Nasdaq, Russell 2000 Try to Pull Dow Industrials, S&P 500 Higher

NEW YORK (TheStreet) - New all-time intraday highs for the Nasdaq Composite and Russell 2000 pulled the weekly charts for Dow Jones Industrial Average and Standard & Poor's 500 to neutral from negative, but the technical bull versus bear tug-of-war continues as Dow Transports still have a negative but oversold weekly chart.

Dow Industrials ended last week with a close of 18,015.95 just below its 50-day simple moving average of 18,038.24 with the 200-day simple moving average rising to 17,651.40. The weekly chart is neutral with the index just above its key weekly moving average of 18,002.03, but the momentum reading of 56.92 is down from 63.28 on June 12. So far, the all-time intraday high of 18,351.36 set on May 19 can be considered a failed test of a key level on technical charts of 18,328 which expires on June 30.

The S&P 500 ended last week with a close of 2,109.99 just above its 50-day simple moving average of 2,105.57 with the 200-day simple moving average rising to 2,050.36. The weekly chart is neutral with the index above its key weekly moving average of 2,103.39, but the momentum reading of 69.38 is down from 74.25 on June 12. The all-time intraday high of 2,134.72 was set on May 20.

The Nasdaq ended last week with a close of 5,117.00 well above its 50-day simple moving average of 5,036.12 with the 200-day simple moving average rising to 4,782.70. The weekly chart remains positive but overbought with the index above its key weekly moving average of 5,049.71. The momentum reading of 81.56 is up from 80.62 on June 12 above the overbought threshold of 80.00. The all-time intraday high of 5,134.32 was set on June 18.

Dow Transports ended last week with a close of 8,411.88 below the "death cross" formed by the 50-day simple moving average of 8,585.65 below the 200-day simple moving average of 8,747.72. The weekly chart is negative but oversold with the index below its key weekly moving average of 8,538.38 and its momentum reading of 19.52 up 18.02 on June 12, but still below the oversold threshold of 20.00. Transports are 9.7% below their all-time intraday high of 9,139.92 set on Nov. 28. 

The Russell 2000 ended last week with a close of 1,284.66, well above its 50-day simple moving average of 1,253.58 with the 200-day simple moving average rising to 1,197.94. The weekly chart is positive with the index above its key weekly moving average of 1,257.96 and with its momentum reading of 70.44 up from 63.90 on June 12. The all-time intraday high of 1,287.06 was set on June 18.

For the bulls to win the technical bull versus bear tug-of-war, the Dow Transports must lead with a close this Friday, June 26 above 8,538.38, as that would shift that weekly chart to positive. Otherwise the tug-of-war continues.

For the bears to gain control of the rope, the Dow Industrials and S&P 500 would need to end this week below 18,002.03 and 2,103.39, respectively.

For the bears to win the tug-of-war, the Nasdaq and Russell 2000 would need to close this week below 5,049.70 and 1,257.96, respectively, with both having momentum readings declining below the overbought threshold of 80.00.

Meanwhile the three ETFs that track the Dow 30, S&P 500 and Nasdaq are leaning to the bearish side. Here are their weekly charts.

Here's the weekly chart for the SPDR Dow Jones Industrial Average ETF (DIA), also known as Diamonds.


Courtesy of MetaStock Xenith

Diamonds had a close of $179.76 on Friday, up 1% year-to-date, but fractionally below its key weekly moving average of $179.89. Diamonds has a weekly technical momentum reading of 59.10 on June 19 declining below the June 12 reading of 65.50.

The all-time intraday high for Diamonds is $183.35 set on May 20 and a key level on technical charts for this week is $182.93, which suggests that a new high is unlikely. The downside risk in the second half of 2015 are key technical levels of $150.82 and $145.24 which do not expire until the end of 2015.

Here's the weekly chart for the SPDR S&P 500 ETF (SPY), also known as Spiders.


Courtesy of MetaStock Xenith

Spiders had a close of $210.81 on Friday, up 2.2% year to date, just above its key weekly moving average of $210.52. Spiders has a weekly momentum reading of 71.80 on June 19 down from 76.46 on June 12.

The all-time intraday high for Spiders is $213.78, set on May 20, and a key level on technical charts for this week is above the high at $214.35. Nonetheless, the downside risk in the second half of 2015 are key levels of $158.47 and $155.56, which do not expire until the end of 2015.

Here's the weekly chart for the PowerShares QQQ Trust ETF (QQQ).


Courtesy of MetaStock Xenith

PowerShares QQQ had a close of $109.89 on Friday, up 6.4% year to date just above its key weekly moving average of $109.10. The QQQ's has a weekly momentum reading of 76.38 on June 19, down from 77.96 on June 12.

The all-time intraday high for the QQQ's is $111.16 set on April 27, and a key level on technical charts for this week is above the high at $112.92. Nonetheless, the downside risk in the second half of 2015 is to a key level of $89.24 which does not expire until the end of 2015.

Here's how to read a weekly chart. This chart shows weekly price bars going back to the beginning of 2007 and thus includes the Crash of 2008, then the current bull market for stocks that began in March 2009. The red line tracks the ups and downs of the key weekly moving average. The green line is the 200-week simple moving average. The red line that oscillates along the bottom of the chart is the momentum reading on a scale of 00.00 to 100.00. A reading below 20.00 is oversold and a reading above 80.00 is overbought.

A technically positive weekly chart occurs when a stock ends a week above its key weekly moving average with the momentum reading rising above 20.00.

A technically negative weekly chart occurs when a stock ends a week below its key weekly moving average with the momentum reading declining below 80.00.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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