Stocks were on track to close last week on a positive note until President Trump imposed new, higher tariffs on Turkey. The move caused the Turkish lira to lose more than 15% of its value on Friday and prompted a sell-off across many emerging and developed markets. The iShares MSCI Turkey Investable Market Index Fund (TUR) fell nearly 15% in response.

The good news is that the United States economy remains in relatively good shape. Jobless claims came in lower than expected last week, signaling that the jobs market remains strong, while the consumer price index moved 0.2% higher in July, signaling that inflation is on the rise. Housing prices were largely responsible for inflation gains, while energy prices continued their decline in July.

Next week, traders will be closely watching several key economic indicators, including retail sales and industrial production on Aug. 15, housing starts on Aug. 16 and consumer sentiment data on Aug. 17. The market will also be keeping an eye on the evolving situation in Turkey and its effects on wider emerging markets. (For more, see: Why the Collapse of the Turkish Lira Matters.)

Broad Markets Give Up Gains

Technical chart showing the performance of the SPDR S&P 500 ETF (SPY)

Shares of the SPDR S&P 500 ETF (SPY) moved higher throughout most of last week before falling on Friday. After hitting new 52-week highs, the index moved sharply lower to the middle of its price channel by the end of the week. Traders should watch for a move lower to pivot point and 50-day moving average support at $277.88 or a move to upper trendline and R1 resistance at $287.39. Looking at technical indicators, the relative strength index (RSI) appears neutral at 57.50, but the moving average convergence divergence (MACD) could see a bearish crossover.

Industrials Breakout Fizzles

Technical chart showing the performance of the Dow Jones Industrial Average ETF (DIA)

The SPDR Dow Jones Industrial Average ETF (DIA) briefly moved higher before falling lower by the end of the week. Traders should watch for a move lower to pivot point or 50-day moving average support at $250 or a rebound to retest highs at around $257. Looking at technical indicators, the RSI appears neutral at 54.75, but the MACD experienced the start of a bearish crossover, which could signal a longer-term drop.

Tech Stocks Tread Water

Technical chart showing the performance of the Invesco QQQ Trust (QQQ)

Shares of the Invesco QQQ Trust ETF (QQQ) ended the week on a marginally positive note after falling on Friday. Traders should watch for a move lower to trendline and 50-day moving average support at around $176.72 or a rebound higher to retest R1 resistance at $183.03. Looking at technical indicators, the RSI has neutralized at around 56.25, but the MACD could see a bearish crossover after trending sideways. (See also: Tech Stocks Will Get Big Boost From Buybacks: Goldman.)

Small Caps Outperform

Technical chart showing the performance of the iShares Russell 2000 ETF (IWM)

The iShares Russell 2000 Index ETF (IWM) shares moved higher last week, outperforming all of the other major indexes. Traders should watch for a breakout from the top of the ascending trendline pattern near R1 resistance at $169.86 or a move lower to retest trendline, pivot point and 50-day moving average support at around $166.64. Looking at technical indicators, the RSI appears neutral at 53.15, but the MACD could see a bullish crossover in the near term. (For additional reading, check out: This Friday's Turkish Turmoil, Explained.)

Chart courtesy of StockCharts.com. The author holds no position in the stock(s) mentioned except through passively managed index funds.