Dow Jones futures will open on Sunday night, along with S&P 500 futures and Nasdaq futures. tesla Stock, Apple (AAPL), Caterpillar (CAT) and a new solar initial public offering are in or near the purchase zones.
X
The stock market rally staged a dramatic turnaround late in the week, with the S&P 500 and Nasdaq Composite rebounding from key tests on Thursday morning to all-time resistance levels on Friday. A large number of leading stocks issued buy signals.
The market rally has yet to hold and extend recent gains, but investors should look to add exposure again.
Recent Solar IPO tracker next (NXT) broke out on Friday, while the giant Dow Jones Caterpillar (CAT), EV Token Set in semiconductors (IN), royal caribbean (RCL) and the Chinese e-commerce giant PDD shares (PDD) are early or aggressive entries.
tesla (TSLA) continues to stall near a potential breakout, while Apple shares rallied to key levels, possibly offering an early entry.
The video embedded in the article looked at a pivotal week for the market, while also reviewing NXT stock, alteryx (AYX) and caterpillar.
Nextracker and AYX shares are on the IBD Leaderboard. CAT shares are in IBD Big Cap 20. Nextracker was IBD’s stock of the day on Friday. New America’s latest profiles of AYX stock.
Dow Jones Futures Today
Dow Jones futures open at 6 p.m. ET on Sunday, along with futures for the S&P 500 and Nasdaq 100.
Remember that overnight action in Dow futures and elsewhere doesn’t necessarily translate into actual trading at the next regular stock market session.
Join IBD experts as they discuss actionable actions in the stock market rally on IBD Live
stock rally
The stock market rally traded strongly at the start of the week, ducked lower at the open on Thursday, but then closed again with strong gains.
The Dow Jones Industrial Average rebounded 1.75% in trading last week. The S&P 500 Index rose 1.9%. The Nasdaq Composite jumped 2.6%. The small-cap Russell 2000 rose 2.1%.
The 10-year Treasury yield rose 1 basis point to 3.96%, but after falling 11 basis points on Friday. The 10-year yield hit 4.09% at the high on Thursday. Fed chief Jerome Powell testifies before Congress on Tuesday and Wednesday, while the February jobs report is due Friday morning.
US crude oil futures rose 4.4% to $79.68 a barrel last week. Copper prices rose 3.2%.
ETFs
Among growth ETFs, the Innovator IBD 50 ETF (FFTY) rose 3.8% last week, while the Innovator IBD Breakout Opportunities ETF (BOUT) gained 4%. The iShares Expanded Technology Software (IGV) Sector ETF rose 3.7%. The VanEck Vectors Semiconductor (SMH) ETF rose 2.8%.
SPDR S&P Metals & Mining ETF (XME) soared 9.8% last week. The US Global X Infrastructure Development ETF (PAVE) jumped 4.5%. The US Global Jets ETF (JETS) rose 4%. SPDR S&P Homebuilders ETF (XHB) rose 3.1%. The Energy Select SPDR ETF (XLE) rose 3.1% and the Financial Select SPDR ETF (XLF) advanced 0.9%. The SPDR Select Healthcare Sector Fund (XLV) rose 0.5%, snapping a nine-week losing streak.
Reflecting stocks from more speculative stories, the ARK Innovation ETF (ARKK) was up 5.25% last week and the ARK Genomics ETF (ARKG) was up 4.5%. Tesla stocks are a major component in Ark Invest ETFs.
Five best Chinese stocks to watch now
Actions near points of purchase
Shares of Nextracker rose 4.6% to 33.35 on Friday, capping a weekly gain of 10%. Shares of NXT broke above an IPO base buy point of 33.05 on Friday, according to MarketSmith analysis. The solar tracking and software firm, which went public at $24 a share in early February, is profitable on already sizeable sales.
Several solar stocks are doing well, with First Solar increasing its gains last week. nextracker rival matrix technologies (ARRY) is not far from actionable, whereas canadian solar power (CSIQ) flirted with a buy signal.
CAT shares rose 8.1% to 255.1 last week, recapturing its 50-day line and offering early entry. As of Friday’s close, Caterpillar has a new flat base just above previous consolidations. The buy point is 266.14. Several other machinery stocks are also showing strength.
RCL shares rose 5.5% to 74.02 last week, rebounding from the 21-day moving average. The Royal Caribbean stock has a very deep handled cup base dating back to last April. The buy point is 76.40, but on Friday he offered an early entry. One problem: the volume was low on Friday and during the week. A lot of travel stocks are showing bullish action.
