Trading Places with Tom Bowley

Biotechs And Semiconductors Lead The NASDAQ Charge

Market Recap for Wednesday, August 30, 2017

The U.S. stock market benefited from a lot of the new and a little of the old on Wednesday as the Dow Jones U.S. Biotechnology Index ($DJUSBT) and the Dow Jones U.S. Semiconductors Index ($DJUSSC) posted solid gains to help lead the NASDAQ and NASDAQ 100 yesterday.  The DJUSBT has risen approximately 7% in the past 8 trading sessions and the 2.29% gain yesterday cleared prior price resistance.  This industry remains one of the very best technically as you can see:

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Are We Trending Or Trendless? Watch Small Caps For Clues

Market Recap for Tuesday, August 29, 2017

At Tuesday's open, North Korea and its missile test were the talk of Wall Street. By the close, traders ignored the rising tensions and instead focused on the recent better-than-expected quarterly earnings and the low interest rate environment.  U.S. equities rose on Tuesday with the S&P 500 closing higher for the third consecutive session.  Before you go rushing to your internet broker to push the buy button, however, realize the gains have been 4 points, 1 point, and 2 points, respectively, over the past three trading days.  The S&P 500 remains beneath its 20 day EMA and the weekly negative divergences are still there.  But it's still a subtle victory for the bulls, especially after the news of North Korea firing a test missile over Japan had global equities reeling in early trade.

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Biotechs Surge To Lead The NASDAQ Higher

Market Recap for Monday, August 28, 2017

The U.S. market was able to rally a bit in afternoon trading on Monday and most of our major indices finished in positive territory - the Dow Jones was the lone exception as that index of 30 conglomerates fell 5 points.  Sectors were split with healthcare (XLV, +0.53%) the only sector to post decent-sized gains.  We did see pockets of strength, however.  Home improvement retailers ($DJUSHI) managed to gain close to 1% as the market was anticipating a pick up in demand for stocks in that industry as a result of the devastation caused by Hurricane Harvey in Texas.  Also, truckers ($DJUSTK) cleared an important intermediate-term resistance level, tacking on more than 2%.  Check out the breakout below:

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Down Channels Are Firmly Established As We Approach September

Market Recap for Friday, August 25, 2017

Selling in the final hour on Friday contributed to bifurcated action where the NASDAQ tumbled into negative territory while the Dow Jones, S&P 500 and Russell 2000 all managed to hang onto meager gains.  Our major indices remain in a downtrend as can be seen on the NASDAQ 100 here:

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Food And Broadline Retailers Crushed By Amazon.....Again

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Market Recap for Thursday, August 24, 2017

The 800 lb. gorilla has spoken.  Amazon.com (AMZN) announced that Whole Foods Market (WFM) would be cutting their prices and that its Prime members would see discounts on WFM purchases.  That was enough to send competitors reeling.  Consumer staples (XLP, -1.38%) badly lagged as food retailers & wholesalers ($DJUSFD) dropped a collective 4.12% on Thursday.  Kroger (KR), the largest grocer in the U.S., tumbled 8.10% to close at 21.10, its lowest level since early 2014.  Here's a look at the KR daily chart:

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Oil Exploration & Production Stocks Rebound But Key Resistance Approaching

Market Recap for Wednesday, August 23, 2017

Industrials (XLI, -0.94%) and consumer discretionary (XLY, -0.85%) led a move lower in U.S. stocks on Wednesday as we approach the gathering of global central bankers in Jackson Hole over the next few days.  Energy (XLE, +0.43%) managed to push higher as money rotated into the beleaguered sector as exploration & production stocks ($DJUSOS) bounced.  Unfortunately, the DJUSOS looks awful technically with overhead resistance another 2% above current price.  So perhaps we'll get a bit more of a bounce, check it out:

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Combine Technicals And Seasonality And You Get? A Buy Signal On ULTA

Market Recap for Tuesday, August 22, 2017

All nine sectors advanced on Tuesday to lead a broad-based advance on Wall Street.  The NASDAQ and Russell 2000 were the top performing indices, but the S&P 500 also saw a gain of nearly 1% and the Dow Jones bounced nearly 200 points after successfully testing 21650 price support.  But let me caution that we are now range bound and the S&P 500 has seen 5 crosses of its 20 day EMA in the month of August.  Technology (XLK, +1.49%) has been the leader in 2017 and was the leader once again on Tuesday.  This bounce could be setting up a topping head & shoulders pattern.  First, let's look at a three month daily chart of the XLK:

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Technology Still Looks Most Vulnerable While Healthcare Remains Strong

Market Recap for Monday, August 21, 2017

Healthcare (XLV, +0.45%) led the market's advance on Monday's total solar eclipse day as money rotated into more defensive areas of the market.  Utilities (XLU, +0.37%) and consumer staples (XLP, +0.36%) also benefited and this move towards safety could be seen in our major indices as well.  The Dow Jones and S&P 500 were able to post minor gains while the more aggressive NASDAQ and Russell 2000 ended in negative territory.

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Gold Tops 1300 And Reverses; Equities Close Out Rough Week

Market Recap for Friday, August 21, 2017

Late day selling killed the market's earlier attempt to rebound from Thursday's heavy losses.  A market that finishes multiple days in a row weak is a market that requires a renewed buying effort.  While we could see that at any time, let's keep in mind that it's the 21st day of August and this is the time of all calendar months that we need to be careful.

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Fear Escalates; Gold Nears Major Breakout

Market Recap for Thursday, August 17, 2017

For now it's just a short-term issue, but money is rotating to defensive areas and fear is rising.  The Volatility Index ($VIX) jumped over 32% yesterday to close at its 5th highest level of 2017.  The highest close of 16.04 is just 3% away so clearly nervousness is becoming an issue and is driving these much larger daily selloffs.  The NASDAQ 100 lost more than 100 points on Thursday, its sixth such decline in the past three months.  Prior to May, the last time the NASDAQ 100 lost 100 points was on September 9th, 2016.  This volatility is definitely becoming unnerving.  But worse yet, traders are growing accustomed to it as we see rallies follow.  This is setting up market participants for a much larger drop and a VIX move above 20 in my opinion.  That wouldn't necessarily be a bad thing as it would help to alleviate the weekly negative divergences that have signaled slowing price momentum since earlier this summer.

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