Stock Market News – Charting market cross currents: Late-month divergence persists
U.S. stocks are lower early Thursday, pressured as persistently surging U.S. Treasury yields present a market headwind.
Against this backdrop, the major U.S. benchmarks have largely weathered the recent market whipsaw, though amid increasingly uneven price action. The charts below add color:
Before detailing the U.S. markets’ wider view, the S&P 500’s
hourly chart highlights the past two weeks.
As illustrated, the S&P has rallied to its former range.
The prevailing upturn punctuates a bullish reversal near the 50-day moving average, currently 3,806.
More immediately, the former range bottom (3,885) pivots to support.
Meanwhile, the Dow Jones Industrial Average
remains the strongest major benchmark.
As illustrated, the index has knifed to record highs, briefly tagging the 32,000 mark for the first time on record.
The prevailing upturn punctuates an extended breakout attempt. Consider that four of the prior five session lows have been punctuated by sharp reversals to tag record highs.
True to recent form, the Nasdaq Composite
remains the weakest benchmark.
Still, the index has weathered an early-week whipsaw near the 50-day moving average, currently 13,290.
Slightly more broadly, the index is traversing its former range, territory better illustrated below.
Widening the view to six months adds perspective.
On this wider view, the Nasdaq has whipsawed amid its former range.
Recall that likely last-ditch support matches the 2020 peak (12,973) — and the late-January low (12,985) — the area from which the prior leg higher originates.
The week-to-date low (13,003) has registered slightly above support, preserving a bullish intermediate-term bias.
Separately, the Nasdaq has maintained its 50-day moving average on a closing basis.
On further strength, the breakdown point (13,729) pivots to resistance. The pending retest from underneath should be a useful bull-bear gauge.
Looking elsewhere, the Dow Jones Industrial Average has taken flight.
The prevailing upturn punctuates a bull-flag breakout, placing the index at all-time highs.
Recall several recent successful tests of the former breakout point (31,272) in recent sessions. Bullish price action. (Also see the hourly chart.)
Meanwhile, the S&P 500’s backdrop splits the difference between that of the other two benchmarks.
To start, the S&P has narrowly maintained its breakout point (3,870), outpacing the Nasdaq Composite.
Still, the S&P has not followed through to record highs, underperforming the Dow industrials.
The bigger picture
Collectively, the major U.S. benchmarks have largely weathered a late-month market whipsaw amid increasingly uneven price action.
Against this backdrop, the Dow Jones Industrial Average has knifed to record highs, while the Nasdaq Composite is digesting a violation of its first significant support (13,730).
Each big three benchmark’s intermediate-term bias remains bullish, based on today’s backdrop.
Moving to the small-caps, the iShares Russell 2000 ETF
is digesting the strongest early-month breakout.
The late-month pullback has been underpinned by trendline support and the breakout point (216.70).
Meanwhile, the SPDR S&P MidCap 400 ETF
has staged a stealth breakout, of sorts.
Consider that the mid-cap benchmark, and the Dow industrials, are the only widely-tracked U.S. benchmarks to register new record highs.
Looking elsewhere, the SPDR Trust S&P 500
has sustained a February break to record highs.
This week’s strong-volume bullish reversal has been underpinned by the breakout point (385.40).
Placing a finer point on the S&P 500, the index has reversed to its former range.
Tactically, the former range bottom (3,885) remains an inflection point.
Conversely, the week-to-date peak (3,928) has effectively matched the former range top.
More broadly, the S&P has maintained its breakout point (3,870) on a closing basis.
Recall the prevailing upturn punctuates a bullish reversal near the 50-day moving average, currently 3,806. The week-to-date low (3,805) has registered nearby.
Delving deeper, and as detailed repeatedly, likely last-ditch support points match the 3,723 area and the late-January low (3,694). (The Nasdaq maintained its corresponding last-ditch support Tuesday.)
