January 22, 2012
Mish's Daily
By Mish Schneider
The NASDAQ did indeed manage to end last week at the top of the weekly bar in spite of naysayers and Google. It even spent most of Friday in consolidation thereby working off overbought conditions. A casual observation about mankind and trading-we humans wrap our minds around bad news way more readily than we do good news. What's up with that? We are wired to fail. We can deal with that. Success-well, to us mortals-that's ephemeral.
With that said, there remains an inordinate amount of divergence in the market concerning individual stocks. Many look amazing while others have gotten badly beaten up.
S &P 500 (SPY) Orderly move up, nothing too crazy. 4 Accumulation days now heading into the week. If there is a dip, do not anticipate it lower than 129.50 or so without it spelling trouble.
Russells 2000 (IWM) Tight range with room to the high of the week ending August 5th at 81.00. 2 possible scenarios developing. One is that we have another possible leg up. The other, a reversal and failure from here, although see no typical indication yet of that from a technical standpoint.
NASDAQ (QQQ) Who wants to argue with a new weekly all time high close? And especially after the GOOG report. We still have AAPL to deal with of course. But, again, anything is possible, although it does seem awfully tight right now unless it gaps under 59.50 and keeps dumping. Then I would venture to say time for longs to regroup.
ETFs:
GLD Took out those tops, but it seems more in sympathy to silver (SLV) which was the place to be last Friday. The closing price in GLD shifts the momentum and back looking at the gap fill should it clear 163.19.
XRT (Retail) Took a good inside day breath after last Thursday's run.
XLF (Financials) 14.17 the October 27th high, Friday high 14.15. Major significance when that happens is if a bizarre gap lower back under the 200 DMA happens. That is a sign of reckoning. Otherwise, focus more on the change of phase to accumulation.
IYR (Real Estate) Resistance still resides at 60.00 although it seems determined to get there. In overbought territory which makes the resistance area noteworthy.
IBB (Biotechnology) Still digesting the recent move to new highs.
SMH (Semiconductors) Target reached on weekly Bollinger band but unless it breaks and closes under 32.75, still very positive.
IYT (Transportation) Good inside day pause after a gap higher last Thursday provided the gap holds.
XLE (Energy) Big eyes on 71.98 January 10th high.
TBT (Ultrashort 20+ Year Treasury Bonds) Most recent high on 12/23 at 19.31 although this time the instrument closed above the 50 DMA.
Every day you'll be prepared to trade with:
