New Highs For The Dow And S&P 500 As Transports And Small Caps Roll Over

The five major U.S. equity averages can be traded using five markets ETFs. The Dow Jones Industrial Average is represented by Diamonds. The S&P 500 is represented by Spiders. The Nasdaq Composite is represented by the QQQ’s, which is the Nasdaq 100.

The five major U.S. equity averages can be traded using five markets ETFs. The Dow Jones Industrial Average is represented by Diamonds. The S&P 500 is represented by Spiders. The Nasdaq Composite is represented by the QQQ’s, which is the Nasdaq 100. Transports is traded by iShares IYT. Small caps are traded by iShares IWM for the Russell 2000.

SPDR Dow Jones Industrial Average ETF (DIA)

Courtesy of MetaStock Xenith

The weekly chart for Diamonds ($220.50 on Aug. 9) is positive but overbought with the ETF above its five-week modified moving average of $216.55 and above its 200-week simple moving average or “reversion to the mean” at $178.87. The 12x3x3 weekly slow stochastic reading remains well above the overbought threshold of 80.00 at 94.02.

Investment Strategy: Buy weakness to my semiannual and quarterly value levels of $214.93 and $203.15, respectively. My annual pivot of $220.14 remains a magnet. Sell strength to my monthly risky at $226.26. My annual value level is $150.83.

SPDR S&P 500 ETF Trust (SPY)

Courtesy of MetaStock Xenith

The weekly chart for Spiders ($247.46 on Aug. 9) is positive but overbought with the ETF above its five-week modified moving average of $245.17. The 200-week simple moving average or “reversion to the mean” is $207.22. The 12x3x3 weekly slow stochastic reading remains above the overbought threshold of 80.00 at 90.18.

Investment Strategies: Buy weakness to my quarterly value level of $231.82. Sell strength to my semiannual, annual and monthly risky levels of $252.96, $253.37 and $254.76, respectively. My annual value level lags $167.75.

PowerShares QQQ Trust ETF (QQQ)

Courtesy of MetaStock Xenith

The weekly chart for QQQ’s ($144.12 on Aug. 9) is positive with the ETF above its five-week modified moving average of $141.95. The 200-week simple moving average or “reversion to the mean” is $108.20. The 12x3x3 weekly stochastic reading is projected to rise to 79.15 this week up from 70.02 on Aug. 4.

Investment Strategy: Buy weakness to my quarterly value level of $131.86. My annual pivot is $139.42. Sell strength to my semiannual and monthly risky levels of $146.49 and $150.67, respectively.

iShares Transportation Average ETF (IYT)

Courtesy of MetaStock Xenith

The weekly chart for transports ($166.20 on Aug. 9) is negative with the ETF below its five-week modified moving average of $168.52. The 200-week simple moving average or “reversion to the mean” at $148.25. The 12x3x3 weekly slow stochastic reading is projected to decline to 64.53 this week down from 74.30 on Aug. 4

Investment Strategy: Buy weakness to my quarterly value level of $158.89. Sell strength to my monthly, semiannual and annual risky levels of $170.08, $181.18 and $182.54, respectively.

iShares Russell 2000 ETF (IWM)

Courtesy of MetaStock Xenith

The weekly chart for the small caps ETF ($138.79 on Aug. 9) is negative with the ETF below its five-week modified moving average of $140.36. The 200-week simple moving average or “reversion to the mean” is $120.09. The 12x3x3 weekly slow stochastic reading is projected to decline to 72.58 this week down from 78.87 on Aug. 4.

Investment Strategy: Buy weakness to my quarterly value level of $125.32. Sell strength to my semiannual, monthly and annual risky levels of $144.61, $144.99 and $154.33, respectively.

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