Weekly Wrap. Week Report for the week ended 9/8/24
World markets tumbled at the beginning of the week and regained some ground as the week progressed.
Weekly QQQ - ETF for Nasdaq - finished up +0.37% for the week
Weekly QQQ has broken below the uptrend line from the end of October, so the long bull rally which lasted nine months is now in a bearish retracement.
This week saw the QQQ bounce to test the up line from under-neath. If that test fails, we will likely see much more downside.
Daily QQQ.
We can see that Monday produced a big gap down on the QQQ and then plenty of intra-day buying reduced the size of the fall;
On Monday, positive divergences on CCI and MACD Histogram suggested an upside movement which saw the QQ rise to finish the week on a positive note.
Just above the current level is the confluence of three resistance levels: resistance from the old long-term up trend line from late October, more recent horizontal resistance from late July, and resistance from a high-volume node on the Volume Profile on the left hand side of the chart. That confluence of resistance levels is a tough ask for QQQ - not impossible to overcome, but likely to produce a move to the downside.
Weekly STW ETF for the XJO
STW finished down -1.93% for the week. XJO was down a little more -2.08%. The long lower wick on this week's candle indicates plenty of buying during t week.
Daily STW
Tues-Thurs STW consolidated at the low end of the chart range, but rebounded sharply on Firday. Plenty of intr-day buying is shown by the long lower wick on the daily candle.
Given the positive action on Friday night in the American market and commodities, it seems likely that another move to the upside will occur. But then, STW is faced with horizontal resistance from the low of 25 July, the 10-Day MA, and Supertrend (10/1). That's the confluence of three important resistance levels.
Again - not impossible to overcome - but a tough ask. The probabilities lie to the down side after a move up on Monday.
ASX Sector Performance
this week.
The worst performing group of sectors thisweek was the "Sensitive" group (Telecoms, Energy, Industrials and Technology). Energy and Technology are notoriously volatile and they suffered the word declines this week. Energy -4.92% and Technology -3.64%.
The next worst group of Sectors was the "Cyclical" group. Materials -2.54% and Financials -2.57%.
The Defensive Group was only down -0.22%. The Defensive Sector suffering significant losses was Staples -0.9%. Health was marginally down -0.01%, and Compsite Bonds flat 0.00%
So the Defensive Group of stocks out-performed the other two groups relatively by large margins. Such is the profile of a bearish market.
Long-term Investment Index.
I use New Highs and New Lows as a Long-term Investment Index.
When the 10-Day Moving Average of New Highs minus New Lows moves below zero, its time for long-term Investors to take defensive action. The market is not yet at that level but the MA is headed down.
This week was the first week since December 2023 that we've seen more than one day where New Highs minus New Lows fell into negative territory. That's still not enough to turn the Long-Term Investment Index into defensive territory, but a few more negative days would do it. Friday was a positive day.
This is a lagging index. It won't get you into the beginning or ends of trends, but it will keep you getting the greater part of a trend.
Conclusion.
The past couple of weeks has seen significant damage done to world markets. The markets bounced up at the end of the week and looking positive. But the charts are now looking at significant resistance in the coming week. Not impossible to overcome - but the probabilities still lie to the downside.
Take care.
(20min delay)