daily stock market analysis - stock market technicals
"daily stock market analysis - stock market technicals"
in the news daily stock market analysis - stock market technicals? What this all about..... See below.
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Sentiment Trader shows a very interesting chart today. As our VIP members here <= section here is on fire with the calls lately.
The Dow posted first four-day losing streak since June
U.S. stocks closed narrowly mixed Tuesday as technology stocks recovered some of their losses, and its a chart we want to cover today, as its quite interesting!
The Dow Jones industrial average closed nearly 12 points lower at 22,284.32 in its first four-day losing streak since June 23.
Information technology closed up 0.4 percent to lead three S&P 500 advancers, while telecommunications was the greatest laggard. The benchmark index closed less than 0.2 points higher at 2,496.84.
Sentiment Trader thinks investors are being a little more cautious, some profit-taking going on, and also wanting to see if the president can get the Affordable Care Act repealed and [enact] any tax reform, as that is the biggest thing going on right now.
Investors seem to be waiting for bigger news, or the calendar to hurry up and start earnings season. Until then there is no catalyst to take the market higher.
With that being said, we want to cover the TECH SECTOR, as it has been taking a hit lately. This chart below shows or the XLK daily chart.
Large-cap technology shares including the FANG basket crushed the market this year and drove hedge fund performance. But with the technology stalwarts faltering, what does that mean for the stock market?
"Some FANG stocks such as Amazon and Google/Alphabet have seen weakness before but usually it's been company-specific and not broad-based. Typically, Facebook and Netflix have held firm.
Facebook shares declined 4.5 percent on Monday, its worst day since November. The drop followed the disclosure last week that the social media company will share information with Congress about suspected Russian-linked election ads.
Netflix shares fell 4.7 percent on Monday after a report that 21st Century Fox is adding more inventory to its FX+ streaming service. Investors may be concerned that content owners are pulling more content from the streaming giant.
It's not just FANG — Facebook, Amazon, Netflix and Google-parent Alphabet. Apple has lost approximately $50 billion in market value since the company announced its latest line of products on Sept. 12 as investors worry over the strength of the new iPhone models' "super cycle."
Hickey believes it is not just fundamental news driving the sector lower, but it could be a reaction to the Federal Reserve's announcement Wednesday to roll off its $4.5 trillion balance sheet.
When the QEs were announced by the Fed, stocks jumped across the board before the actual buying occurred. We may be seeing the reverse happen following Wednesday's Fed meeting when they announced QT [quantitative tapering],
So what does a falling technology sector mean? Is it really that bearish?
Well that is a good question, so lets go an look at the chart...
Since March 2009, a weak month for the technology sector is generally bad news for the market, according to Kensho.
XLK CHART - Technology sector .
We have been looking at the daily chart recently you can see that since the start of the year we have clearly been in an upwards channel. With solidified resistance and then support, which right now as you read this sits at about 56.5 - 57. While people are calling for a crash in technology and the technology sectors we are going to refrain from that and we will tell you why.
1) The chart is in an upwards trajectory. The saying "The trend is your friend until the end is suffice here"
2) Selloffs in XLK or technology sectors across the board lately have been muted, and not serious. Dips here have a tenancy to be bought up. Sure that can fail, and eventually it will but for now lets call it, going with the overall direction of the sector itself with seems to be more north.
3) The sell off we are currently seeing is not backed up by heavy volume or larger lot trades, which mean its not big deep pocket traders hands selling.
we would expect this to come off a bit more, but right now our targets are at about 57, so if we get down to this level and the sellers start to panic and the bulls drop the ball that would leave the door open for a bigger 5% correction. For now we are seeing too much panic out there over nothing more than a normal healthy retrace! We will keep our eye on this going into OCT and post more chart updates then. This chart is quite interesting.
Our members here => VIP members here have noticed a very interesting trend that, normally going into the weekend there is always some sort of news about North Korea or North Korea Tensions. This time the news was about the North Korea foreign minister warning or considering a hydrogen bomb test in the Pacific Ocean.
Technology shares, along with industrial and consumer discretionary stocks, share the highest correlation with the market.
Despite the recent declines, the FANG stocks are still doing well on a year-to-date basis with Facebook up 42 percent, Amazon up 25 percent, Netflix up 44 percent and Alphabet up 18 percent through Monday versus the S&P 500's 12 percent return.
However, the big tech gains may be a sign of earlier excessive risk-taking by investors, which could mean a large reversal when the tide turns. So we must keep that in mind as well.
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