ChartAdvisor for March 27 2014

By Justin Kuepper | Updated September 02, 2014 AAA

Major U.S. indices moved lower over the past week despite data showing the economy grew slightly faster than previously estimated in the fourth quarter. In addition to the better-than-expected reading, new jobless claims fell to a four-month low last week, suggesting the economy has plenty of momentum. The market shrugged off these gains amid concerns the Federal Reserve may raise interest rates sooner than expected based on comments from Chairwoman Janet Yellen.

International markets moved largely higher this week despite troubles in the U.S. market. Japan’s Nikkei 225 rose 2.32%; Britain’s FTSE 100 rose 0.48%; and, Germany’s DAX 30 rose 1.16%. In Asia, investors are still wondering whether Japan’s consumption tax hikes will impact its recovery. In the Eurozone, economic growth has continued to progress, although there remains a lot of progress to be made before the recovery has fully taken hold over the long-term.

The SPDR S&P 500 (ARCA:SPY) ETF fell 0.84% this week as of Thursday’s close. After moving off its highs, the index moved closer toward its 50-day moving average at 182.77 and the middle of its price channel. Traders should watch for a breakdown toward its lower trend line at 178.00 or a rebound to retest its highs. Looking at technical indicators, the RSI appears relatively neutral at 46.66 but the MACD remains in a long-term bearish downtrend.

The SPDR S&P 500 (ARCA:SPY) ETF fell 0.84% this week as of Thursday’s close.

The SPDR Dow Jones Industrial Average (ARCA:DIA) ETF fell 0.26% this week as of Thursday’s close. After bouncing off its upper trend line and prior high, the index moved closer to its 50-day moving average at 160.57. Traders should watch for a rebound from these levels toward its upper trend line or a move down to its S1 support and lower trend line at around 155.62. Looking at technical indicators, the RSI appears neutral at 51.74 but the MACD remains in a downtrend.

The SPDR Dow Jones Industrial Average (ARCA:DIA) ETF fell 0.26% this week as of Thursday’s close.

The PowerShares QQQ (Nasdaq:QQQ) ETF fell 2.37% this week as of Thursday’s close. After moving below its 50-day moving average at 88.62, the index fell below its pivot point and lower trend line at around 88.03. Traders should watch for a further move below S1 support at 85.31 or a rebound to retest its lower trend line. Looking at technical indicators, the RSI appears oversold at 37.25 while the MACD remains in a bearish downtrend that’s confirmed by the price channel breakdown.

The PowerShares QQQ (Nasdaq:QQQ) ETF fell 2.37% this week as of Thursday’s close.

The iShares Russell 2000 (NYSE:IWM) ETF fell 3.66% this week as of Thursday’s close. After reaching its upper trend line, the index fell sharply lower past its 50-day moving average at 115.21 to its pivot point at 114.20. Traders should watch for a continued move down to its S1 support and lower trend line at 110.01 or a rebound higher to retest its upper trend line. Looking at technical indicators, the RSI appears oversold at 38.93 while the MACD remains in a bearish downtrend.

The iShares Russell 2000 (NYSE:IWM) ETF fell 3.66% this week as of Thursday’s close.

Summary

The major U.S. indices moved largely lower this week as of Thursday’s close. While the S&P 500 SPDR and the DJIA SPDR saw only modest declines, the Nasdaq QQQ and the Russell 2000 Index saw steeper declines. Next week, traders will be watching a number of key economic indicators including the ISM Index on April 1st, International Trade and Jobless Claims on April 3rd, and Employment Data on April 4th, in addition to any comments out of the Federal Reserve.

Charts courtesy of StockCharts.com.

Disclosure - At the time of writing, the author did not own shares of any company mentioned in this article.

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