The ultimate technical pattern that represents indecision is when by midweek, the price range remains stuck inside the trading pattern of the week prior.
Such is the case with the 4 stock market sector ETFs featured in the chart above.
The Retail Sector ETF (XRT) held critical support thus far, but still has that 10 month consolidation range to break up or down.
The Russell 2000 ETF (IWM) has hung in there with the rising yields and US Dollar. Nonetheless, IWM remains rangebound.
The Transportation Sector ETF (IYT) also trades inside last week’s range.
The Regional Banks Sector ETF (KRE) has a much smaller and narrower range, which makes sense given bank earnings coming up.
You put this all together and we have a couple of conclusions.
The rangebound ETFs are at least near the top of the range while the S&P 500 (SPY) makes new all-time highs. All have absorbed a lot of headwinds this week.
The 2 stock market sector ETFs in our next chart (above) are trading a bit beyond the price ranges for last week.
The Biotechnology Sector ETF (IBB), while the range has not wandered too far, remains closer to the lower end of the bigger range from May.
The Semiconductors Sector ETF (SMH) is trading above last week’s highs.
While still far from the all-time highs, SMH is doing a good job of keeping the market happy.
As we end this week with inflation numbers and earnings, (plus storms and geopolitics), watch the way the ranges from last week reconcile, if they do at all.
Follow the way the ranges break, or sit tight if the ranges remain rangebound.
Also, check out Dave Keller’s time with me on Market Misbehavior podcast-posted later today.
Stock Market ETFs Trading Analysis & Summary:
(Pivotal means short-term bullish above that level and bearish below)
S&P 500 (SPY): $565 price support; $595 price resistance
Russell 2000 (IWM): Price range $215-$225
Dow Jones (DIA): New all-time highs
Nasdaq (QQQ): $485 pivotal price support
Regional banks (KRE): $52-$55 price support zone
Semiconductors (SMH): $240 price support; $255 price resistance
Transportation (IYT): $67 pivotal
Biotechnology (IBB): $140-$142 price support zone
Retail (XRT): $75 pivotal
iShares iBoxx Hi Yd Cor Bond ETF (HYG): $79.50 failed so watching for risk factors carefully
Twitter: @marketminute
The author may have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author and do not represent the views or opinions of any other person or entity.
