You're Going To Need A Bigger Boat

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Jaws

Not sure I would consider today’s relatively meager rally a bottom, rather, more of a potential launching pad should the market hold up going into Thursday.

Clearly, there remains a lot of vulnerability in the indices not to mention uncertainty concerning the geopolitical events.

NASDAQ hung on once again for dear life to the 50 DMA and the bullish phase. All the other indices kept their existing warning or distribution phases intact although we can at least look at the IWM closing green and think this was either the calm before the storm for a new leg down or signs of more buying around the corner.

However, I would not change anything about the current method of operation-mainly cash, light positions (half of the normal size) and way fewer of them until we actually do see something more substantial.

The Retail, Solar and Regional Bank sectors all had decent basing action. Eyes should be kept there for go to longs if that trend continues in the near-term. Otherwise, keep your life vests on!

S&P 500 (SPY) Over 192.93 and buying should come in BUT under today’s low trouble lurks

Russell 2000 (IWM) Under 110, 108 is the May low area. Over 112.50 perhaps some new life

Dow (DIA) A better close would have made me more optimistic. For now, going with the lower levels in store theory

Nasdaq (QQQ) 94.00 is the 50 DMA. If that holds and this turns up on good volume, I will get more positive. For now, that line in the sand looks precarious.

XLF (Financials) May lows are under the 200 DMA-therefore, looking at 21.50

SMH (Semiconductors) confirmed warning phase

IYT (Transportation) 142.90 is the recent June low

IBB (Biotechnology) Back barely in an unconfirmed bullish phase

XRT (Retail) Could not close over the 200 DMA but gets brownie points for trying

GLD Converging moving averages and now above them unconfirmed bullish phase

USO (US Oil Fund) Unconfirmed distribution phase

XOP (Oil and Gas Exploration) Inside day against the 200 DMA-like better over today’s highs

TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs -still over the 50 DMA. Maybe under 114.37 that picture can change some to support the theory of higher rates coming

UUP (Dollar Bull) Perhaps a reversal top in place-has to confirm