• Happy New Year everyone. I hope 2022 brings you good health, happiness and prosperity.

Santa Rally

• Santa rally did not disappoint this year with the SPY having its best December since 2010.
•  $SPX has put on a serious display of strength during Santa Rally .
•  There was a 270-point rally over six trading days, from December 20th to 28th. Now, $SPX is trying to consolidate those gains

IWM and QQQ – Divergence

•  The trouble lies beneath the surface, where extremely broad based indices such as the Russell 2000 ($RUT; IWM) and the NASDAQ (QQQ) Composite are lagging well behind.
• But, we have seen these negative divergences fairly frequently in the last six months. They did lead to limited selling in September and December, so this one may not $SPX has broken out, and the Dow and $NDX are not far behind. But many stocks are lagging.
• As for the $SPX chart, there should be support at the old breakout level near 4700, although that has not been tested yet. If $SPX should fall back below there, it would be back in its old trading range, with support at 4500. However, a pullback of that magnitude – while not necessarily setting off bear market alarms – would remove the current “bullish” status from the $SPX chart.

What happening  this Week:

• Tesla car deliveries sets records. This record combined with the news flow coming from the Consumer Electronics Show (CES) this week will likely boost the tech sector and EV stocks specifically.
• Maybe the China stocks are finding a bottom.
• Continued US dollar weakness good for commodities and emerging markets.

Sectors in Play

Utilities, healthcare and defensive staple stocks were best performers last week.

Tech could catch a bid this week but overall, the sector has been showing some weakness.

Earnings:

Earnings on deck this week: Thursday – BBBY, WBA and STZ

Watching:

AAPL – strong run up – $180 put in a double top and $175 is moving average support. We may just consolidate here.

AMD – news at CES about new chip. $141 support and $155 resistance

BIDU – Strong Thursday. A break through $150 and next target is $155

DIS – break above $158 for continuation higher.

FB – Support $325 and resistance $350

LCID, NIO, XPEV, TSLA – in play Monday on good delivery news.

NVDA – maybe some CES news this week $290 is important support level.