Market Begs: Tell Us Something Good!

September 26, 2023

Mish's Daily

By Mish Schneider


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We compiled a list of the 10 biggest uncertainties in the stock market right now.

In no particular order:

  1. China-trade wars and chip wars
  2. Oil and food inflation
  3. Strikes
  4. Government shutdown
  5. Corporate and individual bankruptcies on the rise
  6. Commercial real estate and banking
  7. Fed-rates higher for longer
  8. Political polarization
  9. Social Unrest-how far can folks be pushed economically
  10. Geopolitical concerns-Russia and how far will they go

What we do know is that the market is not a big fan of uncertainty.

Hence, until there is some glimmer of hope, we expect fear to prevail.

That leads us to speculate on where might hope come from?

In 2011, the government shut down. By October 2011, the market bottomed along with TLT (yields began to soften.)

Oil was at $100 a barrel and in 2012 fell to $80.

The accommodative Fed helped save the day. Plus, oil had very different fundamentals than today.

Now though, with $33 trillion in debt and rising inflation, if the Fed softens, it will help commodities prices and drive the economy towards stagflation.

We speculate that the dollar could fall as well.

In 2011 FED had wiggle room and much less of a debt issue.

Now, not so much.

We show the NASDAQ chart as this is most likely where hope can emerge from.

Can AI and tech help efficiency while soothing the ailments of the day?
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Over the weekend we looked at volatility, retail and small caps and came up with this as the Bottom line:

“A move over 18.00 or the 200-DMA in VIX, coupled with more downside pressure in IWM and XRT (watch momentum), could spell another leg lower-perhaps to 170 in IWM and 57 in XRT.

Then, we look at the monthly charts and our 80-month moving averages on both, which have held since the heart of COVID.”

Volatility cleared 18. Neither XRT nor IWM have hit the levels mentioned on the monthly chart yet.

Looking at the NASDAQ or QQQ chart, thus far it is the only index holding the August lows.

It is neck and neck in performance to SPY.

Momentum continues to have negative or bearish divergence as QQQ is now under the 200-DMA in real motion while still well above in price.

Where does hope come from?

The charts will tell us.

Should we reach a nadir of support in XRT, IWM and QQQs, buyers will come back. (market is oversold).

However, oversold can get more oversold so right now, the precipice still stares investors in the face.

 

If you find it difficult to execute the MarketGauge strategies or would like to explore how we can do it for you, please email Ben Scheibe at Benny@MGAMLLC.com, our Head of Institutional Sales. Cell 612-518-2482.

For more detailed trading information about our blended models, tools, and trader education courses, contact Rob Quinn, our Chief Strategy Consultant, to learn more.
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Mish in the Media - All clips here

Benzinga Pre Mkt 09-22-23

Final Bar with Dave Keller  09-21-23

Your Daily Five Stockcharts 09-20-23

Article-Q4 Stock Market Outlook 09-20-23

Article-Kitco Oil 09-20-23

CMC Market Daytrading Commodities Ahead of the FOMC 09-20-23

Business First AM 09-19-23

Yahoo Finance Chart Analysis 09-19-23

CMC markets Daytrading Commodities 09-19-23

Business First AM TEVA 09-14-23

IBD Investing 09-13-23

Traders Edge Jim Iuorio Bob Iaccino 09-13-23

 

Coming Up:

September 29 Live Coaching

October 2 Schwab The Watch List 

October 4 Jim Puplava Financial Sense

October 5 Yahoo Finance

October 12 Dale Pinkert F.A.C.E.

October 26 Schwab at the NYSE

October 27 Live in Studio with Charles Payne Fox

October 29-31 The Money Show

Weekly: Business First AM, CMC Markets

 

ETF Summary

S&P 500 (SPY) There are multiple timeframe support levels round 420-415

Russell 2000 (IWM) 170 huge

Dow (DIA) 334 support

Nasdaq (QQQ) 330 possible if cant get back above 365

Regional banks (KRE) 39.80 the July calendar range low

Semiconductors (SMH) 133 the 200 DMA with 147 pivotal resistance

Transportation (IYT) 225 next support

Biotechnology (IBB) 125 if clears impressive

Retail (XRT) 57 key support

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