Technically speaking, the U.S. benchmarks’ bigger-picture backdrop remains uneven as a March divergence persists.
On a headline basis, the S&P 500 and Dow industrials have retained a bullish intermediate-term bias — even amid recent volatility — while the Nasdaq Composite is vying Tuesday to repair a more damaging March downdraft.
Before detailing the U.S. markets’ wider view, the S&P 500’s
hourly chart highlights the past two weeks.
As illustrated, the S&P has staged a bullish reversal from major support (3,723).
The successful retest preserves a bullish intermediate-term bias.
More immediately, the prevailing upturn initially stalled near the breakdown point (3,870). The S&P has followed through atop this area early Tuesday. Constructive price action.
Meanwhile, the Dow Jones Industrial Average
remains the strongest major benchmark.
In fact, the index has briefly tagged all-time highs.
The prevailing upturn punctuates a massive three-session bullish reversal, spanning as much as 1,601 points, or 5.2%.
Tactically, the former range top (31,650) pivots to notable support.
True to recent form, the Nasdaq Composite
continues to lag behind.
As illustrated, the index has maintained its next significant support (12,607). (See for instance, the Jan. 7 review.)
Consider that Monday’s close (12,609) effectively matched support, an area also illustrated below.
Conversely, the Nasdaq has initially stalled near its breakdown point (12,973). An extended retest of this area remains underway Tuesday.
Widening the view to six months adds perspective.
On this wider view, the Nasdaq is vying to neutralize last week’s technical breakdown.
Recall the initial downdraft resolved a bearish head-and-shoulders top — defined by the January, February and March peaks — placing the index at two-month lows.
Tactically, Monday’s close (12,609) matched the Nasdaq’s next significant support (12,607).
Conversely, important resistance matches the breakdown point, a level matching the 2020 peak (12,973). A swift reversal atop this area would neutralize last week’s breakdown.
(On a granular note, resistance technically spans from 12,973 to 13,004, levels matching the 2020 peak and February low. Monday’s session high (13,001) matched the latter.)
Looking elsewhere, the Dow Jones Industrial Average continues to outperform.
Technically, the index has registered a bullish reversal from the 50-day moving average, rising to briefly tag all-time highs.
Slightly more broadly, the Dow has not strayed too far from its mid-February range amid constructive price action.
Meanwhile, the S&P 500’s bullish reversal punctuates a fleeting downturn to one-month lows.
Recall that last week’s low (3,723.3) matched the December gap (3,723), a level matching major support.
The bigger picture
Collectively, the major U.S. benchmarks remain in divergence mode — each index is doing different things — amid uneven March price action.
Against this backdrop, the S&P 500 and Dow industrials have retained a bullish intermediate-term bias, while the Nasdaq Composite’s price action has at least briefly signaled an intermediate-term caution flag.
Recall that the Nasdaq’s retest of its breakdown point — an area matching the 2020 peak (12,973) — remains underway Tuesday. A sustained reversal higher would neutralize the March downturn.
Moving to the small-caps, the iShares Russell 2000 ETF
has weathered a less aggressive March downturn.
The prevailing upturn punctuates a jagged retest of the 50-day moving average.
Also recall that the small-cap benchmark registered an unusually strong early-February breakout, encompassing four straight closes atop the 20-day Bollinger bands. The two standard deviation breakout signaled an extended posture — due to consolidate — amid a firmly-bullish longer-term outlook.
Similarly, the SPDR S&P MidCap 400 ETF
has effectively maintained its prevailing range, rising from a successful test of the 50-day moving average. Constructive price action.
Looking elsewhere, the SPDR Trust S&P 500
has registered a bullish reversal from next support, rising amid a March volume spike.
Also recall that the preceding downdraft registered amid relatively tame market internals,not the hallmark of a material trend shift.
Placing a finer point on the S&P 500, the index has rallied to its former range.
The prevailing upturn punctuates a successful test of major support (3,723), detailed previously. The March low (3,723.3) has matched support. Constructive price action.
More broadly, the S&P 500 has registered a bullish reversal from major support (3,723).
The prevailing upturn punctuates a recent whipsaw at the 50-day moving average.
As detailed previously, an eventual violation of major support (3,723) — and the late-January lows — would mark a material “lower low” likely signaling an intermediate-term trend shift.
Beyond technical levels, the U.S. sector backdrop remains bullish-leaning, as detailed last week. The S&P 500’s intermediate-term path of least resistance continues to point higher, based on today’s backdrop.
Tuesday’s Watch List
The charts below detail names that are technically well positioned. These are radar screen names — sectors or stocks poised to move in the near term. For the original comments on the stocks below, see The Technical Indicator Library.
