The exchange-traded fund consists of 85 companies including four components of the Dow Jones Industrial Average plus the major on-line retailer of almost everything. This ETF, at $72, has a year-to-date gain of 7.5% through Christmas Eve versus 13% for the S&P 500. Before showing the daily and weekly charts for this ETF, here's a brief look at four components.
Amazon.com (AMZN) - Get Report should show solid holiday sales this year but the stock suffered some severe downside volatility in 2014. The on-line retailer began 2014 setting an all-time intraday high at $408.06 on Jan. 22 then plunged 30% to as low as $284.38 into May 9. The stock then rebounded 28% trading up to $364.85 into July 24 before declining 22% to as low as $284.00 into Oct.24. The year-to-date decline is 23%.
Dow component Home Depot (HD) - Get Report was a big winner in 2014, up 26% year to date setting an all-time intraday high at $104.38 on Christmas Eve helping the Dow 30 set its all-time high at18086.
Dow component Nike Inc (NKE) - Get Report set an all-time intraday high at $99.76 on Nov. 28, then reported an earnings beat on Dec. 18. The retailer of athletic shoes offered disappointing guidance and the stock fell to as low as $92.83 on Dec.19. This hiccup was just 6.9% as the stock has gained 23% year to date.
Here's the daily chart for the Consumer Discretionary Sector SPDR.
Courtesy of MetaStock Xenith
The daily chart for the consumer discretionary sector ETF shows it entered 2014 above its 200-day simple moving average (green line) at $59.16 but then declined to a test of this moving average between April 11 and May 20 as this average rose from $62.69 to $63.34.
The consumer discretionary ETF had a correction of 11% from $69.33 on Sept. 4 to as low as $61.68 into Oct. 15. The rebound from this low to the all-time intraday high set at $72.19 on Dec.23 totaled 17%. This high is being challenged as 2014 comes to an end.
Here's the weekly chart for Consumer Discretionary Sector SPDR.
Courtesy of MetaStock Xenith
The weekly chart for consumer discretionary sector ETF clearly shows this market has been above its 200-week simple moving average (green line) since August 2011 with this average now at $52.33.
The weekly chart is positive but overbought with its key weekly moving average at $70.15. The momentum reading shown at the bottom of the graph is above the 80.00 overbought threshold at 88.88.
TheStreet Ratings team rates AMAZON.COM INC as a Sell with a ratings score of D+. TheStreet Ratings Team has this to say about their recommendation:
"We rate AMAZON.COM INC (AMZN) a SELL. This is driven by several weaknesses, which we believe should have a greater impact than any strengths, and could make it more difficult for investors to achieve positive results compared to most of the stocks we cover. The company's weaknesses can be seen in multiple areas, such as its deteriorating net income, disappointing return on equity, generally disappointing historical performance in the stock itself, poor profit margins and feeble growth in its earnings per share."
You can view the full analysis from the report here: AMZN Ratings Report
This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.