Dow Jones Industrial Average Looks To End Month, Quarter On A High Note

Market technician Dave Chojnacki of StreetOne Technical Analysis wraps up the trading week, month, and quarter with a deep dive into the underlying technicals for the major U.S. averages.

GDP and Employment Claims came in slightly lower than expected on Thursday, but investors continued to have Trade on their minds.  The major indices have been very choppy the last few days, and yesterday was no different. Techs, which have been weak lately, had a fairly good day, pushing the Nasdaq 100 (NDX) to be the strongest in the session.  AMZN, which announced its purchase of Pillpac, had a strong session, moving up nearly 2.5%, helping to add to the NDX. Crude oil continues to move higher and ended the day at 73.28.

The Dow Jones Industrial Average (DJIA) was the worst performer in the session and has been the weakest index over the last two weeks.   The NDX ended the day with a significant gain, and the DJIA and S&P 500 (SPX) with moderate gains.

At the close, the DJIA was up 0.41%, the SPX added 0.62%, and the NDX gained 0.89%.  Breadth was positive, 1.5 to 1, on below average volume. ROC(10)’s were mixed with the DJIA and SPX advancing and remaining in negative territory.  The NDX declined in the session and continues in negative territory. RSI’s moved higher, with the NDX continuing to be the strongest at 46. The DJIA ended at 37.5, and the SPX finishing at 43.6.  MACD’s remain below signal for all three major indices. The ARMS index ended the day at 0.83, a slightly bullish reading.

It was another choppy session, with the major averages trading around their moving averages.  The DJIA continues to have the weakest technicals. It closed at 24216, remaining below its 200D-SMA of 24313.  Its 50D-SMA sits at 24627. It seemed to find support on Thursday at the 24000.

The NDX had the best session, closing at 7031, above its 50D-SMA of 6952.  It found support in the session right near its 50D-SMA. It remains below its 20D-SMA of 7165. The SPX closed at 2716, right at its 50D-SMA. It traded as low as 2691, above its 200D-SMA of 2667.  It continues below its 50% retrace level of 2726. The VIX fell 5.9% to 16.85.

Near term support for the NDX is at 7000 and 6952. Near term resistance is at 7165 and 7200. Near term support for the SPX is at 2712 and 2700.  Near term critical resistance is at 2726 and 2750.

Europe is significantly higher in early trade Friday, and U.S. Futures are pointing higher in the premarket. Major economic reports on tap today include Durable Goods at 8:30am and Pending Home Sales at 10:00am.

The SPDR Dow Jones Industrial Average ETF (DIA) rose $1.10 (+0.45%) in premarket trading Friday. Year-to-date, DIA has declined -1.33%, versus a 1.92% rise in the benchmark S&P 500 index during the same period.

DIA currently has an ETF Daily News SMART Grade of A (Strong Buy), and is ranked #3 of 81 ETFs in the Large Cap Value ETFs category.

Disclaimer: The content of this article is excerpted from a daily newsletter from Street One Financial. While ETF Daily News may edit the contents and add a relevant title to the piece, the author, David Chojnacki, does not endorse or recommend any issuer or security mentioned herein.

About the Author: Dave Chojnacki

Dave Chojnacki is the Chief Market Technician at StreetOne Technical Analysis. In addition, he is Portfolio Manager for Sabretooth Advisors.

Dave develops a morning newsletter providing clients a daily look at market technicals of the major indices and selected ETF’s. Market trends, support and resistance levels are provided in the daily letter. The Technical portion of the daily can also be found on Seeking Alpha. Mr. Chojnacki has been quoted in a number of industry publications including the Reuters, ETF Trends, Minyanville, Yahoo Financial and Investors.Com.

Prior to joining StreetOne Technical Analysis, Dave designed and developed I/T Systems for the Insurance and Financial Industries.

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