Swing Trading Markets Analysis: SPY Near Breakout #wk26

Here is the swing trading markets analysis for this week #26 ending August 30th 2024 (the end of the month) which saw equities trading slightly higher with SPY near breakout and Gold, Oil, Bitcoin retreating slightly.

Last week’s swing trading markets analysis  saw markets holding rebounds with strong closes to the trading week and gains across the Nasdaq 100 (QQQ), S&P 500 (SPY), Russell 2000 (IWM) holding above key moving averages.

SPY – S&P 500

The S&P 500 stock market index tracks the stock performance of 500 of the largest companies listed on stock exchanges in the United States. It includes approximately 80% of the total market capitalization of public companies in the United States.

This Week: the S&P 500 rose by 0.05%

Last Week: the S&P 500 rose by 1.34%

Moving Averages: the S&P 500 10-day ema and 21-day ema are both above the 50-day moving average as of the close of week. All moving averages are trending higher.

Overall / Current Trend: overall up, in the short term the S&P 500 close the week with a high WCR just under the line of resistance

Next week: I expect the S&P 500 to edge higher and peek through the line of resistance given the strong close to the week and strong volume.

QQQ – Nasdaq 100

The Nasdaq 100 is a stock market index made up of 101 equity securities issued by 100 of the largest non-financial companies listed on the Nasdaq stock exchange. It is a modified capitalization-weighted index, meaning the stocks’ weights in the index are based on their market capitalizations with certain rules capping the influence of the largest components. So price fluctuations in companies like Alphabet, Apple, Tesla, Nvidia directly affect the Nasdaq 100 day to day.

This Week: the Nasdaq 100 fell by 0.71%

Last Week: the Nasdaq 100 rose by 1.04%

Moving Averages: the Nasdaq 100 is above its 50-day, 10-day ema and 21-day ema. The 10-day ema is above the the 21-day ema, and both are trending up toward the 50-day. The 10-day ema is just below the 21-day ema.

Overall / Current Trend: overall up, the QQQ is moving along its long term trendline

Next week: I expect the QQQ to slightly lower overall in-line with its long term trendline

IXF – Nasdaq 100 Financial

The Nasdaq Financial-100 is a stock market index operated by Nasdaq consisting of companies that are listed on the Nasdaq stock exchange, that are in the financial services industry, including banking, insurance, mortgages and securities trading.

This Week: the Nasdaq Financials rose by 0.33%

Last Week: the Nasdaq Financials rose by 2.42%

Moving Averages: the Nasdaq Financials 10-day ema and 21-day ema both remain above the 50-day, with the 10-day above the 21-day

Overall / Current Trend: overall up, strong close even higher above the previous base pivot

Next week: I expect the financials to form a handle here given the strong run straight up in early August

IWM – iShares Russell 2000 ETF

The Russell 2000 Index is a small-cap U.S. stock market index that makes up the smallest 2,000 stocks in the Russell 3000 Index. The index is a widely quoted measure of the overall performance of small-cap to mid-cap company shares. It is commonly considered an indicator of the U.S. economy due to its focus on small-cap companies in the U.S. market.

This Week: the Russell 2000 fell by 0.93%

Last Week: the Russell 2000 rose by 3.44%

Moving Averages: the Russell is above all key moving averages, its 10-day ema has moved above its 21-day ema and slightly diverging

Overall / Current Trend: the Russell 2000 remains in a long term (although shallower) uptrend

Next week: I expect the Russell 2000 to trade higher given it has re-cleared the 220 level, moving averages are stacked the right way, diverging and the Russell is moving up along its support line.

Unlike the Nasdaq bullish run, the Russell 2000 has traded within a range since April 2022. Key previous resistance points to keep an eye on are around around the 211 and 227 and 242 marks. A lot of the money in the market has been driving the large caps higher over the years leaving the Russell 2000 to underperform. In the bigger picture the Russell 2000 has re-cleared the $220 level.

XIU – iShares S&P/TSX 60 Index ETF

XIU is a liquid ETF that tracks the TSX 60 Index, which consists of the top 60 companies in Canada and has a large-cap focus.

