Coming off of last week’s strong gains, the major index ETFs are mostly overbought headed into the new week with eight firmly overbought while the remaining six are still neutral. Those that are overbought are predominantly large caps, though, the Dow (DIA) is actually still neutral and tied with the Core S&P Small Cap ETF (IJR) for the least gains last week at only 1.43%. No doubt this comes as a result of the wild fluctuations in Boeing (BA). While no other small-cap performed as poorly as IJR last week, small and mid-caps have underperformed recently. Despite weaker gains in the past few weeks, since the start of 2019 this group has still treated investors well. While on this topic, the Nasdaq (QQQ), which rose 4.19% last week, has also become one of the best performers year to date. The rapid increase over the past week also leaves the ETF the most extended above its 50-DMA and the most overbought.
On a sector level, the tech-heavy Nasdaq’s rapid rise last week can be credited to the Technology Sector’s (XLK) strength in the past week as the ETF rose 4.56%, making it the most overbought and the furthest above the 50-DMA. Outside of Industrials (XLI) again due to Boeing, every sector has seen a significant push towards overbought levels in the past week. Namely, the Health Care Sector (XLV) has risen from right at the 50-DMA to just under one standard deviation above today.