As always, it’s not just what the benchmarks do, it’s how they do it. But generally speaking, the S&P 500’s bullish intermediate-term bias is intact barring a violation of these areas.
Thursday’s Watch List
The charts below detail names that are technically well positioned. These are radar screen names — sectors or stocks poised to move in the near term. For the original comments on the stocks below, see The Technical Indicator Library.
Drilling down further, the 10-year Treasury note yield
continues to take flight.
In the process, the yield has tagged 52-week highs, its best level since Feb. 21, 2020.
Technically, recent follow-through places the yield atop its breakdown point, a level matching the 2016 low (1.34). (See the five-year chart.)
On further strength, an overhead inflection point, circa 1.67, is followed by the 2017 low (2.03).
More broadly, the prevailing breakout confirms the yield’s late-2020 trend shift, detailed previously. (Also see the Jan. 6 review.)
Fundamentally, the 10-year note yield has approached the S&P 500’s prevailing dividend yield Thursday, a potential near-term market headwind.
Meanwhile, the Financial Select Sector SPDR
has also taken flight, reaching record highs amid surging Treasury yields.
The prevailing upturn originates from the breakout point, circa 29,00, a key bull-bear fulcrum that narrowly weathered an extended test. (See the Jan. 26 review and Feb. 1 review.)
Also recall that a target projects from the former range to the 33.50 area, detailed previously. (See the Feb. 16 review.) Wednesday’s close (33.55) effectively matched the target.
Though near-term extended, and due to consolidate, recent follow-through confirms the group’s primary uptrend.
Initially profiled Oct. 15, Ford Motor Co.
has returned 61.1% and remains well positioned.
Technically, the shares have tagged three-year highs on increased volume.
The prevailing upturn punctuates a tight two-week range underpinned by the 20-day moving average. A near-term target projects to the 12,70 area.
More broadly, the shares are well positioned on the 10-year chart, extending a multi-year trendline breakout atop the mid-2018 peak (12.15).
is a large-cap manufacturer of industrial power-management components. (Yield = 2.2%.)
As illustrated, the shares have reached all-time highs, clearing resistance matching the January peak. An intermediate-term target projects to the 143 area.
Conversely, the breakout point (130.00) is followed by the 50-day moving average and slightly deeper trendline support. The prevailing uptrend is intact barring a violation.
Initially profiled Nov. 23, Zillow Group, Inc.
has returned 48% and remains well positioned.
Earlier this month, the shares gapped to record highs, rising after the company’s fourth-quarter results.
The subsequent pullback has filled the gap — (perhaps partly amid rising Treasury yields) — placing the shares 23.3% under the February peak.
Tactically, the breakout point (159.20) is closely followed by the ascending 50-day moving average. A sustained posture higher signals a bullish bias.
Finally, Dow 30 component Home Depot’s
backdrop has signaled a bearish turn.
As illustrated, the shares have turned lower, pressured amid a volume spike after the company reported better-than-expected quarterly results but opted not to provide forward guidance.
The downturn punctuates a violation of the 50- and 200-day moving averages, placing the shares at seven-month lows.
Tactically, the breakdown point, circa 261.00, is followed by the 200-day moving average, currently 268.35. A rally atop these areas would place the shares on firmer technical ground. The pending retest from underneath will likely add color.
Still well positioned
The table below includes names recently profiled in The Technical Indicator that remain well positioned. For the original comments, see The Technical Indicator Library.
