iShares MSCI USA Momentum Factor Fund (MTUM) Looks like a bottom is in, but need to wait for the 200 DMA to be lower than the share price. Take a look at the iShares MSCI USA Momentum Factor Fund (MTUM). This fund tracks an index of large- and mid-cap U.S. stocks that show relatively higher price momentum. Right now, it's telling me the downtrend in stocks is intact... The black dashed lines from the highs mark the series of lower lows and lower highs. Yes, in late March, this fund broke the downtrend. But this was a false breakout... and really, it was a trap for bulls. After that failed rally, MTUM made a new low earlier this month. Also note that MTUM couldn't muster up enough energy to rally above the important 200-day moving average (200-DMA) in red. This was a warning of continued weakness. So, using trend-line analysis on this fund gave us a bearish signal. But as I often tell my subscribers, you can't just look at one market, like the S&P 500 Index, and ...
t’s one of the oldest pearls of wisdom on Wall Street, and for good reason. You see, often the sectors that have been bloodied the most one year are the ones that come back the strongest the next year. So, with this bloody notion in mind, I present to you the Communication Services Select Sector SPDR (NYSEARCA: XLC) . XLC tracks a market-cap-weighted index of US telecommunication and media & entertainment components of the S&P 500 index. The Communication Services Select Sector SPDR Fund seeks to provide investment results that, before expenses, correspond generally to the price and yield performance of the Communication Services Select Sector Index. It seeks to provide an effective representation of the communication services sector of the S&P 500 Index and to provide precise exposure to companies from telecommunication services, media, entertainment and interactive media and services. It also allows investors to take strategic or tactical positi...
iShares Russell 2000 Fund (IWM) Look like we will have lower low or a test of a trend line. Not yet a buy and hold. Let's compare the MTUM chart above with another favorite of mine, the iShares Russell 2000 Fund (IWM). This fund is a way to track U.S. small-cap stocks... From the high, I used three trend lines instead of two. You can measure from the absolute high and important swing highs as the market trends lower. If you follow the trends down, you'll see how the bottom two trend lines marked important swing highs for IWM. The takeaway is that you shouldn't just rely on one trend line – you have to use several to get a better idea of where resistance will be within a downtrend. Like MTUM, IWM is in a downtrend that's marked by lower highs... It made a lower low last week and is still below its 200-DMA.
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