U.S. stocks have taken flight early Monday, rising amid optimism over a successful final-phase coronavirus vaccine trial.
Against this backdrop, the major U.S. benchmarks have extended an already-aggressive November rally, rising early Monday to tag record highs.
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 had sustained a steep November rally, asserting a posture atop former gap support (3,482).
More immediately, Monday’s unusually strong start places the index in record territory. Tactically, the September peak (3,588) pivots to support.
Meanwhile, the Dow Jones Industrial Average
has sustained a sharp rally from its 200-day moving average.
The index closed last week in slightly negative year-to-date territory — under the 2019 close — though it has briefly tagged an all-time high amid Monday’s aggressive early follow-through.
Similarly, the Nasdaq Composite
asserted a flag-like pattern — the narrow two-session range — to conclude last week.
The bullish continuation pattern punctuates a massive 9.0% one-week rally to start November.
Widening the view to six months adds perspective.
On this wider view, the Nasdaq has knifed from major support (10,840), an area closely matching the July peak and the August gap.
Against this backdrop, last week’s close (11,895) marked the Nasdaq’s third-best close on record.
More immediately, the Nasdaq has briefly tagged record highs early Monday. Its record close (12,056.44) and the September peak (12,074.06) remain under siege.
Looking elsewhere, the Dow Jones Industrial Average has knifed from three-month lows to punctuate a successful test of the 200-day moving average.
And here again, the blue-chip benchmark has briefly tagged all-time highs early Monday. Consider that the early session high (29,933) has registered within striking distance of the 30,000 mark.
Tactically, the Dow’s record close (29,551.42) and the February peak (29,568.57) — formerly the record peak — remain under siege.
Meanwhile, the S&P 500 has knifed from major support.
Recall that the October low (3,233.9) closely matched the June peak (3,233) to punctuate a successful retest.
More immediately, the index has extended to record territory early Monday. The S&P’s record close (3,580.84) and the September peak (3,588.11) — both established Sept. 2 — mark areas to track.
The prevailing upturn punctuates a double bottom — the W formation — defined by the September and October lows.
The bigger picture
Collectively, the major U.S. benchmarks continue to take flight, rising amid an unusually strong November start.
Each big three benchmark has tagged all-time highs early Monday, building on last week’s already-massive bullish reversal.
Tactically, recall that the prevailing upturn originates from major support. The S&P 500 has spiked from the June peak (3,233), the Dow Jones Industrial Average has rallied from the 200-day moving average, and the Nasdaq Composite has spiked from its former breakout point (10,840).
Moving to the small-caps, the iShares Russell 2000 ETF
has also follow-through.
Here again, the small-cap benchmark has tagged record highs early Monday, venturing atop its record close (173.02) and absolute record peak (173.39) established August 2018.
The prevailing upturn punctuates a bullish island reversal to start November.
Similarly, the SPDR S&P MidCap 400 ETF
has reached record highs intraday, eclipsing its record close (384.02) and absolute record peak (384.47) established February 2020.
Looking elsewhere, the SPDR Trust S&P 500
is also acting well technically.
Here again, Monday’s strong start places the SPY in record territory. The prevailing upturn originates from support matching the June peak.
Placing a finer point on the S&P 500, the index sustained its aggressive rally to conclude last week.
Recall that notable floors match the October gap — at 3,482 and 3,500.
Delving deeper, the steep rally originates from support matching the June peak (3,233).
More broadly, the S&P 500 has extended to record territory early Monday. Consider that Monday’s early session low (3,583) has effectively matched the former range top.
Technically, the prevailing upturn, to the extent sustained, punctuates a double bottom defined by the September and October lows.
An intermediate-term target projects to the 3,800 area on follow-through. (The target technically rests at 3,798.)
Beyond specific levels, a potentially consequential break to record territory is underway. All technical trends point higher based on today’s backdrop.
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 10-year Treasury note yield
has extended its late-year breakout, rising amid a risk-on trade.
The upturn places the yield at five-month highs, and punctuates a successful test of the former range top (0.75), detailed previously.
More broadly, recall that the yield is rising from a good-sized double bottom, defined by the April and August lows. (See the one-year chart.) Follow-through atop the June peak (0.96) would resolve the bullish reversal pattern.
Also notice the pending golden cross, or bullish 50-day/200-day moving average crossover.
Recall that the prevailing breakout places the yield atop its 200-day moving average — a widely-tracked longer-term trending indicator — for the first time since December 2018.
Moving to specific names, Texas Instruments, Inc.
is a well positioned large-cap semiconductor name. (Yield = 2.6%.)
As illustrated, the shares have reached record highs, clearing resistance matching the October peak. The former range top, circa 155, pivots to support.
Slightly more broadly, the breakout originates from trendline support roughly tracking the 50-day moving average. An intermediate-term target projects to the 170 area on follow-through.
Norfolk Southern Corp.
is a large-cap railroad operator coming to life. (Yield = 1.7%.)
Technically, the shares have started November with a bullish reversal, rising to challenge all-time highs. Recent persistence near the range top has been punctuated by Monday’s decisive follow-through.
Tactically, the breakout point (225.00) pivots to support. A posture higher signals a firmly-bullish bias.
Initially profiled April 24, Five9, Inc.
has returned 69.5% and remains well positioned.
Late last month, the shares knifed to record territory, rising after the company’s third-quarter results. The initial upturn has been punctuated by pronounced November follow-through.
Though near-term extended, and due to consolidate, the shares are attractive on a pullback. Tactically, the breakout point (156.40) is followed by gap support (152.12).
is a large-cap social media name and the parent company of Snapchat.
As illustrated, the shares have recently gapped to record highs, rising after the company’s quarterly results. The subsequent pullback has been flat, and punctuated by stronger-volume follow-through.
Tactically, the breakout point (43.60) is followed by the post-breakout low (38.67). A sustained posture higher signals a firmly-bullish longer-term bias.
Finally, Flex, Inc.
is a large-cap Singapore-based contract manufacturer.
The shares initially spiked three weeks ago, rising amid speculation that the company may sell its solar-tracking hardware business. (Technology that helps solar panels track the sun.)
The shares also gapped higher after the company’s quarterly results, released Oct. 29.
More broadly, the shares are well positioned on the three-year chart, rising from a massive double bottom. Tactically, a near-term floor rests in the 15.00-to-15.20 area, matching the former range top.
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|
|Materials Select Sector SPDR||XLB||Nov. 6|
|Communications Services Select Sector SPDR||XLC||Nov. 5|
|Health Care Select Sector SPDR||XLV||Nov. 5|
|Alphabet, Inc.||GOOGL||Nov. 5|
|Uber Technologies, Inc.||UBER||Nov. 5|
|Arena Pharmaceuticals, Inc.||ARNA||Nov. 5|
|SPDR S&P Biotech ETF||XBI||Nov. 4|
|Keysight Technologies, Inc.||KEYS||Nov. 4|
|Harley-Davidson, Inc.||HOG||Nov. 4|
|Garmin, Ltd.||GRMN||Nov. 4|
|Pinterest, Inc.||PINS||Nov. 3|
|Sony Corp.||SNE||Nov. 3|
|8×8, Inc.||EGHT||Nov. 3|
|Exact Sciences Corp.||EXAS||Nov. 2|
|Universal Display Corp.||OLED||Nov. 2|
|Logitech International S.A.||LOGI||Oct. 27|
|Dentsply Sirona, Inc.||XRAY||Oct. 27|
|Maxim Integrated Products, Inc.||MXIM||Oct. 21|
|Jazz Pharmaceuticals, plc||JAZZ||Oct. 21|
|The Travelers Companies, Inc.||TRV||Oct. 21|
|Micron Technology, Inc.||MU||Oct. 20|
|Vulcan Materials Co.||VMC||Oct. 19|
|Utilities Select Sector SPDR||XLU||Oct. 19|
|ON Semiconductor Corp.||ON||Oct. 16|
|Ford Motor Co.||F||Oct. 15|
|Texas Instruments, Inc.||TXN||Oct. 15|
|Skyworks Solutions, Inc.||SWKS||Oct. 14|
|First Solar, Inc.||FSLR||Oct. 13|
|Nevro Corp.||NVRO||Oct. 12|
|Teradyne, Inc.||TER||Oct. 12|
|SPDR S&P Homebuilders ETF||XHB||Oct. 9|
|Shake Shack, Inc.||SHAK||Oct. 9|
|SPDR S&P Biotech ETF||XBI||Oct. 8|
