By: John Kosar of Street Authority
Major U.S. indices closed mixed last week, with the broad-market SP 500 and tech-heavy Nasdaq 100 closing higher and the blue-chip Dow industrials and small-cap Russell 2000 closing lower. The bigger takeaway to last week's lack of direction is that the bellwether SP 500 has been moving sideways for the past month and is essentially unchanged since July 1.
This recent loss of upward momentum suggests some distribution/profit-taking has been occurring and defines a near-term decision point in the index, bordered by 1,986 on the upside and 1,953 on the downside, from which its 2014 advance must resume if still healthy and intact.
Small Caps, Volatility Will Be Key Again This Week
In the July 14 and July 21 Market Outlooks, I pointed out that the Russell 2000 and the Vanguard Small Cap Growth ETF (NYSE: VBK) were situated right on top of major support levels and amid favorable conditions to resume their 2014 advances -- if they were still valid. Following initial rebounds, Friday's sharp decline positioned both back on top of these levels -- 1,143 on the Russell 2000 and $121.53 on VBK. Continue reading "Next Gold Buying Opportunity May Be Just Around the Corner"