The Dow Jones futures will open on Sunday night, along with the S&P 500 and Nasdaq futures. The forked stock market recovery had a wild week, but it ended on a strong note.
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It remains a challenging environment, with actions positive enough to attract investors, but volatile enough to discard them. However, with the broader recovery of the stock market strengthening at the end of last week, with several quality names emerging or sending bullish signals from a variety of sectors.
The chip equipment group is one of the hottest at the moment, with ASML (ASML), Lam Research (LRCX), Entegris (ENTG), KLA Corp. (KLAC) and MKS Instruments (MKSI) are actionable now. The already strong group had a big boost last week, when Intel (INTC) announced it would spend $ 20 billion on two new chip factories in Arizona. Intel’s shares hit a 20-year high, plummeting on their 10-week line before recovering to a modest gain.
The biggest unknown is the rise in the stock market. If it continues to rise, then the ASML stock and other chip plays have a good chance of working. But if the stock market resumes agitated stocks or stable sales, expect more difficult times. That is why it is so important to be in a healthy and sustainable market rally. The shares looked better at the end of the week, but this is more of a false head. Meanwhile, Nasdaq continues to live below key levels.
One area of the market remains in intensive care: speculative or highly valued growth actions.
This includes EV stocks, such as Tesla (TSLA), Nio (NIO), Xpeng (XPEV) and Li Auto (LI). But it also includes Teladoc Health (TDOC), Roku (ROKU), Baidu (BIDU), Palantir Technologies (PLTR) and many more. From Tesla shares onwards, these shares are well below their 50-day lines. The shares of Roku, Baidu and Palantir are trading at 2,021 minimum.
The stock ASML and Entegris are in the IBD 50. The stock LRCX and KLAC are in the Big Cap 20.
Dow Jones Futures Today
Dow Jones futures will open at 6 pm Eastern Time on Sunday, along with the S&P 500 and Nasdaq 100 futures.
Keep in mind that overnight action on Dow futures and elsewhere does not necessarily translate into real trading in the next regular stock market session.
Join IBD experts as they analyze actionable stocks at the stock market’s high on IBD Live.
Coronavirus News
Coronavirus cases worldwide reached 126.70 million. Deaths from Covid-19 reached 2.77 million.
Coronavirus cases in the USA reached 30.85 million, with deaths above 561,000.
Stock market rally last week
Overview of the US stock market today |
||||
|---|---|---|---|---|
| Index | Symbol | Price | Gain / Loss | % Change |
| Dow Jones | (0DJIA) | 32818.79 | +199.31 | +0.61 |
| S&P 500 | (0S and P5) | 3937.51 | +27.99 | +0.72 |
| Nasdaq | (0NDQC) | 12960.98 | -16.70 | -0.13 |
| Russell 2000 | (IWM) | 217.69 | +1.03 | +0.48 |
| IBD 50 | (FFTY) | 43.10 | +0.05 | +0.12 |
Last updated: 15h06 ET 26/03/2021 |
||||
The stock market recovery retreated for much of the week, but found its balance during Thursday’s session. A last-minute frenzy on Friday added a positive touch to the week.
The Dow Jones Industrial Average rose 1.4% in last week’s stock market trading. The S&P 500 index rose 1.6%. Essentially, all winnings are played out on Friday. The Nasdaq compound fell 0.6% after dropping sharply to Thursday’s low. The Russell 2000 sank 2.8%, but managed to finish just above its 50-day line.
Among the best ETFs, the Innovator IBD 50 ETF (FFTY) fell 6.4% last week, while the Innovator IBD Breakout Opportunities ETF (BOUT) fell 4.9%, even with weekend gains. The iShares Expanded Tech-Software Sector (IGV) ETF was up 0.5% thanks to Friday’s 2.1% gain. VanEck Vectors Semiconductor ETF (SMH) was up 3.4%, thanks to a 5% increase on Friday. Shares of Intel, KLA, ASML and LRCX are all notable SMH stakes
The SPDR S&P Metals & Mining ETF (XME) was up 0.15%, but recovered from sharp losses, limited to a 6.35% increase on Friday.
Reflecting more speculative history stocks, ARK Innovation ETF (ARKK) and ARK Genomics ETF (ARKG) fell 6.9% last week, with fractional losses on Friday. Tesla’s shares are the largest share in ARK Invest’s ETFs. The shares of Teladoc, Baidu and Roku are also important stakes in ARK, which also has PLTR and Zoom shares.
