Weekly Chart Update 12/1/13

DXY continues to flag after an igniting candle earlier in the month to retake support. Looks good for a long with a stop below this weeks low which coincides with 200 week EMA support.

USDJPY breakout continues as it looks to test prior highs. Rising short term EMAs providing immediate support, macro picture looks good here after it worked off its overbought conditions with some sideways action over the past six months.

GBPUSD bullish breakout off 8 week EMA support. 1.67 is next major target, looks good on a short term, intermediate and macro term basis.

EURUSD looking to retest the 1.37 area again after a false breakout. Short term EMAs continue to provide support after testing the prior wedge breakout at the 200 week EMA.

AUDUSD continues to break down after reaching the price target of .97 and the 50% fib retracement about six weeks ago. Doesn’t look all that compelling on the long side until we get some sort of reversal candle. Shorts can stay intact until price can break back above the short term falling EMAs.

SPY extended from its 8 week EMA and put in a star candle setting up for a possible evening star reversal. We saw some distribution this week toward the end of every session and it pushed price down due to the market being relatively thin on a holiday week. That being said, maybe its a sign to take a little risk off if we get some downside follow through next week, but the macro and intermediate picture continues to suggest higher prices.

IWM extended from its EMAs and bumping up against trend line resistance. Could be within a short term rising wedge as we’ve seen volume taper off a bit at new highs, but previous appearances of this pattern have been negated to the upside. Longer term trend continues to be higher as rising short term EMAs provide immediate support.

QQQ continues to plow through resistance after finding support at the 8 week EMA. Extended a bit as the RSI is nearing 80, but at this point price does not show any indication of changing trend just yet. Remains bullish above its short term EMAs.

DIA continues higher after breaking above a rising trend channel. Short term EMAs continue to provide support but this weeks candle suggesting some caution is necessary. Could possibly see an evening star reversal if we get downside follow through next week. Although caution is warranted, intermediate term and macro trend still has a bias to the upside.

IYT bumping against trend line resistance. Needs to consolidate at these levels before attempting to break to the upside. Volume continues to get lighter and lighter as we drift higher. Rising short term EMAs continue to provide support.

IYR looks like it wants to test the 200 week EMA again. This weeks low is on support, but price action looks heavy and falling short term EMAs continue to act as resistance.

XLU wants to retest support of its prior breakout but looks heavy at these levels. Range likely to remain range bound as rates trade in a relatively narrow range. R/R looks symmetrical here as major support is at the 100 week EMA and resistance is above at last months high.

XLB looking a bit tired here wanting to test the 8 week EMA. Major support is the 21 week EMA, but overall macro trend remains to the upside. Slight RSI divergence at new highs is a concern.

XLF continues higher after its breakout of an intermediate term bull flag. Closed on the lows last week as many of the banks are overbought and need some time to consolidate after a nice run in November.

XLE igniting bar after as it consolidates above the 8 week EMA. Need to see follow through for this candle to mean much, could see a retest of the breakout area around the 13 week EMA.

XLI long legged doji suggesting a possible change in trend from higher to neutral/lower. Looking for a test of the 8 week EMA as it has closed higher for 8 consecutive weeks. If we get downside follow through and fail a test of the 8 week we will most likely test a rising 21 week EMA which has been major support.

XLK continues to grind higher after negating a bearish rising wedge to the upside. Price target of the flag breakout has been met. Would like to see some consolidation but trend remains higher as the 8 week EMA continues to provide support.

XLV needs to consolidate at these levels after meeting the price target of the bull flag breakout. Look for some sideways action as the 8 week EMA catches up.

XLP looking to test the 8 week EMA as price feels heavy at these levels. Symmetrical triangle breakout has a price target of 45 in the intermediate term, but short term some consolidation is needed.

XLY continues to grind higher with the 8 week EMA providing support. Holiday sales numbers will play a big role in deciding whether or not this strength can continue.

XHB negating the head and shoulders formation with last weeks action as it failed an attempt to retake broken trend line support. Action looks decent as the short term EMAs provide support underneath.

XRT bull flag target reached, needs some sideways action here to allow the short term EMAs to catch up.

MDY continues to consolidate above a rising 8 week EMA. Ascending triangle breakout has a price target of 244. Remains bullish above rising short term EMAs.

SMH consolidating in a tight pattern setting up for an aggressive move. The trend being higher suggests the next move will be to the upside but look to play a breakout/breakdown out of this tight range.

IBB shooting star candle suggesting some possible downside as it is extended from its rising short term EMAs. Action remains bullish in the short term if it can consolidate above this weeks low. Shooting star candle needs downside confirmation through price and volume next week.

KRE breakout price target met as it plows through trend line resistance. Needs to consolidate at these levels to allow the short term EMAs to catch up. Could be setting up for a possible false breakout.

OIH continues to show some weakness after a bearish engulfing candle two weeks ago. Looking for it to bottom around the 21 week EMA but we could see a test of trend line support if the broader market shows some weakness. Some individual names in this space look good and may be worth a look going into next week.

PPA continues its parabolic move as the 8/13 week EMA provide support below. Shooting star candle needs downside follow through to confirm trend change. RSI at 80 but price action remains bullish. That being said I probably wouldn’t go out and put a new long on here until we get some consolidation.

GDX continues to drift lower and remains bearish until it can break above falling short term EMA resistance on heavy volume.

TNX looks to be putting in a head and shoulders topping formation inside of a longer term cup and handle accumulation pattern. A break below the neckline will result in a measured move down to 2%. Remains range bound until either the head and shoulders pattern or the cup and handle formation confirms.

TLT continues to hold above 102 support. Falling short term EMAs remain resistance.

JNK continues to melt higher as short term EMAs provide support. Needs to get over 40.84 for more momentum.

MUB flagging above the neckline of an inverse head and shoulders. Price action is stalled until we get some resolution in the 10 yr yield range.

GLD trying to put in a higher low of support as it holds falling trend line support. Last week’s action was constructive but we need a break above the short term falling EMAs to really get going.

SLV trying to reverse here after four weeks to the downside. Doesn’t look terribly compelling here for a long. As with its buddy gold, it needs to break above falling short term EMAs on heavy volume to get anyone excited.

USO trying to hold the prior breakout area of support but falling short term EMAs continue to act as resistance. Need to see how it handles that downside pressure in the coming week or two.

EEM bull flagging above support as it builds the handle of a possible cup and handle accumulation pattern. Need a break above falling trend line resistance to get going, but remains bullish above the 40.85 level.

FXI holding gap support real well as it looks to confirm its breakout of a 5 year symmetrical triangle. 8 week EMA and gap support below, price action remains bullish.

EWW sideways action continues. Not a lot to do here as I have no edge. Needs to retake trend line support on volume to get people interested.

FEZ looking to continue higher as it flags above rising short term EMAs. Above last week’s high, next target is 42.30-42.40.

EWJ grinding higher on the back of a weaker yen. Price action remains bullish above rising short term EMAs.

EWG bull flag price target met as it finds momentum off 8 week EMA support. Price action continues to remain bullish despite RSI creeping into overbought territory.

RSX false breakout as it failed at the 200 week EMA. Lower oil prices likely hitting this market overall. Daily chart looks more compelling for a long with stops below this weeks low. A break of this weeks low on volume will signal a short to fill the gap below and retest the neckline of the inverse head and shoulders breakout.

ECH trying to hold a higher low of support on the back of a positive RSI divergence but chart continues to look heavy. If long use a stop below this weeks low. Dragonfly doji/harami cross, however you want to describe this candle the implications are relatively simple. It is signaling a change of trend from lower to neutral/higher. Long against last week’s low.

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