A prepared trader is a profitable trader, and Sunday is a great day to get ready for the week ahead by studying up from last week’s price action. This weekend, we take a look at the markets into the final days of October to see if November will bring any relief for the financial markets. To get a full week-by-week analysis of the broad markets in October, check out our blog posts here.
$SPY: Daily Candle
- A huge doji closed on Friday right on the channel support which happened at the bottom of the February selloff.
- Positive divergence is still holding RSI vs. the daily candle.
- The MACD is lower than it was in February’s selloff. It looks as if it is trying to find a bottom to start curling back up.
- The daily Williams %R continues to also be oversold along with the weekly (dotted line) but is showing signs of a possible reversal.
$SPY: Weekly Candle
- The weekly candle started to break down through long-term trendline support here with the next area of support shown by the black line below.
- The RSI has not been this oversold since 2016 and is showing signs of a potential bottom based on past setups. However, technicals can very much go out the window during times like these with midterm elections coming up.
- The MACD continues to move down and will likely be the last indicator to confirm a reversal with the fast crossing the slow to the upside.
- The %R is incredibly oversold here with this area showing reversals in the past.
$QQQ: Daily Candle
- $QQQ continued to break down this week to the next area of support shown by the black trendline.
- Positive divergence is forming with price vs. the RSI with a potential technical bottom forming.
- The MACD continues to be more oversold than it has been in 2 years but is showing signs of a possible bottom with the fast converging towards the slow.
- Positive divergence is also forming on the %R which confirmed the bottom back in March.
$QQQ: Weekly Candle
- The weekly candle for the $QQQ ETF is holding at the green trendline support with a strong red candle close showing sellers were in control all week.
- The RSI is nearing extremely oversold levels not seen since 2016.
- The MACD continues to move down and will likely be the confirming indicator and last to signal a bottom.
- The %R is looking similar to the RSI with more oversold levels than the last two selloffs this year.
$XBI: Daily Candle
- After another big move down last week, the price is attempting to find a short-term bottom at the black trendline support.
- The RSI is showing positive divergence with price action over the last couple of weeks.
- The MACD is attempting another curl to the upside after a false move the prior week.
- The %R has false signaled and has not been much of a help predicting the bottom lately. Sometimes when panic ensues, this indicator becomes irrelevant.
$XBI: Weekly Candle
- The weekly candle for $XBI shows a breakdown of the green trendline support we were watching last week. The long tail of the weekly candle shows buyers tried to make a comeback into the end of the weekly trading session.
- As with all charts this weekend, the RSI is very oversold with levels not seen since January 2016.
- The MACD continues to move down below the zero line (this is the line the histogram is based on and moves around).
- The %R is showing signs of positive divergence with a red candle for the weekly close but an uptick in the %R at a higher low shown by the upward sloping pink line.
Before and After: $AKER
In this weekend’s “Before and After”, we take a look at $AKER Biosciences which was trading in a very defined symmetrical wedge found by our automated trendline detection platform. Some trendlines have been hidden to highlight the wedge setup. To learn more about wedge formations, click here to read our blog post!
- The price had recently bounced off the EMA (50) acting as support and was moving up quickly towards the wedge resistance above shown by the green trendline.
- The hourly RSI (solid line) crossed through the daily RSI (dotted line) showing momentum starting to pick up.
- The fast (blue line) bounced off the slow (yellow line) after looking like a possible breakdown was on the way.
- The green trendline above acted as perfect resistance above after the price continued to roar up with increasing volume.
- The daily RSI continued to move up but bounced down right before entering overbought levels.
- The MACD also continued to spike up but began to curl to the downside.
Timestamps from this week: