Another Nail in the Oversold Coffin $SPY $DIA $QQQ $IWM

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Friday was a nap after the dramatic action of the week. The phase change to warning confirmed in all (alas) indexes except the small caps which closed marginally over the 50 Daily Moving Average, therefore going back to an unconfirmed bullish phase. NASDAQ has a weak warning phase as the slope on the overhead 50 DMA remains up. However, both the S&P 500 and the Dow, have begun to see a downturn in the 50 DMA indicating the warning phase could be accelerating. There’s been a lot of buzz about the FED, the economy, tapering and what it all means going forward. With the mixed signals among the 4 indexes-weak versus accelerating warning phases-with one in an unconfirmed bullish phase, the possibility for more downside seems likely, especially since the bounce on Friday was anemic after the drop that preceded it. Therefore, as much as I want to root for the underdog, unless either NASDAQ (QQQ) clears the 50 DMA and the Russell 2000 (IWM) stays over the 50 DMA, the sentiment remains defensive.

S&P 500 (SPY)Has corrected down to the April highs which could offer some support. But, as per my comments above, the return of a robust rally seems less likely for now unless the others bust out.

Russell 2000 (IWM) Unconfirmed bullish phase and a good confirmation would be a move over last Thursday’s high 96.88. If it fails the 50 DMA first thing, go with it.

Dow (DIA) 146 giving this some support and only a move over 150 or so would be encouraging

NASDAQ 100 (QQQ)Also held April highs with the weak warning phase-perhaps we could see a climb to the 50 DMA then a failure-only a move over the 50 DMA would be a game changer.

ETFs:

GLDStarted some semblance of a bounce Friday in spite of the strong rates and dollar. 130 is great resistance and 115 the eventual target

XLF (Financials)18.82 is the gap low from the day this started the runaway gap.

IBB (Biotechnology) Oversold but see no bottoming formations here at time of writing

SMH (Semiconductors) 35.45 is far yet, and the low of the runaway gap move. And, like NASDAQ is in a weak warning phase-at this point, a monthly close over or under 37.50 should help clarify next direction

XRT (Retail) Broke the 50 DMA for an unconfirmed warning phase. Another nail in the oversold coffin.

IYT (Transportation) There is a trendline from the April lows to Friday low-a valid one that if breaks spells more ugliness. But if holds, will look at what happens near the 50 DMA

IYR (Real Estate) Unless this gaps over Thursday’s high, 65.77, the rallies are probably sell opportunities

USO (US Oil Fund)A mess. Confirmed an island top, back in a bear phase (unconfirmed).

OIH (Oil Services)Interesting that it held the old June low, made a new one then close back over 42.29. Good area to watch

XLE (Energy) Broke 78.00 then closed above it. Under 78.00 again, should see more selling

TBT (Ultrashort Lehman 20+ Year Treasuries) Thursday’s gap higher led to more higher prices Friday.

XOP (Oil and Gas Exploration) Touchdown on the 200 DMA-but no fans are cheering.

XHB (Homebuilders) Close to the 200 DMA and made a new 60 Day low. Watching.

UUP (Dollar Bull) Got close to the 50 DMA after returning over the 200 DMA.

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