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Charting a bullish technical tilt: Dow 30,000 and Nasdaq 12,000 under siege

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Technically speaking, the U.S. benchmarks continue to rise amid bullish market rotation and expanding sector participation.

Against this backdrop, two round-number milestones are under siege early Tuesday — Dow 30,000 and Nasdaq 12,000 — as each benchmark builds on already firmly-bullish November price action.

Before detailing the U.S. markets’ wider view, the S&P 500’s
US:SPX
 hourly chart highlights the past two weeks.

As illustrated, the S&P is digesting the steep early-November rally.

Tactically, a near-term floor matches the October peak (3,550) and is followed by the post-breakout low (3,512).

Conversely, the September peak (3,588) marks an overhead inflection point and is followed by the S&P’s record close (3,626.9).

Similarly, the Dow Jones Industrial Average
US:DJIA
 is traversing a range-bound backdrop.

Tactically, overhead inflection points match the Dow’s record close (29,950.44) and absolute record peak (29,964.29). Both areas are under siege early Tuesday.

Against this backdrop, the Nasdaq Composite
US:COMP
has flatlined, asserting a tight six-session range.

This is the only major U.S. benchmark not to register a record close last week.

Against this backdrop, major resistance remains slightly more distant, areas better illustrated below.

Widening the view to six months adds perspective.

On this wider view, the Nasdaq is traversing the November range. The prevailing upturn punctuates a successful test of major support in the 11,450-to-11,460 area.

Conversely, the range top marks significant resistance. Overhead inflection points match the October peak (11,965) and September peak (12,074), formerly the Nasdaq’s all-time high.

Also see the Nasdaq’s record close (12,056.44), established Sept. 2. To reiterate, the marquee 12,000 mark is under siege early Tuesday.

Looking elsewhere, the Dow Jones Industrial Average has sustained a November breakout.

To reiterate, the prevailing flag-like pattern positions the index to build on the steep early-month rally.

Tactically, notable floors match the September peak (29,199) and gap support (29,127), areas that underpinned last week’s pullback.

More broadly, the prevailing upturn punctuates a bullish double bottom — defined by the September and October lows — and originates from the 200-day moving average.

Similarly, the S&P 500 has staged an orderly pullback from its record close, established last week.

Here again, the prevailing flag pattern punctuates a well-defined double bottom. Recall that the November rally originates from major support (3,233).

The bigger picture

As detailed above, the major U.S. benchmarks are acting well technically.

On a headline basis, the S&P 500 and Dow industrials have sustained early-November breakouts — asserting bullish flag patterns — while the Nasdaq Composite remains range-bound.

More immediately, the Dow Jones Industrial Average has tagged the 30,000 mark early Tuesday for the first time on record.

Perhaps not surprisingly, each benchmark’s intermediate-term bias remains firmly bullish.

Moving to the small-caps, the iShares Russell 2000 ETF has extended a break to record highs.

The prevailing upturn punctuates last week’s unusually tight range, a backdrop signaling muted selling pressure.

Similarly, the SPDR S&P MidCap 400 ETF has extended its November breakout.

Here again, the prevailing follow-through punctuates last week’s tight range near record highs.

Combined, the small- and mid-cap benchmarks have staged tandem bull-flag breakouts, reaching previously uncharted territory.

Looking elsewhere, the SPDR Trust S&P 500 is holding its range top.

As detailed repeatedly, the prevailing flag-like pattern is hinged to a double bottom — the W formation — defined by the September and October lows. Bullish price action.

Placing a finer point on the S&P 500, the index is traversing a jagged two-week range.

Within the range, the October peak (3,550) marks a notable floor, a level that has underpinned seven straight closes.

More broadly, the S&P has asserted a flag-like pattern hinged to the steep early-November rally from major support (3,233).

As always, the bull flag is a continuation pattern, improving the chances of upside follow-through.

Tactically, the S&P’s record close (3,626.91) and absolute record peak (3,645.99) mark overhead inflection points. The pending retest from underneath should be a useful bull-bear gauge.

Against this backdrop, the prevailing upturn punctuates a double bottom defined by the September and October lows. As detailed repeatedly, an intermediate-term target projects to the 3,800 area on follow-through.

