Morpheus Trading: Stocks closed near the lows of the session on Friday after attempting to push higher in the morning. The weekly candles look pretty ugly across the board, with all indices closing near the lows of the week on higher volume.
The Dow Jones and S&P 500, which have been relatively strong finally broke down below the 10-week MA on higher volume. Major sector ETFs that were showing relative strength also closed below the 10-week MA, such as financial ETF ($XLF) and transportation ETF ($IYT).
The ugly weekly candle in the Nasdaq Composite suggests that the index will probably touch the 40-week MA and undercut the prior swing low before heading higher. We could possibly see this happen earlier in the week, followed by some sort of bounce from oversold conditions by the end of the week:
Last Friday, we bought the Gold Miners Bear 3x ($DUST) over the two-day high. By going long the inverted $DUST, we are able to short gold mining stocks in qualified (non-marginable) accounts. This is a swing trade that could take a few weeks to play out, depending on how $DUST acts if/when it touches the prior swing high.