Risk-on appetite has been generally supported over recent sessions and debate about the sustainability of this trend is a contested topic. I’m keeping an eye on a number of key stocks/ETFs and indices for clues about the next directional move and a number of these entities have trend lines that are currently under a bit of pressure. Whilst I’m reading that some are excitedly ‘shorting’ at these levels I’m not so confident but I’m watching these trend lines for any make or break activity. The Emerging Market ETF (EEM) and a couple of Transport and Parcel stocks/ETFs are looking rather bullish at the moment and this should not be ignored as they generally give decent clues about the health of the broader market.
S&P500 weekly: how anyone reads this as a ‘screaming SHORT’ is beyond me! I’m watching for any make or break of the Flag trend lines; up or down. However, IMHO, this is currently looking more Bull Flag like than bearish H&S though.
DJIA weekly: this upper trend line is coming under pressure so watch for any make or break activity here:
NASDAQ weekly: a bullish breakout has been seen here already:
RUT weekly: Russell 2000 index: as with the S&P500, this is looking more Bull Flag like at the moment than bearish H&S: watch the Flag trend lines for clues:
SPY weekly: S&P500 ETF: A Bull Flag breakout in progress?
DIA weekly: DJIA ETF: a potential Bull Flag here too so watch the trend lines for any make or break activity:
IWM weekly: Russell 2000 ETF: watch the Flag trend lines here too:
FDX weekly: FEDEX: a Bull Flag breakout here?
IYT weekly: Transport ETF: A Bull Flag looming here?
UPS weekly: United Parcel Service: a Bull Flag looming here too? As per usual, watch the Flag trend lines for any break or respect:
EEM weekly: Emerging Market ETF: this is looking rather bullish as it holds above a descending trend line. Any continuation move up to close and hold above the $35 S/R region would add more weight to this bullish momentum:
Oil weekly: another bullish weekly candle and a close above $40. The $45 S/R level looks like it would be the next major bullish target for any continuation move:
ERX weekly: 3x Bull Energy ETF: this is looking bullish now too:
Copper weekly: a bullish candle for the week and continued bounce up off the ‘2’ handle:
VIX weekly: the ‘fear index’ is back down near the 14 level:
US$ index weekly:the US$ remains range bound but has been bearish over recent weeks. Any break and hold below 92.50, the bottom of the lengthy trading range, would be a further bearish signal and suggest to me that we could be in for more of a pullback. A weakening US$ would help to support ‘risk-on’ and would most likely underpin continued gains with stocks and commodities.
Summary: From my charting perspective, the trading ‘planets’ look like they are moving towards an alignment for a risk on breakout move but they’re not quite there yet. I’m watching trend lines on the above charts for clues about the progress of such a move with either make or break activity at these key trend lines.