The stock market held steady the following week, although most of Friday’s averages fell. Fed Chair Colin Powell commented on Friday that the rise in inflation “is likely to last longer than expected”. Both the S&P 500 and Dow Jones Industrial Average posted record highs for their third straight week of strong gains, both during the day and at the close. This action confirms last week’s statement that the changes have been completed.
Increased awareness of supply chain issues boosted the Dow Jones transport average by 3.8% for the week. Transportation was supported by stock of goods and trains which increased by 5.9% and 4.6%, respectively.
The Dow Jones industrial average was up 2.6% and the S&P 500 was up 1.6%. SPDR gold shares were also up 1.5%, slightly above the Nasdaq 100.
The positive close across all markets on the weekly market review was in line with the latest results from the American Private Investors Association (AAII) poll, with the bullish percentage increasing from 37.9% last week to 47.9%. .. As previously mentioned, it fell to 22.4% on Sept. 15. NS, This is often the level associated with the corrected bottom line c. Last week’s sharp reading reversed the downtrend in emotion, line b.
The weekly chart of the S&P 500 shows sharp gains from a low of 4278 three weeks ago. This corresponds to the sum of the annual R1 levels and the weekly Sharp band analysis. R2 is 4804 and the annual pivot analysis was discussed earlier this year.
Weekly S&P 500 gains/drops hit fresh highs last week to confirm price action. Analysis of the A/D line remains positive during the market recession as it far outperformed the EMA growth and much stronger support of the a line.
Last week’s economic data came as no surprise. Important news such as leading indicators and the Philadelphia Federal Production Index were slightly lower than expected, but remained clearly positive.
So what could make investors question their new bull?
Snaps, Inc. received a major shock from the tech sector last week when (SNAP) predicted that new changes in data protection introduced by iOS software and Apple’s supply chain would weaken sales prospects. Sales were up 57 percent, but SNAP missed the list of analysts, with the stock dropping 28.7 percent weekly, its highest value this year.
In the short term, the stock market is developing and the main concern for the week ahead will be the future earnings reports as some of the FANG stock charts look fragile.
Facebook, Inc. (FB) will report after it ends on Monday, October 25th. NS. The stock price fell 3.7% for the week to September 13 (see arrow) This is a sign of weakness due to the small rally volume over the past four weeks (line b). FB has been down in the last five weeks due to increased volume. The weekly star cluster has been tested over the last few weeks, but last week’s rebound failed with a 20-week drop at the $342.44 EMA. The next chart support, line a, is at $294.
Weekly Relative Performance (RS) fell below the WMA on Sept. 24. NS, line c shows that it does not exceed the S&P 500. In the same week, Balance Volume (OBV) fell below WMA and support line d was negative.
Amazon.com (AMZN) reports on Wednesday, October 27. The share price rose to $3,462.86 last week but then closed at $3,335.55. a new high, reaching $3,773.08. AMZN is down 11.6% from July highs with the next support, line b, at $3,194. Below this support it could fall to $2871.
RS peaked in 2020 and has been making lower peaks since then, Line d. When stock prices spiked in July, they were clearly on the downside, below the WMA drop. The OBV has also created a negative divergence since its peak in August 2020. The e-line was unable to cross the WMA in the three-week rally and broke the support at the f-line. These two indicators will remind you of the July buy breakout.
The outlook for FB and AMZN does not bode well for the first trustworthy Dow Jones Internet ETF (FDN), as AMZN owns 9.7% and FB 7.5%. The alphabetical chart doesn’t look as weak as the other two stocks, but they do make up 9.4% of FDN. Google reports on Tuesday, October 26
FDN also peaked earlier in the week and then fell to the same level. Monthly income was $241.23 and a three-week low was $229.44. There is additional chart support on line a at $219.80. For most of the year the volume will decrease, so row b will experience a negative increase in volume if it continues to decline. Resistance is in the range of $249-252.
The weekly RS is below the support line c and the WMA fell earlier in the month. OBV also seems to have weak support but the d line broke in early September and is in a downtrend for the short term.
By mid-week, you should have a clear idea of where this big tech stock is headed. Spyder Trust (SPY) is up 5% in 7 trading days, more than 2% above the 20-day EMA, so payout opportunities are now high. I think this would be another great opportunity to buy non-tech ETFs and stocks. Be careful about risking new positions and don’t buy far past the 20-day EMA.