January 27, 2012
Mish's Daily
By Mish Schneider
Friday Humor: “An escalator can never break: it can only become stairs. You should never see an Escalator Temporarily Out Of Order sign, just Escalator Temporarily Stairs. Sorry for the convenience.”
Mitch Hedberg (R.I.P)
There is sure a case for the reversal in NASDAQ (QQQ) based on the new high tick on the open followed by the escalator down to almost but not quite Wednesday's low. We all see the bearish engulfing candle pattern. So, note that number- 59.41, since that is one to break for confirmation; otherwise, today was just a low volume correction day.
S&P 500 (SPY) Filled the gap from July 27th on the open. Watch for the reversal, but thinking that some chop and lack of direction could be more in order for the end of the week.
Russells 2000 (IWM) Under 78.20 expect more downside; 0therwise, 81.00 resistance.
ETFs:
GLD Look now for 166.75 to hold which will keep today's gap intact.
XLF (Financials) First sign that the market would pause. Cleared 14.28, made a new 3-month high, then sold off. I always like to see how the financial sector performs since the longer term trend is still negative even with the new and improved accumulation phase on the daily chart. 13.96 was the gap low last week. My focus.
IBB (Biotechnology) The monthly Bollinger band comes in at 116.27-the high 116.76. The weekly chart RSI is overbought.
IYT (Transportation) Closed in the green with an interesting looking DOJI Hammer candle that could signal a reversal or just a healthy pause with 97.00 still in the cards.
XLE (Energy) 73.17 October 28th high was matched before today's retreat. A double top is possible for sure (needs to break 70.70). Then again, over that high, an inverted head and shoulders bottom equally possible.
TBT (Ultrashort 20+ Year Treasury Bonds) Inside day and remains over the 50 DMA.
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