February 2, 2012
Mish's Daily
By Mish Schneider
No seriously, last February 2nd was an inside day in S&P 500 and so was today?? I mentioned the Groundhog Day theory more in jest last night but with history repeating itself so handily; perhaps it's worth rewriting what ensued in the following days last year. After the 02/02/11 inside day, there was another 12 days of steady upside (a couple of bumps in between) before the first major selloff of 2011. If history continues to serve well, see each dip as a buy opportunity until it gets ridiculously overbought or it gets a huge distribution day in volume.
S&P 500 (SPY) Inside day (only index) Needs to clear last week's high 133.40. But unless it breaks 131.80 now, that may not mean much.
Russells 2000 (IWM) The longer it sits now at these levels, the easier it will be to see more upside since now the weekly chart is overbought.
NASDQ (QQQ) Overbought now on the weekly and daily Relative Strength Indexes. A close under 60.20 will be disconcerting.
ETFs:
XRT (Retail) 56.55 has to clear to get his group exciting again
IBB (Biotechnology) Been recommending this sector since it cleared 106.50. In 2011 it stopped at 110 several times before turning. See nothing yet to signal danger other than overbought conditions.
SMH (Semiconductors) Been recommending this group since 31.50 as well. Now 2 recent tops at 34.36 to clear.
IYT (Transportation) That DOJI did indeed lead to some trouble. A gap lower even more ominous, otherwise more digestion than anything else.
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