Decent economic reports pushed the major indices higher at the open on Friday. Techs showed some weakness during the session and helped keep the Nasdaq 100 (NDX) lower on the day. The S&P 500 (SPX) and Dow Jones Industrial Average (DJIA) after a strong morning, fell through the afternoon into the close. They held on to small gains at the final bell.
Volume had picked up on quarterly options expiration. At the close on Friday, the DJIA added 0.29%, the SPX closed up just 4.6 points, and the NDX fell 11 points. Breadth was positive, 2 to 1, on heavy volume. RSI’s were mixed, with the leader, the NDX, moving lower to 58.6. The DJIA and SPX ended at 48.6 and 52.8, respectively. The ARMS Index ended at 0.75, a slightly bullish reading.
For the week, the DJIA fell 1.5%, the SPX slipped 1.2%, and the NDX gained 0.9%. The VIX fell 4.7% on Friday to 15.88. For the week, the VIX added 8.45%, but remains relatively low.
It’ll be a light week for economic reports, but we get Housing Data and Durable Goods reports. We also have the FOMC meeting this week.
Long term, technicals continue with their bias to the upside. We had the NDX making new highs early in the week, before consolidating the remainder of the period. The NDX closed at a new high of 7131 and traded as high as 7186 intraday. All three major averages remain comfortably above their 200D-SMA’s.
Short term, the DJIA remains below its 50D-SMA of 25309 and below its 50% retrace of 25238. The SPX closed 4 points above its 5DD-SMA of 2748. Near term, all 3 major averages continue with their MACD above signal. The SPX holds its 20D-SMA of 2735 and 50% retrace level of 2726. We may see some near term weakness until the SPX gets through the 2800 level.
Europe is lower in early trade Monday, and U.S. Futures are pointing moderately lower in the premarket. There are no major economic reports scheduled for today.
The SPDR Dow Jones Industrial Average ETF (DIA) fell $1.26 (-0.51%) in premarket trading Monday. Year-to-date, DIA has gained 0.70%, versus a 2.75% rise in the benchmark S&P 500 index during the same period.
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Dave Chojnacki is the Chief Market Technician at Street One Financial. He provides technical support for the Street One team and also develops individual analysis for Clients as requested.
Dave is a major contributor to the ‘ETF Daily’, a morning newsletter providing clients a daily look at market technicals of the major indices and selected ETF’s. Market trends, support and resistance levels are provided in the daily letter. The Technical portion of the daily can also be found on Seeking Alpha. Mr. Chojnacki has been quoted in a number of industry publications including the Reuters, ETF Trends, Minyanville, Yahoo Financial and Investors.Com.
In addition, Dave assists with desk trading when necessary. He possesses a Series 7 and 63.
Prior to joining Street One, Dave designed and developed I/T Systems for the Insurance and Financial Industries.