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

Financial Select Sector SPDR F / Technical Analysis

<ul>
<li>We will stay near-term bullish as long as crucial support levels of 6780-6824 on SPX and $255-$257 on IWM continue to hold. With that said, we continue to see deterioration...</li>
<li>...in market dynamics that has us concerned of a deeper pullback, potentially to 6720-6776, 6690, or 6480-6520 on SPX, but 6780-6824 support would need to break first</li>
<li>Financials (XLF) and Discretionary (XLY) are violating crucial price and RS supports, and we are downgrading both Sectors to underweight</li>
</ul>


We will stay near-term bullish as long as crucial support levels of 6780-6824 on SPX and $255-$257 on IWM continue to hold. With that said, we continue to see deterioration...
...in market dynamics that has us concerned of a deeper pullback, potentially to 6720-6776, 6690, or 6480-6520 on SPX, but 6780-6824 support would need to break first
Financials (XLF) and Discretionary (XLY) are violating crucial price and RS supports, and we are downgrading both Sectors to underweight


Defensives Still Leading; Deeper Pullback?; Downgrading Financials and Discretionary to Underweight

<ul>
<li>Our outlook remains bullish and we see the market in the midst of a significant end-of-year rally that we have been expecting since mid-October.</li>
<li>We continue to expect support at 20-day MAs on $SPX and Nasdaq 100 (QQQ), while support at current levels or the 50-day MA is likely on the Russell 2000 (IWM).</li>
<li>Market dynamics continue to improve, giving us confidence that this bull run is likely to go at least another month into mid-January, and quite likely beyond.</li>
</ul>


Our outlook remains bullish and we see the market in the midst of a significant end-of-year rally that we have been expecting since mid-October.
We continue to expect support at 20-day MAs on $SPX and Nasdaq 100 (QQQ), while support at current levels or the 50-day MA is likely on the Russell 2000 (IWM).
Market dynamics continue to improve, giving us confidence that this bull run is likely to go at least another month into mid-January, and quite likely beyond.


Growth Leading This EOY Rally; Expect More Upside. PHLX Semis $SOXX With a Bullish 5-Month Reversal

<ul>
<li>We downgraded our long-term outlook to neutral last week (8/6/24 Compass) after being bullish since early-November 2023. We still believe the SPX is going through a 1-to 4-month consolidation phase.</li>
<li>It is possible the low for this consolidation has been established within our expected pullback zone of 5100-5191 that we discussed two weeks ago (7/30/24 Compass)</li>
<li>In terms of upside, the SPX could test its YTD highs or make a marginal new high, or could also see it roll over at the 5400 or 5585 resistances.</li>
</ul>


We downgraded our long-term outlook to neutral last week (8/6/24 Compass) after being bullish since early-November 2023. We still believe the SPX is going through a 1-to 4-month consolidation phase.
It is possible the low for this consolidation has been established within our expected pullback zone of 5100-5191 that we discussed two weeks ago (7/30/24 Compass)
In terms of upside, the SPX could test its YTD highs or make a marginal new high, or could also see it roll over at the 5400 or 5585 resistances.


Downgrading Discretionary to UW; 2000, 2007, 2022 SPX Top Similarities Suggest Test of YTD Highs

<ul>
<li>Mega-Cap growth names such as AMZN, TSLA, MSFT, GOOGL, and META have picked up the slack as semiconductors (SMH, SOXX, NVDA, AVGO, etc.) are simply consolidating after getting extended.</li>
<li>This was a possibility we discussed in last week's Compass (6/25/24), which means we are not seeing any lasting rotation away from large-cap growth.</li>
<li>We remain bullish on all names listed (including the semiconductors), and we continue to recommend an overweight to large-cap growth (relative to value) as initially discussed in our 5/29/24 Compass</li>
</ul>


Mega-Cap growth names such as AMZN, TSLA, MSFT, GOOGL, and META have picked up the slack as semiconductors (SMH, SOXX, NVDA, AVGO, etc.) are simply consolidating after getting extended.
This was a possibility we discussed in last week's Compass (6/25/24), which means we are not seeing any lasting rotation away from large-cap growth.
We remain bullish on all names listed (including the semiconductors), and we continue to recommend an overweight to large-cap growth (relative to value) as initially discussed in our 5/29/24 Compass


Remain Overweight Large-Cap Growth; Downgrading Materials to Underweight; Software Buys $MSTR $CRWD

<ul>
<li>Our bullish outlook (since early-November 2023) remains intact. Few things are more bullish than indexes (SPX, NDX) breaking out to all-time highs following a major correction we had in 2022</li>
<li>Last week (5/21/24) we discussed how it is a very bullish sign that there have been three upside gaps in May on the S&amp;P 500, with all gaps left unfilled.</li>
<li>Important short-term gap supports we are watching on SPX include 5250-5263, 5127-5142, and 5073-5101; so far 5250-5263 support has held. Also downgrading Industrials (XLI) to market weight</li>
</ul>


Our bullish outlook (since early-November 2023) remains intact. Few things are more bullish than indexes (SPX, NDX) breaking out to all-time highs following a major correction we had in 2022
Last week (5/21/24) we discussed how it is a very bullish sign that there have been three upside gaps in May on the S&amp;P 500, with all gaps left unfilled.
Important short-term gap supports we are watching on SPX include 5250-5263, 5127-5142, and 5073-5101; so far 5250-5263 support has held. Also downgrading Industrials (XLI) to market weight


Downgrading Manufacturing (XLI) To Market Weight; Shift to Overweight Growth; 5250-5263 SPX Holding

United States

iShares Russell 1000 Growth ETF is an exchange-traded fund incorporated in the USA. The ETF tracks the performance of the Russell 1000 Growth Index. The ETF holds mostly large-cap U.S. stocks. Its investments are in companies whose earnings are expected to grow at an above-average rate relative to the market. The ETF weights the holdings by market capitalization.

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iShares Russell 1000 Growth ET (IWF US)

Defensives Still Leading; Deeper Pullback?; Downgrading Financials and Discretionary to Underweight

Defensives Still Leading; Deeper Pullback Coming?; Downgrading Financials $XLF and Discretionary $XLY $XRT to Underweight. Crucial support levels...

Vermilion Research

Growth Leading This EOY Rally; Expect More Upside. PHLX Semis $SOXX With a Bullish 5-Month Reversal

Growth Leading This EOY Rally $MSFT $AAPL as Tech $XLK Breaks Out; Expect More Upside $ARKK $ARKW $ARKF $BITQ $WGMI. PHLX Semiconductor $SOXX With...

Vermilion Research

Downgrading Discretionary to UW; 2000, 2007, 2022 SPX Top Similarities Suggest Test of YTD Highs

Downgrading Discretionary $XLY to Underweight; 2000, 2007, 2022 SPX Top Similarities Suggests Possible Test of YTD Highs; Expect Semiconductors...

Vermilion Research

Remain Overweight Large-Cap Growth; Downgrading Materials to Underweight; Software Buys $MSTR $CRWD

Remain Overweight Large-Cap Growth $IWF as discussed 5/29/24; Downgrading Materials $XLB to Underweight; Buy/Stay Long Software Stocks $IGV $MSFT...

Vermilion Research

Downgrading Manufacturing (XLI) To Market Weight; Shift to Overweight Growth; 5250-5263 SPX Holding

Downgrading Manufacturing $XLI to Market Weight; Shift to Overweight Growth $IWF; Three May $SPX Upside Gaps Unfilled = Bullish; Expect supports at...

Vermilion Research

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