Markets Look Primed to Finish the Year Strong
The HCM-BuyLine® is positive, and as per usual, any pullback should be bought. Look for the market to move higher over the last two quarters of 2021. Fed Chair Powell gave the markets a boost this morning with his comments about being slow to raise rates, but in all probability, they will start to taper later in the year. Another positive for the markets is that the Delta-variant is receding (our central case), economic resilience will resume, and this is a positive setup for stocks. This is the reason we have seen Cyclicals rallying so strongly in the past week.

The Semiconductors index (SOXX) again looks strong and has been slowly moving higher. If it can break above $471, this index should move much higher and end the year strong. We would buy the ETF and not try to pick a few stocks.

JETS, the ETF of all the major airlines, has made a short-term double bottom and looks ready to move higher. If it can move to about $24 we could see a run up to the 1st quarter highs around $29 a share. Any good news on the Delta Covid front will help this sector.

Last we have IBB, a Biotech ETF. It did move above its February high, and point of resistance at $174, but has since pulled back to the 50-day moving average. We think it is looking stronger and should perform well going into the last two quarters.