Technical Analyst, Vermilion Research

Joe Jasper

Technical Analyst

Technical and Quantitative Research

Vermilion Research

Vermilion’s objective is to deliver timely, actionable, and unique technical research to professional investors through the application of our various technical indicators.

Our research strategists seek to highlight securities which we believe are at major inflection points, based on our various technical and quantitative indicators, and offer asymmetric risk/return profiles. Our unique research methodology, centered on relative strength, enables our strategists to deliver superior investment recommendations.

Our process begins by organizing the universe of actively traded stocks into discrete sectors, then into industry groups. We then apply our technical and quantitative tools to identify developing price trends. Once attractive trends are identified within a selected sector or group, we screen for individual stocks which we believe offer the best risk/reward profile. We provide a historical perspective that often reveals, through our long-term charts, how price patterns often repeat themselves over time.

Technical Analysis

<ul>
<li>Ever since our 5/30/23 ETF Pathfinder, our view has been that we cannot be bearish unless a key support level breaks (at the time, that was 4050 on the SPX).</li>
<li>The S&amp;P 500 is now above 4300-4325 -- a level that, in January this year, we had anticipated would cap upside for 2023.</li>
<li>We believe 4300-4325 will act as major support moving forward, and we are bullish as long as the SPX is above 4300; we discussed this in our 7/3/23 ETF Pathfinder.</li>
</ul>


Ever since our 5/30/23 ETF Pathfinder, our view has been that we cannot be bearish unless a key support level breaks (at the time, that was 4050 on the SPX).
The S&amp;P 500 is now above 4300-4325 -- a level that, in January this year, we had anticipated would cap upside for 2023.
We believe 4300-4325 will act as major support moving forward, and we are bullish as long as the SPX is above 4300; we discussed this in our 7/3/23 ETF Pathfinder.


DXY Break Below $101 Suggests Breakouts Likely Coming for Equal-Weight SPX, Dow, and Russell 2000

iShares Russell 2000 ETF / Technical Analysis

<ul>
<li>We discussed last week how consolidation was likely, so far that has played out with the SPX back testing the 4300-4325 area which we anticipated would cap upside for 2023.</li>
<li>We continue to watch short-term support at 4300, and we cannot be bearish if the S&amp;P 500 is above 4300.</li>
<li>The Russell 2000 (IWM) is back to test support at $180; we would expect to see this hold as support, but a failure to hold would mean a trip to $170<span id="autocomplete"><span id="autocomplete-searchtext"></span></span>
</li>
</ul>


We discussed last week how consolidation was likely, so far that has played out with the SPX back testing the 4300-4325 area which we anticipated would cap upside for 2023.
We continue to watch short-term support at 4300, and we cannot be bearish if the S&amp;P 500 is above 4300.
The Russell 2000 (IWM) is back to test support at $180; we would expect to see this hold as support, but a failure to hold would mean a trip to $170



Russell 2000 (IWM) Testing $180 Support; Breadth Remains Constructive; Construction/Engineering Buys

<ul>
<li>We continue believe that upside is limited with the S&amp;P 500 testing the top-end of our anticipated 2023 trading range (4165-4200).</li>
<li>Our gameplan remains unchanged; reduce risk near resistance (where we are now) and add risk near support (the December 2022 lows at 3765 and/or the 2022 lows at 3490).</li>
<li>A break above 4200 on the SPX would likely mean a test of 4300-4325, which we would view as a selling opportunity. A break below 4050 would kickstart a pullback.</li>
</ul>


We continue believe that upside is limited with the S&amp;P 500 testing the top-end of our anticipated 2023 trading range (4165-4200).
Our gameplan remains unchanged; reduce risk near resistance (where we are now) and add risk near support (the December 2022 lows at 3765 and/or the 2022 lows at 3490).
A break above 4200 on the SPX would likely mean a test of 4300-4325, which we would view as a selling opportunity. A break below 4050 would kickstart a pullback.


