Abbott Labs (ABT) has been trapped under the $45 level for about 18 months. This week, the stock blew through the glass ceiling, cracking new highs. The recent breakout in late February was a cautionary signal the stock was trying to go higher. This week it is looking to close near the top end of the weekly range.
The Dow Jones U.S. Coal Index ($DJUSCL) spent 2016 bouncing from the ashes after a disastrous 2015 in which the DJUSCL lost 90% of its value. The "dead cat bounce" looks as though it may have ended as price action has rolled over and the weekly MACD has clearly turned bearish. Here is the current technical view:
The Russian Trading System Index ($RTSI) is struggling this year and down around 6.5% year-to-date. In contrast, the S&P 500 is up over 7% year-to-date and the Eurotop 100 ($EUR) is up around 6.5%. In addition to relative weakness, the index sports a bearish continuation pattern after a breakdown in February. Notice that the index broke support in February and then formed a triangle the last few months. This triangle represents a rest after the sharp decline and a break below triangle support would signal a continuation lower. Also notice that the rising 200-day SMA is right near triangle support. The triangle measures around 100 points and a break near 1070 would target a move to the 970 area. Take this target with a grain of salt!
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The long bond is an emotional beast. There has been lots of discussion about how the long bond price should be falling through the floor with the Fed raising rates. The TLT ETF represents the 20 + Year (Long) bonds. Today marks an interesting test of the 200 DMA from the bottom side. The 200 DMA has been an area of friction before.
The SCTR is perking up from being one of the worst ETF's in the market to moving out of the basement now. Interestingly, an SCTR above 30 has been associated with uptrends. While the Relative Strength has not started to make higher highs, it wouldn't take much to get to 6-month highs.
Infinera (INFN) gapped higher in February on massive volume, but has been falling in a descending channel ever since. Volume accelerated on Friday as INFN clearly broke this down channel. The reversal also is taking place after a key gap support level was filled and tested. Take a look at the chart:
Starbucks (SBUX) continues to brew higher highs. Recently the stock was under pressure because their new pre-order mobile app was too successful. While it is a problem, it is a good problem. Perhaps this chart is suggesting a positive outcome with the long wait times? As technicians, breakouts to new highs are clues we like.
Recently, competitor Cisco Systems (CSCO) broke out to a 15 year high. While Juniper Networks (JNPR) hasn't seen its price move to decade and a half highs, it is on the verge of breaking to a six year high amid very heavy volume. JNPR traded more than 25 million shares on April 26th following its blowout quarterly earnings. Both revenues and EPS handily topped forecasts and traders rewarded the company with a week long rally that nearly cleared resistance at 31.50 from November 2015. Here's the chart:
Banking stocks bounced on Tuesday as the 20+ YR T-Bond ETF (TLT) fell and the 10-yr T-Yield ($TNX) moved higher. These bounces reinforce the positive correlation with TLT and the negative correlation with $TNX. The chart below shows three big banks in long-term uptrends and six month stalls. Technically, Bank of America, JP MorganChase and Morgan Stanley are in long-term uptrends because they are above their rising 200-day EMAs and they hit new highs in March.
Caterpillar continues to track higher on the price charts but in May the chart has reached an interesting level.
The Utilities SPDR (XLU) is clearly one of the leading sectors in 2017 because it is trading at its highest level of the year. XLU, by the way, is the only sector SPDR that hit a year-to-date high on Monday. The chart shows XLU correcting into November 2016, breaking out in December and then consolidating from mid-March to mid-May. This consolidation just ended with an upside breakout and the breakout signals a continuation of the bigger uptrend. The indicator window shows the PPO(10,40,1) turning positive in December as well and remaining well above zero the entire year. This confirms the uptrend because it means the 10-week EMA is above the 40-week EMA.
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