Chip gear inventory in shopping zones
ASML shares rose 7.1% on Friday to 625.67, limiting a weekly gain of 14%. This is in the range of a purchase point of 608.81 for a consolidation that was missing one day for a cup base. However, ASML is 10.7% above its 10-week line, so by some measures, it has been extended. But after Monday’s opening, with the start of the new week, the 10-week line will be a little higher. Therefore, ASML’s shares will be in the buy range, although investors can wait to see if the shares back down a bit. The relative strength line is at a new high.
LRCX’s shares jumped 6.6% on Friday to 584.23, rebounding positively from its 50-day and 10-week lines. Lam Research’s stock is actionable now, with 603.70 as the official point of purchase.
Entegris shares jumped just over 6% to 110.03. This broke a trend line and released a 108.92 identifier entry. ENTG’s stock has another entry at 110.47 on what could be seen as a double-bottomed base. The official point of purchase is 114.10.
KLAC’s shares rose 6.9% on Friday and 9.2% on the week to 319.94, rebounding positively from the 50-day line, as do LRCX shares. The official entry for the KLA stock is 342.31.
MKSI’s shares rose 7% to 183.11, up from 117.46 double-bottom purchase points, according to MarketSmith’s analysis. But it also has a complicated handle with a higher entry at 184.79. MKSI’s stock is just below that, although it ended on Friday above the portfolio closing high. The RS line is at short-term highs.
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End of story for Tesla’s stock, Roku
Tesla’s shares plunged 5.5% to 618.70 last week, the sixth drop in seven weeks. Tesla’s shares at least tried to get back above its 21-day line last week, which is more than said for most of those stocks.
Nio’s shares plunged nearly 17%, closing on its 200-day line. Xpeng’s shares plunged 14% and Li Auto’s shares 9.8%.
Tesla is expected to report global first quarter deliveries at the end of next week. Nio is due to release March data at the end of next week, but warned on Friday that it would suspend production next week and cut its delivery target for the first quarter.
Roku’s shares plunged 12%, Teladoc 7.4% and Baidu 19%, all reaching 2,021 lows. PLTR shares fell 7.15%, testing recent lows.
All of these were big winners in 2020. The “story” is still there. This can be useful when a stock is going up, but don’t let a story override the technical signals. From Baidu’s shares to Tesla, all of these names are seriously damaged. Many of these actions can recover, but they can take a significant amount of time. Some former winners never come back.
Wait for these stocks to recover their 21- and 50-day lines before taking them seriously.
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Market Rally Analysis
The stock market recovery showed positive overall action, thanks to some late heroic acts, but it was still a mixed bag.
The Dow Jones tested its 21-day exponential average on Thursday. The S&P 500 closed below 21 days on Wednesday and shortened the 50-day line briefly in the following session. But at the end of the week, Dow and S&P’s record closes, just below all-time highs.
Friday’s strong Dow and S&P 500 price movements in higher volume than on Thursday were strong enough to be subsequent days. But as the market entered Friday as an “uptrend under pressure” against a direct correction, it is not an FTD. Still, given the unstable market, large gains in higher volume are welcome.
The Russell 2000 fell below its 21 and 50-day line last week and came close to its March low before recovering. The small cap index closed just above the 50-day line, but still with considerable weekly losses.
Nasdaq, despite its large intraday fluctuations, ended up having the week with the least consequence among the four main indices. It started last week claiming its 21-day line, but soon encountered resistance on its 50-day line and sold out. After recovering from Thursday’s intraday casualties, the Nasdaq ended with a modest loss. Nasdaq’s strong gain on Friday also came with lighter volume.
Ultimately, the high-tech compound remains below its 21- and 50-day moving averages. As long as this is the case, there will be a question mark about the entire stock market boom.
However volatile the broad indices were, individual stocks and sectors used to be even more unstable. Even when the general trend is lateral, the large intraday and weekly movements make it difficult to make much progress.
There are just enough good deeds to attract investors. And more than enough to shake them up. This is the hallmark of a busy market.
If the market can move stronger or simply slowly tame, then today’s buyable stocks are likely to prosper. But this is the big wildcard.
What to do now
This It’s a rise in the stock market, with Friday’s action encouraging. Over there are a series of quality names in areas of purchase or creation. Thus, investors can be invested. But until there is more evidence that this market is on a more stable path, keep your individual positions small and your overall exposure light.
Have an exit strategy for your positions. This is especially important in unstable markets, when there is a high chance that a stock will fall back significantly after it bursts or issues a buy signal.
Create a comprehensive watch list. Look for stocks with solid fundamentals or, at least, recovering profits that are moving towards or above pre-pandemic levels. Make sure you have a diverse watch list. To check . Yes, chip and equipment retailers look strong, but the lead in the stock market rally is changing. So don’t get stuck in one or two groups.
Read The Big Picture every day to stay in sync with the direction of the market and leading stocks and sectors.
Follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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