ChartAdvisor for October 19, 2014

Commentary Tickers in this Article: SPY, DIA, QQQ, IWM Major U.S. indices experienced another choppy week. Most of them fell only to rally during Friday’s session. While Wall Street has been concerned about interest rates, Main Street has been showing ongoing signs of improvement. Jobless claims fell to a new 14-year low last week, and industrial output rose sharply in September, signaling that the economy continues to recover despite some concerns earlier this month. International markets were mixed over the past week, as of early trading on Friday morning. Japan’s Nikkei 225 fell 3.32%; Britain’s FTSE 100 fell 0.62%; and Germany’s DAX 30 rose 0.07%. In Europe, Germany slashed its growth forecast for 2014 and 2015 sparking concerns of a triple-dip recession in the Eurozone. In Asia, Japan’s business confidence slipped to its lowest levels in over a year, and investors remain concerned over the country’s plans to raise taxes.

SPDR S&P 500 (SPY) The SPDR S&P 500 (SPY) ETF fell 0.87% over the past week, as of early trading on Friday morning. After falling below its 200-day moving average and other key support levels, the index rebounded slightly toward the end of the week. Traders should watch for a move back above the 200-day moving average at 189.16 or a break down back to its lows. Looking at technical indicators, the RSI appears oversold at 39.54 but the MACD remains in a clear, bearish down trend.

SPDR Dow Jones Industrial Average (DIA) The SPDR Dow Jones Industrial Average (DIA) ETF fell 1.19% over the past week, as of early trading on Friday morning. After falling below its 200-day moving average and trend line support, the index jumped back above the trend line at week’s end. Traders should watch for a rebound above the 200-day moving average at 164.22 or a move back down to re-test its lows. Looking at technical indicators, the RSI appears oversold at 40.37 but the MACD remains in a downtrend.

PowerShares QQQ (Nasdaq:QQQ) The PowerShares QQQ (QQQ) ETF fell 1.13% over the past week, as of early trading on Friday morning. After falling sharply below its S2 support at 96.15, the index reached its 200-day moving average at 91.56 before rebounding. Traders should watch for a rebound back to its S2 support or a move back below its 200-day moving average. Looking at technical indicators, the RSI appears oversold at 38.51 while the MACD remains in a strong bearish down trend.

iShares Russell 2000 (NYSE:IWM) The iShares Russell 2000 (IWM) ETF rose 3.49% over the past week, as of early trading on Friday morning. After falling below its S1 support at 106.61, the index reached its S2 support at 103.88 before rebounding. Traders should watch for an extended move higher to its pivot point at 112.05 or a move back down to re-test its lows of 103.88. Looking at technical indicators, the RSI appears neutral at 45.95 while the MACD appears like it may experience a bullish crossover.