On Monday, we talked about specific sectors weakening as they teetered on the edge of support from their major moving averages.
The main three sector ETFs were Transportation (IYT), Retail (XRT), and Semiconductors (SMH).
It just so happens that these sectors perfectly align with the holiday season as people begin to do what they do best, consume and buy more stuff.
Having said that, this should boost transportation along with tech and retail stores if they can build momentum.
Though supply issues continue, we can watch for the demand side of the economy to hold through these ETFs.
However, just because key sectors are holding up, the major indices including the S&P 500 (SPY), Nasdaq 100 (QQQ), Dow Jones (DIA), and the Russell 2000 (IWM) are still in a pivotal area with looming resistance ahead.
As seen in the above chart, none are attempting a break over recent resistance areas (black line).
Instead, they continue to look weak or neutral.
This leaves investors in a tough spot as the major indices have come back from recent lows, but seem to be holding their breath for a reason to push higher.
Therefore, we need to watch for resistance to clear and trade carefully as the market mauls over its current price action.
With that said, if these key indices can outperform the overall market this could be the next tip that the market will continue to hold, and we can look for more buying opportunities.
Stock Market ETFs Trading Analysis:
S&P 500 (SPY) Price resistance is at 442. Price support is at 426.
Russell 2000 (IWM) Consolidating with price support at 216.76.
Dow Jones Industrials (DIA) 350 is price resistance.
Nasdaq (QQQ) 350 is next price support. Needs to clear 365.69.
KRE (Regional Banks) Doji day. Needs to get back over 70.
SMH (Semiconductors) 248.83 is price support.
IYT (Transportation) Watching to stay over the 250.55 price level.
IBB (Biotechnology) 153.38 is price support.
XRT (Retail) Holding the 200-day moving average at 89.03.
The author may have a position in mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author and do not represent the views or opinions of any other person or entity.