Weekend Video and Chartbook – Uptrends Extend with Small Gains, ETFs Go from Oversold to New Highs, Not Many Setups

After big gains the first week of February, stocks followed through with smaller gains the second week. A gain is a gain and new highs proliferated. SPY, QQQ, IWM and over half the ETFs in the Core List hit new highs this past week. The trends are up, the up trends are strong and the breadth models remain firmly bullish. Concerns remain with overextended conditions in IWM, the RSI over 50 streak, deterioration in short-term breadth and coin-flip seasonality for February, but we have yet to see any signs of weakness on the price charts. There are not many setups because stocks moved sharply higher the last two weeks. I am seeing some potential in the Industrials SPDR (XLI), Materials SPDR (XLB), Metals & Mining SPDR (XME) and Silver ETF (SLV). These four have breakouts working, but remain relatively close to their breakout zones. The Oil & Gas Exploration & Production ETF (XOP) and Regional Bank ETF (KRE), on the other hand, extended above their January highs and are in the trend-monitoring phase.