Stock Market Indices Review for Week 29 in 2015

Jul 19, 2015 -

Stock Market Highlights - Week 29

- Q2 2015 S&P 500 earnings stand at $28.61, a 3.8% decline in growth year-over-year.
- WTI was 7/19 at $59.89 and Crude Oil $57.72. Oil prices continues to decline.
- US jobless claims dropped for the first time in 4 weeks, according to the Department of Labor
- Google's Share price hits all-time high, closed at 672.93 .
- Retail sales reduced 0.3% last month, the weakest reading since February.

The Dow Jones Industrial Average (DJIA) closed at 18086.45 on Friday, July 17 2015, which was about a 326 point decline versus a week ago of 17760.41 on Friday, July 10 2015. The DJIA dipped below the trading range for the first time in four months. However, managed to bounce back though unconvincingly. It took several attempts before breaking above the 200 DMA. You'll notice as we go through the other charts, this is the weakest of the three indices. We should see a retest of the top trading range. 

After four consecutive positive trading days, the market took a break near 18000. The short-term stochastic (STO) indicators now show overbought conditions. Don't be surprised to see some consolidation to work off that overbought condition or a pullback. 

The S&P 500 closed at 2126.64 on Friday, July 17th 2015 versus a week ago of 2076.62 on Friday, July 10th 2015. This was a 50 point swing upward. The S&P experienced a huge drop toward the 200 DMA, and like the DJIA struggled to make a convincing V-shaped bounce like we've seen in the past. Nonetheless, it did recover and is now trading above the 50DMA.

The STO levels suggest that a period of consolidation or pullback is likely to follow. This is especially the case now that we are toward the top of the trading range. The doji (cross) at the top of chart is just another indication that we may be at a top of this leg up. 

The Nasdaq (COMPQ) closed at 5210.14 on July 17th, 2015 versus 4997.70 on Friday, July 10th . The strongest of the three indices is still the COMPQ. To our amazement, the COMPQ made a new high. Not only that, but it also closed near the top of the high of the day. Without a doubt this is positive action of the chart. Although it is overbought at the moment, further run up is possible before we see any consolidation or pullback. 

Notice that we did not even come close to testing the 200 DMA on this chart. Just incredible strength despite the weakness we see in the DJIA and the S&P. 

Etsy, Inc. (Etsy) operates a marketplace where people around the world connect, both online and offline, to make, sell and buy unique goods. My first position in the stock was when it first IPOed, we were able to get in at the great price of $16 per share. The first trading day it jumped up towards $30 and then we dumped it the second day due to weakness. 

Needless to say the stock had been on a downward spiral ever since. Our analysis taking eBay's IPO price relative to its earnings, tagged Etsy to be valued at around $12 per share. It didn't get that low, so we didn't enter the stock. However, from a technical analysis standpoint, the breakout of the trading range was the first buy signal. Then the breakout of the 50 DMA was the second. 

We would wait for a consolidation or another trading setup as we've already missed the last two opportunities. 

Disclosure: I do not have a position in ETSY.

The information provided on this site is not advice to buy, sell, hold, trade, or invest in any securities. I am not a financial professional. Do your own research before acting on any information provided on this site.
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