Technically speaking, the major U.S. benchmarks have taken flight to start April, rising amid statistically unusual bullish momentum. In the process, the S&P 500 and Dow Jones Industrial Average have knifed to record highs, while the Nasdaq Composite has staged a potentially consequential trendline breakout.
Before detailing the U.S. markets’ wider view, the S&P 500’s
hourly chart highlights the past two weeks. As illustrated, the S&P has taken flight, extending a break atop the 4,000 mark. The prevailing upturn has effectively tagged an intermediate-term target (4,085) detailed previously. (Tuesday’s early session high (4,086) has registered nearby.) Tactically, gap support (4,020) is followed by the firmer breakout point (3,983).
Similarly, the Dow Jones Industrial Average
has knifed to record territory. The prevailing upturn punctuates a bull flag — the tight three-session range — also illustrated on the daily chart. Tactically, the breakout point (33,227) closely matches the top of the gap (33,222), an area that pivots to support.
Against this backdrop, the Nasdaq Composite
has extended a rally atop the 50-day moving average. The breakout places the January peak (13,729) under siege, an area better illustrated below.
Widening the view to six months adds perspective. On this wider view, the Nasdaq has knifed to six-week highs, extending a sharp break atop trendline resistance. Additional overhead matching the January peak (13,729) is currently under siege. Slightly more broadly, the prevailing upturn punctuates an extended test of major support matching the 2020 peak (12,973). The successful retest preserves a bullish intermediate-term bias.
Looking elsewhere, the Dow Jones Industrial Average continues to outperform. As illustrated, the index has spiked to all-time highs, rising from a flag pattern underpinned by the 33,000 area. (Also see the hourly chart.) More broadly, the prevailing upturn originates from a successful March retest of the breakout point (32,009). Bullish price action.
Meanwhile, the S&P 500 has also taken flight, knifing atop the 4,000 mark for the first time on record. The prevailing upturn punctuates a successful March retest of the 50-day moving average. The bigger picture As detailed above, the major U.S. benchmarks have registered decisive April breakouts. The S&P 500 and Dow Jones Industrial Average have knifed to all-time highs, while the Nasdaq Composite has staged a sharp trendline breakout. Notably, the April spike has registered as statistically unusual, with each big three benchmark closing atop its 20-day Bollinger bands. Each index is vying Tuesday for the more reliably bullish consecutive closes atop the bands. (As always, closes atop the Bollinger bands signal an unusually strong two standard deviation breakout.)
Moving to the small-caps, the iShares Russell 2000 ETF
has rallied less aggressively from the March low. Still, the prevailing upturn places it back atop the 50-day moving average, and within striking distance of record highs.
Meanwhile, the SPDR S&P MidCap 400 ETF
remains incrementally stronger. Technically, the mid-cap benchmark has extended a rally atop its former breakout point (Feb. peak), rising to challenge record territory.
Looking elsewhere, the SPDR Trust S&P 500
has knifed to uncharted territory. The prevailing upturn originates from a March test of the 50-day moving average.
Placing a finer point on the S&P 500, the index has extended a break atop the 4,000 mark. In the process, the index has swiftly reached its intermediate-term target (4,085) detailed previously. (Tuesday’s early session high (4,086) has registered nearby.)
More broadly, the S&P 500 has staged a decisive 2.4% April breakout, confirming its primary uptrend. Against this backdrop, the S&P is vying Tuesday to register an unusual second straight close atop its 20-day volatility bands. As always, consecutive closes atop the bands signal a tension between time horizons. Though near-term extended, and due to consolidate, bullish momentum has registered as extreme, likely laying the groundwork for longer-term gains. (See the early-January break atop the bands, subsequent sideways price action, and upside follow-through.) Beyond the details, the S&P 500’s strong second-quarter start is constructive. All technical trends continue to point higher. Also see: Charting the S&P 500’s approach of the 4,000 mark.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 Consumer Staples Select Sector SPDR
is acting well technically. (Yield = 2.5%.) As illustrated, the group has sustained a recent break to record territory. The prevailing upturn builds on the March rally atop trendline resistance closely tracking the 50-day moving average. (The 50-day’s slope has recently ticked higher, also consistent with a trend shift.) Tactically, the breakout point (68.00) is followed by the post-breakout low (67.55). The prevailing rally attempt is firmly intact barring a violation. (Also see the March 25 review.)
