TECH AND NASDAQ LEAD MARKET HIGHER -- SEMICONDUCTERS LEAD XLK HIGHER -- SMALL CAPS MAY BE TRIANGULATING -- BITCOIN MEETS 40K RESISTANCE

John Murphy
by John Murphy,
Pioneer Technical Analyst

NASDAQ LEADS MARKET HIGHER... Stocks are reacting positively to this morning's job report which came in weaker than expected but showed job growth during May.   Bond yields weakened on the report which may be helping to boost stocks, and technology stocks in particular.   Chart 1 shows the Invesco QQQ Trust climbing sharply today and nearing a test of some overhead resistance formed over the last month.   The QQQ is the strongest of the major market indexes.   A strong day in technology is the main reason why.

TECHS AND CHIPS HAVE A STRONG DAY...Chart 2 shows the Technology Sector SPDR (XLK) rising today to the highest level in a month.   The XLK is the day's strongest sector.   It's being led higher by semiconductors.    Chart 3 shows the VanEck Vectors Semiconductor ETF (SMH) moving further above its 50-day moving average.

Chart 1
Chart 2
Chart 3

SMALL CAPS MAY BE TRIANGULATING...Small caps are also looking stronger and may be nearing an upside breakout.   Chart 4 shows the Russell 2000 iShares (IWM) testing a falling trendline drawn over its March/April  highs.   The two converging trendlines overlaid over the price action resemble a potential "symmetrical triangle" which is normally a bullish continuation pattern.   A decisive close over the upper trendline would be a positive signal.

Chart 4

BITCOIN MEETS 40K RESISTANCE...Chart 5 shows Bitcoin consolidating between chart support near 30,000 formed during January and resistance near 40,000.   It also remains below its 200-day moving average.   It would have to clear that red resistance line to strengthen its short-term trend (see red arrow).

Chart 5
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John Murphy
About The Author:

A trailblazer in intermarket analysis, John authored key texts that shaped technical trading and helped generations of investors decode market trends using charts and correlations. Learn More 

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