Charting market cross currents: S&P 500 pulls in from record close

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U.S. stocks are lower early Monday, pressured partly amid concerns that a hedge fund’s forced liquidation may have adverse ripple effects.

Against this backdrop, the S&P 500 and Dow industrials have pulled in from their latest record close, even as the Nasdaq Composite vies to simply maintain major support matching the 2020 peak (12,973).

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 has rallied toward its range top, rising to conclude last week with a nominal record close.

Tactically, the Feb. peak (3,950) remains an inflection point, and is followed by the 3,915 support.

Conversely, the marquee 4,000 mark remains within view.

Similarly, the Dow Jones Industrial Average US:DJIA  has extended a bullish reversal from two-week lows.

In the process, the index has registered a record close, as well as its second-ever close slightly atop the 33,000 mark.

Tactically, near-term inflection points in the 32,500 and 32,800 areas remain in play.

True to recent form, the Nasdaq Composite US:COMP remains the weakest major benchmark.

Still, the index has reclaimed a key bull-bear inflection point matching the 2020 peak (12,973), an area also illustrated below.

A potentially consequential retest remains underway to start this week.

Widening the view to six months adds perspective.

On this wider view, the Nasdaq has narrowly maintained major support (12,973). This area matches the 2020 peak — as well as the early-March breakdown point — and remains a useful intermediate-term bull-bear gauge.

Delving deeper, significant support (12,607) closely matches the March closing low (12,609), an area detailed repeatedly.

Looking elsewhere, the Dow Jones Industrial Average remains the strongest major benchmark.

Recall that last week’s low (32,071) registered above the breakout point (32,009) amid a relatively orderly pullback from the March peak.

The subsequent reversal from support has been swiftly punctuated by a nominal record close.

Bullish momentum is intact. The directionally sharp March rallies encompass a comparably sluggish mid-month pullback.

Meanwhile, the S&P 500 has staged a bullish reversal from its 50-day moving average.

Here again, the sharp rally from the late-March low has been punctuated by a nominal record close. Constructive price action.

The bigger picture

Collectively, the major U.S. benchmarks remain in divergence mode, though amid a still largely bullish bigger-picture backdrop.

On a headline basis, the S&P 500 and Dow industrials have registered bullish reversals from major support, rising to tag nominal record closes. (See the daily charts.)

Meanwhile, the characteristically lagging Nasdaq Composite has thus far maintained major support matching the 2020 peak (12,973) though an extended retest remains underway.

Moving to the small-caps, the iShares Russell 2000 ETF US:IWM  has extended its bullish reversal from two-week lows.

A retest of the 50-day moving average, currently 220.55, remains underway.

Delving slightly deeper, the range bottom (216.70) marks a familiar inflection point, detailed previously.

Meanwhile, the SPDR S&P MidCap 400 ETF US:MDY  remains incrementally stronger.

As illustrated, the MDY has reclaimed its breakdown point, rising within striking distance of record highs.

The prevailing upturn punctuates a successful test of the former range bottom, an area roughly matching the 50-day moving average.

Looking elsewhere, the SPDR Trust S&P 500 US:SPY  has also reclaimed its breakdown point, an area matching the February peak.

The strong-volume bullish reversal effectively originates from the 50-day moving average.

Also recall the SPY has struggled to break too far from its prevailing seven-week range.

Placing a finer point on the S&P 500, the index has reversed sharply from two-week lows.

The upturn punctuates a jagged test of major support (3,870) and the 50-day moving average, currently 3,877.

Within the range, the S&P’s former breakdown point (3,950) remains an inflection point.

More broadly, the S&P 500 has weathered a garden-variety late-March pullback.

The downturn has been underpinned by major support (3,870) and punctuated by a sharp two-session reversal to tag a record close. Bullish momentum is intact.

Tactically, near- to intermediate-term targets project from the late-March downturn to the 4,050 and 4,085 areas.

Beyond technical levels, the S&P 500’s intermediate-term bias remains comfortably bullish as the index vies to confirm its uptrend with more decisive follow-through to record territory. Wednesday’s monthly close also concludes the first-quarter and will likely add color.

