XLK
Bearish harmonic pattern near 2K tech bubble levelsXLK has been one of the main forces behind the U.S stocks market rally since Trump was elected.
XLK is up almost 20% since the U.S elections and it is now approaching the 2K tech bubble levels.
Bearish Bat pattern will be complete just below 60$
Interesting price zone to watch in near future.
Are we near the end?
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“History never repeats itself but it rhymes,” Mark Twain.Monthly chart of Microsoft. Fib and price study. Draw your own conclusions.
XLK Synthetic StraddleTrade Setup:
- 1 XLK May 19 45/53/53/57 Synthetic Straddle @ 1.97.
DTE: 57
Max Win: $197
Max Loss: $603 (theoretically), but will manage at 2x credit, so ~$200.
Breakevens: $51.03 & $54.97
Trade Management: 25% profit; WIll risk full loser to upside and only 2x credit received to downside. I often will take off one of the sides when it becomes nearly worthless to reduce risk one of the directions.
Green is profit zone; Vertical black bar is expiration.
Long Term Sector RotationSPX vs Major Sectors. I added IBB to cover Biotech.
Please comment. My understanding at this point is to stay in sectors which have good fundamentals and have been relative laggards. The 3 bottom ones at this point seem to be Financials, Technology and XLU / XLP.
Since utilities is a risk-averse sector, so in a pro-growth environment I may want to go with the other 3. XLB is like the coyote / fox from Mickey mouse that runs a few meters off the cliff thinking its still running on solid ground before realizing that there's nothing below it and then falls like a rock. Great if you can time it right.
TWTR - Quick bargin price + new trend potential"Bargin price", after failed news and into supply zone + oversold zone. evidence of buyers and increased volatility, could be a quick one.
AKAM - New trend opportunityBuy the next succesfull reversal above the trading range for entering an early trend
What's propping up XLK: AAPL?Of the top three weighted holdings in XLK, only AAPL is up on higher prices.
Tech sector has a decision to make soonSeeing a lot of similar charts. Coiled with weakness over last few days but still holding onto longer uptrend.
MACRO VIEW: XLK IN UPTREND ON ALL FRONTSXLK - the SPDR Tech sector ETF s in firm uptrend both on macro and on micro perspective, and it is the best-looking US sector ETF from the SPDR range.
On long term perspective price has broken back into the 5 and 10 year uptrend, trading above upper first standard deviation from 5 and 10 year means respectively
On long term perspective price has recently broken out into the quarterly and 1-year uptrend, trading above upper first standard deviation from quarterly and 1-year means respectively
Looks bubblish? maybe, but it is OK to dance while the music plays!=)
XLK 42.78-neutral- Consolidates within a 3-week range XLK has been consolidating within a 3-week range between 42.97 (July 23, 2015 high) and 41.83 (August 7, 2015 low). An upside break above 42.97 would extend strength towards the 43.81 double top (as shown on the daily cahrt). However, a breakdown below 41.83 (near the 200 day moving average) would suggest near-term topping and weaken towards the 7-month range low at 40.79 (July 9, 2015 low).
Outlook:
Short term: neutral
Long term: bullish
Microsoft long to close the gap.$MSFT Long $42.75 with a wide stop. Target $46 - 48 zone. Once in the gap I'll move my staggered stops up to close to $41.50 area and hide below L7 Cyclical Support at $41.53. If half gap holds, I'll continue trailing.
AAPL Short term pressure to the down sideSelling into Nov 2014 recent highs has morphed into churning. See also link to previous post in 2014.11.24 (TradingView dates are mis-aligned) re my position size reduction going into $120 Nov 2014. Right shoulder $114.85 was a cyclical resistance level calculated on 2014.12.10. Trading lifted prices off short term lows at $106.26 on Dec 16. Likely pro trading desks sold into strength particularly on 2014.12.19 leading to "Lo Demand" & "Distribution" on 2014.12.29 at the mentioned cyclical resistance level. Now I have a couple of longer term supply signals in play. One level 3 Excess Supply confirmed from 2014.08.27 and now a tentative level 4 Excess Supply. I believe longer term owners are distributing to newer entrants at these prices in a position reduction perhaps (as I did). I think it is highly probable for drop to the $102 - 100 area as sideways churning continues into earnings the fourth week of Jan 2015 I am near term "short" bias. I would not take a short position but I have reduced size between $119 - 120 as stated in Nov. My longer term bias is bullish long given the fundamentals of Apple. BTW... currently I have a resting buy order at slightly over $101. If filled, I may play it as a possible short term trade. See attached static charts for some clarity.
S&P Sector Review - A Look at Relative PerformanceThe charts above show the performance of each sector relative to all nine sectors combined. XLK tech couldn't be included due to having only 8 panes but it was included in determining the sector ratios. Important to keep in mind that these are ratios, all prices could go lower or higher together but what I'm interested in here is purely the relative performance. Also, in order for one to outperform is ensuring that another sector somewhere is underperforming.
Top Row:
XLU Utilities, XLP Consumer staples, XLF financials and XLV Health are all breaking out on a relative basis. 3 of 4 can be considered defensive sectors. Financials are interesting in that the sector was completely demolished after the 2008 recession and appear to be breaking out of a 5 yr wedge.
Bottom Row:
XLE Energy issues are widely known. Not much to say other then its possible that they go lower longer term and return to previous levels (.10-.12 of the total). The "energy commodities are an asset class" theme may finally be unwound and if so XLE could suffer from underperformance for some time (oversold bounces excluded). XLB materials have not broken down yet but look quite vulnerable. XLY Consumer discretionary did break down and may have recently been saved by the plunge in oil. Any economic weakness and i suspect this will quickly revert and this sector could significantly underperform. XLI Industrials looks like it could break out but has not yet. The transportation portion of this sector has significantly helped this sector.
Summary:
XLU - breaking out upwards, 6 yr wedge
XLP - breaking out upwards, 6 yr wedge
XLF - breaking out upwards, 5 yr wedge
XLV - breaking upper trend line important since 2011
XLE - broke out down, 6 yr wedge, approaching possible long term support
XLB - approaching bottom trend line important since 2002
XLY - broke ascending wedge lower, recently bounced back towards 2013 highs
XLI - sitting at upper trend line that has been important since 2000
XLK - Not shown
AAPL Apple entering a choppy zone of Fibonacci confluenceLong until $120 then trim. Trailing stops currently moved up to mid $90's. Looks like AAPL could run sideways towards trend at approx $115 then proceed higher. Looks like profit taking on 2014.11.21.Fri. No supply signals at this time to concern me. I will attach weekly & monthly charts to this thread as a comment.
