The major U.S. indexes moved higher over the past week. While nonfarm payrolls unexpectedly fell by 33,000, which is presumably due to the hurricanes, the big surprise was a decline in the unemployment rate by two-tenths of a point and an increase in average hourly earnings by 0.5%. The news followed an unexpectedly bullish ISM Manufacturing Index reading of 60.8 and an equally impressive ISM Non-Manufacturing Index reading of 59.8.
International markets followed U.S. markets higher over the past week. Japan’s Nikkei 225 rose 1.69%; Germany’s DAX 30 rose 0.99%; and Britain’s FTSE 100 rose 2.03%. In Europe, the IHS Markit survey hit a four-month high in a sign that the Eurozone economy is picking up steam. In Asia, Japan’s economy is likely to match its second best stretch of uninterrupted growth since World War II, despite an ongoing lack of inflation. (See also: Why Is Deflation Bad for the Economy?)
The SPDR S&P 500 ETF rose 1.25% over the past week, making it the worst performing major index. Since the beginning of the month, the index has posted a string of gains that have led it past trendline and R1 resistance at $253.79. Traders should watch for an extended breakout to R2 resistance at $256.34, or if a false breakout occurs, a move back into its price channel below trendline support. Looking at technical indicators, the relative strength index (RSI) has reached significantly overbought levels at 77.61, but the moving average convergence divergence (MACD) remains in a bullish uptrend.
Weekly technical summary of the major U.S. indexes. …read more
Read more here: Stocks Continue to Hit Highs Amid Positive Economic Data
Category: SPY, DIA, IWM, QQQ