Some thought a Santa Clause rally was in the works after the G20 summit briefly raised hopes of less volatility into the rest of the year. However, that quickly came to a screeching halt as the weekly candles failed to break through key moving averages above. This weekend's analysis focuses on the daily price action with the weekly Keltner Channels overlaid on the daily price chart.
SPY: Daily vs. Weekly
The SPY tested wedge resistance perfectly on Monday after the G20 summit trade war news with a huge hanging man that formed on the daily candle right above the SMA (20). The weekly Keltner channel lower band is coinciding strongly with the channel support below. An alert is set for a test of this area below next week if the price continues to move down. The RSI on the daily chart is also showing a breakdown of the weekly RSI which has backtested with more downside in the past. The weekly candle is showing a massive bearish engulfing candle with a test of long-term channel support once again. A breakdown through this key level could create panic among technical traders and investors. Click here for the video analysis.
QQQ: Daily vs. Weekly
The daily price of QQQ is trading right in the middle of the of the weekly Keltner channel between the lower and middle band. This middle band has created a trendline as price respects the longer-term indicator level. The weekly candle is showing a potentially huge head and shoulders formation with a massive bearish engulfing candle into next week. The RSI on the weekly candle is showing extremely oversold levels. Click here for the video analysis.
XBI: Daily vs. Weekly
Biotech looks very similar to the QQQ on the daily chart with a potential retest of the lower Keltner band. The weekly candle is the one that is most intriguing here as the bullish thesis may be tested if price begins to break down through this channel support after the bearish engulfing candle last week. The weekly MACD is attempting to curl here but there have been fakeouts in the past. Notice the SMA (20) also nearing a cross down through the EMA (50). Click here for the video analysis.
NOTE TO READERS: All charts posted in this article are from the TrendSpider automated technical analysis platform and have been annotated outside of the platform. These are simply our views of the current technical landscape of the stock market and should not be taken as trading or investment advice. To watch the video analysis of these tickers in the weekend blog post, please click here.