Evening Watch List for 10/23

Mish Schneider | October 22, 2015

Russell 2000s and Retail Have Yet to Say “Yes”.

What’s a shotgun wedding without Granddad and Grandma in attendance?

NASDAQ and Semiconductors hired Draghi to cater the wedding with a cocktail hour that begins serving Italian cheeses.

Apparently, SMH and QQQ Google searched different varieties of cheese before ordering them through Amazon.

However, concerning the RSVPs required from the Economic Modern Family, the current low attendance could still thwart our happy couple’s future plans.

What might the Family be waiting for before they reply yes or no?

First, let’s begin by looking at our domestic cheese, the 20+ Year Treasury Bonds (TLTs). With Draghi’s statement that the ECB will buy back bonds in December, the obvious case would be that the US might do the same.

The Cheese That Stands Alone: The FED

TLTs tested the 200 DMA, closing below it. The Slopes on the 50 and 200 DMAs remain neutral. It is possible that the FED can either decide to raise rates soon, figuring that if the ECB adds liquidity that will allay some of their concerns about the global economy.

Equally possible is the FED keeps interest rates the same or even decides to do more easing as well.

In last night’s daily I surmised that based on the continuum of phases in the Economic Modern Family, our Back to the Future prediction was longer term negative.

With the FED’s next rate decision hanging in the balance, what are the other family members saying amongst themselves?

Granddad IWM had a doji day right on the 50 DMA. That’s the technical analysis way of saying, “I have no clue what to do from here.” Grandma Retail (XRT) said, “Leave me alone for now.” XRT is trading in a bear phase.

Prodigal Son Regional Banks (KRE) always willing to redeem himself, is leaning towards a yes. A move and hold over 42.70, we can count him in.

Transportation (IYT) loves a party. Trannies are still eyeballing the September 17th high however at 149.89, before taking the gown to be pressed.

Biotechnology (IBB), which looked like it sent regrets on Wednesday, could turn out as a wedding crasher if everyone else resolves to show up.

All in all, as wonderful as it is to see NASDAQ and Semiconductors happy, it’s the Economic Modern Family that will ultimately make or break the revelry.

And for the Family, much of their decision to rally further or not, will have to do with their taste for cheese.

S&P 500 (SPY) 206 the 200 DMA. 203.85 the underlying 100 DMA Subscribers: Pivots Positive in all

Russell 2000 (IWM) Unconfirmed return to a Recovery Phase

Dow (DIA) 175.62 the 200 DMA 172.22 the underlying 100 DMA support

Nasdaq (QQQ) Our NASDAQ All Stars model rocked it. I admit I am still in a bit of disbelief how well this has done.

XLF (Financials) 24.20 the 200 DMA with 23.35 underlying 50 DMA support

KRE (Regional Banks) 42.72 the 100 DMA with 41.40 underlying support

SMH (Semiconductors) Pregnant yet still unwed. 57.40 good target

IBB (Biotechnology) Over 320 will look so much better

XRT (Retail) Consumer sentiment weak

IYR (Real Estate) Closed over 76.00. With a second one looks good

ITB (US Home Construction) A close over 28 gets me interested

GLD (Gold Trust) Subscribers: Keep a mental stop of 112.40 to get long with a stop under 111

SLV (Silver) Like over 15.19 if holds 15.00

GDX (Gold Miners) Over 16.40 looks like a new leg up

USO (US Oil Fund) Confirmed bear phase with a trading range in play

XLE (Energy) Over 69.70 looks great

TAN (Guggenheim Solar Energy) If oil prices stay low so will this have trouble going up much more

TLT (iShares 20+ Year Treasuries) Even better over 124.60

UUP (Dollar Bull) Express to an unconfirmed Recovery phase if holds 24.93

EEM (Emerging Markets) Looks good

SGG (Sugar) New high on this move

***Market Tone: Short-term Positive 1, Intermediate-Term Neutral, Long-Term Positive 3

NOTE: *All starred picks are from the automated list of picks (which now includes short picks!) denote that it has one or more of the 18 chart patterns we have used on the radar screen. For example, inside day, 2 days under floor trader pivots, phase change, brick wall or return to the 10 DMA, etc.

Tap here to view the September Live Coaching recording:
"How To Vet the Evening Watch Picks"

Longs:

ACN**
ADBE**
AEM**
AGO
AMZN**
BMR
BYD**
CAM
CAR
CRM**
CTB
CTSH**
CTXS**
CVRR**
CXO**
DHR**
EOG
EQIX**
FBHS
FSLR
GD
JNPR
K**
MCD**
NFX**
NKE**
NOC**
O**
REGN**
RTN**
SYK**
SYNA
TNA**
TRN**
TSO
YOKU