September 26, 2012
Mish's Daily
By Mish Schneider
I took the day off from trading. As such, I could step back a bit and digest the last several days. The fact that the drop happened quickly (over the last couple of days) is concerning but, the drop is into support therefore would expect a bounce from here. With S&P 500 posting 2 distribution days in volume in the last 2 weeks and NASDAQ 100 with 3, these are real warning signs for the near term. However, NASDAQ 100 internals show the trend both in the short and longer terms still bullish. The logical conclusion then is to watch NASDAQ for the lead. Specifics below.
S&P 500 (SPY) 143.00 acted as support. 144.45 is initial resistance to clear, then the next area is the fast moving average.
Russell 2000 (IWM) 82.70 is the area of support with a move back over 84.50 also an indication of a test of the fast moving average. Not expecting much more than these areas as an established trading range for the time being.
Dow (DIA) 133 big area of support
NASDAQ 100 (QQQ) Through 68.90, expect a test of the fast moving average. Also, expect 67.45 level to hold. It seems that although the QE3 has not been the shot in the arm everyone expected, it should have an impact going forward. Certainly, the FED acted for a reason-to abate the possibility of another recession. So, if the plan worked, we should stay firm. That doesn't mean new highs necessarily, but more or a trading range for now.
ETFs:
GLD Gap lower, close at the intraday high. If cannot clear 170, next support 164.
XLF (Financials) 15.71 now initial resistance then 15.95. Best support 15.38
IBB (Biotechnology) With 2 days left to the month, watching to see if hold the close of last month considering it has done that all but one time this year
SMH (Semiconductors) Came real close to its 60 day low. Above 31.30 would expect a relief rally
XRT (Retail) Slightly out-performed the market. 63.75 resistance if firms more
IYR (Real Estate) Seriously oversold now
TBT (Ultrashort Lehman 20+ Year Treasuries) The bizarre relationship of strong TBTs and market means that with this oversold, back above 15.50 should help the market.
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