Monday’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 Consumer Staples Select Sector SPDR US:XLP   — profiled last week — has extended its rally attempt. (Yield = 2.6%.)

In the process, the group has cleared its range top, rising to record highs.

Tactically, the breakout confirms the group’s recent trend shift. An intermediate-term target projects to the 73 area.

More broadly, the group is well positioned on the three-year chart, rising from a continuation pattern hinged to the massive V-shaped 2020 bullish reversal.

Meanwhile, the iShares U.S. Real Estate ETF US:IYR  has also come to life technically. (Yield = 2.2%.)

Specifically, the group has reached 52-week highs, clearing resistance matching the mid-March peak. The prevailing upturn punctuates a bull-flag breakout. A near-term target projects to the 94 area.

More broadly, the tandem surge in these rate-sensitive groups — real estate and the consumer staples sector — is consistent with the view that Treasury yields may have asserted at least an intermediate-term plateau.

Moving to specific names, Texas Instruments, Inc. US:TXN  is a well positioned large-cap semiconductor name. (Yield = 2.2%.)

Technically, the shares have knifed to all-time highs, clearing resistance matching the February peak. The upturn punctuates a two-month range, and a V-shaped reversal from the March low.

Though near-term extended, and due to consolidate, the sharp rally is longer-term bullish. Tactically, the breakout point (181.80) pivots to well-defined support.

NXP Semiconductors N.V. US:NXPI  is a large-cap Netherlands-based semiconductor name.

Earlier this month, the shares gapped sharply higher, rising after the March 15 announcement of the company’s pending addition to the S&P 500. (The company was formally added to the S&P 500 on March 22.)

The ensuing pullback has been punctuated by a rally toward the former range top.

Tactically, the 50-day moving average, currently 183.70, is rising toward gap support (189.50). The prevailing uptrend is comfortably intact barring a violation.

Finally, Coca-Cola Co. US:KO  is a Dow 30 component coming to life technically. (Yield = 3.2%.)

As illustrated, the shares have knifed to nearly three-month highs, rising to the former range. The breakout punctuates a cup-and-handle defined by the January and March lows.

Tactically, the breakout point (51.90) roughly matches the November gap (52.07) and pivots to support. The prevailing recovery attempt is intact barring a violation.

