Weekly Market Review: June 19, 2009

The market gapped down on Monday and never recovered this week. We tested the support from late June. In other words, the market gain from June has evaporated. What it means next week is that we're at least trading in a lower trading range now. This could be the start of the long-awaited retracement. Let's just see if we can break below this important resistance at 91 on the SPY. The pre-market on the e-mini this Monday morning is already at 906. Let's see if volume can follow at the open and failures to get back up.

From Figure 2, we can see that we've broken below a decending support this week. But we managed to climb back up above it on Friday.

[caption id="attachment_1526" align="aligncenter" width="500" caption="S&P500 ETF"][S&P500 ETF][][/caption]

[caption id="attachment_1527" align="aligncenter" width="500" caption="S&P500 ETF"][S&P500 ETF][][/caption]

GICS Sectors Review

The chart below is taken from CaraCommunity’s RSIApp. Because of the dip in the market this week, 6 of 10 sectors are below the 50 threshold in their 7 days RSI. Whereas last week, we only had 2 of 10 below 50. This again tells us what we already knew from the SPY charts above, that is, we had a sell off this week. However, from the 7 weeks RSI, none of the sectors are below 50 yet. So this shows that we still have room for a further down move if the market decides so.

Ticker![][] Last![][] RSI7d![][] RSI7w![][] RSI7m![][] Zone (estimate)![][]
[XLE][] \*
49.21 30.65 52.57 41.68
[XLB][] \*
26.07 35.3 56.16 44.92
[XLI][] \*
22.20 32.82 55.04 39.97
[XLY][] \*
23.13 43.63 59.68 48.01
[XLP][] \*
22.89 46.73 58.97 44.89
[XLV][] \*
26.08 67.11 65.77 45.17
[XLF][] \*
12.04 50.41 62.71 39.32
[XLK][] \*
18.12 57.01 73.05 52.15
[IYZ][] \*
17.70 37.76 55.69 44.8
[XLU][] \*
27.47 57.49 61.05 40.37

[S&P500 ETF]: http://traderpau.files.wordpress.com/2009/06/2009-06-22-spy.png [S&P500 ETF]: http://traderpau.files.wordpress.com/2009/06/2009-06-22-spy_prop.png