Moving to specific names, VMware, Inc.
is a well positioned large-cap cloud-infrastructure name. Late last month, the shares knifed to five-month highs, rising from an inverse head-and-shoulders pattern defined by the December, January and March lows. The subsequent flag-like pattern has formed amid decreased volume, positioning the shares to build on the initial spike. Tactically, a sustained posture atop the breakout point (149.90) signals a firmly-bullish bias.
is a large-cap software vendor showing signs of life. As illustrated, the shares are challenging trendline resistance roughly tracking the 50-day moving average. The prevailing upturn punctuates a March retest of the 200-day moving average. Tactically, the former range top (275.00) pivots to support. A breakout attempt is in play barring a violation.
Initially profiled March 10, Southwest Airlines Co.
has added 6.9% and remains well positioned. Technically, the shares have rallied to three-year highs, clearing resistance matching the March peak. A near-term target projects to the 68 area. Conversely, the breakout point (62.20) closely matches the top of the gap and is followed by a near-term floor, circa 60.70. A sustained posture atop this area signals a bullish bias.
Finally, Dollar Tree, Inc
is a well positioned large-cap discount retailer. As illustrated, the shares have knifed to 52-week highs, clearing resistance matching the December and January peaks. The upturn punctuates a late-March flag pattern. Though near-term extended, and due to consolidate, the shares are attractive on a pullback. Initial support, circa 116.00, is followed by the firmer breakout point (114.75). More broadly, the shares are well positioned on the 10-year chart, challenging major resistance matching the 2018 and 2019 peaks. 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.
Symbol* (Click symbol for chart.)
Sunnova Energy International, Inc.
VanEck Vectors Semiconductor ETF
Lam Research Corp.
U.S. Steel Corp.
F5 Networks, Inc.
Texas Instruments, Inc.
NXP Semiconductors N.V.
iShares U.S. Real Estate ETF
Home Depot, Inc.
Cisco Systems, Inc.
Steel Dynamics, Inc.
Procter & Gamble Co.
Consumer Staples Select Sector SPDR
iShares U.S. Home Construction ETF
Jabil Circuit, Inc.
Dish Network Corp.
UnitedHealth Group, Inc.
Shift4 Payments, Inc.
D.R. Horton, Inc.
Virtu Financial, Inc.
Spirit Airlines, Inc.
Walgreens Boots Alliance, Inc.
International Paper Co.
iShares Europe ETF
CME Group, Inc.
Southwest Airlines Co.
Big Lots, Inc.
Alaska Air Group, Inc.
State Street Corp.
American Eagle Outfitters, Inc.
Beazer Homes USA, Inc.
United Airlines Holdings, Inc.
Signet Jewelers Limited
Old Dominion Freight Line
U.S. Global Jets ETF
Motorola Solutions, Inc.
Diamondback Energy, Inc.
Toll Brothers, Inc.
Avis Budget Group, Inc.
Capital One Financial Corp.
Magna International, Inc.
M.D.C. Holdings, Inc.
Zebra Technologies Corp.
Nexstar Media Group, Inc.
iShares Transportation Average ETF
Energy Select Sector SPDR
Skyworks Solutions, Inc.
Financial Select Sector SPDR
JPMorgan Chase & Co.
SDPR S&P Regional Banking ETF
Emerson Electric Co.
Kulicke and Soffa Industries, Inc.
American Airlines Group, Inc.
Bank of America Corp.
SPDR S&P Oil & Gas Exploration and Production ETF
Applied Materials, Inc.
Regions Financial Corp.
Norfolk Southern Corp.
Communications Services Select Sector SPDR
Micron Technology, Inc.
ON Semiconductor Corp.
Ford Motor Co.
SPDR S&P Homebuilders ETF
Shake Shack, Inc.
Martin Marietta Materials, Inc.
Abercrombie & Fitch Co.
Five Below, Inc.
Deere & Co.
Johnson Controls International
General Motors Co.
Builders FirstSource, Inc.
Industrial Select Sector SPDR
SPDR S&P Metals & Mining ETF
Materials Select Sector SPDR
SPDR S&P Retail ETF
iShares MSCI Japan ETF
Mar. 27, 2020
Feb. 22, 2019
* Click each symbol for current chart.