"If You Had To Ask What It Symbolizes, It Didn't"

December 29, 2014

Mish's Daily

By Mish Schneider

Roger Ebert

Over the weekend Keith and I saw three films (end of year push so we are prepared for the awards season!) Birdman we loved! To sum it up, it covered what actors, though really all of us, go through in life-self-loathing contrasted by hope that we survive long enough to make a difference. Add to that a solid dose of our lighthearted revelry mixed with our bouts of fear.

The Theory of Everything about Stephen Hawking tried hard to find an inspirational balance between Mr. Hawking’s personal life (quite the virile man!) and his scientific accomplishments. Movie fell short on the latter, but certainly had one impressed with the devotion of the 2 women and 3 children in his life!

We also saw Dying to Know, about Timothy Leary and Richard Albert (Ram Das). Harder to pinpoint in a sentence, let’s just say that after the chronology of both men’s lives, death as a passage rather than the end was explored.

What does this have to do with the market you might be asking yourselves? Has the girl been drinking? Perhaps the intention is more a commentary about us traders. We all go through bouts of self-loathing and doubt, especially as we reflect on our yearlong performance during a slow low volume holiday period. (Could have been better, worse, I’m content, I’m not..) But, we survive on hope to combat fear and constantly dream of our next trades going really well. Before a new year in particular, we are most optimistic with the impending fresh start!

Traders do try for that healthy balance between a happy personal life and a productive trading life. And, if the balance goes off kilter, well, trading can suffer. As far as death as a passage, I prefer to use that as a metaphor for the market. “Death” or deep corrections or any sustained down move in the overall market or in a specific instrument is always a passage with the eventual turnaround. Patience and timing are key (better than death, which we typically cannot time well.) The Tibetans believe that death is the best preparation for life. If I can twist that into a metaphor, knowing we will have losing trades is the best preparation and affirmation for letting the winners run! And a solid, consistent strategy of course!

Happily, the market seems to want to sustain recent gains. The low oil prices continue to support a perception of “more money in my pocket, thank you very much,” interest rates are not ready to rise just yet and the Russell 2000s made new 2014 highs!

This is my final daily commentary for 2014. The next one will be available Sunday, January 4^th, before we return to begin 2015.

We wish you all a wonderful, healthy, happy and prosperous New Year. I have thoroughly enjoyed bringing you my musings and analysis each day and look forward to another fabulous year together!

“We’ll take a cup o’ kindness yet, for auld lang syne!”

Peace out!

S&P 500 (SPY) 208.97 new 2014 high. Hard to read much with the low volume except to say it seems the market wishes to remain firm. 204.50 major underlying support

Russell 2000 (IWM) Made new 2014 highs and now should hold 117.60-118.00

Dow (DIA) Closed slightly red but not enough to worry about unless it breaks 176.44

Nasdaq (QQQ) Inside day and in the 106-103 range which at some point will break one way or another and show a clearer path

XLF (Financials) Made new intraday highs, closed on new highs-firm but lackluster ahead of the new year

KRE (Regional Banks) Like to see this hold around 41.00 for a clear neckline breakout on an inverted head and shoulders bottom

SMH (Semiconductors) Lagging behind so for now, not the place to be unless you want short setups if the market drops and this breaks 54.75

IYT (Transportation) Although chart doesn’t show it clearly, new 2014 high close

IBB (Biotechnology) 310 good area to cross

XRT (Retail) Rocked back to life and on new highs

IYR (Real Estate) Like it better if clears 78.50 holds 77.25

ITB (US Home Construction) 25 key support and over 26 looks very strong

GLD (Gold Trust) If I had to guess, I say much lower prices in store for 2015