Also see: Charting the approach of Dow 30,000 as bullish sector rotation persists.

Tuesday’s Watch List

The charts below detail names that are technically well positioned. These are radar screen names — sectors or stocks poised to move in the near term. For the original comments on the stocks below, see The Technical Indicator Library.

Drilling down further, the VanEck Vectors Semiconductor ETF
US:SMH
 is acting well technically. (Yield = 1.7%.)

Earlier this month, the group gapped to record territory, clearing resistance matching the October peak.

The subsequent pullback has been effectively underpinned by the breakout point, and punctuated by a bull flag, the recently tight one-week range.

Monday’s close marked a nominal record close, laying the groundwork for potentially more decisive follow-through. An intermediate-term target continues to project to the 210.00 area.

Meanwhile, the SPDR S&P Homebuilders ETF is showing signs of life.

As illustrated, the group has weathered the Nov. 9 downdraft, the long red bar induced by recent vaccine progress. (A vaccine is expected to redirect spending away from housing, on a relative basis, and toward more conventional spending patterns.)

More immediately, the prevailing upturn has been punctuated by a nominal record high. An intermediate-term target projects to the 62.50 area on follow-through.

Initially profiled April 23 — and revisited last week — Tesla, Inc.
US:TSLA
 has returned 255% and remains well positioned.

Earlier this month, the shares knifed atop trendline resistance, rising after the announcement that the company will be added to the S&P 500, effective Dec. 21.

As of today, Tesla would be the seventh-most valuable S&P 500 component.

The subsequent follow-through has been punctuated by a break to record territory. Tactically, a sustained posture atop the breakout point (502.50) signals a firmly-bullish bias. Delving deeper, the post-breakout low (487.60) is followed by the former range top (465.90).

More broadly, the shares are well positioned on the two-year chart, rising from a continuation pattern hinged to the massive mid-2020 breakout.

Coca-Cola Co.
US:KO
 is a well positioned Dow 30 component. (Yield = 3.1%.)

Technically, the shares have recently gapped to eight-month highs, rising amid a vaccine-fueled strong-volume spike.

The subsequent pullback has been orderly, placing the shares 3.7% under the November peak.

Tactically, the top of the gap (52.07) is followed by the firmer breakout point (51.50). The prevailing rally attempt is intact barring a violation.

Finally, Microchip Technology, Inc.
US:MCHP
 is a well positioned large-cap semiconductor name.

Earlier this month, the shares gapped to all-time highs, rising after the company’s strong second-quarter results. The breakout punctuated a prolonged five-month range, underpinned by the 200-day moving average.

More immediately, the shares have registered consecutive record closes fractionally under the early-November peak (131.65). A near-term target projects to the 141 area on follow-through.

Still well positioned

The table below includes names recently profiled in The Technical Indicator that remain well positioned. For the original comments, see The Technical Indicator Library.

Company

Symbol* (Click symbol for chart.)

Date Profiled

Zillow Group, Inc.

ZG

Nov. 23

Yeti Holdings, Inc.

YETI

Nov. 23

Carvana Co.

CVNA

Nov. 23

Palo Alto Networks, Inc.

PANW

Nov. 20

Bank of America Corp.

BAC

Nov. 20

Eaton Corp.

ETN

Nov. 20

SPDR S&P Oil & Gas Exploration and Production ETF

XOP

Nov. 20

MetLife, Inc.

MET

Nov. 19

Hilton Worldwide Holdings, Inc.

HLT

Nov. 19

American Express Co.

AXP

Nov. 18

Kohl’s Corp.

KSS

Nov. 18

FleetCor Technologies

FLT

Nov. 18

Applied Materials, Inc.

AMAT

Nov. 17

Delta Air Lines, Inc.

DAL

Nov. 17

Consumer Staples Select Sector SPDR

XLP

Nov. 17

Appian Corp.

APPN

Nov. 16

Ross Stores, Inc.

ROST

Nov. 16

Boeing Co.

BA

Nov. 16

RingCentral, Inc.

RNG

Nov. 13

Urban Outfitters, Inc.

URBN

Nov. 13

Regions Financial Corp.

RF

Nov. 13

iShares Europe ETF

IEV

Nov. 13

Flex, Inc.

FLEX

Nov. 9

Snap, Inc.

