If the stock market could talk, it might say that our core family of ETFs we follow (which we call the Modern Family) is happy right now.
Perhaps happier than they have been in a long time.
Starting Friday, Forrest and I pointed out that the Russell 2000 ETF (IWM), Transportation Sector ETF (IYT) and Retail Sector ETF (XRT) all closed green in the face of the COVID news about Trump while technology indices fell by 4%.
Monday, that trend continued. IWM made the largest percentage gain over the other 3 indices. IYT and XRT held their own as well.
The best percentage gainer in the family today was Biotechnology, another sector we both pointed to watch last week.
With the news of (REGN) Regeneron’s Experimental polyclonal antibody cocktail helping Trump recover and the acclearted race for a vaccine and a way to alleviate symptoms of COVID, the Biotech Sector (IBB) rallied over 4%. Here’s a chart:
Last Friday IBB was flirting with the 50-DMA. Now it’s well over, and with a strong move back over the 10 and 50 day moving averages, we could see a move back to July’s highs.
Speaking of the Modern Famly, the Regional Banks Sector ETF (KRE) closed up 3.98%, which was not far off from IBB, which was up 4.28%.
KRE has consistently been the weakest link in the Family. A comeback from its recent September lows was well needed as many have been worried about this sector.
As the week continues, we need to see the Family continue to take the lead. Yes, some of this strength is on Trump’s recovery, but most of it is on the assumption some stimulus will be passed.
Regardless, if you believe that price rules, then the Family is reflecting all of the optimism in the face of continuing doom and gloom perpetuated by the pundits.
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S&P 500 (SPY) Needs a second close over 336 and a clearance over 343
Russell 2000 (IWM) 160 Resistance 153 Support
Dow (DIA) 284 Resistance 277 Support
Nasdaq (QQQ) 276 Support. Needs to clear 283
KRE (Regional Banks) Unconfirmed Bullish phase needs a second close over the 50-DMA
SMH (Semiconductors) 181 resistance. Needs to hold the 50-DMA
IYT (Transportation) 203 Pivotal
IBB (Biotechnology) 138 Now Support 143 Resistance.
XRT (Retail) Granny could make new all time highs.
Twitter: @marketminute
The author may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
