Coming off a three day weekend the markets opened rather weak as the financial stocks held the markets back. This is the inauguration week and traders are left to speculate how the markets will respond to the reality the Donald Trump will be the next president of the United States.
The Financials (NYSE: XLF) are lower by 2.38% so far this week as Morgan Stanley (NYSE: MS) reported their earnings along with others. The technical pattern now on the XLF leads traders to believe that the financials have begun a breakdown. This is due to the close under the range of the last month and a half. This is a pretty obvious pattern for technical traders so many are now leaning bearish in the short term.
The Russell 2000 (NYSE: IWM) has also shown some weakness so far this week with a loss on Tuesday of 1.36%. Although the trend is only slightly downward, traders have been taking note of the short term downtrend on the IWM. For the year the IWM is negative but just slightly off all time highs.
Gold (NYSE: GLD) has started to make headlines as the rally continues to gain momentum. There is some talk of a pullback due to the overbought nature of this rally but so far traders have seen none of it. Tuesday the GLD was able to add another 1.44% bringing its total move to 8.5% since setting a low just one month ago.
The Nasdaq 100 (NASDAQ: QQQ) refuses to pullback at all. Even with a small down day on Tuesday the QQQ remains just a whisper off all time highs. This is largely due to the recent moves in popular tech names like Apple (NASDAQ: AAPL) which just made a new high on Tuesday. Traders continue to note that the trend remains strong on the Nasdaq and volume shows very little signs of selling.