Tuesday, April 19, 2016

The Week Ahead: Volatility (VXX), Biotechnology (XBI), Small Caps (IWM), and Semiconductors (SMH)

I'm very tired and haven't had a real day off in ten days so I'm just going to post some interesting charts. Things still appear very precariously positioned in the markets but I still have this sneaking suspicion that this is all just an intermediate pause as the markets will eventually turn higher again in a blow-off top (beautifully written about by NorthmanTrader.com in an article called "The Big Move"). Several stocks and index ETF's are putting in bearish ascending wedges at the moment so some of these should be taken advantage of.

Volatility: VXX
VXX had a shocking drop on Monday but then a bounce today off of the support line put in last year. A large bullish declining wedge is starting to go in and today looked like a good place to allocate capital on a reversal.
Small Cap: IWM
I haven't liked the look of it for a while but I made a bad call recently when IWM came up to the resistance line of the large red declining channel. Small Caps have continued to power on and after this small downturn I expect them to continue on (if the recent past is any guide).

Biotechnology: XBI
Biotechnology had a poor day today as it appear to be completing a bearish ascending wedge. A sell signal has also gone in on the RSI(5) indicating at least a near-term down wave.
Semiconductors: SMH
This was one of my better sell signals that I made a few weeks ago. The move down so far hasn't been significant and I do not expect it to go much further (indicated by my proposed upward channel) but several signals continue to stay in place such as the RSI(5) and TRIX(9,5). Additionally today Intel announced layoffs of 11% of their workforce.