January 12, 2016
Mish's Daily
By Mish Schneider
NASDAQ is like the sexy single aunt who comes to visit the Modern Family, seducing them all into thinking they too have sex appeal.
When QQQs come around, the family start to compete for her attention. Then, after she leaves, they are left looking in the mirror reckoning with their own reflections.
Hot and NASD(Y), she’s been a real tease ever since the market tumbled.
Early Tuesday for instance, QQQs came on strong. Opening above the first resistance point or R1, (first time since December 29th), she sent Granddad Russell 2000 (IWM) to the medicine chest looking for his Cialis.
That made Granny Retail come out of her room dressed in her silk lingerie, ready to compete with the QQQs by tackling the now historic potential triple bottom low at 42.00.
Gramps took his medicine. IWM rose to the occasion but stopped cold just shy of the 200 week moving average (105.12). When the mercurial QQQs failed R1, that left Granddad, well-limp.
Granny changed back to her flannel pajamas, put a scowl on her face and hobbled to bed muttering to herself that she’ll try 42.00 some other day.
The siblings of the family (IBB, KRE, SMH, IYT) figure at this point, they’ll hover just above Monday’s lows and follow Granddad’s lead.
Transportation (IYT) a dutiful follower, had an inside day (when the range is inside the trading range of the day prior). Trannies sit in repose. Same can be said for Big Bro Biotechnology (IBB).
Semiconductors (who almost had a shotgun wedding with NASDAQ), fared better than the rest of the sibs. Over last Friday’s high of 49.80, there’s a chance it could see a rally to 51.40 or perhaps 52.40.
Regional Banks (KRE) made a new low since August 24th and came back to close green by end of day.
What do the QQQs IWM and XRT have to do?
After touching down on Monday the 23 month moving average, further evidence that this time she’s not merely teasing, QQQs have to take out 106.29, Friday’s highs.
Next time Granddad IWM pops a booster pill, his rally has to last long enough to close out the week back over 105.12. Contradicts the drug’s “if the rally lasts longer than the 4-hour” warning, but hey, this is my version!
Granny Retail (XRT) could surprise everyone. If she decides she’s had enough of sexy spinster QQQs and her flirty ways, we might just see her take an Addyi, (the female equivalent to Cialis) and jump 42.00’s bones!
S&P 500 (SPY) 195 looks like a good chart point to clear. 190 was a good target so makes sense we should see more rally if it does clear there. Subscribers: Positive Pivots in all
Dow (DIA) Friday’s high 166.39 to clear with 164 near term support to hold
XLF (Financials) 22.00 a good spot to bounce more from
KRE (Regional Banks) A follower right now
SMH (Semiconductors) Should hold 49.00
IYT (Transportation) Inside day
IBB (Biotechnology) Inside day
IYR (Real Estate) Like that this held 72.29 the November 13th low. If continues see possible move back up to at least 73.50 or higher
GLD (Gold Trust) 103.50 area is support.
GDX (Gold Miners) Back in a bear phase
USO (US Oil Fund) I know folks are watching this as a clue to the market. I see solar more interesting. Or if you want to be 2016 and not a dinosaur, watch TLTs to fail 124
TLT (iShares 20+ Year Treasuries) 124 big resistance. Let’s see if this clears that or fails 122 first.
UUP (Dollar Bull) confirmed bullish phase.
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