ON shares were up 3.49% at 78.94 for the week, but it was a wild ride. On Semiconductor, also known as Onsemi, plunged to its 50-day intraday line on Thursday after key customer Tesla said it aimed to reduce the use of silicon carbide in its next-generation vehicle. But ON’s shares closed down just 1.9% and then rallied on Friday to retake the 21-day line. On Semiconductor shares are back above a buy point of 77.38 and have yet to break out from their 50-day/10-week lines. But investors should know that this is a volatile stock.
PDD shares were up 14.3% for the week at 95.69, rallying above the 50-day line on above-average volume. PDD Holdings is the parent company of Chinese e-commerce giant Pinduoduo, as well as Temu’s new US site. Shares fell on February 21 as a larger rival jd.com (JD) said it would increase spending to compete against the value-focused Pinduoduo.
PDD shares offer an early entry into an emerging consolidation, which needs another week to be a proper footing.
apple stock
Apple shares rose 2.9% to 151.03 for the week, including Friday’s 3.5% gain to recapture the 200-day and 21-day lines. The iPhone giant has a buy point of 157.48 on a basis going back to August. Aggressive investors could buy AAPL shares from its 200-day bounce line. But with a relatively low RS rating and uninspiring growth estimates, there may be a number of better options out there. Still, Apple shares participating in the market rally is positive for the major indices.
Tesla Stock
Tesla shares fell below their 21-day line for the first time in weeks on Thursday, but rebounded on Friday and closed the week up 0.5% at 197.86. TSLA shares have stalled for a few weeks below the 200-day line after a big run at the start of the year. Investors could arguably use 217.75 as a buy point, although they should probably wait for Tesla stock to break above the 200-day line as well, which is now below 221.
The electric vehicle giant announced that it will build a plant in Mexico, which will produce its next-generation vehicle. But Tesla did not unveil a new EV at Investor Day on Wednesday, saying it will come “later.”
Meanwhile, demand for Tesla appears to be declining again after an initial boost from January’s big price cuts. In recent days, the electric vehicle giant has reduced European prices for Model 3 and Y vehicles in stock by a further 6%.
Weekly Chinese EV registration data on Tuesday will be important in gauging demand in the world’s largest EV market, which is in the midst of a major price war started by Tesla.
Tesla vs. BYD: EV giants are vying for the crown, but which is the best buy?
Market recovery analysis
The stock market rally marked a key turning point, with a large bullish reversal late in the week.
On Thursday morning, the S&P 500 broke above its 200-day line. The Nasdaq was nearing its 50-day line while the Dow Jones was at its 2023 lows. It is not an exaggeration to say that the market rally appeared to be on its last legs.
As of Friday’s close, the S&P 500, Nasdaq and Russell 2000 had rallied above their 21-day moving averages, which had served as resistance for the past two weeks. The Nasdaq finally had a bullish outside week, adding to the bullish turnaround.
Many leading stocks from a variety of sectors issued buy signals at the end of the week, while others positioned or extended previous moves.
Chips, building materials, travel, housing, software, medicine, machinery, e-commerce, automakers (not just Tesla stock), auto parts makers and more are showing strength. .
It is notable that the bullish reversal of the market rally began with the 10-year Treasury yield well above 4%. That yield was back below 4% on Friday, but it has skyrocketed over the last month.
It wouldn’t take long for the S&P 500 and Nasdaq to break back below their 21-day lines and test major support. On the upside, the early February highs are the next big area of ​​resistance.
Time the Market with IBD’s ETF Market Strategy
What to do now
The market rally staged a dramatic comeback at the end of the week. Major indices are showing momentum, while major stocks are advancing. Broad participation and leadership is another bullish sign.
It is a good time for investors to initiate new positions. Don’t be too quick to increase your exposure, and make sure you’re not too focused. The market rally could easily fail again, so you don’t want to get caught making large bets on a single day or stock. If this uptrend has any real legs, it won’t take long to “gradually” fully reverse.
This is an important weekend to build your watchlists. Yes, many of the major stocks have been broken down or have shown early entries. But several are still within scope, while dozens of others are close to actionable.
Read The Big Picture every day to stay in sync with market direction and major stocks and sectors.
Follow Ed Carson on Twitter at @IBD_ECarson for stock market updates and more.
YOU MIGHT ALSO LIKE:
Why this IBD tool simplifies the search for the best stocks
Do you want to make quick profits and avoid big losses? Try SwingTrader
The best growth stocks to buy and watch
IBD Digital: Unlock IBD’s Premium Stock Listings, Tools & Analytics Today
AI Stock Headlines 5 Leading Blinking Buy Signals