|Company||Symbol* (Click symbol for chart.)||Date Profiled|
|Oracle Corp.||ORCL||Feb. 24|
|United Airlines Holdings, Inc.||UAL||Feb. 24|
|Nucor Corp.||NUE||Feb. 23|
|Signet Jewelers Limited||SIG||Feb. 23|
|Old Dominion Freight Line||ODFL||Feb. 22|
|Southern Copper Corp.||SCCO||Feb. 22|
|Seagate Technology||STX||Feb. 19|
|Canada Goose Holdings, Inc.||GOOS||Feb. 19|
|Texas Instruments, Inc.||TXN||Feb. 18|
|Zynga, Inc.||ZNGA||Feb. 18|
|Chevron Corp.||CVX||Feb. 18|
|Lyft, Inc.||LYFT||Feb. 16|
|Intel Corp.||INTC||Feb. 12|
|KLA Corp.||KLAC||Feb. 12|
|Pinterest, Inc.||PINS||Feb. 12|
|Nvidia Corp.||NVDA||Feb. 11|
|Veeva Systems, Inc.||VEEV||Feb. 11|
|Helmerich & Payne, Inc.||HP||Feb. 11|
|U.S. Global Jets ETF||JETS||Feb. 9|
|Motorola Solutions, Inc.||MSI||Feb. 9|
|iShares U.S. Home Construction ETF||ITB||Feb. 8|
|Lennar Corp.||LEN||Feb. 8|
|Diamondback Energy, Inc.||FANG||Feb. 4|
|Wix.com, Ltd.||WIX||Feb. 3|
|CarMax, Inc.||KMX||Feb. 3|
|Toll Brothers, Inc.||TOL||Feb. 2|
|Eagle Materials, Inc.||EXP||Feb. 2|
|Avis Budget Group, Inc.||CAR||Feb. 1|
|Capital One Financial Corp.||COF||Jan. 29|
|NetApp, Inc.||NTAP||Jan. 29|
|Aptiv, plc||APTV||Jan. 29|
|Rio Tinto Group||RIO||Jan. 26|
|Netflix, Inc.||NFLX||Jan. 25|
|Cummins, Inc.||CMI||Jan. 25|
|Magna International, Inc.||MGA||Jan. 22|
|M.D.C. Holdings, Inc.||MDC||Jan. 22|
|Zebra Technologies Corp.||ZBRA||Jan. 14|
|Chegg, Inc.||CHGG||Jan. 11|
|Macy’s, Inc.||M||Jan. 11|
|Nexstar Media Group, Inc.||NXST||Jan. 11|
|iShares Transportation Average ETF||IYT||Jan. 11|
|Energy Select Sector SPDR||XLE||Jan. 8|
|Teledoc Health, Inc.||TDOC||Jan. 8|
|Skyworks Solutions, Inc.||SWKS||Jan. 7|
|Financial Select Sector SPDR||XLF||Jan. 7|
|Synaptics, Inc.||SYNA||Jan. 4|
|JPMorgan Chase & Co.||JPM||Dec. 22|
|United Therapeutics Corp.||UTHR||Dec. 21|
|Shopify, Inc.||SHOP||Dec. 18|
|Calix, Inc.||CALX||Dec. 17|
|Elastic N.V.||ESTC||Dec. 17|
|Tenet Healthcare Corp.||THC||Dec. 16|
|Williams-Sonoma, Inc.||WSM||Dec. 15|
|iShares Nasdaq Biotechnology ETF||IBB||Dec. 15|
|SDPR S&P Regional Banking ETF||KRE||Dec. 14|
|Etsy, Inc.||ETSY||Dec. 14|
|Emerson Electric Co.||EMR||Dec. 8|
|Zscaler, Inc.||ZS||Dec. 7|
|Fortinet, Inc.||FTNT||Dec. 7|
|Kulicke and Soffa Industries, Inc.||KLIC||Dec. 7|
|Dillard’s, Inc.||DDS||Dec. 4|
|Spotify Technology S.A.||SPOT||Dec. 3|
|Valero Energy Corp.||VLO||Dec. 3|
|Analog Devices, Inc.||ADI||Dec. 2|
|Sonos, Inc.||SONO||Dec. 1|
|American Airlines Group, Inc.||AAL||Nov. 30|
|Zillow Group, Inc.||ZG||Nov. 23|
|Bank of America Corp.||BAC||Nov. 20|
