Dow Jones futures will begin trading on Sunday night, along with S&P 500 futures and Nasdaq futures. The stock market had a modest week, but the Nasdaq showed the most technical damage. Facebook (FB), American steel (X), Wayfair (W), Google Parent Alphabet (GOOGL) and Apple Provider Qorvo (QRVO) is among notable stocks near buying points.
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While investing can get complicated, there are also some simple concepts. You want to invest if the stock market lives above the exponential moving average of 21 days and the 50-day line. This applies to the most important indices as well as the leading stocks. At the moment, the stock market is deeply divided: the Dow Jones and S&P 500 are living above these levels while the Nasdaq is not.
The splitting of the split market is especially difficult to make progress.
Facebook stock, Dick’s Sporting Goods (DKS) and Element Solutions (ESI) is above buying points or early entries. Meanwhile, Google shares, Qorvo, US Steel and Wayfair are close to buying points.
Google and Dick’s shares are on IBD Leaderboard. Wayfair shares are on the IBD 50.
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Coronavirus News
Coronavirus cases worldwide reached 122.87 million. Covid-19 deaths rose to above 2.71 million.
Coronavirus cases in the US hit 30.42 million, with deaths above 554,000.
Bursary meeting last week
US stock market overview today |
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|---|---|---|---|---|
| Index | Symbol | Price | Profit / loss | % Change |
| Dow jones | (0DJIA) | 32628.04 | -234.26 | -0.71 |
| S&P 500 | (0S & P5) | 3912.81 | -2.65 | -0.07 |
| Nasdaq | (0NDQC) | 13215.24 | +99.07 | +0.76 |
| Russell 2000 | (IWM) | 227.01 | +1.77 | +0.79 |
| IBD 50 | (FFTY) | 46.77 | +0.42 | +0.91 |
Last updated: 16:06 ET 19/19/2021 |
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The rise in the stock market looked promising early in the week, with the Dow Jones and S&P 500 reaching new highs and the Nasdaq above its 50-day moving average. But late in the week, with rising treasury yields and crude oil prices, the major indices wiped out gains and then some.
The Dow Jones industrial average fell 0.5% last week. The S&P 500 index fell 0.8%, but remained above its 21- and 50-day highs. The Nasdaq composite lost 0.8%, but the 3% tumble from Thursday pushed it below the 21- and 50-day lines.
The ten-year treasury yield rose 12 basis points to 1.73%, with almost everything on Thursday.
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) retreated 0.5% last week, while the Innovator IBD Breakout Opportunities ETF (BOUT) sank by 1%, but both stayed above their 50-day line. The iShares Expanded Tech-Software Sector ETF (IGV) rose 2.5% and fell beyond the 50 days. The VanEck Vectors Semiconductor ETF (SMH) rose 1.2% but could not hold for more than 50 days. Qorvo share is part of SMH.
Ark Innovation ETF reflects more speculative story shares and 3.1% and Ark Genomics ETF 1%, both of which are resisting their 21-day line.
Dick’s Stock
Dick’s Sporting Goods share rose 3.8% to 80.58 on Friday, just above an 80.42 buy point. It was a brief consolidation that was one day of a cup base. The volume was light during the breakthrough, which is not great. The relative strength line, which tracks the performance of a stock against the S&P 500 index, is at a new high. Earnings are out of the way.
Facebook stock
FB share rose 4.1% Friday to 290.11 in large volume, when CEO Mark Zuckerberg impacted appeal(AAPL) new privacy rules over Facebook’s advertising business. Facebook shares cleared an early entry of 286.89 in a heavy volume and came close to an official buy point of 304.77. Investors can start a position here, but after a recent run, FB shares can retreat and form a handle.
The RS line for FB shares has been dragging on for months, but it is now 2021 high.
Element Solutions Stock
The manufacturer of specialty chemicals with some technological exposure dropped nearly 5% last week to 19.75, which held just above a 19.50 purchase point of a breakthrough earlier this month. ESI shares found support Friday near this entry and just above the 21-day line. Investors may buy Element Solutions shares at current levels, or perhaps if it breaks a trend line in a short consolidation just above the buying point. The cleaning of the high handle would offer another buying point on 21.09.
Google inventory
Google shares fell 1.1% last week to 2,2026.96, closing slightly below the 21-day line. The FANG stock now has a flat base with a 2 145.24 buy point, according to MarketSmith analysis. But the GOOGL stock can recover from just above the ten-week line. If it revisits last week’s high and stands at 2114, it could offer an early entry from the ten weeks.
