Commentary

Saturday, 22 January: Weekend Video

Note that I am aiming to post between 8 and 8:30 AM ET.

The weight of the evidence is bullish for the broader market, but there are some sizable pockets of weakness, as seen when looking at the percentage of stocks above the 200-day SMA for the various indexes. Yield spreads show no signs of stress and the Fed Balance sheet is near an all time high. Despite a bullish backdrop overall, the market went through a transition phase the last few months as ETFs related to banks, energy, materials and infrastructure led the way higher. Meanwhile, tech and high beta ETFs took it on the chin. Semiconductors avoided the selling pressure in tech though and continue to consolidate. Elsewhere, breakouts in the Electric Vehicle ETFs are holding, commodity related ETFs remain strong, the Lithium Battery Tech ETF formed a bullish pattern and Uranium ETF continues to consolidate. Note that I also updated the Market Regime page.

       Broad Market Notes

  • Composite Breadth Model is Bullish
  • BBB and CCC Spreads are Slightly Elevated
  • Fed Balance Sheet is Back Near Prior High
  • Percentage of Stocks Above 200-day SMA Deteriorates
  • SPY Chops Higher as QQQ Chops Lower
  • QQQJ Forges another Lower Low as IWM Tests Support
  • TLT Holds Break Down as TNX Holds Break Out
  • GLD Bounces as Dollar Falls, but Remains Range Bound
  • Dollar Becomes Oversold within Uptrend

      ETF Trends, Patterns and Setups:

  • Energy SPDR Surges to New High (XLE)
  • Oil and Energy ETFs Close in on October Highs (XES, XOP, FCG)
  • Banking ETFs Extend Lead with New Highs (KRE, KBE)
  • Utilities and Staples Fall Back after New Highs (XLU, XLP, PBJ)
  • Materials SPDR and Infrastructure ETF Fall Back after Breakouts (XLB, IFRA)
  • Metals & Mining SPDR Challenges 2021 Highs (XME)
  • Healthcare ETFs Fall Back after New Highs (XLV, IHF)
  • Real Estate SPDR Corrects Hard, but not Oversold (XLRE)
  • Semiconductor ETFs Consolidate and Hold Up (FIVG, SOXX)
  • Electric Vehicle ETFs Hold Breakouts (DRIV, CARZ)
  • Copper Miners ETF Extends on Breakout (COPX, CPER, DBB)
  • DB Agriculture ETF Holds Wedge Breakout (DBA)
  • Lithium Battery Tech ETF Forms Bullish Wedge (LIT)
  • Uranium ETF Consolidates in Potential Reversal Zone (URA)
  • Home Construction ETF in Uptrend, but Short-term Volatile (ITB)
  • Steep Declines and Lower Lows for Tech-Related ETFs (SKYY, FDN, IGV, IBB)
  • XLC Holds Above December Low Shows Less Weakness (XLC)
    Cybersecurity ETF Holds Up Better than Others (CIBR)
  • Retail ETFs Extend Lower (IBUY, XRT)
Thanks for tuning in and have a great weekend!

-Arthur Hill, CMT
Choose a Strategy, Develop a Plan and Follow a Process

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