|SPDR S&P Oil & Gas Exploration and Production ETF||XOP||Nov. 20|
|MetLife, Inc.||MET||Nov. 19|
|Kohl’s Corp.||KSS||Nov. 18|
|Applied Materials, Inc.||AMAT||Nov. 17|
|RingCentral, Inc.||RNG||Nov. 13|
|Regions Financial Corp.||RF||Nov. 13|
|Snap, Inc.||SNAP||Nov. 9|
|Norfolk Southern Corp.||NSC||Nov. 9|
|Communications Services Select Sector SPDR||XLC||Nov. 5|
|Health Care Select Sector SPDR||XLV||Nov. 5|
|Alphabet, Inc.||GOOGL||Nov. 5|
|Exact Sciences Corp.||EXAS||Nov. 2|
|Maxim Integrated Products, Inc.||MXIM||Oct. 21|
|The Travelers Companies, Inc.||TRV||Oct. 21|
|Micron Technology, Inc.||MU||Oct. 20|
|Vulcan Materials Co.||VMC||Oct. 19|
|ON Semiconductor Corp.||ON||Oct. 16|
|Ford Motor Co.||F||Oct. 15|
|SPDR S&P Homebuilders ETF||XHB||Oct. 9|
|Shake Shack, Inc.||SHAK||Oct. 9|
|SPDR S&P Biotech ETF||XBI||Oct. 8|
|Twilio, Inc.||TWLO||Oct. 8|
|Cloudflare, Inc.||NET||Oct. 7|
|SailPoint Technology Holdings, Inc.||SAIL||Oct. 1|
|Martin Marietta Materials, Inc.||MLM||Sept. 30|
|Abercrombie & Fitch Co.||ANF||Sept. 29|
|Zendesk, Inc.||ZEN||Sept. 23|
|Scientific Games Corp.||SGMS||Sept. 23|
|Crocs, Inc.||CROX||Sept. 14|
|Five Below, Inc.||FIVE||Sept. 10|
|Eastman Chemical Co.||EMN||Sept. 10|
|Deere & Co.||DE||Aug. 24|
|Johnson Controls International||JCI||Aug. 21|
|General Motors Co.||GM||Aug. 20|
|Builders FirstSource, Inc.||BLDR||Aug. 18|
|Freeport McMoRan, Inc.||FCX||Aug. 10|
|Industrial Select Sector SPDR||XLI||Aug. 6|
|Penn National Gaming, Inc.||PENN||July 30|
|SPDR S&P Metals & Mining ETF||XME||July 28|
|iShares MSCI South Korea ETF||EWY||July 28|
|Materials Select Sector SPDR||XLB||July 20|
|Caterpillar, Inc.||CAT||July 20|
|Roku, Inc.||ROKU||July 16|
|Consumer Discretionary Select Sector SPDR||XLY||July 13|
|Danaher Corp.||DHR||June 24|
|Fiverr International, Ltd.||FVRR||June 19|
|Square, Inc.||SQ||June 8|
|SPDR S&P Retail ETF||XRT||June 3|
|iShares MSCI Japan ETF||EWJ||May 29|
|Synopsis, Inc.||SNPS||May 27|
|Agilent Technologies, Inc.||A||May 15|
|Five9, Inc.||FIVN||Apr. 24|
|Chewy, Inc.||CHWY||Apr. 24|
|Tesla, Inc.||TSLA||Apr. 23|
|VanEck Vectors Semiconductor ETF||SMH||Apr. 17|
|Okta, Inc.||OKTA||Apr. 16|
|Target Corp.||TGT||Apr. 16|
|Invesco QQQ Trust||QQQ||Apr. 14|
|Apple, Inc.||AAPL||Mar. 27|
|iShares MSCI Emerging Markets ETF||EEM||Mar. 19|
|Microsoft Corp.||MSFT||Feb. 22|
|* Click each symbol for current chart.|
Stock Market News – Charting market cross currents: Late-month divergence persists
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