In this post I look at the Dow leaders, laggards and names on the move. I also provide some commentary and key levels for several names.
Dow Industrial Rotation: Leaders, Laggards and names on the move
Although much of the recent buzz has been on Tech ( and rightly so ) I was curious about how the Dow names were performing. Pictured below is the 5 week Relative Rotation graph and Performance table using $SPX as the benchmark.
Rotation Study Interpretation
As you examine the findings, keep in mind that the length of the tail of each stock represents the speed of the move. Additionally, remember that this study presents relative rotation and performance based upon relative strength and momentum. Just because a name is “lagging” doesn’t necessarily mean the stock is going down. It just means that it is lagging peers and the benchmark.
Leading Group Commentary & Key Levels
$AAPL – Keep riding the wave if long, but have a trailing stop in place as the name goes almost parabolic. Commentary should remain bullish into its product event Sept 12. First support is $190
$MRK – Last week the stock printed a gravestone doji on the weekly chart which is never a good thing. Additionally RSI and momentum beginnng to roll over. I’d expect a test of the 20ema near term.
$PFE – Strong stock but RSI and momentum have rolled over on the daily. Needs to hold $40.50 or expect a test of the 50ema down around $39.50
$VZ – Hit a wall at $55. A re-test and hold of the recent breakout at $53.50 would give a nice objective long entry location. Below $53.50 gets iffy .
$WMT – Gapped higher recently on the best earnings report in years. It’s gotta hold the gap at $94.50. Anything above is bullish. Anything below opens the door for a gap fill down to $90.50
$DIS – Has pulled back and is re-testing the $111.75 – $112 breakout level. Needs to hold here or a test of the rising 50ema around $110 seems likely.
$PG – Recently hit a huge wall of resistance at $84. If you’ve been long since the turn up in May, I’d consider booking that win. Getting through $84 looks tough, but if it does, certainly a bullish development.
$JNJ – Needs to hold $133.80 to stay uber bullish short term; otherwise look for a test of the rising 20ema near term
$UTX – Blue skies above $136 but after 2 rejections at that level, a double top scenario is a distinct possibility.
Interesting Set ups or levels to Note
$GS & $JPM Both have hit key resistance zones. Better places to look for outperformance IMO. Not a huge fan of the money center banks at the moment. Regional Banks look much better.
$MMM – Filled the gap from late April and now currently sits around $210. Traders can stay long against the 200ema at $207.50. Below that I’d be cautious.
$TRV & $WBA – Both Stocks have been in a downtrend. I interpret the recent action as a counter trend rally. The 200ema’s are close by and I’d use those levels as a stop if you’re long.
$NKE – Nice rising channel. Any tag of the 50ema has been a great buying opportunity
$XOM & $CVX Not a big fan of either at the moment. More inclined to sell below the 200ema rather than be a buyer. Oil within striking distance of recent highs yet these two can’t get much going. Refiners are performing much better with an expanding crack spread. If interested, you can read more about it HERE .
$HD – A move above $203 with some conviction will get this going. A nice place for an objective long.
$CAT & $BA Expect further weakness if the anticipated additional tariffs on $200 B of Chinese Goods kicks in late next week.
There you go traders. Hope it helps.
Happy hunting and Good Trading.
Have a great Labor Day weekend!!