December 22, 2014
Mish's Daily
By Mish Schneider
From An Officer And A Gentleman Duet Song by Jennifer Warnes and the late Joe Cocker (RIP)
“Tis the 3rd day to Christmas, and the market gave to me, 5 Phases Changing, 4 Doji Days, 3 All-time Highs, 2 Golden Crosses, and a rally near 2014 highs.”
For brevity sake, I will focus on the 2 Golden Crosses since they may well be the next great movers for 2015.
The Regional Bank ETF KRE had both an inside day and a Golden Cross (when the 50 crosses above the 200 DMA). I have written about this sector many times this year, and definitely more recently. I am extremely friendly to it and today’s cross gives this a lot more panache!
The small caps or Russell 2000s (IWM) had the Golden Cross last week, yet worth mentioning again as it nears the 2014 highs and could be the next best trade going into 2015.
Overall, the market quietly held up and closed extremely well in the face of declining oil prices, slightly lower interest rates, and a negative turn in the Russian ETF while the US Dollar ran to new highs once again!
A note about Joe Cocker: Recently I received an email from a loyal reader who told me that many of the thoughts I share each night are observations that anyone can observe for him/herself. Of course I respectfully disagreed since there is an observation and then there’s a superior interpretation. Clearly this was Joe Cocker’s claim to fame. He was one of the great rock interpreters. His fame came from what he did with the words to songs written by other performers. Even in the era when songwriting was prized more than singing, he covered many tunes that often actually superseded the celebrated originals. So J.C., here’s to you!! May you rest in peace!
S&P 500 (SPY) Over 208 looks even better. Under 203.40 trouble
Russell 2000 (IWM) Another new multi-month high
Dow (DIA) Very close to the 2014 highs
Nasdaq (QQQ) Unless this gaps below 103.10 and continues to fail from there, has to clear 106
XLF (Financials) 24.45 key support if this is to continue
SMH (Semiconductors) 54.75 support to hold
IYT (Transportation) Cleared first line of resistance-has more to go
IBB (Biotechnology) Big drop with lots of pharma news early on
XRT (Retail) Inside day near the highs
IYR (Real Estate) Big day here-multiyear highs not seen since 2008
ITB (US Home Construction) Nice looking chart and looks good for 2015
GLD (Gold Trust) Face plant and perhaps lower for the upcoming year
USO (US Oil Fund) The RSI on the weekly/monthly charts is so super oversold
XLE (Energy) Like this a bit better than the others with its inside day.
XOP (Oil and Gas Exploration) Inside day
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs not done yet it seems-watch rates carefully
UUP (Dollar Bull) New highs-again
EEM (Emerging Markets) Maybe the whole emerging world is bottoming
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