Evening Watch List for November 10th

Mish Schneider | November 9, 2015

How to Read the Federal Reserve TLT Leaves

On Sunday, I went on my version of a rant about the Federal Reserve and their lack of resolve.

Last May, I had Janet’s photo on my twitter feed and I would have sworn that I saw a rate rise behind her eyes. Back then, I cheered Janet on to make that bold step.

Now, I am in the ‘too little too late” camp. In fact, I see nothing good from a rate hike in December except panic in the already beat up commodities which should create a domino effect in the stock market.

Was I surprised to see the market drop over 200 points early on Monday? Not at all. The title of my weekend daily was: The Tangled Web Good Economic News Creates.

The TLTs

Oversold, Monday TLTs made a new 60+ day low. Prior to that, the low was 118.55 made September 16th, just as the stock market had spiked higher (the proceeded to sell off again in the days afterwards).

A while back I reviewed the 5 Criteria for a Reversal Trade. TLTs only met one of the criteria-it made a new 60+ day low. TLTs did not close within 25% of their intraday highs, have an expanded range nor extraordinary volume.

However, add to the mix the US Dollar. Possible that we saw the highs for now after Friday’s “good news” jubilation.

Therefore, we have the perfect scenario to watch unfold this week. Watch to see if the TLTs confirm with a second day move higher on Tuesday (would have to close above Monday’s high to confirm a potential bottom).

Secondly, watch the US Dollar to confirm with a move lower. Likewise, it would have to close under Monday’s settlement price.

If both the TLTs and the UUP confirm bottoms and tops respectively, I will imagine Janet’s face looking similar to Saint Nicholas as described in “Twas the Night Before Christmas.”

“A wink of his eye and a twist of his head
Soon gave me to know I had nothing to dread.”

The next moves in the TLTs and UUP will likely impact the phases of many instruments. I will be reviewing that live tonight in my free webinar. Please read my special notice about it below.

S&P 500 (SPY) Back looking at 206.41 the 200 DMA to hold. Then 210 the resistance to clear Subscribers: Negative Pivots in all

Russell 2000 (IWM) Possible brick wall top but more likely I would say that with more oomph if this opens or trades and closes Tuesday under 117.20. Otherwise, back over 119 it should be good.

Dow (DIA) 175.73 the 200 DMA with 177.85 pivotal area to clear

Nasdaq (QQQ) Runaway gap low is at 112.07 and ultimately the point to hold. Over 114.50 better

XLF (Financials) Broke 24.50 and could be a topping candle.

KRE (Regional Banks) Possible reversal and bearish engulfing candle. Need more evidence of that

SMH (Semiconductors) Inside day. 54.22 the 200 DMA to defend and 55.60 the point to clear.

IYT (Transportation) Doji day after the Norfolk Southern rumor

IBB (Biotechnology) Range to break one way or another 320-340

XRT (Retail) If holds today’s low then maybe still has a shot to play catch up

IYR (Real Estate) Held the 50 DMA

ITB (US Home Construction) Has spent 5 weeks trading around converging moving averages-big move one way or another coming-26.50-28.00 range to break one way or another

GLD (Gold Trust) Did this wake up after testing the July-August lows? TLTs will decide.

SLV (Silver) Oversold now with 14.00 pivotal

GDX (Gold Miners) Good day but not a valid reversal just a good day

USO (US Oil Fund) 14.00 good support level to hold

OIH (Oil Services) 32.00 pivotal

XLE (Energy) 68.50 level a good risk point to hold. Back over 70.00 probably good

TAN (Guggenheim Solar Energy) A move over 30.60 would be good

TLT (iShares 20+ Year Treasuries) If holds Monday’s low and clears 118.90, pay attention

UUP (Dollar Bull) Watch for a break of 25.74

EEM (Emerging Markets) Held the 50 DMA

***Market Tone: Short-term Negative 5, Intermediate-Term Negative 4, Long-Term Positive 4

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**
AMGN
AMZN
AWAY
BYD
CIEN
CNO
CSC
CTB**
CTSH
CTXS
DHR**
DIS
EA
EW**
EXPE
FB**
FBHS
GD**
GE
GOOG**
ISIS**
JNPR**
LEA
LMT**
MCD
MGM**
MNST**
MYGN**
PEP**
PM**
PSX**
PXD**
RCL
RDC
REGN
RHT**
RTN**
SCO
SNDK
SWI
SWK**
TQQQ
TSO**
TTWO
YOKU**