The NYSE Fang+ Index Looks Poised for Some Strength From Here

Back from vacation and taking a look at the NYSE Fang+ Index this morning with the symbol "NYFANG". According to ICE literature, the index "includes 10 highly liquid stocks that represent the top innovators across today's tech and internet/media companies." The index is equally weighted across all stocks and "allows for a more diversified and represented portfolio. NYSE FANG+ is one of the most highly correlated indices to technology and related stocks."

All well and good but let's take a look at the charts and indicators (sorry, no volume).

In this daily bar chart of NYFANG, below, we can see a rally from late September of 2017. A peak in June can be seen followed by lower highs and lower lows until this month. Prices are below the declining 50-day moving average line but above the limited 200-day line. The price driven indicators show some promise or upside from here.

Prices made equal lows in late July and early September but the 12-day price momentum study in the first panel shows a bullish divergence with higher lows from July to September, suggesting that buyers slowed the second decline.

In the middle panel is the Moving Average Convergence Divergence (MACD) oscillator which is narrowing from below the zero line. A cover shorts buy signal could develop in the days ahead.

In the lower panel is the slow stochastic indicator. This oversold/overbought indicator shows an oversold extreme for this index - this can be a buy signal in a sideways market.

In this limited weekly candlestick chart, below, we can see a mixed picture. The index shows lower shadows or rejection around 2,700. The index is above the rising 40-week moving average line.

Momentum shows an "uptick" this week versus last week.

The MACD oscillator is still bearish and the weekly stochastic reading is not very oversold.

Bottom line strategy: Though some stocks in this index look weak, others are strong and may be strong enough to turn NYFANG to the upside. Aggressive investors should look for this index to turn up from here.

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