SPX, NDX, FAZ, VXX Among Our Charts to Watch
by Harry Boxer, www.TheTechTrader.com
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We’re going to review some of the ultra-shorts as well as take a look at the S&P 500 and the Nasdaq 100 to see where we are at this critical point in a time.
The S&P 500 chart shows a massive head-and-shoulder top that’s formed over the last eight month. The last rally failed right at the declining topsline and 50-day moving average, rolled over hard, accelerating today d,own 3.11% or 33.42 on the SPX alone to 1041 with a low at 1035. That area is right at the low that it reached in May and early June, also going back to last year as well. So, there’s a massive neckline on a head-and-shoulder pattern at this point. Any further downside damage, and it could easily slip down under 1000 to the 989-90 zone, even 970 short-term. Outside that, possibly, a quick hit down to 950, if it really accelerates.
The Nasdaq 100 also has a similar pattern, more of an up-slopping neckline, that was broken today. The NDX dropped 71.23, or 3.88%, to 1764.77. It’s taken out the three lows in May and early June, and after the big rally failed at the declining 50-day moving average, it’s rolled over pretty hard. The parallel price channel appears to be at an angle down around the 1700 zone. There is some support up around 1710-15 area, but it could see a very quick hit down to that area in the next few days.
The Direxion Daily Financial Bear 3X Shares (FAZ) also appears to be potentially basing. The triple top up around 18 may be tested as early as tomorrow. If that is the case and it breaks out on heavy volume, you could see it run up to the 20 area, and then as high as 22 1/2 – 23.
The IPath S&P 500 VIX Short-Term Futures ETN (VXX), one of my favorites, had a huge move in April and May. I anticipate another move like that could take place if the stock breaks out here. The stock gained 2.60, or 9.23%, on 35 million shares today. It looks like acceleration is taking place. Target is 35-36 zone, which if taken should lead to something up around 40.
Other stocks highlighted tonight are Apple Inc. (AAPL), Amazon.com Inc. (AMZN), Google Inc. (GOOG), Goldman Sachs (GS), Mastercard Incorporated (MA), Research In Motion Ltd. (RIMM), Direxion Daily Large Cap Bear 3X Shares (BGZ), Direxion Daily Emrg Mkts Bear 3X Shares (EDZ), Direxion Daily Technology Bear 3X Shares (TYP).
