I grew up in Queens, NYC. The closest I ever came to a sheep was when the family would go to Sheepshead Bay, Brooklyn to visit relatives. Bada Bing! Regarding my recent diatribe on sheep, I’m no expert.
But this much I do know-the market has been moving with the herd. Wednesday, the Shepherd came in the form of what I hope was at least a Hermes scarf wearing, Janet Yellen and the market loved every vague word she uttered-or is that uddered?
Therefore, our modern family had a fiesta, except for the Regional Banks (KRE), which found the prospect of rates not changing, maybe changing, disconcerting. So, will our sheep now retreat after busting out of the pasture, back into the safety of their normal confines?
Continue to check in with the leaders, Russell 2000s-new highs after the year-long consolidation, Retail-gotta love $100, Semiconductors-helping enough to be cooperative,Biotechnology-big brother lending his hand and Transportation-nearly ready to take out January Calendar Range highs.
The plausible trading plan remains plausible. Buy dips that are orderly with tight stops in case of a massacre. Stay the course and/or look for shorter term trades when the sheep and family are grazing (up days) and get ready to take profits once the boundaries widen above the range assuming (like Wednesday’s), rallies can be shorter lived!
S&P 500 (SPY) Would not be surprised to see some digestion, but maybe not as it might have some catch up to IWM Subscribers: Positive Pivots in all
Russell 2000 (IWM) Cleared new highs and now needs to hold around 127.50 level for some slippage
Dow (DIA) 181 level next point to clear and 179 to hold
Nasdaq (QQQ) 108 remains some resistance based on closing price below and 106 has to hold.
XLF (Financials) we need to see this clear 24.90 to really be in gear!
KRE (Regional Banks) The Japanese Candlestick says it all-up or down encompassing the range over the last 4 trading days-now the way she breaks…follow
SMH (Semiconductors) Cleared 56.45 which would like to see hold
IYT (Transportation) 165.17 the high to clear and 162 area to hold
IBB (Biotechnology) Parabolic move continues!
IYR (Real Estate) Unconfirmed return to a bullish phase-liked the rate talk
ITB (US Home Construction) Just made it back to the January 6-month calendar range high
GLD (Gold Trust) That interesting inverted hammer candle did what it radioed it might do-took off on a good short-covering and maybe more fresh buying rally
USO (US Oil Fund) Ok-this is EXACTLY what you want to see-wait for it, wait for it and blast off-high volume, big range reversal off new lows. Needs another day to confirm for those still panting after it
OIH (Oil Services) Triple bottoms, now a big run here too
XLE (Energy) Right up to the 50 DMA-like to see that clear
XOP (Oil and Gas Exploration) Unconfirmed phase change to recovery
UNG (US NatGas Fund) Confirmed phase change to recovery
TAN (Guggenheim Solar Energy) This is the future!
TBT (Ultrashort Lehman 20+ Year Treasuries) Unconfirmed phase change in TLTs back to Bullish
UUP (Dollar Bull) Fell victim to the FOMC
EEM (Emerging Markets) Cleared the 50 and 100 DMAs today along with the rest of the herd
EWW (Mexico) Subscribers: Huge day with an unconfirmed recovery phase to hold up
EWG (Germany) Looks good over 30.00
EWY (South Korea) The setup I really like over 3 moving averages- wow!
RSX (Russia) 16.75 now should hold after this very impressive run up
BAL (Cotton) Subscribers: Think this is bottoming so looking for an entry somewhere around 41.70-41.90