|Alexion Pharmaceuticals, Inc.||ALXN||Oct. 8|
|Twilio, Inc.||TWLO||Oct. 8|
|Cloudflare, Inc.||NET||Oct. 7|
|Ceridian HCM Holding, Inc.||CDAY||Oct. 7|
|Gap, Inc.||GPS||Oct. 6|
|Motorola Solutions, Inc.||MSI||Oct. 6|
|RSailPoint Technology Holdings, Inc.||SAIL||Oct. 1|
|Martin Marietta Materials, Inc.||MLM||Sept. 30|
|Whirlpool Corp.||WHR||Sept. 29|
|Abercrombie & Fitch Co.||ANF||Sept. 29|
|Blueprint Medicines Co.||BPMC||Sept. 28|
|Zendesk, Inc.||ZEN||Sept. 23|
|Datadog, Inc.||DDOG||Sept. 23|
|Scientific Games Corp.||SGMS||Sept. 23|
|Maxar Technologies, Inc.||MAXR||Sept. 18|
|Crocs, Inc.||CROX||Sept. 14|
|Five Below, Inc.||FIVE||Sept. 10|
|Eastman Chemical Co.||EMN||Sept. 10|
|International Paper Co.||IP||Sept. 3|
|Anaplan, Inc.||PLAN||Sept. 2|
|Celanese Corp.||CE||Aug. 26|
|Westlake Chemical Corp.||WLK||Aug. 25|
|Deere & Co.||DE||Aug. 24|
|Expedia Group, Inc.||EXPE||Aug. 24|
|Johnson Controls International||JCI||Aug. 21|
|Canadian Solar, Inc.||CSIQ||Aug. 20|
|General Motors Co.||GM||Aug. 20|
|Starbucks Corp.||SBUX||Aug. 18|
|Builders FirstSource, Inc.||BLDR||Aug. 18|
|Steel Dynamics, Inc.||STLD||Aug. 17|
|Elanco Animal Health, Inc.||ELAN||Aug. 17|
|Brinker International, Inc.||EAT||Aug. 13|
|Enphase Energy, Inc.||ENPH||Aug. 13|
|Nucor Corp.||NUE||Aug. 11|
|Freeport McMoRan, Inc.||FCX||Aug. 10|
|Natera, Inc.||NTRA||Aug. 10|
|McDonald’s Corp.||MCD||Aug. 7|
|Industrial Select Sector SPDR||XLI||Aug. 6|
|Penn National Gaming, Inc.||PENN||July 30|
|Procter & Gamble Co.||PG||July 29|
|SPDR S&P Metals & Mining ETF||XME||July 28|
|iShares MSCI South Korea ETF||EWY||July 28|
|Advanced Micro Devices, Inc.||AMD||July 23|
|Best Buy Co., Inc.||BBY||July 22|
|Materials Select Sector SPDR||XLB||July 20|
|Caterpillar, Inc.||CAT||July 20|
|Progressive Corp.||PGR||July 17|
|Livongo Health, Inc.||LVGO||July 17|
|Roku, Inc.||ROKU||July 16|
|Cognizant Technology Solutions, Inc.||CTSH||July 16|
|Costco Wholesale Corp.||COST||July 15|
|Consumer Discretionary Select Sector SPDR||XLY||July 13|
|SunPower Corp.||SPWR||July 13|
|Walmart, Inc.||WMT||July 8|
|Big Lots, Inc.||BIG||July 1|
|Tandem Diabetes Care, Inc.||TNDM||July 1|
|Danaher Corp.||DHR||June 24|
|Fiverr International, Ltd.||FVRR||June 19|
|Etsy, Inc.||ETSY||June 17|
|HubSpot, Inc.||HUBS||June 8|
|Square, Inc.||SQ||June 8|
|FedEx Corp.||FDX||June 3|
|SPDR S&P Retail ETF||XRT||June 3|
|iShares MSCI Japan ETF||EWJ||May 29|
|Synopsis, Inc.||SNPS||May 27|
|Agilent Technologies, Inc.||A||May 15|
|Qualcomm, Inc.||QCOM||May 12|
|Facebook, Inc.||FB||May 7|
|Dollar General Corp.||DG||Apr. 28|
|ServiceNow, Inc.||NOW||Apr. 27|
|Five9, Inc.||FIVN||Apr. 24|
|Chewy, Inc.||CHWY||Apr. 24|
|Tesla, Inc.||TSLA||Apr. 23|
|VanEck Vectors Semiconductor ETF||SMH||Apr. 17|
|Veeva Systems, Inc.||VEEV||Apr. 17|
|Okta, Inc.||OKTA||Apr. 16|
|Target Corp.||TGT||Apr. 16|
|Invesco QQQ Trust||QQQ||Apr. 14|
|Zscaler, Inc.||ZS||Apr. 3|
|Apple, Inc.||AAPL||Mar. 27|
|Nvidia Corp.||NVDA||Mar. 27|
|Zoom Video Communications, Inc.||ZM||Mar. 19|
|iShares MSCI Emerging Markets ETF||EEM||Mar. 19|
|SPDR Gold Shares ETF||GLD||Jan. 2|
|Microsoft Corp.||MSFT||Feb. 22|
|* Click each symbol for current chart.|
View more information: https://www.marketwatch.com/story/bullish-momentum-accelerates-sp-500-extends-to-uncharted-territory-2020-11-09