An inverted hammer doji is created when the open, low and close are all around the same price.
Often, this candlestick pattern signals the end of the down move, or that a reversal is possible.
After a downtrend, this type of stock market pattern could mean that sellers are growing tired.
Furthermore, although the last couple of days brought back euphoria into the stock market, with market volatility hanging tough, one should be prepared for anything.
When encountering an inverted hammer, traders often check for a higher open and close the next day to validate it as a bullish signal.
As far as the inside weeks, only two stock market ETFs in the “Economic Modern Family” are left with that pattern.
The Transportation Sector ETF (IYT) needs to clear its range-197.95-188.93.
And the Retail Sector ETF (XRT) needs to clear its range-45.15-42.90.
Everyone else took out last week’s highs today.
So, if IYT and XRT are signaling any impending weakness from here, watch the volatility index (VXX) to take out 14.75-14.86.
Otherwise, watch IYT and XRT to see if they too, can clear the prior week’s highs.
On July 12-13, 2020, I will be speaking/teaching at the Modern Traders Summit in Philadelphia. Only 5 speakers, which means attendees will get a lot of attention, I hope to meet many of you there: https://moderntraderssummit.com/2020-speakers/
S&P 500 (SPY) New all-time highs. 332.53 as first line of support. Then lower 327.31
Russell 2000 (IWM) 165.56 key support to hold.
Dow (DIA) 293.61 the all-time high and 287.72 underlying support.
Nasdaq (QQQ) Another new all-time high. Must hold 226 area.
KRE (Regional Banks) 55.85 ow support to hold.
SMH (Semiconductors) 145.58 last week’s high now support to hold.
IYT (Transportation) 197.95 point to clear and 195 point to hold.
IBB (Biotechnology) 118 key support to hold.
XRT (Retail) 45.15 point to clear.
Volatility Index (VXX) Look for this to hold around 14.30 and clear 14.73-14.86
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.
