ARK Innovation ETF: Is ARKK signaling that stocks have bottomed out?

  • ARKK ETF was up over 1% on Wednesday as it continues to recover.
  • ARKK stock is up nearly 10% over the past week.
  • As one of the riskier growth ETFs, ARKK may a signal of the bottom.

ARK Invest and Cathie Wood have been a favorite target of bears in the first half of 2022 with the former high-flying fund manager and ETF both falling from grace as 2022 progressed into bear market territory. Now though a curious outperformance has begun, not just in ARKK but across the tech and high-growth sectors. Does this point to a stock market bottom, or is this just a pause before another leg lower?

ARKK stock news

ARKK is down 66% from June 2021, 57% for 2022, and 38% over the past three months. Lately though, we have begun to see a possible bottom in the growth and tech space. Let us take a look at some formerly beaten-down names and sectors to illustrate.

ARKK weekly chart

ARKK has stopped short of the $33 low from March 2020 or the pandemic low.

Another high-risk, high-growth sector also looks to have bottomed out. See below the chart of KWEB ETF. This is the China Internet ETF and includes such names as Alibaba,, Baidu, etc. 

KWEB ETF chart, daily

Things look slightly less positive for the DJ Internet Fund or FDN ETF, but it still has so far held the pandemic lows and looks oversold on both the Relative Strength Index (RSI) and Money Flow Index (MFI) indicators. This one holds the likes of Netflix, Paypal, Airbnb, Twitter, Amazon, Meta, Google, etc.

FDN ETF chart, weekly

The percentage of stocks trading above their 200-day moving average has continued to fall in this bear market. The chart below shows the number of stocks above their 200-day moving average (green line) to be at 15% of the overall number of stocks on the NYSE. Previous moves under 15% are associated with bottoms in the S&P 500 (orange line).

For June, growth and momentum stocks have outperformed value. Chart below shows Value ETF (VLUE) in orange versus Momentum (MTUM) in green and Growth (SPYG) in blue.

ARKK Stock forecast

Have we bottomed out? That is a big ask. My feeling is that this is merely some position adjusting ahead of the end of the first half of the year and option and flow needs. The next earnings season should finally see Wall Street analysts lower their EPS forecasts, which could see a bottom form sometime in late summer or fall. $35 remains key short-term support in ARKK, and then the $33 pandemic low is huge.

ARKK daily chart


Like this article? Help us with some feedback by answering this survey:

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Follow us on Telegram

Stay updated of all the news

Join Telegram

Recommended content

Editors’ Picks

EUR/USD holds above 1.0700 supported by Dollar’s slide Premium

EUR/USD holds above 1.0700 supported by Dollar’s slide

EUR/USD is consolidating above 1.0700, supported by a weaker US dollar across the board. The tone around the Greenback changed on Monday after the release of a weak ISM Services PMI report from the US. Despite the rebound from 1.0685 to 1.0720, the pair remains below the 20-day SMA.


AUD/USD holds above 0.6600 ahead of the RBA Premium

AUD/USD holds above 0.6600 ahead of the RBA

AUD/USD rose on Monday ahead of a crucial day for the Aussie with the Reserve Bank of Australia's decision. The central bank is expected to keep rates unchanged at 3.85%, but it's a close call, and a rate hike wouldn't be a major surprise.


Gold grinds higher past $1,950 amid downbeat United States data

Gold grinds higher past $1,950 amid downbeat United States data

Gold stays on the front foot aroud $1,961, after an upbeat start of the week, as the bullion traders seek more clues to extend the latest rebound during early Tuesday in Asia. The precious metal cheered downbeat United States statistics and dicey markets to regain upside momentum the previous day.

Gold News

Binance and CEO face 13 charges by the SEC, citing securities laws violation

Binance and CEO face 13 charges by the SEC, citing securities laws violation

Binance entities and CEO Changpeng Zhao are facing 13 charges from the US SEC. Allegations revolve around securities law violations, among other crimes that the regulator has been clamping down against.

Read more

June flashlight for the FOMC blackout period

June flashlight for the FOMC blackout period

After raising rates by 500 bps since March 2022, the FOMC signaled at the conclusion of its previous meeting on May 3 that the tightening cycle may be coming to an end.

Read more