Major U.S. indices were mixed this week, led by technology stocks and small-caps. Stocks were somewhat buoyed by U.S. jobless claims that fell by 2,000 to 326,000 last week from a revised 328,000 during the prior period. Retail sales remained a weak spot in the economy with purchasing increasing just 0.2% after a 0.4% increase in November, although some economists attributed this to lower auto sales due to the poor weather.
International markets were also mixed this week. Japan's Nikkei 225 fell 3.42%; Germany's DAX 30 increased 2.85%; and, Britain's FTSE 100 jumped 1.33%. In Asia, investors are growing concerned that the age of double-digit growth rates may be ending. In Europe, growth rates remain subdued despite industrial production expanding at a faster than expected 1.8% in November - the biggest rise in industrial production since May of 2010.
The SPDR S&P 500 (ARCA:SPY) ETF fell 0.27% this week. After reaching new highs in December, the index continues to retreat towards the middle of its price channel. Traders should watch for a move down towards its lower trend line and pivot point at 181.96 or a move higher towards its upper trend line and R1 resistance at 187.42. Looking at technical indicators, the RSI appears moderate at 56.45 but the MACD remains in a downtrend.
The SPDR Dow Jones Industrial Average (ARCA:DIA) ETF fell 0.19% this week. After reaching new highs in December, the index continues to retreat towards the middle of its price channel. Traders should watch for a move towards its lower trend line and pivot point at around 162.43 or a move towards its upper trend line just under R1 resistance at 168.29. Looking at technical indicators, the RSI appears moderate at 58.27 but the MACD remains in a bearish downtrend.
The PowerShares QQQ (NASDAQ:QQQ) ETF rose 0.63% this week. After retracing from its new highs set earlier this year, the index rebounded towards its upper trend line. Traders should watch for a move to the upper trend line just above R1 resistance at 89.35 or a move lower to its pivot point and lower trend line at around 86.57. Looking at technical indicators, the RSI appears moderately overbought at 58.74 but the MACD appears as if it could experience a bullish crossover.
The iShares Russell 2000 (NYSE:IWM) ETF rose 0.36% this week. After giving up gains earlier this year, the index moved past its prior highs in recent sessions. Traders should watch for a breakout higher towards the upper trend line and R1 resistance at 117.92 or a move lower towards the lower trend line and 50-day moving average at 112.25. Looking at technical indicators, the RSI is modestly overbought at 60.54 but the MACD shows signs of a possible bullish crossover in the near-term.
The major U.S. indices moved in two different directions with the major indices moving lower and technology and small-caps moving higher. During the shortened trading next week, traders will be watching a number of economic indicators including jobless claims (326,000 previous reading) and existing home sales (4.9 million previous reading) that are both due out on January 23, 2014. Eyes will also be on the incoming Federal Reserve Chairman and any insights she may bring to the table.
Charts courtesy of StockCharts.com.