by Steve Auger
Many of the sectors are looking pretty bearish again this week with the 200 day Simple Moving Average coming into play for many of these ETFs. As thanksgiving is a major holiday in the USA, I look for a potential turn positive after the holiday, probably at the start of the following week.
The following is this week's ETF sector analysis of the DJ symbols IYZ, IYW, IYT, IYM, IYK, IYJ, IYH, IYF, IYE, IYC and IDU.
iShares DJ US Telecom
ETF Symbol: IYZ
There is currently a short position being held in DJ US Telecom. This ETF has continued downward within a descending channel. The price is sitting at the 200 day Simple Moving Average. If this SMA is breached then look for the bottom to fall out of this. Keep the short position but move the protective stop to $23.50.
iShares DJ US Technology
ETF Symbol: IYW
iShares DJ Transportation Average
ETF Symbol: IYT
iShares DJ US Basic Materials
ETF Symbol: IYM
DJ US Basic Materials has fallen below the 200 day SMA. Enter short with a protective stop at $67.50.
iShares DJ US Consumer Goods
ETF Symbol: IYK
A short trade was entered for DJ US Consumer Goods on a stop. The 200 day Simple Moving Average was breached and then the ETF price rebounded to sit at the SMA. Keep the short position but add a protective stop at $73.5.
iShares DJ US Industrials
ETF Symbol: IYJ
iShares DJ US Healthcare
ETF Symbol: IYH
DJ US Healthcare is hovering around a support level. Stay on the sidelines this week.
iShares DJ US Financial
ETF Symbol: IYF
DJ US Financial ETF has conflicting signals as Williams %R is showing a bearish trend with a support level breached, while the On-Balance Volume is showing bullish divergence. Stay on the sidelines this week.
iShares DJ US Energy
ETF Symbol: IYE
A short position in DJ US Energy was previously initiated and it should be maintained as the price has dropped below the 200 day SMA. A descending channel has formed and there may be a bounce here up to the $40.50 region. The protective stop should be adjusted upwards to $40.75 to accommodate the potential short term bounce.
iShares DJ US Consumer Services
ETF Symbol: IYC
DJ US Consumer Services dropped out of the descending channel last week but is just above a major support level. Stay on the sidelines.
iShares DJ US Utilities
ETF Symbol: IDU
DJ US Utilities continued to drop last week. I prefer to stay on the sidelines again this week as I still believe there will be a bounce after such a large move downwards.
Sector Inspector's Sign Language
- Sell short,continue to hold a short position or close long position
- Do not initiate a new position
- Go long, continue to hold a long position
Technical Analysis Terminology
Disclosure: The author "Walks the walk" in addition to "Talking the Talk".