Hello, everyone, and welcome to Monday morning. It’s Stephen Whiteside here from theuptrend.com. In the pre market this morning, things are fairly quiet out there. We don’t have any major economic numbers coming out this morning. There is economic numbers coming out from some country every hour on the hour during the week.
And what I’ve tried to do is just limit this list to the major ones. And so we’ve got FOMC minutes coming out on Wednesday. We’ve got jobless claims on Thursday, and then we’ve got the Fed chairman speaking on Friday. So those are probably the biggest news items of the week ahead. Now, the market made a complete recovery last week and so we’re back to where we started, essentially.
And we’ve got the VIX on a sell signal. We’ve got the VIX for the Nasdaq on the sell signal, and we’ve got the VIX for the Russell finally on a sell signal. And so that’s supportive for higher stock prices. The Dow gapped higher last week. The S&P 500 gapped higher and traded back up to where all of this madness started.
And here we are at resistance. If we can take out that resistance, then 562.50 is our next target. And that’s where we peaked back in July. So there’s not much further to go before we get back to retesting the high. And of course, if we can take out that high, you can see the next two targets to the upside.
For the Nasdaq 100. We’re back to again where it started. And we’re also back to the bottom of an open gap. So that could potentially continue to act as resistance. Looking at the Russell 2000, we finally got back on a buy signal on Thursday and we’re stuck here at 212.50.
And there’s the open gap that still needs to get filled. And if we take that out, then 218.75 would be our next target to the upside. Looking at the Canadian market, we’re right back up at the previous highs there at 35.16 on the iShares for the TSX 60. If we take that out, then 35.94 is our next target to the upside. Canadian banks, the equal weighted Bank ETF is back up at the recent highs.
The energy sector had a nice run last week. It has pulled back on Friday and it may pull back again today with crude oil trading slightly lower in the pre market on Monday morning. Now, while energy stocks pulled back on Friday, gold stocks continued to move higher for this move and are back up at previous resistance. We’re trying to break through that. If we can do that, then 23.44 comes into play.
I don’t think that’s going to happen on Monday. Now, while the stock market was rallying last week, we didn’t see much interest in the cryptocurrencies with both Bitcoin and Ethereum still on sell signal. So no change in trend there. And it looks like they are trading lower in the premarket this morning. Looking at the bond market, the bond market still on buy signals here for the TLT and the XBB.
What’s outperforming at the moment are the high risk bonds, whether you’re looking at the emerging market or the junk bond market. There’s the HYG, the JNK, both hitting new highs for this move on Friday. Looking at commodity ETF’s, we had crude oil pull back into the channel on Friday. A close blow, $75.51 would give us a sell signal on Monday. Joining gasoline already on a sell signal and natural gas trading in the channel looking for close on Monday below $13.88.
There’s the GLD making a new high, trying to break away from 231.25. If we can do that, then 237.50 would be our next target. Not expecting that to happen on Monday. There’s palladium and platinum on buy signals right now and silver trading up to the highs from two weeks ago last up this morning. Let’s take a look at the magnificent eight ETF.
It’s on its fourth day of a buy signal here and we’re trading up, getting pretty close to the 45 31 level. If we can take that out. You can see that there’s still an open gap here and we’ll be looking for a move up to 46.88. Now, the two stocks that have performed the best out of this group have been meta and Shopify. And in both cases, I waved off those buy signals and I would do it again there.
Shopify moving up to $75 in the US, trying to fill that. It filled that open gap. It looks like I would do it again. And the reason for that was at the time that those buy signals went off, the VIX was still on a buy signal. And you can see the big move up we had in the VIX for the Nasdaq.
So, yeah, I’m unfortunate that I waived both of those off and they performed so well. But next time around, I’m going to do it again. Because when the options traders in Chicago are telling me that something could be broken and they’re anticipating the stock market to potentially crash. I’m not going to throw new money into the market at that particular time. So certainly, if I’m short one of those stocks, I’m going to cover my short position, but I am not going to go long in that situation if it comes up again in the future, obviously, you know, if you’ve got a crystal ball and you can see how things are going to work out, when the VIX is that elevated, then, yeah, use your crystal ball.
But I don’t have one. And I just got to go with the information I have at the time. Okay, folks, that is all for this morning’s presentation. It looks like we’re going to have a fairly quiet open on Monday morning. Enjoy the rest of your day.
Next time you’ll hear my voice is on Tuesday morning.
Stephen Whiteside
TheUpTrend.com
Monday, August 19, 2024
