ChartAdvisor for July 17, 2014

By Justin Kuepper | Updated September 02, 2014 AAA

Major U.S. indices were mixed over the past week, led by the Dow Jones Industrial Average and lagged by small-cap stocks, as of Thursday’s close. Despite concerns that the equity market might be overextended, the U.S. economy showed some signs of strength in June after unemployment claims unexpectedly fell and manufacturing activity in the mid-Atlantic region accelerated to its highest level in years.

International markets moved largely higher over the past week, as of Thursday’s close. Japan’s Nikkei 225 jumped 1.07%; Britain’s FTSE 100 jumped 0.85%; and, Germany’s DAX 30 jumped 0.91%. In Europe, investors grew concerned over a slowdown in Germany’s economy, as Germany has generally served as an anchor for the region. In Asia, China’s economy grew at a 7.5% annualized rate--a positive sign.

The SPDR S&P 500 (SPY) ETF fell 0.45% over the past week, as of Thursday’s close. After reaching new highs earlier this month, the index moved lower toward its pivot point at 194.42. Traders should watch for a rebound from those levels to retest its R2 resistance at 199.87 or a move lower to its lower trend line and 50-day moving average at 193.02. Looking at technical indicators, the RSI remains neutral at 50.95 and the MACD experienced a bearish crossover.

spy screenshot

The SPDR Dow Jones Industrial Average (DIA) ETF rose 0.24% over the past week, as of Thursday’s close. After moving off of its R2 resistance at 171.02, the index moved lower towards its R1 resistance at 169.45. Traders should watch for a rebound higher from these levels to retest its R2 resistance or a breakdown from its lower trend line towards its 50-day moving average at 167.44. Looking at technical indicators, the RSI and MACD both appear to be neutral.

dia screenshot

The PowerShares QQQ (QQQ) ETF fell 0.69% over the past week, as of Thursday’s close. After reaching new highs earlier this month, the index moved lower toward its trend line support. Traders should watch for a breakdown from these levels toward its pivot point at 92.82 or a rebound higher to retest its R2 resistance at 96.56. Looking at technical indicators, the RSI appears neutral at 56.21 but the MACD appears a little top-heavy.

The iShares Russell 2000 (IWM) ETF fell 2.27% over the past week, as of Thursday’s close. After moving toward the upper portion of its price channel, the index retreated toward its 200-day moving average at 112.58. Traders should watch for a rebound from these levels towards its pivot point at 115.83 or a breakdown to its lower trend line and S2 support at 108.06. Looking at technical indicators, the RSI appears oversold at 35.31 but the MACD remains bearish.

iwm screenshot

Summary

The major U.S. indices were mixed over the past week, as of Thursday’s close. Although many of them appear top-heavy judging by technical indicators. Traders will be watching a number of key economic events next week, including the consumer price index and existing home sales on July 22nd, jobless claims and new home sales on July 24th, and durable goods orders on July 25th.

Charts courtesy of StockCharts.com.

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