US steel stock
US Steel tumbled 7.3% to 22.41 last week, but it was still constructive after running to near the top of a cup base. On a weekly chart, X stock now has a cup-with-handle point with a 24.56 buy point. The daily chart shows an entry of 24.81 cups without handle, but US Steel is on course to have a handle after Monday.
Wayfair Stock
On Friday, Wayfair shares rose 2.9% to 335.36. In the entry, the stock reached 348, making a short entry of 343.09. The RS line for Wayfair shares is right on consolidation highs, although it is not in August.
Wayfair shares were Friday’s IBD Stock Of The Day.
The online furniture retailer is very strong in the market.
Luxury furniture retailer RH (RH) jumped 6.1% on Friday and 9.2% for the week to 515.64. RH stock has an official buy point of 524.32 but has cleared a downtrend and reached a closing high. RH share would be workable, but earnings are Wednesday.
Meanwhile, luxury retailer for household furniture and household goods Williams-Sonoma (WSM) rose 29% last week on strong earnings and leadership. The WSM stock fell from a base on Thursday and rose on Friday.
Qorvo Stock
The Qorvo share rose 4.2% last week to 179.85, regaining its 50-day line. During the week, the 5G and iPhone disk maker came up to 185.96 and cleared some early entries before retiring. To clear up last week’s highlight now will be an early entry. One benefit of using this entry is that if the QRVO stock deletes it, the Nasdaq stock is likely to regain its 21-day line, if not its 50-day.
The official purchase price is 191.92.
Qorvo’s earnings growth accelerated for three consecutive quarters, while revenue growth increased for two consecutive quarters.
Several other slide stocks are close to points of sale, including Applied materials (AMAT), FMD instruments (MKSI) and Entegris (ENTG).
In terms of Apple shares, the Dow Jones technology titan fell 0.9% to 119.99, falling below its 21-day line and well below the 50-day high. The AAPL share did not fall much from its low in March.
Market analysis
In general, you want the major indices and the leading stocks to live above their 21-day and 50-day moving averages. On Friday, the S&P 500 index and the Russell 2000 small capital found support in their 21-day lines, slightly above their 50-day lines. The Dow Jones never came close to one of the two rules.
But the Nasdaq remains below its 21- and 50-day lines, with Friday’s bounce recovering only a portion of Thursday’s 3% tumble. Investors will likely have to wait until the Nasdaq returns above the moving averages as well as last week’s highs, before increasing technological exposure.
It is still unclear whether the Dow and S&P 500 will push the Nasdaq above key levels and whether the Nasdaq will lower the broader stock market. In a rise in the market, stocks are likely to trend higher. But in a half-rally-half-correction environment, it is difficult to understand the true market direction.
As for the leading stocks, the real economy and reopening scene have made solid gains over the past few weeks. Technical stocks have struggled, with a recent setback faltering. Many also sit below their 21 and 50 day lines.
But over the past week or so, recent outbreaks of all streaks have had a bit more problems, whether it has risen slowly, tested buying points or retreated below the buying points.
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What to do now
An investor does not have to make money from half of her transactions if her winners are large and her losses are small. In the current market climate, it is difficult to make progress with a low profit percentage and the winners achieving slim to modest profits.
Investors may want modest exposure, some long-term winners and some pilot positions in different sectors, to keep up with the market.
But you probably do not want to be heavily invested, not even outside of technology. A sharp market is very difficult. It’s just strong enough to entice investors to buy – usually in the short term – but weak enough to force stop losses.
In addition to preserving your capital, you also want to preserve your psyche. Taking a series of losses in a bad market can make you shy if the market shows a clear rise and wants to be aggressive.
If you hold stocks that remain below their 21- and 50-day lines, you may want to exit, especially if they have a higher volume. If you are sitting on such a stock with a large profit, you can try to withstand the storm, but do not do so with the bulk of your portfolio.
It is said that many stocks are not far from buying points, such as Wayfair, Qorvo or Google stocks. Some good days for the market surveys and the stocks could possibly do. So work on your watchlists. Find quality stocks above their key moving averages. Be sure to include stocks in different sectors to make sure you stay abreast of this changing market.
Read the big picture every day to keep up with the market direction and leading stocks and sectors.
Follow Ed Carson on Twitter at: @IBD_ECarson for stock market updates and more.
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