March 6, 2023
By Mish Schneider
The 23-month moving average or a 2-year business cycle-is particularly important this year after a big up then down year-looms large.
Looking at Granny Retail, that business cycle not only leaves investors with the trading range resistance, it also shows how the Retail sector could be a harbinger of worse times this spring.
On the weekly chart though, Granny is still in the game holding both the 50 and 200 week moving averages.
The Real Motion indicator flashes a divergence, however. Momentum weakens while price is ok.
And the Triple Play indicator has Granny underperforming the benchmark.
So, the ever-important representative of US growth is stressed-albeit not broken.
Regional Banks or our Prodigal Son has a story as well.
As per the weekend Daily on the Economic Modern Fam , “Regional Banks (KRE) sit below the 50-WMA and noteworthy, below the 50-DMA. With folks not depositing money due to high credit card debt (AND HIGHER YIELDING OPTIONs LIKE T-BILLS), and with mortgage rates so high, it is no wonder our Prodigal Son struggles?”
The higher rates on T-Bills, CDs and other bank deposits have been attractive for consumers and businesses.
However, that is costly for the US banking industry, already experiencing a slowdown in lending.
With banks having to raise the rates for deposits, bank profits could fall.
And as we know, the Regional Banks character is called Prodigal Son for this very reason-first they (banks) hoard your capital and pay you very little interest, and then they come back asking for forgiveness.
In this case, should banks start to project larger unemployment and smaller profits, that could be the reason Fed either does a pivot or pause, or raises the inflation target from 2% up to 3%.
But we are getting ahead of ourselves.
Granny Retail and Prodigal Regional Banks are my key go to’s for this week.
Teetering on support, they could be just fine, and low risk buy opportunities.
BUT, if they fail support, take note!
If you missed it check out the Weekend Outlook with commentary charts and the important points taken from Big View on risk
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"I grew my money tree and so can you!"- Mish Schneider
Mish in the Media
Daily Briefing Real Vision 03-01-23
Kitco Gold and Sugar 3-01-23 Print Article
Your Daily Five StockchartsTV-Stock Picks 03-01-23 On our YT
March 6th-International Women’s Day-Mish on CNBC Asia with analysis and stock picks
March 7th The Ladies are taking over Business First
March 8th-StockChartsTV-The Pitch-a panel with Mish and 5 stock picks
March 8th-Investment Strategy Twitter Spaces with Wolf Financial
March 9th-Twitter Spaces with Wolf Financial
March 13th Mish on TD Ameritrade with Nicole Petallides
March 14th F.A.C.E. Forex Analytix with Dale Pinkert
March 16th Final Bar with Dave Keller StockchartsTV
And down the road
March 20th Madam Trader Podcast with Ashley Kyle Miller
March 22nd, The RoShowPod with Rosanna Prestia
March 24th Opening Bell with BNN Bloomberg
March 30th Your Daily Five StockchartsTV
March 31st Festival of Learning Real Vision “Portfolio Doctor”
April 24-26 Mish at The Money Show in Las Vegas
S&P 500 (SPY) 390 support with 405 pivotal 410 resistance
Russell 2000 (IWM) 190 failed so Grandpa hurts-295 support
Dow (DIA) 326 support 335 resistance
Nasdaq (QQQ) 284 big support 300 pivotal 305 resistance
Regional banks (KRE) 60 pivotal f-closed below
Semiconductors (SMH) 240 pivotal 248 key resistance
Transportation (IYT) 240 resistance and 230 support
Biotechnology (IBB) 125-135 trading range
Retail (XRT) 66 pivotal with 64 key support
Every day you'll be prepared to trade with: