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 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
- 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:
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