Algo’s Flip Mid-Day After Failing At Resistance

Stocks were mostly higher today, with the S&P 500 rising about 50 bps, and the Nasdaq 100 rising by 1.4%. Despite the strength, markets were unable to advance beyond some significant levels of resistance that were needed to extend the gains. Instead, the indexes failed at those levels and reversed lower.

NASDAQ 100 (QQQ)

The Q’s increased to the April trend line but were unable to retake that uptrend. Instead, they turned lower. It is the second time the Qs have tried to move above the trend line in recent days. It suggests that the trend line may permanently be broken, and an indication that the broader direction of the market has likely seen a momentum shift.

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S&P 500 (SPX)

Meanwhile, the S&P 500 gave up a significant portion of its gains after failing to push past resistance at 3,425.

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Financials (XLF)

The financials had a horrible day with the XLF dropping over 1%. Some negative commentary out of an industry conference from the big banks sent the group lower. The XLF has been struggling and has been moving sideways outside of the wedge, and it appears more and more likely the next move here is lower.

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Apple (AAPL)

The move lower started today, around the time that Apple concluded its big event. Overall, not too exciting and nothing that wasn’t expected. I’m not sure if investors were holding out hope of a new iPhone, but they didn’t get it. Once the event was over, the stock and the market started its drift lower. The stock has been struggling to advance past the $115.70 level.

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Exxon Mobil (XOM)

Exxon Mobil has been crushed in recent weeks, and I think it likely has further to fall. Layer that in with some bearish bets, and it could be a recipe for a further decline, with the chance to fall to $31.

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