News:
On Wednesday, markets opened green and declined throughout the session.
The indexes all closed red. The losses were modest…
- Dow Jones -0.2%
- Nasdaq -0.6%
- S&P 500 -0.4%
- Russell 2000 -0.2%
There was no catalyst for the selling. Need a culprit?
- Overbought conditions are still present
- December usually starts off on a weak note
The current trend for the market is sideways.
But don’t worry … Late December is known for strong rallies. This is the time to buy.
Sector Round Up
4 of the 11 sectors ended Wednesday’s session with gains.
At the top…
- Utilities (XLU) +1.3%
- Industrials (XLI) +0.4%
- Consumer Discretionary (XLY) +0.2%
At the bottom…
- Financials (XLF) -0.5%
- Technology (XLK) -0.9%
- Energy (XLE) -1.5%
The energy sector is trading at its lowest level since July following the oil price slide.
Technicals:
Overbought conditions persist in just 1 of the 4 major indexes—The Dow Jones…
But as you can see, the index is trading near 52-week highs and only a few ticks away from all-time highs.
Watch for a test of the market level before the rally continues.
Your latest readout…
- The VIX remains bullish low
- RSI levels are mostly neutral—see above for the lone exception
- The put-to-call ratio is neutral
Timing:
Next week, we’ll look for the phenomenon known as the January Effect to start.
Historically, from Mid-December thru February, small-cap stocks, tracked by the Russell 2000, outpace large caps, tracked by the Russell 1000, by 2-to-1.
Do with this information what you will. We remain long all major indexes.
Watchlist:
*Low Float
^Open Position
*DRCT support at $12
*CHSN on watch
*MYO support at $3.50, resistance at $4.50
HRTG support at $8.50, resistance at $9.50
AAOI support at $16
ALT support at $6
PRCH key level $2
Secondary watchlist—float about 100 million
BLUE support at $4, resistance at $5
AGRO support at $12
NMRK support at $8, resistance at $8.50
CLSK support at $8
^IOT support at $32, resistance at $35
GPS on watch
AFRM support at $35, resistance at $40
S support at $22
LYFT support at $12, resistance at $13
SID support at $3.35