Since December 26th 2018 the boom in Software sector has been fantastic. The software sector and industry groups have been fantastic so far.
Let’s look at the following chart.
So till wednesday it grew around 32 % !
they have been sell offs on March 4th and March 22nd and then yesterday April 4th 2019. But yesterday’s sell off was different.
On March 4th and 22nd there was market wide sell off. But yesterday there was just unloading of the top performing software stocks by Institutions for other pastures.!
lets look at 3 months performance of the sectors
Information technology sector – went up 28.3% in three months – the next nearest one Industrials was about 6 % points below it. The sector went down by 0.44 %. an insignificant amount.
look at yesterday’s performance of Industry groups within Information technology Sector
So all is well so far when it comes to non Computer sector/Software sector
i am still long on TQQQ and NQM19
IBD 50 index is an index of 50 top performing growth stocks in the world with high spectacular momentum and top line (top 1%) of fundamentals.
As the market is picking up steam growth stocks lead it – and IBD 50 Index has been picking up. it just cleared its 200 days SMA and has been going up steadily last 3 days.
One positive yesterday is the OBV for TQQQ
Look at the chart below
the OBV is approaching very close to the the march 2019 high – and this is just 1st day of trading for 2nd quarter of 2019 !
I am long on NQ and TQQQ!
happy trading !
happy traveling also !
wow travelers and traders, wow. what a 1st calendar year quarter it has been!
Major stock indexes closed out the first quarter with good gains Friday, capping a strong quarter that saw the Nasdaq composite rise 16.5%. The S&P rose 13.1% in the first quarter, its best quarterly performance since the third quarter of 2009. (source : IBD)
IBD says this “While the market remains under pressure and investors must remain cautious, the market showed some improvement the past few days. Indexes closed near the week’s highs, and some buying is reappearing.”
That is a good sign!
Back in October 9th 2018 NASDAQ closed at 7738. The next day, 10/10/2018, which was a Wednesday, the floor fell of and NASDAQ dropped 316 points and then it fell 1550 points till December 24th 2018 !
last friday the market closed at 7730. So we are right there. Now at this current time about 2 am EST, the futures are up 76 points or little more than 1 %. It appears we are going to start off the week with a bang!
last week from the above table industrials, materials and Consumer discretionary have taken a lead. which is good because the participation is very broad in this market rally!
Look at the table below for 3 months sectors performance
everything except financials are closing at the top in the first quarter of 2019!
the information technology sector is on the tear. IBD’s enterprise software group rallied 31% in Q1, easily outperforming the major stock indexes
iShares Expanded Tech-Software Sector ETF (IGV)n grew by 30 %. TQQQ triple NASDAQ-100 grew by 72%.
I’m planning on getting back into the market on the first day of trading this week.
If we look at the below chart we see the problem in the 2 and 1/2 month rally started in the first half hour on Friday March 22nd 2019., You see with
the volume for 9:30 am half hour was about 3 times the average 50 Half hours volume.
TQQQ went down by -2.1 % compared to the previous days close !! that is – $ 1.25. i would have saved considerably money if i exited then. But alas, I did not.
Moreover look at the average trading range for 50 half hour periods. It is around 0.61. it lost double that during first half hour! Next on 3/25 Monday the volume grew even more to 5+ million and the price drop was close to 1 dollar!
Now look at the daily chart for TQQQ
3 fantastic high volume declines in last 4 sessions!!
IBD says this “The market outlook was lowered a notch to uptrend under pressure last Friday, when the Nasdaq composite plunged 2.5% in higher volume. With the market uptrend under pressure, it’s perfectly fine to take some profits in some top performers, especially if a stock has rallied 20% or more after a breakout from a base.”
high volume selling or severe stalling is 6 on NASDAQ and 7 on S&P 500 in the last 25 sessions.
Happy waiting !!
last 2 -3 days were very interesting. Yesterday S&P 500 dropped by 0.3 % but the number of S&P 500 stocks above their 50 days Simple Moving average (SMA). Last 5 trading days it dropped by around 9 points. Nothing serious but makes me cautious.
