O’Neil Health Care Weekly

XLV fell 2.6% last week closing back below its 21- and 50-DMA ($134.72), which will again act as near-term resistance. The next
range of support is $127.35 to $130. Its RS line remains near all-time lows, still warranting an underweight sector positioning.

O’Neil Market View

U.S. Market

 

The U.S. market remains in a Confirmed Uptrend. Indices were relatively flat for the week, as the S&P 500 and Nasdaq are consolidating above 21-DMA (5,943, 19,290) support and remains only 3–4% off all-time highs. The distribution day count stands at five and three, respectively, with two days expiring on the S&P 500 next week.

O’Neil Health Care Weekly

XLV gained 1.3% last week, regaining its 50-DMA (~$135) which will now act as near-term support above the rising 21-DMA
($134.30). Its RS line has rallied off lows, however, it remains near all-time lows, still warranting an underweight sector positioning.
We will be looking for XLV to settle above its 50-DMA and for a further rise in its RS line before recommending an equal weight
positioning.

O’Neil Market View

U.S. Market

 

The U.S. market is in a Confirmed Uptrend. The S&P 500 and Nasdaq fell 0.4% and 0.6%, respectively, last week. Indices are 2–3% off their all-time high (6,147; 20,204), with primary support at rising 21-DMAs (5,921; 19,172). The distribution day count stands at five and three, respectively, after the S&P 500 added one on Friday.

 

This week, all sectors except Consumer Staple closed above their 50-DMA and all but Consumer Staple, Health Care, and Transportation above their 200-DMA.

 

O’Neil Health Care Weekly

XLV gained 1.3% last week and is now testing key resistance at its rolling 50-DMA ($135.83). Near-term support is now the rising 21-
DMA ($133.39) followed by ~$130. Its RS line remains near multi-decade lows, still warranting an underweight sector positioning.

O’Neil Market View

The U.S. market is in a Confirmed Uptrend. Indices rose 1–2% this week and are approaching all-time highs ( 6,147, 20,204) which is less than ~3% away. The first level of support for the S&P 500 and Nasdaq is at their 10-DMA (5,935; 19,254). The distribution day count stand at four and three, respectively, with one day expiring on the S&P 500 next week.

O’Neil Health Care Weekly

XLV gained 1.8% last week, rallying from YTD lows and back into rolling 21-DMA ($133.40) resistance. Though the sector continues
to trade near long-term support at ~$130, its RS line remains near all-time lows, still warranting an underweight sector positioning.

O’Neil Market View

U.S. Market

 

The U.S. market remains in a Confirmed Uptrend. The S&P 500 and Nasdaq rose 1.9% and 2.0%, respectively, for the week. Indices are still testing resistance near 5,970/19,200 and have immediate support at their rising 21-DMA (5,802/18,617). The distribution day count remains at three and two, respectively.

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O’Neil Health Care Weekly

XLV fell over 2% last week after hitting resistance at the falling 21-DMA ($133.96). Though the index is trading near support between
$127-$130, its RS line remains near all-time lows, still warranting an underweight sector positioning.