June 5, 2017
Mish's Daily
By Mish Schneider
Over the weekend, we saw Wonder Woman. Apparently, so did a lot of people as the movie made $100.5 million in box office sales.
The “buzz” is all about the women. Although improving, strong roles for women have been scant. The leading actress landed a breakthrough role. Furthermore, this film is directed by a woman.
Yet, there is another woman. She’s been using her cuffs to knock the competition out of the ballpark for some time now.
Self-directing, strong, (Amazonian in fact), with superhero powers, Sister Semiconductors (SMH) exhibits superior combat skills.
SMH’s 2008 crash low at around $14.00 evolved into a phase change to bullish on the weekly charts in October 2010 when it was trading at $27.00.
Since then, SMH has not traded below the 200-week moving average.
Today’s high tick and new all-time high is 87.46.
Semiconductors have enjoyed a 7-year bull market that exemplifies not only the disparate Modern Family, but also the growing demand for tech and computer chips.
Can you imagine a world without electronics and semiconductors? After this weekend, can we imagine a world without Wonder Woman?
And how do we imagine the rest of the Modern Family fits in?
Beginning with the Russell 2000, the topping reversal pattern from April at 141.17 still stands. For now, IWM confirmed back to a bullish phase last week.
Above 137.50 is its safe zone. Through 141.17 we are looking at 142 then the top of the monthly channel. I suspect that should IWM get to around 142.50 then fail the channel, for the first time in a long while, I would consider a short position.
Should the channel hold and gather Sister Semiconductor-like powers, a move to 150 is likely.
Transportation also returned to a bullish phase. Today, IYT had a quiet inside day. Not surprising considering the “talk” of an infrastructure plan.
Regional Banks (KRE) gained, but remain in a warning phase. A break of 51.00 would put pressure everywhere. However, that would correspond with a dovish Federal Reserve.
With a Fed meeting coming up, hard to assess what the FED will do and how the overall market might react.
Biotechnology (IBB) tested and held its bullish phase. That makes 291-292 a good line to use as support.
Finally, Retail (XRT), borrowing fortitude from the rest of the clan, miraculously held 40.00. With earnings season in that sector over, perhaps all the bad news has already been priced in.
Today, Retail held over 41.00.
As the lagging sector of the Family, should XRT catch more bids, possible old Granny will act more like Wonder Woman’s mom and free herself from the evils of the decaying brick and mortar.
***There will be no Daily Commentary or ETF analysis tomorrow Tuesday, June 6th. I thank Geoff and Keith for so deftly filling in for me these last 3 weeks. I will be back with you all June 7th.
S&P 500 (SPY) The launch from 240 put 245-246.50 as a target before Bollinger band resistance sets in. A quiet inside day trading range
Russell 2000 (IWM) With a monthly channel top at 142-143 level, the test to those highs seems more likely than not. So for now, on alert if this fails 137.50, otherwise, thinking one more run up.
Dow (DIA) Inside day near the highs. 211 pivotal
Nasdaq (QQQ) If Semi’s are Wonder Woman, this is Zeus. Quiet doji day, but wait, still managed to post a new high
KRE (Regional Banks) 51.00 is a super important support level. Otherwise, 53.60 is the place to give this new life
SMH (Semiconductors) Even with profit taking, this closed on new highs Subscribers: If in at 80, reached a second target and now should have stop under 84.00.
IYT (Transportation) 168 pivotal number. Then there’s still resistance all the way up to 172.89. A failure now of 163.50 would be troubling
IBB (Biotechnology) Confirmed return to bullish phase. 291-292 must hold and the elusive 300 must clear.
XRT (Retail) The 50-DMA at 42.07 if clears should be interesting. 40 massive support to hold. 41 pivotal. Of interest
IYR (Real Estate) Held all the moving averages but still in massive consolidation between 77 and 81.
XLU (Utilities) Possible that this has some selling to do with 53.50 near-term support, and 52 rock-bottom support
GLD (Gold Trust) In a bullish stage. 121 pivotal. 124.50-125.50 next big resistance
SLV (Silver) Confirmed recovery phase. If holds 16.50, a move over 16.75-80 would clear 200 DMA and bode well for further even bigger gains
GDX (Gold Miners) Quiet tight range and still waiting for a break over the 200 DMA and 6-month calendar range of 23.50 to get long. A break below 21 could get ugly to downside
XME (S&P Metals and Mining) If holds 28 and clears 30 could get interesting
USO (US Oil Fund) Looks heavy unless it clears and closes over 10.35
XLE (Sel Energy Spdr Fd) For this to show signs of life must clear and close over 65.57
TAN (Solar Energy) Dancing around the 200 DMA. A good sign if holds and clears 18.60
TLT (iShares 20+ Year Treasuries) Ahead of the Fed, could not confirm over the 200 DMA.
UUP (Dollar Bull) 25.00 pivotal, see more downside if breaks unless it gets back over 25.10
Every day you'll be prepared to trade with:
