Dow Jones Futures: What to Do When Markets Fall, Hold Key Levels; Apple News On Tap
Dow Jones futures open Sunday night, along with S&P 500 futures and Nasdaq futures.
The stock market rallied halted for a shortened week. The major indexes fell slightly but remained at the important level even as Federal Reserve policymakers signaled major interest rate hikes were likely in a few more meetings. But it is unclear whether recent market action has been bullish or bearish.
Investors can have small to modest exposure, but need to be willing to step back.
Apple holds its annual Worldwide Developers Conference next week. Apple (AAPL) will show its latest OS changes. Rumor has it that Apple WWDC will unveil an NFL streaming bundle. Still, Apple stock fell steadily on Friday, closing lower for the week.
Tesla shares tumbled on Friday and during the week as Tesla CEO Elon Musk reportedly wants to cut his paid jobs by 10% amid a “bad feeling” about the economy.
Go beyond Tesla (TSLA) moves on their own, which is a reminder that volatile, highly regarded bulls can make big moves from the bottom, but also have a hard time selling.
Northrop Grumman (NOC), Dollar tree (DLTR), Flex LNG (FLNG), Albemarle (ALB) and Integrated resources ZIM (ZIM) is the year the stock trades close to buy points. All have relative strength line at or near the high, a bullish sign. The RS line, the blue line in the chart provided, tracks a stock’s performance against the S&P 500 index.
NOC and Albemarle stocks are on IBD Rankings. ZIM shares are available on IBD 50. The video embedded in this article discusses this week’s market recovery action and analyzes Northrop stock, DLTR, and ALB stock.
Dow Jones Futures Today
Dow Jones futures open at 6 p.m. ET on Sunday, along with S&P 500 futures and Nasdaq 100 futures.
Remember that action overnight in Dow futures contract and elsewhere that doesn’t necessarily translate into actual trading the next week stock market meeting.
Join the IBD experts as they analyze the stocks that could act in the stock market rally on IBD Live
Rally stock market
The stock market recovered modestly for the week, albeit with some big daily swings in the major indexes.
The Dow Jones Industrial Average fell nearly 1% last week stock market trading. The S&P 500 index rose 1.2%. The Nasdaq composite fell 1%. The small-cap Russell 2000 fell 0.2%.
The 10-year Treasury yield rose 21 basis points to 2.96%, recovering to 3% amid generally strong economic data and aggressive Fed comments. That follows three weeks of significant declines in 10-year yields.
US crude oil futures rose 3.3% to $118.17 a barrel last week. Gasoline futures rose 8.7%.
Among the Best ETFsThe Innovator IBD 50 ETF (FFTY) rose 1.2% last week, while the Innovator IBD Breakthrough Opportunity ETF (BOUT) dropped about 1%. iShares Extension Software-Technology Sector ETF (IGV) increased by 0.7%. VanEck Vectors Semiconductor ETF (SMH) sink 1.5%.
SPDR S&P Metals & Mining ETF (XME) fell 2.2% last week. The United States X Global Infrastructure Development Fund (SAVE) embedded 0.2%. US Global Jets ETF (JETS) gradually decreased by 4.6%. SPDR S&P Homebuilders ETF (XHB) back 1%. The Energy Select SPDR ETF (XLE) rose 1.1% and the Financial SPDR ETF (XLF) decreased by 2%. SPDR Fund for the Healthcare Sector (XLV) slip 3.1%
Reflecting a more speculative narrative on equities, the ARK Innovation ETF (ARKK) retreated nearly 5% last week and the ARK Genomics ETF (ARKG) 3.7%. Tesla stock still holds the #1 spot on Ark Invest ETFs.
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At the Apple WWDC event June 6-10, the Dow Jones tech giant will showcase changes to various device operating systems: iOS, iPadOS, macOS, watchOS, and tvOS. Media reports surmise that Apple could unveil a deal to make NFL football games, such as the NFL Sunday ticket bundle. Apple TV+ announced a deal to offer Baseball League Baseball games on March 8. Increasing sports content is one way to attract and keep streaming subscribers, but it will not cheap.
Shares of Apple fell 2.85% for the week to 145.38, including Friday’s 3.9% drop below the 21-day mark. AAPL stock is far from any buy point and is below the 50-day and 200-day lines.
Tesla’s ‘super bad’ sell-off
Tesla shares fell 7.4% to 703.55 last week, falling 9.2% on Friday to fall below the 21-day mark. CEO Elon Musk is said to have announced a hiring freeze and wants to cut Tesla’s paid jobs by 10% due to what he calls a “bad feeling” about the economy. Those comments were delivered in an email Thursday sent to Tesla executives, Reuters reported on Friday.
Musk’s email comments raised many questions. Large job cuts would indicate weaker demand. Still, Tesla’s current demand looks strong, especially in a context where car production is still limited. The EV giant just added two new plants and forecasts 50% growth for years to come.
Musk said he expects the number of hourly production workers to increase.
Meanwhile, the National Highway Traffic Safety Administration said Friday that it has received 758 reports of “virtual braking” – in certain Model 3 and Y vehicles in 2021 and 2022. NHTSA. , on May 4, requested information from Tesla by June 20.
Separately, NHTSA will release autopilot crash data this month, The Wall Street Journal Friday report. NHTSA is investigating a number of Tesla crashes involving Autonomous Driving.
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Stocks near the buy point
Northrop shares rose 3.35% to 478.37 on Friday, just cleared 477.36 cup with handle buy points. NOC stock tested its 50-day line on Thursday and essentially formed a large range control ring. Shares of Northrop are still just 4.8% above its 50-day line.
Shares of Dollar Tree fell 3.1% over the past week to 159.88, but held above its 50-day moving average. Stocks have settled down after a major plunge and resurgence. DLTR stock crashes for the first time due to weak earnings and guidance from Walmart (WMT) and Target (TGT), but then rebounded on Dollar Tree earnings a week later. On the weekly chart, shares of Dollar Tree have formed a peg, giving it a handle buy point of 166.45. On the daily chart, it takes another day to form, hence the Dollar Tree is worth 177.29 cup base buy points.
FLNG stock rose 7.6% last week to 29.74, recovering positively from the 50-day line, offering early entry. The official consolidation buy point is 32.88, according to MarketSmith . Analysis. Ideally, the LNG game would pause for a few days, even forming a rotation, to give the 50-day line some more base.
ALB stock had an active week. After soaring nearly 15% last week, breaking through an early entry around 248, the lithium giant fell to a low of 232.75 on June 1, although it did find support at the 21-day line. . Albemarle stock ended the week down 7.4% to 250.76, well above that entry. On the weekly chart, ALB stock currently has a buy point at 273.78. That will show up on the daily chart after Monday. But a longer pause should help the 50-day line – still under 200 days – catch up. Shares of Albemarle jumped 35% in May, thanks to two large upward revisions to its full-year earnings target amid soaring lithium prices.
ZIM stock fell 6.4% on May 31, but rebounded to close the week down just 0.5% to 67.70. Technically, ZIM stock currently has a position on the weekly chart, giving it 68.63 buy points. That handle could grow after Monday’s close, but aside from the May 31 drop, not much has changed. Additionally, ZIM stock is 11.9% higher than its 50-day line.
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Market aggregation analysis
The stock market rally took a pause last week, with the major indexes falling slightly, largely due to Friday’s losses. The major indexes hold their 21-day moving averages and most of their gains from the previous week.
Was the last week positive for the market recovery or ominous? It depends on what happens next. A drop in price is not a big surprise after a strong rally. It allows some handles to form. But is this a pause before the major indexes recover or the start of a retracement back to the lows? A push above this week’s high would also be just one step. The 50-day moving average shows up for the major indexes, with several other major hurdles after that.
Last week, Fed officials made it clear that they would not stop aggressively tightening until they saw a sharp drop in inflation and a substantial drop in the labor market. But that process will be painful for the economy. The fact that the stock market sold off on Friday, Musk reportedly wanted big Tesla job cuts and The May jobs report showing strong hiring suggests investors aren’t sure what the “good news” is right now.
Energy remains strong, with shale producers, refineries, integrated giants, coal producers and LNG producers like FLNG stock still thriving. Solar stocks are also bouncing back. Shippers like ZIM stock, lithium players like Albemarle, some retailers like Dollar Tree and other building related companies are also very interesting.
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What to do now
Investors may have added or cut exposure over the past week, based on the actions of the major indexes and their own positions. In all cases, exposure should remain modest.
In the long run, there will be huge opportunities for investors. Perhaps we are starting a major bull run. Or this could be a short-term rally in an extended bear market. Keep most of your dough dry so you can take advantage of it when the tide is clear.
Investor’s Business Daily is all about identifying potential leaders. Use it as a building block for your own watch list. Stay alert and stay flexible.
Read Big picture every day to stay in sync with market trends and top stocks and sectors.
Please follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
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