SNAP

Nov. 9

Norfolk Southern Corp.

NSC

Nov. 9

Materials Select Sector SPDR

XLB

Nov. 6

Communications Services Select Sector SPDR

XLC

Nov. 5

Health Care Select Sector SPDR

XLV

Nov. 5

Alphabet, Inc.

GOOGL

Nov. 5

Uber Technologies, Inc.

UBER

Nov. 5

Keysight Technologies, Inc.

KEYS

Nov. 4

Harley-Davidson, Inc.

HOG

Nov. 4

Garmin, Ltd.

GRMN

Nov. 4

Pinterest, Inc.

PINS

Nov. 3

Sony Corp.

SNE

Nov. 3

8×8, Inc.

EGHT

Nov. 3

Exact Sciences Corp.

EXAS

Nov. 2

Universal Display Corp.

OLED

Nov. 2

Dentsply Sirona, Inc.

XRAY

Oct. 27

Maxim Integrated Products, Inc.

MXIM

Oct. 21

Jazz Pharmaceuticals, plc

JAZZ

Oct. 21

The Travelers Companies, Inc.

TRV

Oct. 21

Micron Technology, Inc.

MU

Oct. 20

Vulcan Materials Co.

VMC

Oct. 19

Utilities Select Sector SPDR

XLU

Oct. 19

ON Semiconductor Corp.

ON

Oct. 16

Ford Motor Co.

F

Oct. 15

Texas Instruments, Inc.

TXN

Oct. 15

Skyworks Solutions, Inc.

SWKS

Oct. 14

First Solar, Inc.

FSLR

Oct. 13

Nevro Corp.

NVRO

Oct. 12

Teradyne, Inc.

TER

Oct. 12

SPDR S&P Homebuilders ETF

XHB

Oct. 9

Shake Shack, Inc.

SHAK

Oct. 9

SPDR S&P Biotech ETF

XBI

Oct. 8

Alexion Pharmaceuticals, Inc.

ALXN

Oct. 8

Twilio, Inc.

TWLO

Oct. 8

Cloudflare, Inc.

NET

Oct. 7

Ceridian HCM Holding, Inc.

CDAY

Oct. 7

Gap, Inc.

GPS

Oct. 6

Motorola Solutions, Inc.

MSI

Oct. 6

RSailPoint Technology Holdings, Inc.

SAIL

Oct. 1

Martin Marietta Materials, Inc.

MLM

Sept. 30

Whirlpool Corp.

WHR

Sept. 29

Abercrombie & Fitch Co.

ANF

Sept. 29

Blueprint Medicines Co.

BPMC

Sept. 28

Zendesk, Inc.

ZEN

Sept. 23

Scientific Games Corp.

SGMS

Sept. 23

Crocs, Inc.

CROX

Sept. 14

Five Below, Inc.

FIVE

Sept. 10

Eastman Chemical Co.

EMN

Sept. 10

International Paper Co.

IP

Sept. 3

Anaplan, Inc.

PLAN

Sept. 2

Celanese Corp.

CE

Aug. 26

Westlake Chemical Corp.

WLK

Aug. 25

Deere & Co.

DE

Aug. 24

Expedia Group, Inc.

EXPE

Aug. 24

Johnson Controls International

JCI

Aug. 21

Canadian Solar, Inc.

CSIQ

Aug. 20

General Motors Co.

GM

Aug. 20

Starbucks Corp.

SBUX

Aug. 18

Builders FirstSource, Inc.

BLDR

Aug. 18

Steel Dynamics, Inc.

STLD

Aug. 17

Elanco Animal Health, Inc.

ELAN

Aug. 17

Brinker International, Inc.

EAT

Aug. 13

Enphase Energy, Inc.

ENPH

Aug. 13

Nucor Corp.

NUE

Aug. 11

Freeport McMoRan, Inc.

FCX

Aug. 10

Natera, Inc.

NTRA

Aug. 10

McDonald’s Corp.

MCD

Aug. 7

Industrial Select Sector SPDR

XLI

Aug. 6

Penn National Gaming, Inc.

PENN

July 30

Procter & Gamble Co.

PG

July 29

SPDR S&P Metals & Mining ETF

XME

July 28

iShares MSCI South Korea ETF

EWY

July 28

Advanced Micro Devices, Inc.

AMD

July 23

Best Buy Co., Inc.

BBY

July 22

Materials Select Sector SPDR

XLB

July 20

Caterpillar, Inc.

CAT

July 20

Roku, Inc.

ROKU

July 16

Cognizant Technology Solutions, Inc.

CTSH

July 16

Costco Wholesale Corp.

COST

July 15

Consumer Discretionary Select Sector SPDR

XLY

July 13

SunPower Corp.

SPWR

July 13

Walmart, Inc.

WMT

July 8

Danaher Corp.

DHR

June 24

Fiverr International, Ltd.

FVRR

June 19

HubSpot, Inc.

HUBS

June 8

Square, Inc.

SQ

June 8

FedEx Corp.

FDX

June 3

SPDR S&P Retail ETF

XRT

June 3

iShares MSCI Japan ETF

EWJ

May 29

Synopsis, Inc.

SNPS

May 27

Agilent Technologies, Inc.

A

May 15

Qualcomm, Inc.

QCOM

May 12

Facebook, Inc.

FB

May 7

Dollar General Corp.

DG

Apr. 28

ServiceNow, Inc.

NOW

Apr. 27

Five9, Inc.

FIVN

Apr. 24

Chewy, Inc.

CHWY

Apr. 24

Tesla, Inc.

TSLA

Apr. 23

VanEck Vectors Semiconductor ETF

SMH

Apr. 17

Veeva Systems, Inc.

VEEV

Apr. 17

Okta, Inc.

OKTA

Apr. 16

Target Corp.

TGT

Apr. 16

Invesco QQQ Trust

QQQ

Apr. 14

Apple, Inc.

AAPL

Mar. 27

Nvidia Corp.

NVDA

Mar. 27

iShares MSCI Emerging Markets ETF

EEM

Mar. 19

Microsoft Corp.

MSFT

Feb. 22

* Click each symbol for current chart.



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Video: Why Mike Novogratz sees bitcoin reaching $500,000 by 2024

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Galaxy Digital’s Mike Novogratz explains the outlook for crypto as Coinbase goes public.





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My fiancée’s mother asked us to raise her 2 kids, as we live in a good school district and she has a gambling addiction — then she claimed their stimulus checks

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Dear Quentin,

Last year, in February, my fiancée’s stepfather passed away. After his passing, my fiancée’s mother asked both her and me to raise her younger sons, as we had recently purchased a new home, have degrees and will be able to provide a great area for their education, such as help with homework and the ability to communicate with their schools or doctors. My fiancée’s mother cannot read, write or speak English, and she has an addiction to gambling at casinos.

COVID-19 hit soon afterward. We both were let go from our jobs, and are making it by with unemployment and savings.

With that said, in March of this year, we filed taxes and my fiancée claimed both of her brothers since they had lived with us for almost nine months of last year. We received both of their stimulus payments a few days later. About three weeks later, we found out that my fiancée’s mother had also received the stimulus payments, even though she is adamant that she did not claim her children this year.

Upon seeing the money, I advised her to leave the money as the Internal Revenue Service may eventually ask for it back. Her new boyfriend then quickly told her to withdraw it anyway. They’ll deal with it later if the IRS asks for it, he said.

My question is: Will this situation hurt my fiancée and me in any way? I fear that the IRS may find out sooner or later about the error and seek the money from us, as her mother may have already gambled away that stimulus money, and make us pay for it even though we are using it as it was intended: for bills and necessities.

Fiancé

You can email The Moneyist with any financial and ethical questions related to coronavirus at qfottrell@marketwatch.com.

Dear Fiancé,

You are correct. The IRS will eventually ask for that money back, and it will likely do so by deducting the money from a future tax refund. You are also correct that your de facto mother-in-law should not spend the money. I take my hat off to you for raising these two children, and giving them a stable home and the head start in life that they deserve.

Many people in such a situation would write complaining about how they did X, Y and Z, and their in-laws were ungrateful. But you have taken the high road, knowing that these shenanigans are between you two and your fiancée’s mother, and do not involve your girlfriend’s two younger siblings. I am glad that you have not involved them in this somewhat messy situation.

