Tech Looking Exhausted - Rotation or Top?
S/R Levels for the week of August 18th - 22nd
The stock market saw a mixed finish to the week, with the Dow Jones and the S&P 500 setting new all-time intraday highs before pulling back. Broader market weakness, particularly in the technology sector, weighed on the major indices.
The DJIA reached a new intraday high of $45,203.5, and the S&P 500 touched $6,481.3 before pulling back. Our major target shared to premium subscribers months ago can be considered reached.
Respecting the Levels: A Winning Strategy
The Health Care sector was the standout performer, gaining 1.7%, largely driven by a 12.03% advance in UnitedHealth (UNH) following news of a significant investment by Berkshire Hathaway, but most importantly, the stock opened on Monday above $247, the central weekly level that defines bullish or bearish conditions, similar to BRK.B that had a bullish reading in my previous Weekly Compass, the stock stayed above its central weekly level of $464. In contrast, the Information Technology sector fell 0.8%, pressured by a 14.7% decline in Applied Materials (AMAT) after its forward guidance disappointed investors.
For the NDX, my analysis provided last weekend mentioned the chances of a visit to the bullish target or first resistance at $23,829 and a retrace, and indeed the price for the week danced around that level before falling a bit on Friday. 0.51% is a small change, but the price structure is suggesting significant caution as you see in the chart below.
In a separate note, my publication on Wednesday correctly anticipated the chances for the price to avoid an immediate pullback, considering special indicators shared that day. Those indicators are updated in the chart below as well.
To access the publication and the chart use the link below, remember that after each Fundamental or Educational content I write a market update on Wednesdays:
Macro: A preliminary reading of the University of Michigan Consumer Sentiment survey for August showed a decline to 58.6, its first drop in four months, attributed to rising inflation concerns (this is a key indicator analyzed in the latest macro update), get access here:
The probability of a September rate cut, according to the CME FedWatch Tool, edged lower to 84.9%. In the bond market, the 10-year Treasury yield rose four basis points to 4.33%.
This publication consistently analyzes the following securities to provide a broad market perspective and empower your trading decisions:
Indices & Futures: SPX, NDX, DJI, IWM, ES=F, NQ=F
ETFs: SPY, QQQ, SMH, TLT, GLD, SLV, DIA, SH, PSQ
Major Stocks: AAPL, MSFT, GOOG, AMZN, NVDA, META, TSLA, BRK.B, LLY, UNH, AVGO, COST, PFE, PLTR, NFLX
Crypto & Related: Bitcoin, ETH, IBIT, MSTR
Leveraged ETFs: TQQQ, SQQQ, UDOW, SDOW, UPRO, SPXS, URTY, SRTY
Visit my educational content, it covers investment instruments, technical indicators, setup analysis, fundamentals, trading psychology, breadth indicators, macro, and market studies:
Let’s continue with the Support and Resistance Levels, AAPL, TSLA, BRK.B, UNH are a must watch next week.
WEEKLY LEVELS
Staying above the figures included in the blue columns maintains bullish momentum, next week is crucial as the NDX chart shows.