Market Analysis for Trading on 9/12/2013

Mish Schneider | September 12, 2013

Existing Position Long: XLF 19.97

Name of Instrument: S&P Sel Financial SPDR Fund

Current Price: 20.29

Sell Stop: 19.19

First target: 20.97 sell 1/3 to 1/2

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Existing Position: Long: IYR 62.15 2/3 to ½ position left

Current Price: 64.35

Stop Loss: 62.15

First Target MET: Reached!

Next Target: 64.75 Sell another ½ of remaining position-keep tail

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Existing Position: Long OIH $45.47 (1/4 position)

Current Price: 47.68

Stop: 45.47 (no loss)

First Target: Reached

Next Target: Reached!

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Existing Position: Long UUP $22.12

Current Price: 22.01

Stop: 21.79 (Lowered back to original stop)

First Target: 23.00 take ½-1/3

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Existing Position: Long TXN $39.18

Current Price: 40.16

Stop: 37.94

First Target: 40.59 Sell 1/3-1/2

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The index that went up the most during Wednesday’s session for a second day in a row is DIA or the Dow Industrials. I once again begin with this factoid as A) DIA had been the laggard B) with the move up today, it finally crossed and closed above the 50 DMA for an unconfirmed phase change to bullish. However, the Russell 2000s closed unchanged, the S&P 500 marginally higher and NASDAQ closed red. Why is this potentially significant? SPY and IWM still have 2013 highs made in early August to contend with while the QQQs could have had a reversal form new highs-that all depends on confirmation and whether it holds here or gaps lower Thursday.   All indicesare rich on the daily relative strength indicators, thereby, this move in the Dow could be a last gasp. Usually, I like to see volume on exhaustion rallies, but better than average volume seems to come in on down way more than up days. The interest rates dropped today-that could be another clue, especially since the Treasuries are holding August lows-that and that this is acommodities fueled rally still.  Be that as it may, I began this week commemorating Jason’s birthday this Friday the 13th. Have you checked the children?

S&P 500 (SPY) 168.26, Tuesday’s gap low is important to hold. Otherwise, we are looking at the 2013 high as resistance  Subscribers: Positive pivots in all indices.

Russell 2000 (IWM) 105.63 is the 2013 high.

Dow (DIA) Cleared the 50 DMA for an unconfirmed phase change to bullish

Nasdaq (QQQ) Over 78.26 negates the possible topping action

ETFs:  

XLF (Financials) Confirmed phase change to bullish. Has to hold the 50 DMA

SMH (Semiconductors) 39.72 the 2013 high to clear for sustained rally. Inside day.

XRT (Retail)  Confirmed phase change to bullish. Has to hold the 50 DMA

IYT (Transportation)  2013 highs next hurdle

IBB (Biotechnology) Resting

IYR (Real Estate) