The Bull Continues Rampage Through the U.S. Stock Market

The Dow Jones Industrial Average (INDU) , SP 500 , Nasdaq Composite (NDAQ) , Dow Transports and the Russell 2000 continue to have positive but overbought weekly charts.

All-time intraday highs were set at 20,125.58 for the Dow 30, 2,300.99 for the SP 500, 5,669.61 for the Nasdaq and 9,502.50 for Dow transports on Jan. 26. The Russell 2000 lags by setting its all-time intraday high of 1,392.71 on Dec. 9.

Here’s the risk/reward by the key levels:

The Dow Jones Industrial Average (20,093.78 on Jan. 27) set an all-time intraday high of 20,125.58 on Jan. 26. Monthly and quarterly value levels are 19,482 and 18,300, respectively, with a weekly risky level of 20,643 and semiannual risky levels at 20,893 and 22,148. My annual risky level is in-between at 22,042. My annual value level lags at 15,111.

The SP 500 (2,294.69 on Jan. 27) set its all-time intraday high of 2,300.99 on Jan. 26 testing its weekly risky level of 2,299.2. My quarterly value level is 2,141.2 with a monthly pivot of 2,270.5, and weekly risky level of 2,348.6, and semiannual risky levels of 2,492.4 and 2,608.9. My annual risky level is in-between at 2,537.9. My annual value level lags at 1,676.1.

The Nasdaq Composite (5,660.78 on Jan. 27) set its all-time high of 5,669.61 on Jan. 26. My quarterly value level is 5,335 with a monthly pivot of 5,619 and weekly risky level of 5,789. My semiannual risky levels are 5,946 and 6,387. My annual risky level is in-between at 6,253. My annual value level is 4,331.

Dow Transports (9,444.28 on Jan. 27) set its all-time intraday high of 9,502.50 on Jan. 26. My monthly value level is 8,621 with a semiannual risk level of 9,980. Annual and quarterly value levels are 7,910 and 7,243, respectively, with annual and semiannual risky levels of 10,167 and 10,713, respectively.

The Russell 2000 (1,370.70 on Jan. 27) set its all-time intraday high of 1,392.71 on Dec. 9. My quarterly value level is 1,234.21 with a monthly pivot at 1,367.34 and a semiannual risky level of 1,487.52. My annual value level is 1,091.77 with annual and semiannual risky levels at 1,548.95 and 1,549.50, respectively.

Here’s how to trade these markets using exchange-traded finds.

Here’s the weekly chart for the SPDR Dow Jones Industrial Average ETF (DIA) , aka Diamonds.

 

Courtesy of MetaStock Xenith

Diamonds trade at $200.63, up 1.6% in the first four weeks of 2017. An all-time intraday high of $200.97 was set on Jan. 26. This ETF is in bull market territory 30% above its Jan. 20, 2016, low of $154.38.

The weekly chart for Diamonds remains positive but overbought with the ETF above its key weekly moving average of $196.88 and well above its 200-week simple moving average of $170.57. The weekly momentum reading rose to 93.80 last week up from 93.34 on Jan. 20, moving further above the overbought threshold of 80.00.

Investors looking to buy Diamonds should do so on weakness to $194.66, which is a key level on technical charts until the end of January. A lower value level is $182.90, in play until the end of March. Investors looking to reduce holdings should do so on strength to $206.01 and $208.59, which are key levels on technical charts until the end of this week, and the end of June, respectively. My annual value level lags at $150.83 with annual and semiannual risky levels of $220.14 and $221.34, respectively.

Here’s the weekly chart for SPDR SP 500 ETF Trust (SPY) , aka Spiders.

 

Courtesy of MetaStock Xenith

Spiders trade at $229, up 2.4% in the first four weeks of 2017. The ETF set an all-time intraday high of $229.71 was set on Jan. 26. This ETF is in bull market territory 26.5% above its Jan. 20, 2016, low of $181.02.

The weekly chart for Spiders remains positive but overbought with the ETF above its key weekly moving average of $225.18 and above its 200-week simple moving average of $196.76. The weekly momentum reading up-ticked to 89.96 last week up from 88.02 on Jan. 20, moving further above the overbought threshold of 80.00.

Investors looking to buy Spiders should do so on weakness to $213.62, which is a key level on technical charts until the end of March. I show a monthly pivot of $227.04, which has been crossed in each week so far in 2017. Investors looking to reduce holdings should consider selling strength to $233.59, which is a key level on technical charts until the end of this week. My annual value level lags at $167.75 with annual and semiannual risky levels of $253.37 and $260.40, respectively.

Here’s the weekly chart for the PowerShares QQQ Trust ETF (QQQ) .

Courtesy of MetaStock Xenith

QQQ trades at $126, up a solid 6.2% in the first four weeks of 2017 on my theme of technology strength. QQQ set its all-time intraday high of $125.92 on Jan. 27. This ETF is in bull market territory 32.6% above its Feb. 8, 2016 low of $94.84.

The weekly chart for QQQ remains positive but overbought with the ETF above its key weekly moving average of $121.58, and well above its 200-week simple moving average of $99.49. The weekly momentum reading rose to 89.20 last week up from 85.25 on Jan. 20, well above the overbought threshold of 80.00.

Investors looking to buy QQQ should consider buying weakness to $118.68, which is a key level on technical charts until the end of March. Investors looking to reduce holdings had the opportunity to do so last week on strength to $125.33, which is now a pivot on technical charts until the end of January. Investors looking to reduce holdings this week should consider selling strength to $128.24, which is a key level on technical charts for this week. My annual value level lags at $98.20 with semiannual and annual risky levels of $139.27 and $139.42, respectively.

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