Drilling down further, the U.S. Global Jets ETF
is acting well technically.
The group initially spiked two weeks ago, knifing to 52-week highs on increased volume.
The upturn marked an unusually strong two standard deviation breakout, encompassing three straight closes atop the 20-day Bollinger bands.
The consecutive closes atop the bands signaled a then near-term extended posture — due a sideways chopping-around phase, that has subsequently transpired — amid a bullish longer-term outlook. (Also see the November break atop the bands, subsequent sideways price action, and upside follow-through.)
Separately, consider that the March low has punctuated a fleeting retest of the breakout point (24.00). The sharp reversal from major support signals that bullish momentum is intact.
Initially profiled July 20, the Materials Select Sector SPDR
has returned 24.8% and remains well positioned. (Yield = 1.6%.)
Technically, the group has weathered the recent broad-market volatility spike, maintaining the 50-day moving average.
The prevailing upturn has been fueled by increased volume, placing record highs under siege.
Tactically, the 50-day moving average, currently 74.20, is followed by the former breakout point (72.40). A sustained posture atop this area signals a comfortably bullish bias.
Moving to specific names, Visa, Inc.
is a well positioned large-cap name.
Technically, the shares have rallied to the range top, rising to challenge all-time highs.
The prevailing upturn punctuates a relatively tight March range. A near-term target projects to the 231 area on follow-through.
Conversely, the prevailing range bottom is closely followed by the 50-day moving average, currently 209.20. A breakout attempt is in play barring a violation.
More broadly, the shares are well positioned on the three-year chart, rising from a continuation pattern, of sorts, hinged to the 2020 V-shaped reversal.
Under Armour, Inc.
is a well positioned large-cap name.
The shares initially spiked four weeks ago, gapping to 52-week highs after the company’s fourth-quarter results.
The subsequent pullback has been flat, positioning the shares to build on the initial strong-volume spike.
Tactically, a notable floor holds in the 17.85-to-18.00 area, levels closely matching the March low and February gap. A sustained posture higher signals a comfortably bullish bias.
Big Lots, Inc.
is a mid-cap discount retailer showing signs of life.
As illustrated, the shares have registered a bullish reversal from the March low, rising to tag a fractional record close amid increased volume.
The prevailing upturn punctuates an otherwise orderly three-week range, hinged to the sharp January rally. An intermediate-term target projects to the 74 area on follow-through.
Finally, Alaska Air Group, Inc.
is a well positioned large-cap carrier.
Late last month, the shares knifed to 52-week highs, rising from an orderly two-month range.
The subsequent flag pattern has formed amid decreased volume, positioning the shares to build on the nearly straightline February spike.
Tactically, the prevailing range bottom (63.60) is followed by the post-breakout low (59.70). The prevailing uptrend is firmly-intact barring a violation.
Still well positioned
The table below includes names recently profiled in The Technical Indicator that remain well positioned. For the original comments, see The Technical Indicator Library.
|Company||Symbol* (Click symbol for chart.)||Date Profiled|
|State Street Corp.||STT||Mar. 8|
|American Eagle Outfitters, Inc.||AEO||Mar. 8|
|Hess Corp.||HES||Mar. 3|
