The market continues to move in a consistent uptrend. Every week I like to take a shot at those that won't stop shorting the market and telling others to do so, but this week I think we should take a moment to appreciate them. We don't know how much of their ignorance is creating these beautiful up trends but I would guess that paired with the endless amounts of QE, it is creating potent bull runs as they are forced to cover their shorts and bid up the market. The NASDAQ and Russell are holding up the best. I really like the strength that the NASDAQ is showing so that is what I am going to be using as the anchor setup for everything else. I will be tracking the Russell closely as well since it has been participating. The bond market got above that resistance area I talked about last week and the 130m trend is working on turning higher again, so it is fair game for the bulls.
Both the NASDAQ and Russell resumed their 15 minute up trends on Friday when we saw a pullback that held the 50 period average. The NASDAQ has no resistance to worry about but there is some on the Russell. The swing high put in on the 24th is something to pay attention to so we can see how confident the buyers are in this index. That is about all I have to say about the indices this week so lets take a look at gold, oil, and some sectors that are looking good.
Financials, technology, and discretionary are my top 3 for next week. All three of them are being supported on 130 minute trends (as is the NASDAQ). This is the longest lasting intraday trend so if we can get lift off from it, there is potential for a lot more upside for a lot longer than anyone expects. Remember that we are trading off of a nice base, this isn't some spur of the moment rally like a lot of people are acting like. Another sector I don't really trade actively that is looking good is the utilities. They are being supported on a 65 minute trend.
Gold has not given back any of those gains it saw on the gap up. It is being supported on a 65 minute trend based on the information we have now and if that is the case we should see some movement higher this week. Oil is making movement similar to how bonds did this year. It held a daily trend to build a platform and now it is being supported on a 130m trend. Remember these are the longest lasting intraday trends so there is no telling how long this can go for especially with the weekly chart ready for lift off.
I hope you are learning something. All I am doing is relaying the message of the markets so if you don't already understand how to read it, you will. Thanks for reading.
Trade well,
-Michael
