Market Churns for Whats Next

WEEKLY MARKET ANALYSIS

Stocks opened modestly higher and the advance continued but decellerated intra-day into the close. The Dow Jones Industrial Average ETF DIA was up 0.61 points on the day and closed at 245.71. For the S&P 500, there is support near 2622 and 2602. Resistance levels are currently at 2662 and 2682.

GLOBAL ASSETS UPDATE

TWELVE SECTOR ANALYSIS

VOLATILITY UPDATE

On Wall Street, 7 of the 12 major market sectors are seeing red today. The biggest losers are Technology (XLK), Consumer Discretionary (XLY), and Retail (XRT). The strongest sector today has been Industrial (XLI) which has gone up 0.9%.

The CBOE Volatility Index (VIX) is down $-0.32 going from $19.45 to $19.13 today. The ratio of puts to calls for the current at-the-money strike of $19 is below average which means that traders are favoring Calls over Puts currently.

MARKET HEAT

A NASDAQ stock with unusually high volume today is Zynerba Pharmaceuticals Inc (ZYNE). On the AMEX Silvercorp Metals Inc (SVM) has had significant interest, and on the NYSE GameStop Corp. (GME) has had unusual volume.

The biggest mover out of other high-volume stocks is GameStop Corp. (GME) which has moved down over -27% recently on volume of over 32 million shares. The chart below shows the performance of GME over the last year. GameStop Corp. is an omnichannel video game retailer.

DARWIN GAMESTOP CORP. FORECAST

The performance of GameStop Corp. (GME) will be worth watching in the near term for a number of reasons. The forecast for the coming week on GME is for the price to go up. The correlation of GME to the S&P 500 recently has been 0.4 which is a weak positive correlation. Key levels to watch for GME are upside resistance at both the $13 and $14 price points.

Trade smart,

Paul "Bulldog" Hudson, Chief Investment Officer
Darwin Investing Network