Technical analyst Dave Chojnacki of Street One Financial recaps Monday’s anemic market action and looks ahead to Tuesday’s session with a look at where the important technical levels sit for the major U.S. averages.
There wasn’t much to move the market on Monday morning, as the major averages opened flat. A weak Empire Manufacturing report had little effect on equities. The major indices stayed in a narrow range through most of the session and ended mixed at the final bell.
The Nasdaq 100 (NDX) eked out enough of a gain to make it 7 straight sessions to the upside. The Dow Jones Industrial Average (DJIA) and S&P 500 (SPX) ended off just slightly on below average volume.
All in all, it was a typical mid-July Monday with nothing significant happening. At the close, the DJIA was off 8 points, the SPX inched down 0.13 of a point, and the NDX added 1.6 points. Breadth was slightly positive, 1.2 to 1, on below average volume. ROC(10)’s were mixed, with the DJIA and SPX declining and the NDX advancing. All three remain in positive territory.
RSI’s inched higher, with the DJIA continuing to lead at 64.8. The SPX and NDX remain in the low 60’s. All three MACD’s continue to remain above signal. The ARMS index ended the day at 0.96, a neutral reading at the close.
It was a slow summer Monday, as the major averages changed very little in the session. The DJIA met resistance in the session at the top of its Bollinger Band® of 21632. It continues to be comfortably above its 20D-SMA of 21443. The small loss kept it from moving to a new high once again.
The NDX, meanwhile, moved higher for the 7th straight session. It is now just 46 points below its early June high of 5885. It is above its 20 and 50D-SMA ‘s of 5726 and 5732, respectively.
The SPX met resistance at its top Bollinger Band® of 2460 in the session. Its 20D-SMA is now at 2435.
The VIX added 3.2% to finish at 9.8, still a historically low reading.
Netflix (NASDAQ:NFLX) reported earnings after the bell and subscriptions were up big. The stock was up 10% after hours as a result. Note that NFLX is a core holding of the new FANG-focused ETF from Advisors Shares, FNG.
Near term support for the NDX is at 5800 and 5750. Near term resistance is at 5850 and 5874. Near term support for the SPX is at 2450 and 2435. Near term resistance is at 2460, 2462 and 2475.
Europe is lower in early trade Tuesday, while U.S. Futures are mixed in the premarket. In terms of economic reports on tap today, we’ll see Import/Export Prices at 8:30am and the Housing Market Index at 10:00am.
The SPDR Dow Jones Industrial Average (SI:SPDR) ETF fell $0.14 (-0.06%) in premarket trading Tuesday. Year-to-date, DIA has gained 10.72%, versus a 10.86% rise in the benchmark S&P 500 index during the same period.
DIA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #5 of 76 ETFs in the Large Cap Value ETFs category.