The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq gapped up off its 21-DMA after pulling back sharply to this moving average earlier in the week. Despite the volatility, indices closed relatively unchanged for the week. Support remains at the 21-DMA (S&P 500: 3,113; Nasdaq: 8,550) with three distribution days on the S&P 500 and four on the Nasdaq.
Tag: Confirmed Uptrend
Market View
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq made new all-time highs this week
as both continue to trend higher off their respective 10-DMA. Distribution remains low at two days each, with
one expiring on the S&P 500 next week. We expect the market to consolidate gains in the coming days given the
sharp move higher over this past week. Should that occur, look for underlying action among quality growth
ideas to remain constructive.
Nine of 11 sectors are trading above their respective 50-DMA, led by Health Care which was up 1.7% this week
after recently breaking into new all-time highs. Technology is also leading, trending into all-time highs similar to
the major averages. Energy and Utility continue to lag, both trading relatively flat on the week and still ~1% be-
low their 50-DMA. 159 of 197 industry groups and 72% of S&P 500 stocks are trading above their respective
50-DMA, improving from 141 and 67% last week, respectively. The best performing industry groups this week
include Biotech (
), Software (
), Internet Retail (
), Lodging (
), Apparel (
), and Home Fur-
nishings (
).
US Focus
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq made new alltime highs this week as both continue to trend higher off their respective 10-DMA. Distribution remains low at two days each, with one expiring on the S&P 500 next week. We do expect the market to consolidate gains in the coming days given the sharp move higher over this past week. Should that occur, look for underlying action among quality growth ideas to remain constructive.
European Focus
On Thursday, the Stoxx 600 ended the day 1.30% above last Friday’s close and remained in a Confirmed Uptrend. During the week, we upgraded the U.K. to a Confirmed Uptrend from a Rally Attempt after a follow-through day. Of the 17 indices we cover, 15 are in a Confirmed Uptrend, and two are in an Uptrend Under Pressure.
Market View
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq consolidated gains this week, trad-
ing slightly lower but remaining above all major moving averages. The 21-DMA (S&P 500: 3,079; Nasdaq:
8,423) remains a primary level of near-term support. The distribution day count is low at two days each.
Nine of 11 sectors, 141 of 197 industry groups, and 67% of S&P 500 stocks are trading above their respective
50-DMA. Health Care is trading ~7% above its 50-DMA after breaking into new all-time highs this week. The
best performing industry groups this week include Biotech ( VRTX ), Long-Term Care ( AMED ), Managed Care
( UNH ), and Software ( SPLK ).
We remain positive on the general market. Despite sideways consolidation among the major averages, underly-
ing action across growth-oriented ideas and groups was very strong. Multiple ideas are breaking out from con-
solidation and pushing into higher highs. We continue to recommend selectively increasing risk in quality ideas
as they emerge from sound bases.
US Focus
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq consolidated gains this week, trading relatively flat, but remaining above all major moving averages. The 21-DMA (S&P 500: 3,079; Nasdaq: 8,423) remains a primary level of near-term support. The distribution day count is low at two days each.
European Focus
On Thursday, the Stoxx 600 was down 0.4%, witnessing the fourth down day in a row this week. Compared with last Friday’s close, the index was down 0.94% until Thursday. Today, the index is upbeat and looks to pare some of the losses incurred in the week.
Market View
U.S. Market
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq gapped up and sustained strength
throughout the session as both indices are poised to trend higher. Short-term support is at the rising 21-DMA
(S&P 500: 3,054; Nasdaq: 8,339).
Nine of 11 sectors are trading at or above their respective 50-DMA, led by Technology (5.7%), Basic Material
(+5.6%), Transportation (+5.4%), and Capital Equipment (+5.2%) over the trailing four weeks, while Consumer
Staple (+0.5%) and Utility (-2.4%) are lagging. We continue to see a gradual improvement in the base consolidation of growth-oriented sectors/groups. Standout industry groups include Semiconductors (
), Security
(
), and Medical Equipment (
).
We continue to recommend increasing risk
China A Shares
The CSI 300 dropped 2.4% for the week on lower volume and remains in a Confirmed Uptrend with three distribution days. Disappointing economic and financial data released this week significantly subdued market confidence, and five consecutive sessions of below-average volume indicate very cautious sentiment. However, we have not seen a large-scale selloff, so we recommend a wait-and-see approach. The China-U.S. trade deal still remains uncertain. We expect the index to continue consolidating around 3,820–4,000. The CSI 300 lost 50-DMA support, with the next support at the 100-DMA (~3,850) and the next resistance at the gap above ~3,970. We will be watching to see if the Chinese government introduces more policies to boost the domestic economy. Investors are advised to stay patient and focus on ideas that have recently broken out with strong fundamentals. Avoid chasing highs.
US Focus
The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq gapped up and sustained strength throughout the session as both indices are poised to trend higher. Short-term support is at the rising 21-DMA (S&P 500: 3,054; Nasdaq: 8,339).