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
Home Depot, Inc. HD Mar. 26
Ferrari N.V. RACE Mar. 26
Funko Inc FNKO Mar. 26
Cisco Systems, Inc. CSCO Mar. 25
Steel Dynamics, Inc. STLD Mar. 25
Procter & Gamble Co. PG Mar. 25
Consumer Staples Select Sector SPDR XLP Mar. 25
iShares U.S. Home Construction ETF ITB Mar. 23
Lennar Corp. LEN Mar. 23
Jabil Circuit, Inc. JBL Mar. 23
Dish Network Corp. DISH Mar. 23
UnitedHealth Group, Inc. UNH Mar. 22
DraftKings, Inc. DKNG Mar. 22
Shift4 Payments, Inc. FOUR Mar. 19
Whirlpool Corp. WHR Mar. 19
U.S. Bancorp USB Mar. 19
Nasdaq, Inc. NDAQ Mar. 18
D.R. Horton, Inc. DHI Mar. 18
Facebook, Inc. FB Mar. 17
AutoNation, Inc. AN Mar. 17
McDonald’s Corp. MCD Mar. 16
Virtu Financial, Inc. VIRT Mar. 16
Spirit Airlines, Inc. SAVE Mar. 16
LKQ Corp. LKQ Mar. 15
Anthem, Inc. ANTM Mar. 15
Walgreens Boots Alliance, Inc. WBA Mar. 12
International Paper Co. IP Mar. 12
iShares Europe ETF IEV Mar. 11
CME Group, Inc. CME Mar. 11
3M Co. MMM Mar. 11
Southwest Airlines Co. LUV Mar. 10
Under Armour, Inc. UA Mar. 9
Big Lots, Inc. BIG Mar. 9
Alaska Air Group, Inc. ALK Mar. 9
State Street Corp. STT Mar. 8
American Eagle Outfitters, Inc. AEO Mar. 8
Hess Corp. HES Mar. 3
Beazer Homes USA, Inc. BZH Mar. 3
Mastercard, Inc. MA Mar. 2
Boeing Co. BA Mar. 2
Starbucks Corp. SBUX Mar. 1
Eaton Corp. ETN Feb. 25
Oracle Corp. ORCL Feb. 24
United Airlines Holdings, Inc. UAL Feb. 24
Nucor Corp. NUE Feb. 23
Signet Jewelers Limited SIG Feb. 23
Old Dominion Freight Line ODFL Feb. 22
Seagate Technology STX Feb. 19
Chevron Corp. CVX Feb. 18
Lyft, Inc. LYFT Feb. 16
Intel Corp. INTC Feb. 12
U.S. Global Jets ETF JETS Feb. 9
Motorola Solutions, Inc. MSI Feb. 9
KeyCorp KEY Feb. 5
Diamondback Energy, Inc. FANG Feb. 4
CarMax, Inc. KMX Feb. 3
Toll Brothers, Inc. TOL Feb. 2
Avis Budget Group, Inc. CAR Feb. 1
Capital One Financial Corp. COF Jan. 29
Cummins, Inc. CMI Jan. 25
Magna International, Inc. MGA Jan. 22
M.D.C. Holdings, Inc. MDC Jan. 22
Zebra Technologies Corp. ZBRA Jan. 14
Nexstar Media Group, Inc. NXST Jan. 11
iShares Transportation Average ETF IYT Jan. 11
Energy Select Sector SPDR XLE Jan. 8
Skyworks Solutions, Inc. SWKS Jan. 7
Financial Select Sector SPDR XLF Jan. 7
Synaptics, Inc. SYNA Jan. 4
JPMorgan Chase & Co. JPM Dec. 22
Williams-Sonoma, Inc. WSM Dec. 15
SDPR S&P Regional Banking ETF KRE Dec. 14
Emerson Electric Co. EMR Dec. 8
Fortinet, Inc. FTNT Dec. 7
Kulicke and Soffa Industries, Inc. KLIC Dec. 7
Dillard’s, Inc. DDS Dec. 4
Sonos, Inc. SONO Dec. 1
American Airlines Group, Inc. AAL Nov. 30
Bank of America Corp. BAC Nov. 20
SPDR S&P Oil & Gas Exploration and Production ETF XOP Nov. 20
MetLife, Inc. MET Nov. 19
Kohl’s Corp. KSS Nov. 18
Applied Materials, Inc. AMAT Nov. 17
Regions Financial Corp. RF Nov. 13
Norfolk Southern Corp. NSC Nov. 9
Communications Services Select Sector SPDR XLC Nov. 5
Alphabet, Inc. GOOGL Nov. 5
Micron Technology, Inc. MU Oct. 20
ON Semiconductor Corp. ON Oct. 16
Ford Motor Co. F Oct. 15
SPDR S&P Homebuilders ETF XHB Oct. 9
Shake Shack, Inc. SHAK Oct. 9
Martin Marietta Materials, Inc. MLM Sept. 30
Abercrombie & Fitch Co. ANF Sept. 29
Crocs, Inc. CROX Sept. 14
Five Below, Inc. FIVE Sept. 10
Deere & Co. DE Aug. 24
Johnson Controls International JCI Aug. 21
General Motors Co. GM Aug. 20
Builders FirstSource, Inc. BLDR Aug. 18
Industrial Select Sector SPDR XLI Aug. 6
SPDR S&P Metals & Mining ETF XME July 28
Materials Select Sector SPDR XLB July 20
Caterpillar, Inc. CAT July 20
SPDR S&P Retail ETF XRT June 3
iShares MSCI Japan ETF EWJ May 29
Tesla, Inc. TSLA Apr. 23
Apple, Inc. AAPL Mar. 27, 2020
Microsoft Corp. MSFT Feb. 22, 2019
* Click each symbol for current chart.