Week 46 Stock Market S&P 500 Roundup — Diversified Industrials in focus
By: Ming Jong Tey
Tags: Investing, Day Trading, Business, Stock Market, Money

As mentioned in Week 45 stock market roundup, bullish scenario played out last week with S&P 500 broke all time high followed by profit taking and possible rotation from NASDAQ to the Dow Jones and RUSSELL 2000. If you are still wondering if the volume spike in conjunction with strong rejection on last Monday could pose some damage to the market, watch my video where I discussed how to seek for confirmation for the beginning of a a market sell-off or simply profit taking with rotation in play.

Since the strong rejection on last Monday, S&P 500 futures (ES) did not have follow through to the downside, which is a bullish sign. It is likely to attempt to rally up to test the all time high at 3668 with immediate support at 3500.

On 12 Nov, I compared side by side in a trade review about an inverse head and shoulders pattern trade vs how to trade from the price action perspective (with volume). Are you trading the pattern like the head & shoulder pattern or double bottom, etc…? Do watch the video below as it is crucial to understand the rationale behind the price movement rather than simply trading from the pattern alone.

Industry Group for Study — Dow Jones US Diversified Industrials Index (DJUSID)

The Diversified Industrials index has been a laggard since Mar 2020. However, it relative strength started to turn up with higher high and higher low forms since Oct 2020. The current rotation in play could further propel some of the strong stocks within this industry.

Photo by Author — Ming Jong Tey

Here are some interesting stocks to watch in terms of their price structure and volume: strong stocks: HON (HONEYWELL INTERNATIONAL INC), ETN (EATON CORPORATION PLC); SWK (STANLEY BLACK & DECKER INC), AME (AMETEK INC), etc…

Stock Watchlist — Malaysia

Watch the walkthrough of the Malaysia stocks watchlist below:

VS (V.S INDUSTRY BHD) — VS is within the trading range between 2.25–2.56. Next support at 2.1–2.2.

JHM (JHM CONSOLIDATION BHD) — Broke above resistance at 2.0 and hit all time high. Support is at 1.9–2.0. Staying above this support level could see JHM to trend higher.

FRONTKN (FRONTKEN CORPORATION BHD) Support levels: 3.5, 3.25. Should FRONTKN can stay above the support, it should attempt to test 3.8.

MI (MI TECHNOVATION BERHAD) - Trading range between 3.7–4.7 is still in play. MI is likely to challenge the resistance again at 4.7. Supply has been decreasing, which is a bullish sign.

PENTA (PENTAMASTER CORPORATION BHD) — Increasing of supply caused PENTA to test the support at 5.0 again. Supply absorption was observed and PENTA is likely to challenge 5.5.

Stock A as mentioned in Week 45, is UWC (UWC BERHAD). UWC tested the resistance-turned-support and hit all time high on last Friday. Further upside is expected.

Stock Watchlist — US

Watch the walkthrough of the US stocks watchlist below:

MSFT (MICROSOFT) — Profit taking on last Monday and Tuesday was held at the intermediate support at 210. Trading range of 210–225 is expected.

FB (FACEBOOK) — Supply absorption was observed during the profit taking on last Monday and Tuesday. FB is expected to challenge the swing high resistance at 300.

SE (SEA Limited) — similar to MSFT and FB, supply absorption was observed during the profit taking process last week. Higher upside target is expected.

JD (JD.com) — Supply absorption was observed. JD is expected to trend higher.

NET (CLOUDFLARE) — One of the strong stocks outperform the market. Continuation to the upside is expected for NET.

PTON (PELOTON INTERACTIVE INC)— Strong profit taking in PTON currently testing the support level at 100. Possible trading range between 90–110.

BABA (Alibaba Group Holdings) — Strong sell off with spike of supply in last week. Sign of weakness showed up in BABA broke below the support at 268. Strong bearish momentum could propel BABA to test the next support is at 240–250.

BTG (B2GOLD CORP) — BTG tested the support at 6.0.

FSLY (FASTLY INC) — Supply has been exhausted for FSLY and commitment above the support at 74 violated the sign of weakness mentioned last week. First resistance is at 90. Support is at 62.

SQ (SQUARE INC) — Support is at 160–170. SQ is expected to test the resistance at 193.

AVGO (BROADCOM INC) — Immediate resistance is at 388 while the support is at 360 for AVGO.

Stock X as mentioned in Week 45 is ROKU. Last week profit taking did not cause lots of damage to the price structure. ROKU is likely to test the resistance at 239.

I revealed the actual or extra stocks and exclusive content in the email to my subscribers. If you are keen to know the actual stocks for studies prior I reveal them in my next week roundup, feel free to subscribe my weekly stock trading / investing ideas plus exclusive content in email for free below:

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Further Reading:

Disclaimer: The information in this presentation is solely for educational purpose and should not be taken as investment advice.