You, of course, have done the right thing. The Moneyist column has dealt with dependents who claimed the stimulus, and parents who are not guardians of their children collecting it. The $1,400 economic stimulus payment, as you are aware, is not a loan. This third stimulus check is an advance tax credit on your 2021 taxes, and calculated based on your 2020 taxes.

If the IRS does not know who is telling the truth here, it will audit both parties. The truth will come to light eventually, and your fiancée’s mother and her boyfriend should be made aware that you are not in a position to help bail them out of this situation. They have knowingly walked into it, and there should be a clear boundary between helping her children and being a facilitator to this malfeasance.

The IRS has extensive guidance on what to do when someone fraudulently claims your dependent. “If you determine the other person was not eligible to claim your dependent, you’ll need to take steps to protect your right to claim the dependent and ensure an accurate filing,” it says. You have everything you need to know in order to take proactive steps here.

I leave that for you to decide.

The Moneyist: ‘I cut his hair because he won’t pay for a haircut’: My multimillionaire husband is 90. I’ve looked after him for 41 years, but he won’t help my son

Hello there, MarketWatchers. Check out the Moneyist private Facebook
US:FB
 group, where we look for answers to life’s thorniest money issues. Readers write in to me with all sorts of dilemmas. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.

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I’m on track to retire at 58. My fiancée is in debt and drives my old car, and I support her family. How do I ensure my son inherits my wealth after I die?

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Dear Quentin,

I have dated my fiancée for just over three years. Within those three years, I have been severed from a job and spent two years unemployed looking for a new job. I have a new job, making roughly 75% of what I previously made, but it is a more than livable salary. My fiancée makes a modest salary in comparison to my own.

Financially, I had spent a lot of years going without in order to pay for my son’s college education and to stockpile savings in order to retire early. According to my financial planner, I am well ahead of my goal to retire at 58 (I’m 51 currently) with an IRA of around $2 million, plus savings and other liquid assets.

Currently, my fiancée is trying to get herself out of debt. She drives my old car and shares no utility bills or mortgage payments, but she does buy groceries, as the household is made up of her, her children and me. By supporting her family, I have very little I can do for my own son.

It has always been tradition in my family to leave an inheritance. I had planned on leaving my only son a rather large inheritance so that he may better himself and his family. My fiancée has children, and my concern is that if I am married (I live in Texas), the savings I have would go to her and subsequently her children, bypassing my son.

Since I am 10 years older than my fiancée, I suspect she may outlive me. How do I protect my assets so that they can be split as part of my wishes?

Nervous Fiancé and Father

You can email The Moneyist with any financial and ethical questions related to coronavirus at qfottrell@marketwatch.com.

Want to read more? Follow Quentin Fottrell on Twitterand read more of his columns here.

Dear F & F,

Texas is a community-property state, so what you bring into the marriage, you also take out of the marriage. Assets accrued during the marriage, with the exception of inheritance, are deemed marital or community property.

You have several options, including setting up a living trust to allow you to transfer your wealth to your son during your lifetime, and thereby avoiding going through probate, which can be an unpredictable, cumbersome and public process.

You have two choices of trust: revocable or irrevocable. The first can be changed. You could retitle financial accounts in your son’s name. The latter cannot be changed, and also serves to save on estate taxes. It’s typically used to leave assets to children and grandchildren.

Other routes: a prenuptial agreement, a will (obviously) and naming your son as your beneficiary on your life-insurance policy. With the help of an estate planner, you can devise ways to ensure your son is taken care of after you’re gone, and your future wife is not left out.

In the meantime, ensure you keep separate property separate. If you deposit an inheritance in a joint bank account, for instance, it becomes marital property. If your fiancée contributes to the renovation of a home in your name, it again becomes community property.

Speak to your fiancée about your concerns and goals. It’s important to be transparent and ensure that you and she are on the same page, and share the same financial expectations. You may also want to wait until your wife pays her debts before marrying.

Hello there, MarketWatchers. Check out the Moneyist private Facebook
US:FB
 group, where we look for answers to life’s thorniest money issues. Readers write in to me with all sorts of dilemmas. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.

By submitting your story to Dow Jones & Company, the publisher of MarketWatch, you understand and agree that we may use your story, or versions of it, in all media and platforms, including via third parties.





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