Highlights from last week include-midterm elections and the anticipated market movers based on perception-Oil and Gas moved higher while Biotechnology and Solar Energydropped-market on new highs but with NASDAQ and the Small Caps lagging, good unemployment numbers, yet barely a budge in the Labor Participation Rate. Finally, Phil Rudd, the drummer of AC/DC skirted the Highway to Hell when charges of attempting to procure a murder were dropped.
As the market made new highs, the number of stocks above key short-term (10 DMA) moving averages diminished. However, the number over 50 and 200 DMAs increased. Metaphorically speaking, the market showed signs of fatigue, but overall, the immune system remains robust. The Doctor prescribes Viagra and hopes the results last way longer than 4 hours!
We will be looking for follow through or lack thereof in Agricultural Commodities for starters-(MOO) the ETF closed well over the 200 DMA. We will also look for follow through in the oil, gas and metals. Silver did not quite give us an island bottom, but it did close over $15.00. Uranium exploded (pun intended) soaring over 12% on Friday.
Perhaps the best place to look as this week begins will be the Russell 2000s. It seems theconsolidation and number of days in its current holding pattern might be the gift that keeps on giving once that consolidation clears up or down.
Over the last several months, we have witnessed pretty much all of my absolute favorite technical patterns, (Blow off Volume, Island Bottoms, Shooting Stars, and Brick Wall Bottoms). All did exactly as the textbook definition tells us they should do. Now, here’s toIWM (Small Caps) setting up for 2 more of my faves-Inverted Head and Shoulders bottom on the daily going back to August (left shoulder) and, a breakout of a 6 sessionconsolidation pattern, which should fuel it to clear 117.80 and retest 120 area-close to the 2014 highs (at least).
“There cannot be a crisis next week. My schedule is already full.”
Henry A. Kissinger
S&P 500 (SPY) Unless the bizarre happens, the close on new highs after the 3 shooting stars patterns, should be good, unless it breaks 200. Subscribers: Positive Pivots in all
Russell 2000 (IWM) Over 117.80 brings it to the Promised Land and has to hold 115.20
Dow (DIA) Overbought which partially explains my interest now in IWM
Nasdaq (QQQ) Needs to clear 102.03 and hold 100.60
XLF (Financials) Consolidation near the highs
KRE (Regional Banks) Nearly closed over 40.43 –now a great place for this to begin this week
SMH (Semiconductors) Semis are not needed at this party, but, still like to see them clear 52.00
IYT (Transportation) Truckin”
IBB (Biotechnology) Not a great weekly close. 280 support and over 293.64, a better shot
XRT (Retail) New highs-that’s more like it!
IYR (Real Estate) Tired sector-rather look elsewhere now for sparks
ITB (US Home Construction) Decent follow through off the 200 DMA
GLD (Gold Trust) A gap over 113.75 would surprise a lot of shorts
USO (US Oil Fund) Not nearly as pretty as Natural Gas
OIH (Oil Services) A better confirmation of a bottom would be clearing 46.00
XOP (Oil and Gas Exploration) Inside days and their importance played out Friday after it had one on Thursday. Now, 62.00 next hurdle
FCG (First Trust ISE Reserve NatGas) Over 15.81 should have more
TAN (Guggenheim Solar Energy) Subscribers: Held 36 which is my area of support. However, glad to be flat for now
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs back near the 120 pivotal area
UUP (Dollar Bull) Ran into resistance with 23.00 now the support
IFN (India Fund Inc.) Wrote last week this look poised-and so it was-closed on new highs for the year
EWW (Mexico) Subscribers: Inside day which means eyes here for Monday over 67.75
