March 3, 2014
Mish's Daily
By Mish Schneider
Quote by J.R.R. Tolkien
Like a Treasure Map, the market left a big clue to the prize-for Monday anyway, when the Volatility Index, what I kept writing about last week into this one, blew out on the Ukraine story.
I do not mean to crow, rather, to educate and direct my readers to looking at such signs to help protect you all from possible disaster.
Now, the Dow, which threatened the 50 DMA all day, closed above it. Furthermore, my other tell, the small caps or Russell 2000s, closed green. In fact, all sectors stayed in their current phase with one exception-Financials-they closed on the cusp of the 50 DMA.
Looking ahead, given a couple of decent economic indicators that were muted by Putin, if the situation ameliorates, some great opportunities just emerged. Otherwise, while the market remains news sensitive best to keep eyes out on indicators like volatility and phase changes.
S&P 500 (SPY) Distribution day in volume with a test and closed just above the fast moving average. 185.66 and above puts this back in the game
Russell 2000 (IWM) Gapped down but filled the gap which is a good thing. Also held the 10 DMA. Therefore, 117.60 becomes the area to penetrate
Dow (DIA) Watch that 50 DMA
Nasdaq (QQQ) If I didn’t know what was going on in the world, I would say this was a healthy correction
XLF (Financials) Unconfirmed warning phase
SMH (Semiconductors) Barely a move down
IYT (Transportation) Hung onto the 50 DMA
IBB (Biotechnology) Can never dismiss this group and could be setting up for a new buy
XRT (Retail) Amazingly held the 50 DMA
IYR (Real Estate) This is not done-good for a shorter term trade
XHB (Homebuilders) As long as gaps were filled after the open (this did) then still a contender
GLD Gapped higher now has to hold it
USO (US Oil Fund) I knew this would break 37.50-now it has
TBT (Ultrashort Lehman 20+ Year Treasuries) Oversold big time
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