Market technician Dave Chojnacki of StreetOne Technical Analysis recaps Tuesday’s market action and updates the important technicals for the major U.S. averages.
The JOLT(Job Openings) number came in good for the third straight month and had the major indices opening to the upside. The move petered out as there was not much enthusiasm in the market. Stocks were flat for most of the session and the only excitement was Elon Musk tweeting. Musk tweeted that he may take Tesla (NASDAQ:TSLA) private and we discovered that the Saudi’s invested 2 Billion in the company. TSLA shares moved higher on the news and ended the day up 10.9%. In the last hour, we witnessed a brief sell-off, which brought the averages down to a small gain for the session. We have been in a slow slog upwards in recent sessions. The 10YR finished the session at 2.97%.
At the close on Tuesday, the Dow Jones Industrial Average was up 0.5%, the S&P 500 added 0.28%, and the NDX moved up 0.32%. Breadth was slightly positive, on weak volume. ROC(10)’s declined in the session, with all three major indices remaining in positive territory. RSI’s advanced in the session, with the SPX leading at 66.8. The DJIA moved up to 66.7 and the NDX to 61.2. The SPX and NDX MACD crossed back above signal, joining the DJIA. The ARMS index ended the day at 0.96, a neutral reading at the close.
The DJIA was the best performer of the day, but the SPX and NDX had their MACD cross above signal. The MACD is an important near term technical. The major indices gained for the fourth straight session. The NDX ended the day at 7462, just 46 points below its recent closing high of 7508. It continues above its 20D-SMA of 7359. The DJIA closed at 25628, continuing to pull away from its 20D-SMA of 25240. Of the major three indices, it is the furthest from its all-time high. It continues nearly 1000 points below its all-time high. The SPX finished Tuesday at 2858, just 3 points off its low of the day. It is only 14 points below its closing high. It has support at its 20D-SMA of 2817. The VIX finished at 10.93 down 3%. It continues with very low volatility. Near term support for the NDX is at 7400 and 7359. Near term resistance is at 7475 and 7508. Near term support for the SPX is at 2850 and 2825. Near term critical resistance is at 2862 and 2872. Europe is slightly higher in early trade. US Futures are slightly higher pre-market.
The SPDR Dow Jones Industrial Average (SI:SPDR) fell $0.11 (-0.04%) in premarket trading Wednesday. Year-to-date, DIA has gained 4.35%, versus a 7.35% rise in the benchmark S&P 500 index during the same period.
DIA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #3 of 81 ETFs in the Large Cap Value ETFs category.