Waiting For A New Twist

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Today's Mish's Daily was prepared by Geoff Bysshe, co-founder of MarketGauge.
There were some nice moves in our individual stock selections but the indexes were very quiet. As a result subs will find today's stock selections have an emphasis on the compression pattern of an inside day.

On Wednesday the Fed is expected to announce its replacement plan for the soon ending Operation Twist. If the market falls asleep tomorrow, don't try to trade price action that doesn't really exist.

S&P 500 (SPY) Now a confirmed but weak bull phase. It needs to clear last week's high of 142.92. Look for support at 142.16 - 142.00. Subs: Positive Pivots

Russell 2000 (IWM) More consolidation. Has to get above 82.80 to make the 50 DMA a distant memory. On a positive note, the 10 DMA has now clearly crossed the 50 DMA for the first time since late Oct. Subs: Pivots Positive

Dow (DIA) Edged higher. Look for support at Friday's lows and resistance at 133. Subs: Pivots Positive

NASDAQ 100 (QQQ) The only one of the 4 indexes that did no break the prior day high. It is still consolidating. However, below 64.50 that's in question, and under 64.25 the down trend may gain momentum. If it moves higher, 65.77 is a key level to break before the bigger test of the consolidation highs at 66.37. Subs: Pivots Flat for a second day

ETFs:
GLD Gapped up and sat at the 166 resistance level we anticipated - 166. Upside looks like 167.50. It's sitting right at the negatively sloped 10 DMA. If it heads lower look for support at Fridays high of 165.22.

SLV Broke a 4 day range high but could not clear its opening range and fell back below the key level of 32.20. A good breakout could run quickly to the 33 area. Look for support at Friday low, 31.84 and 31.60 areas.

XLF (Financials) For all practical purposes, it had an inside day.

IBB (Biotechnology) A complete reversal from Friday's action. If it moves over Monday's highs its worth following.

SMH (Semiconductors) An inside day right under the 200DMA. A break of Friday's highs improves its phase and confirms a break of the weekly resistance line from the 2012 highs. Must hold 32.20 to remain positive.

XRT (Retail) A struggling transition into a bullish phase. Has potential to go either way.

IYT (Transportation) Broke PDH and followed through on decent volume making it a confirmed accumulation phase. If it can consolidate over the 200 DMA then I'll change my disinterested stance, but until then I maintain that buying strength at the top of a daily range in this index has been the wrong thing to do all year. Below 92 this is a good short candidate in a weak market.

IYR (Real Estate) Friday's breakout continued nicely but was pulled back down by the general market. Look for 64.90 on the upside with support at 64.15.

XLI (Industrial Spdr Fund) Continued to move higher and stopped at logical resistance at 37.74. Volume was light but price action was healthy. 37.40 should be good support, and resistance is 38.07.

OIH (Oil Services) Will last week's death cross prevent a breakout over the 200 DMA and daily consolidation high of 39.28? Under 38.50 it is very vulnerable.

XLE (Energy) Tried to breakout but stopped dead at the 50 DMA at 71.80. Support is in the 70.40 area.

TBT (Ultrashort Lehman 20+ Year Treasuries) In the middle of a 3 week range.

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Best wishes for your trading,

Geoff Bysshe

For more detailed analysis join me, along with hundreds of other subscribers, at Mish's Market Minute and get my daily trade picks, trade alerts, training videos, and exclusive analysis tools. Sign up for Mish's Market Minute now and get a free 2 week trial!