|Alcoa Corp.||AA||Mar. 3|
|Beazer Homes USA, Inc.||BZH||Mar. 3|
|EchoStar Corp.||SATS||Mar. 3|
|Mastercard, Inc.||MA||Mar. 2|
|Boeing Co.||BA||Mar. 2|
|Starbucks Corp.||SBUX||Mar. 1|
|Oceaneering International, Inc.||OII||Mar. 1|
|Eaton Corp.||ETN||Feb. 25|
|Oracle Corp.||ORCL||Feb. 24|
|United Airlines Holdings, Inc.||UAL||Feb. 24|
|Nucor Corp.||NUE||Feb. 23|
|Signet Jewelers Limited||SIG||Feb. 23|
|Old Dominion Freight Line||ODFL||Feb. 22|
|Seagate Technology||STX||Feb. 19|
|Canada Goose Holdings, Inc.||GOOS||Feb. 19|
|Chevron Corp.||CVX||Feb. 18|
|Lyft, Inc.||LYFT||Feb. 16|
|Intel Corp.||INTC||Feb. 12|
|Helmerich & Payne, Inc.||HP||Feb. 11|
|U.S. Global Jets ETF||JETS||Feb. 9|
|Motorola Solutions, Inc.||MSI||Feb. 9|
|Diamondback Energy, Inc.||FANG||Feb. 4|
|Wix.com, Ltd.||WIX||Feb. 3|
|CarMax, Inc.||KMX||Feb. 3|
|Toll Brothers, Inc.||TOL||Feb. 2|
|Eagle Materials, Inc.||EXP||Feb. 2|
|Avis Budget Group, Inc.||CAR||Feb. 1|
|Capital One Financial Corp.||COF||Jan. 29|
|Aptiv, plc||APTV||Jan. 29|
|Cummins, Inc.||CMI||Jan. 25|
|Magna International, Inc.||MGA||Jan. 22|
|M.D.C. Holdings, Inc.||MDC||Jan. 22|
|Zebra Technologies Corp.||ZBRA||Jan. 14|
|Macy’s, Inc.||M||Jan. 11|
|Nexstar Media Group, Inc.||NXST||Jan. 11|
|iShares Transportation Average ETF||IYT||Jan. 11|
|Energy Select Sector SPDR||XLE||Jan. 8|
|Skyworks Solutions, Inc.||SWKS||Jan. 7|
|Financial Select Sector SPDR||XLF||Jan. 7|
|Synaptics, Inc.||SYNA||Jan. 4|
|JPMorgan Chase & Co.||JPM||Dec. 22|
|Calix, Inc.||CALX||Dec. 17|
|Tenet Healthcare Corp.||THC||Dec. 16|
|Williams-Sonoma, Inc.||WSM||Dec. 15|
|SDPR S&P Regional Banking ETF||KRE||Dec. 14|
|Etsy, Inc.||ETSY||Dec. 14|
|Emerson Electric Co.||EMR||Dec. 8|
|Fortinet, Inc.||FTNT||Dec. 7|
|Kulicke and Soffa Industries, Inc.||KLIC||Dec. 7|
|Dillard’s, Inc.||DDS||Dec. 4|
|Valero Energy Corp.||VLO||Dec. 3|
|Sonos, Inc.||SONO||Dec. 1|
|American Airlines Group, Inc.||AAL||Nov. 30|
|Zillow Group, Inc.||ZG||Nov. 23|
|Bank of America Corp.||BAC||Nov. 20|
|SPDR S&P Oil & Gas Exploration and Production ETF||XOP||Nov. 20|
|MetLife, Inc.||MET||Nov. 19|
|Kohl’s Corp.||KSS||Nov. 18|
|Applied Materials, Inc.||AMAT||Nov. 17|
|Regions Financial Corp.||RF||Nov. 13|
|Norfolk Southern Corp.||NSC||Nov. 9|
|Communications Services Select Sector SPDR||XLC||Nov. 5|
|Alphabet, Inc.||GOOGL||Nov. 5|
|The Travelers Companies, Inc.||TRV||Oct. 21|
|Micron Technology, Inc.||MU||Oct. 20|
|Vulcan Materials Co.||VMC||Oct. 19|
|ON Semiconductor Corp.||ON||Oct. 16|
|Ford Motor Co.||F||Oct. 15|
|SPDR S&P Homebuilders ETF||XHB||Oct. 9|
|Shake Shack, Inc.||SHAK||Oct. 9|
|Martin Marietta Materials, Inc.||MLM||Sept. 30|
|Abercrombie & Fitch Co.||ANF||Sept. 29|
|Scientific Games Corp.||SGMS||Sept. 23|
|Crocs, Inc.||CROX||Sept. 14|
|Five Below, Inc.||FIVE||Sept. 10|
|Eastman Chemical Co.||EMN||Sept. 10|
|Deere & Co.||DE||Aug. 24|
|Johnson Controls International||JCI||Aug. 21|
|General Motors Co.||GM||Aug. 20|
|Builders FirstSource, Inc.||BLDR||Aug. 18|
|Freeport McMoRan, Inc.||FCX||Aug. 10|
|Industrial Select Sector SPDR||XLI||Aug. 6|
|Penn National Gaming, Inc.||PENN||July 30|
|SPDR S&P Metals & Mining ETF||XME||July 28|
|iShares MSCI South Korea ETF||EWY||July 28|
|Materials Select Sector SPDR||XLB||July 20|
|Caterpillar, Inc.||CAT||July 20|
|Roku, Inc.||ROKU||July 16|
|SPDR S&P Retail ETF||XRT||June 3|
|iShares MSCI Japan ETF||EWJ||May 29|
|Tesla, Inc.||TSLA||Apr. 23|
|Apple, Inc.||AAPL||Mar. 27|
|iShares MSCI Emerging Markets ETF||EEM||Mar. 19|
|Microsoft Corp.||MSFT||Feb. 22|
|* Click each symbol for current chart.|