To The Moon

Dow Jones Futures Fall: Is Uptrend More Than Bear Market Rally? Apple Leads 4 Dow Stocks In Focus

Dow Jones futures fell slightly Sunday evening, along with S&P 500 futures and Nasdaq futures. The stock market rally held support levels last week. Now can the S&P 500 move above its 200-day moving average in the coming days and weeks? Apple (AAPL) could be key.

Apple stock held key levels and rose modestly even as the overall market generally retreated. Like the S&P 500, the iPhone tech titan is coming back toward its 200-day line. A decisive move above that level could offer a buying opportunity. But another rejection could offer another chance to short AAPL stock.

Meanwhile, fellow Dow Jones components Boeing (BA), JPMorgan Chase (JPM) and GS stock have quietly been on significant runs in the past several weeks, contributing to the Dow's outperforming in the current market rally. BA stock technically is right around a traditional buy point. Goldman Sachs (GS) is forging a deep base while JPM stock still has work to do.

Dow Jones Futures Today

Dow Jones futures fell 0.3% vs. fair value. S&P 500 futures declined 0.3%. Nasdaq 100 futures lost 0.3%.

The 10-year Treasury yield fell 2 basis points to 3.8%.

Hong Kong's Hang Seng index opened sharply lower. Hong Kong leader John Yee tested positive for Covid after returning from the APEC summit.

Remember that overnight action in Dow futures and elsewhere doesn't necessarily translate into actual trading in the next regular stock market session.

Stock Market Rally Analysis

Last week, the Dow Jones Industrial Average rose less than 0.1% in last week's stock market trading. The S&P 500 index declined 0.7% and the Nasdaq composite slumped 1.5%. The small-cap Russell 2000 gave up 1.75%.

On Tuesday, Nov. 15, the S&P 500 briefly topped 4,000, getting close to the 200-day moving average. That level is especially important because the benchmark index was turned back just 1 point from the 200-day line on Aug. 16, triggering another leg in the bear market.

A decisive move above the 200-day line, which would also roughly coincide with a declining-tops trendline from the Jan. 4 all-time high, would be a powerful signal that the uptrend is more than a bear market rally.

The S&P 500 clearing the 200-day line would also be a positive backdrop for leading stocks, which have struggling near buy points amid a choppy market.

Meanwhile, the Russell 2000 fell back below its 200-day line last week but would likely retake that level ahead of the S&P 500. The Dow Jones, buoyed by Boeing, Goldman and JPM stock is comfortably above the 200-day. But clearing last week's high would get the Dow back to 34,000 and just below its August peak.

The Nasdaq, weighed down by aggressive growth, is 8.3% below the 200-day line. Moving above last week's highs would be a good first step. Also a positive: The 21-day moving average just edged above the 50-day line on Friday.

Thanksgiving week isn't necessarily a great time for a big market move. Markets will be closed on Thanksgiving with a half-day session on Friday. Volume will likely be light throughout the week. The following week ends with a bang. On Dec. 1, investors will get October PCE inflation data, along with ISM's November manufacturing index. On Dec. 2, the November jobs report is due. That news could have a big impact on Fed rate hike expectations, bond yields and stock prices.

So it wouldn't be a surprise to see the major indexes trade in a range over the next week or so. There's nothing wrong with a little consolidation for the major indexes and leading stocks.

Apple Stock

Apple stock rose 1.1% last week to 151.29, following the prior week's 8.2% spike. Shares held their 50-day moving average, with the 21-day line set to overtake the 50-day. AAPL stock is only modestly below its 200-day line. The Dow giant flirted with its 200-day on Oct. 28 following earnings. But that turned out to be a great opportunity to short, with shares tumbling in a few days to their worst close since mid-June.

A decisive move above the 200-day line, perhaps clearing the Oct. 28 high of 157.50, would offer an early entry in a bottoming base starting on Aug. 17. But if Apple stock reverses lower from that area, it could provide a new shorting opportunity.

Apple's success or failure at the 200-day line could be key for the S&P 500's own attempt, and vice versa.

Boeing Stock

BA stock fell 2% to 173.89, following a 47% run over five weeks. While the Dow Jones aerospace giant reversed lower Oct. 26 on earnings, shares bounced back, especially on a bullish cash-flow guidance a few days later.

Technically, Boeing stock is just below 173.95 cup-base buy point. But shares are 9.5% above their 200-day line and 19.5% over their 50-day. Pausing around current levels could create a safer buying opportunity.

Boeing is expected to turn a profit in 2023, ending four years of losses.

Goldman Stock

GS stock slipped 1.55% to 379.20 last week. On a daily chart, shares are extended from a 358.72 cup-base buy point within a much-larger consolidation. On a weekly chart, Goldman stock has a 389.68 buy point from a yearlong cup-with-handle base, according to MarketSmith analysis. But after a 28% gain over a four-week winning streak, it's an awfully tiny handle. A longer, deeper handle would be helpful, and let the 50-day line close the gap.

The relative strength line is at a four-year high, reflecting Goldman stock's outperformance vs. the S&P 500. The RS line is the blue line in the charts provided.

PM Stock

JPMorgan stock dipped 1.1% to 133.84 last week. That's after a 29.5% advance over six weeks. Shares are above their 50-day and 200-day lines, but have work to do. JPM stock could build the right side of a long, deep consolidation, or it could forge a bottoming base.