The broader market has been consolidating all week after three green weeks from the reversal higher in early June. After the S&P 500 Index made a new daily closing high on Thursday, June 20th, SPY, the ETF proxy for the index has since consolidated under the weekly all time closing high from May of this year. This has been a tough level to penetrate for 18 months. Looking at the weekly chart of the Dow ETF, DIA, you can see it is trying to push up through this level (blue line). The more often it pushes the more likely it is to bust through. You can see price has not been totally rejected at this level with just light selling and the Dow did just make a new all time monthly closing high. This is good. Remember, price is right where it was 18 months ago. We had the volatile consolidation of 2018/2019 which challenged primary support from the bottom in 2009 and price was catapulted higher through April when we had a reactionary reversal lower to a natural retracement level in May then a reflectionary move back up to confront the all time highs again. So, here we sit. What’s next?
While none of us mere mortals know the answer to that question, absent any really bad news missiles, the trend should continue higher and we should break out of the range we have been in for the last 18 months. I would not be surprised to see a Dow 30,000 by the beginning of 2020. Please note my price projections on the DIA chart. Remember, these are just my opinions!
Please note on all charts many of my notes and/or annotations are months and sometimes years old. I leave them on there for a long time for many reasons. I hope they help you rather than confuse you.
SPDR Dow Jones Industrial Average ETF (DIA) weekly
Before I highlight some charts I have been working on this week check out bitcoin. Oh my!
GBTC, the Grayscale Bitcoin Trust hit $17.40 this week after going parabolic once it cleared $12. I still own it and I will accumulate on dips that tag support. I have drawn in those current levels on the chart. This is speculative and I know the risks are high but I want to own it for a lot of reasons. Up 247% from my March 4th recommendation.
Grayscale Bitcoin Trust (GBTC) daily
Speaking of bitcoin, check out Riot Blockchain Inc (RIOT). It’s smaller than a micro cap. It’s a nano cap at under $50 million. This is high risk/high reward. But, I like it. See chart. I’m putting it on the Entry List. This is speculative! It has a very high short float at 26% so this can be volatile. Please understand your risks.
Riot Blockchain Inc (RIOT) daily
Turning Point Therapeutics Inc (TPTX) is another rather speculative company with a nice looking entry. It’s a San Diego based Pharma/Biotech company that went public in April. It has never made money and, in fact, lost $25 million last year. But, the chart looks so good. It has been supported by an ascending linear base that has propelled price at previous encounters. Price action just popped at this ascending level again which just happens to coincide with support from the high in early May (horizontal purple line). Again, the conservative entry is to wait for resistance (descending blue line) to be crossed but when it crosses it will probably ramp up rather quickly. I am putting this on the Entry List. It’s risky but just looks too good to pass up. We want it to track the projection lines I have drawn in. If it doesn’t, and breaks ascending support we must insert risk management and limit losses. Looking for just under $50.
Turning Point Therapeutics Inc (TPTX) daily
I like Alibaba Group Holding Ltd (BABA). Price looks like it wants to track up towards $200. Looking for current support to hold with a breakout of wedge compression and a ramp to $195 towards October. See my price projections on chart.
Alibaba Group Holding Ltd (BABA) daily
Arrow Electronics Inc (ARW) looks like it’s all charged up and ready to bolt back to $87. It was just there in April and reversed back down to $65 in short order and now is getting bid up right into resistance. I am looking for support to hold and resistance to get taken out for a ramp back to $87. I am looking for the price projection I have drawn on the chart.
Arrow Electronics Inc (ARW) daily
I highlighted Etsy Inc (ETSY) on May 6th. Price has been consolidating from the early March push higher and basing at the level where that push began. This price behavior is consistent with past expansions and I would expect a spike up through the ascending blue line resistance soon. If you didn’t get a chance to enter in May this would be another opportunity to start a position. For those that own it, this would be the time to accumulate if you like it. Risk is breaking below ascending support.
Etsy Inc (ETSY) daily
And finally, another swing trade I like the looks of. Texas Capital Bancshares (TCBI) is kicking up its heels at ascending support and crossed blue line resistance last week running right up into green line resistance which you can see is a level with some clout. If price can ram up through $62 it should run lickety split up to $67/$70. I expect target to be hit by mid July. It might need another dip before the rip but this one should come out of the gate like a bull. Risk is under first support which is the ascending pink/red line. All puns intended pards.
Texas Capital Bancshares (TCBI) daily
Those are some of my thoughts and ideas this week. If you have any questions about my charting, technical analysis or other stocks you might be interested in just let me know. I would be happy to try and help. Also, my weekly blabbing is archived on the web site on the blog page with charts embedded in the content so that it’s easier to read if for some strange reason you would want to refer to again. It usually takes a day or two to get archived as I think my “archiver” is on Hawaiian time…”gone surfing”.
Have a Happy 4th of July and a joy filled week. I will be in Carlsbad this week and some of next week dog sitting, hopefully going surfing, eating and charting of course.
Cheers,
Don
PS It will be a short week in TradeLand with an early close on Wednesday and the 4th of July on Thursday.