Russell 2000 closed below its 10 days SMA. It’s finding a touch resistance at 200 days SMA.
Let’s look at Heikin-Ashi chart for S&P 500 Stocks Above 50-Day Average ($S5FI)
not good look – the number of stocks in S&P 500 are losing momentum and are falling below their 50 days SMA. about 21 percentage points from march 1st 2019.
It’s in an amazing trend – not only there has been higher volume price increase in QQQ yesterday but volume increase was 50 percent above average!
lets look at 5 mins chart for NASDAQ composite
just up and down and lots of volatility but the most important point is that the closing price of the day. Which is the most important price – its been going up since Friday of March 8th 2019 except for one day on 3/14/2019, which is last Thursday.
for the 3rd day in a row TQQQ closed above the 200 days SMA!
The only thing little bothersome is Russell 2000 has been falling in the last chart which is the ETF with volume
all the FAANG stocks are up – wonderfully yesterday. Netflix was a bumper. It went up 4.5%, up 16 + dollars !!!
So what is the conclusion? Price is the only true north star and it is up so I am long NQM19 and TQQQ.
TQQQ just crossed its 200 days Simple Moving Average on Tuesday’s trade. It crossed it in Higher Volume of 20 million. It’s average 50 days Volume is 18 million.
ProShares UltraPro QQQ seeks daily investment results, before fees and expenses, that correspond to three times (3x) the daily performance of the Nasdaq-100 Index.
From the above picture it gained around 72 % in the last 3 months or so
Below is QQQ reflecting 1:1 for NASDAQ 100. look at the On Balance Volume. It is fantastic with no divergence.
IBD says this “The overall action points to a generally healthy climate for stock pickers.
In IBD Leaderboard on Tuesday, as many as seven companies rallied 0.5% or higher, easily outrunning the major indexes. They include Zscaler (ZS), which has thrust more than 40% past a prime buy point of 48.34. Diabetes play Dexcom (DXCM), Euronet Worldwide (EEFT) and Chipotle Mexican Grill (CMG) also rose nicely.”
One cloud in the silver lining – It continues “The Nasdaq composite wasted an early advance of nearly 0.7% to finish with a 0.1% gain. It closed well within the lower half of Tuesday’s intraday range. Volume rose vs. the prior session. The price-and-volume action pointed to stalling, a form of distribution in which large fund managers sell heavily into market strength.
The stalling day raised the Nasdaq’s distribution count back to five over the past 25 trading sessions. On March 13, the Nasdaq shaved off a Feb. 7 distribution day to its recent strong advance.
Four other instances of unusually strong profit-taking have taken place a lot more recently: Feb. 28 (down 0.3%), March 4 (-0.2%), March 6 (-0.9%) and March 7 (-1.1%).”
It has been 7 days of fantastic run after the bad week of Monday March 4th – Friday March 8th
Currently I’m Long on NQ and TQQQ
the top 5 sectors closed at the week’s highs. IWM – Russell 2000 ETF after last weeks red candle and down week has been picking up and again this week might test the 50 days Simple moving average (SMA).
according to IBD “The Nasdaq sprinted 0.8%, leading the market largely on strength in semiconductor stocks. The S&P 500 and Dow Jones Industrial Average each added 0.5%. The small-cap Russell 2000 rose nearly 0.3%. Volume rose sharply due to the simultaneous expiration of options and futures.”
IBD continues “During the week, leadership was broadly based. A dozen and a half groups scored weekly gains of 5% or better, according to preliminary data. They included medical stocks, retail, tobacco, semiconductors, computers, oil and transportation ships.
Note the variety: This is not a narrowly based uptrend, and that’s good news. Bulls prefer diversified leadership because it protects the indexes against one-off outcomes.
The S&P 500 index and Nasdaq composite recouped the prior week’s losses and hit their best levels of the current stock market rally, climbing 2.9% and 3.8%, respectively, for the week.”
Overall the market is in good health. Small caps are rising, and most importantly growth stocks are behaving extremely well.