From Inflation Fears to Nasdaq Strenght: What’s Next for the Market?
2024.12.16 02:59
From my last Daily:
“But, unless the market continues to broaden, we can almost take the Mag 7 stocks outperforming as a lack of confidence. Unless small caps can deliver.”
As we ended this week, clearly held up better than pretty much everything else.
had its first red week in over a month!
Inflation numbers spooked the market. NASDAQ cares less.
Yields rose, which also spooked the market. NASDAQ cares less.
ECB and Canada cut rates. That strengthened the , which also spooked the market. NASDAQ cares less.
NASDAQ cares less until it cares more, unless this past week was the correction to buy and not the massive double top we fear might happen in Granddad ().
Looking at the weekly charts,
Granny Retail does not get spooky unless it breaks under the highs of 4 weeks ago or under 81.00. If she is indeed consolidating, this week would be a really great time to let us know that.
Gramps or IWM made a top in 2021 and now again in 2024 at around 245. This $13 drop could be nothing. But, like Granny, he needs to stop the bleed this week and reverse course back up over 240 to start. Otherwise, we will be watching $217 carefully for if that breaks, a double top becomes more than just speculation.
Big Brother Biotechnology , doesn’t look so big or brotherly. And we were so enthusiastic about it too. This can’t be totally political. But if it is, then I will look to buy a dip here for sure with major support around 130.
Moving down to the chart of Sister Semiconductors , she closed higher on the week thanks to Broadcom’s (NASDAQ:) rally. The question now is can SMH clear 260?
The second biggest disappointment this week was the Transportation sector . Having peaked 3 weeks ago, now IYT is in a daily chart caution phase. IYT must hold here, or we go back to the earlier point that “a double top (IWM) becomes more than just speculation.”
Prodigal Son Regional has big support around $60. Plus, after this correction, signs of strength offer investors a look at $65 as a very low risk pivotal point to clear and hold.
Finally, 
had its highest weekly close ever!
The consolidation over the last 2 weeks has been great for traders to sit back and wait for higher prices still.
We are looking at a $130,000 target by the end of January. At least that is what I said on CNBC Asia in November.
Circling back to the Daily I quoted at the beginning of this one
“Yay growth, but we need confidence in inflation behaving, the US debt decreasing and Trump delivering on the Made in America notion. “
ETF Summary
- (Pivotal means short-term bullish above that level and bearish below)
- S&P 500 (SPY) 604 pivotal for Monday
- Russell 2000 (IWM) 217 major major support back thru 240 better
- Dow (DIA) 445 resistance
- Nasdaq (QQQ) 520 support
- Regional banks (KRE) 65 pivotal
- Semiconductors (SMH) 250 resistance 240 support
- Transportation (IYT) confirmed Caution Phase
- Biotechnology (IBB) 140 resistance 130 major support
- Retail (XRT) 80 support 87 resistance
- iShares iBoxx Hi Yd Cor Bond ETF (HYG) 79.50 failed end of the week-also caution