This Week: the Canadian S&P/TSX fell by 0.84%

Last Week: the Canadian S&P/TSX rose by 0.68%

Moving Averages: the Canadian S&P/TSX remains above all key moving averages, with the 10-day ema above the 21-day ema above the 50-day

Overall / Current Trend: in a long term uptrend since October 2023, the Canadian market has moved to near new highs after a quick rise starting in early October followed by a short flat base

Next week: I expect the Canadian market to trade higher given the long basing period and recent moves higher

Looking at a slightly longer time horizon, we can see that the TSX has been trading sideways since April 2022 and has broken through the high / resistance level at $33.91 and remains trading above this previous resistance level.

GLD – SPDR Gold Shares ETF

GLD is a relatively cost efficient and secure way to access the gold market. SPDR Gold Shares is the largest physically backed gold exchange traded fund in the world.

Gold formed a long base since mid-2021 until early 2024. Gold ran up in 2024 and has since broken out of a short base.

This Week: Gold fell by 0.93%

Last Week: Gold rose by 0.81%

Moving Averages: Gold remains above all key moving averages with the 10-day ema above the 21-day ema above the 50-day

Overall / Current Trend: Gold has been in an overall up trend since 2024 and has cleared the previous base pivot of mid May

Next week: I expect gold to continue to trade higher following clearing the base pivot, however the slight close below the 10-day ema may mean more sideways trading before pushing higher

USO – United States Oil Fund ETF

USO’s investment objective is for the daily changes, in percentage terms, of its shares’ net asset value (NAV) to reflect the daily changes, in percentage terms, of the spot price of light sweet crude oil delivered to Cushing, Oklahoma, as measured by the daily changes in the Benchmark Oil Futures Contract. Specifically, USO seeks for the average daily percentage change in USO’s net asset value, for any period of 30 successive valuation days, to be within plus/minus 10% of the average daily percentage change in the price of the Benchmark Oil Futures Contract over the same period.

Looking at the longer term view, Oil is trading in a range and has formed higher lows and lower highs since late 2023

This week: oil fell by 4.79%

Last Week: oil rose by 0.94%

Moving Averages: Oil has moved below all moving averages

Overall / Current Trend: the long term trend of Oil is higher lows and lower highs

Next week: I expect oil to trade around its 21-day ema given its higher lows and lower highs

GBTC – Grayscale Bitcoin Trust

Bitcoin is a digital asset that is created and transmitted through the operations of the peer-to-peer Bitcoin Network, a decentralized network of computers that operates on cryptographic protocols. The Bitcoin Network allows people to exchange tokens of value, Bitcoins, which are recorded on a public transaction ledger known as a Blockchain.

The Grayscale Bitcoin Trust is one of the first securities solely and passively invested in Bitcoin (“BTC”) that enables investors to gain exposure to BTC in the form of a security while avoiding the challenges of buying, storing, and safekeeping BTC, directly.

Bitcoin is in a long term uptrend which became extended during the March to April 2024 period however has since reverted back to the overall trendline, and fallen through support.

This week: Bitcoin fell by 8.14%

Last Week: Bitcoin rose by 8.32%

Moving Averages: Bitcoin has moved below all moving averages

Overall / Current Trend: overall long term trend up, in a basing period making lower highs and lower lows

Next week: I expect Bitcoin to trade lower given its break below all moving averages (including the 200-day) and low WCR.

TLT – iShares 20+ Year Treasury Bond ETF

The iShares 20+ Year Treasury Bond ETF seeks to track the investment results of an index composed of U.S. Treasury bonds with remaining maturities greater than twenty years. The TLT portfolio’s effective duration is 16.5 years. So, if interest rates fall by 1.0%, TLT’s price could rise by 16.5%.

This Week: TLT fell by 2.21%

Last Week: TLT rose by 1.00%

Moving Averages: TLT has moved clear below its 10-day ema and 21-day ema

Overall / Current Trend: the longer term view is that TLT is in an uptrend as shown by rising bottoms, TLT has moved higher on the continued anticipation that rate cuts will materialize later this calendar year.  

Next Week: I expect TLT to trade slightly lower given the break of the 21-day ema, but I expect TLT to trade around its 21-day ema overall

Swing Trading Market Summary – SPY Near Breakout