SPX Forming Coiled Spring Between 4200 and 4050; 10Y/2Y Treasury Spread Suggests Recession Close

<ul>
<li>We still recommend a tactical overweight to defensives (Staples, Utilities, Healthcare, and gold miners) as the SPX tests our 4165-4200 resistance range, and also resistance from the prior 1.5-month uptrend.</li>
<li>As we await Wednesdays FOMC announcement, the DJIA and Nasdaq Composite are testing 1-year resistances at 34,280 and 12,300, the DXY appears to be inflecting higher, and breadth remains weak.</li>
<li>While we still see a reach to 4300-4325 as possible, we believe playing for more upside is akin to picking up pennies in front of a steamroller.</li>
</ul>


We still recommend a tactical overweight to defensives (Staples, Utilities, Healthcare, and gold miners) as the SPX tests our 4165-4200 resistance range, and also resistance from the prior 1.5-month uptrend.
As we await Wednesdays FOMC announcement, the DJIA and Nasdaq Composite are testing 1-year resistances at 34,280 and 12,300, the DXY appears to be inflecting higher, and breadth remains weak.
While we still see a reach to 4300-4325 as possible, we believe playing for more upside is akin to picking up pennies in front of a steamroller.


S&P 500 Testing 4165-4200, DJIA Testing 34,280, Nasdaq Composite Testing 12,300; Stay Defensive

<ul>
<li>On 3/21/23 we discussed the potential for a 2-5% rally to the 1.5-month downtrend on the SPX, or the 4165-4200 range, which would set up an opportunity to get defensive.</li>
<li>The S&amp;P 500 has gained 4.5% since, but has reversed topside the downtrend, putting a test of 4165-4200 in play.</li>
<li>We still believe 4165-4200 will cap upside in 2023 -- with a reach to 4300-4325 also possible -- but considering limited upside, we recommend shifting toward defensives.</li>
</ul>


On 3/21/23 we discussed the potential for a 2-5% rally to the 1.5-month downtrend on the SPX, or the 4165-4200 range, which would set up an opportunity to get defensive.
The S&amp;P 500 has gained 4.5% since, but has reversed topside the downtrend, putting a test of 4165-4200 in play.
We still believe 4165-4200 will cap upside in 2023 -- with a reach to 4300-4325 also possible -- but considering limited upside, we recommend shifting toward defensives.


$SPX 4165-4200 in Play; WTI Crude Testing $82 Resistance; Buys in Gold Miners, Waste Services

United States

Financial Select Sector SPDR Fund is an exchange-traded fund incorporated in the USA.  The Fund's objective is to provide investment results that, before expenses, correspond to the performance of The Financial Select Sector.  The Index includes financial services firms whose business' range from investment management to commercial & business banking.

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Financial Select Sector SPDR F (XLF US)

DXY Break Below $101 Suggests Breakouts Likely Coming for Equal-Weight SPX, Dow, and Russell 2000

$DXY Break Below $101 Suggests Breakouts Likely Coming for Equal-Weight SPX $RSP, Dow $DJI, and Russell 2000 $IWM $RTY. $SPX remains bullish as...

Vermilion Research

Russell 2000 (IWM) Testing $180 Support; Breadth Remains Constructive; Construction/Engineering Buys

Russell 2000 $IWM Testing $180 Support; $RTY $SPX Breadth Remains Constructive; Highlighting buy ideas in Services (Research/Consulting &...

Vermilion Research

SPX Forming Coiled Spring Between 4200 and 4050; 10Y/2Y Treasury Spread Suggests Recession Close

We continue believe that upside is limited with the $SPX testing the top-end of our anticipated 2023 trading range (4165-4200). On the off chance...

Vermilion Research

S&P 500 Testing 4165-4200, DJIA Testing 34,280, Nasdaq Composite Testing 12,300; Stay Defensive

$SPX testing our 4165-4200 resistance range, $DJI testing 34,280 1-yr resistance, Nasdaq Comp $COMPQ testing critical 12,300 resistance. All while...

Vermilion Research

$SPX 4165-4200 in Play; WTI Crude Testing $82 Resistance; Buys in Gold Miners, Waste Services

The $SPX reversed topside the 2-month downtrend, putting a test of 4165-4200 in play. We still believe 4165-4200 will cap upside in 2023;...

Vermilion Research

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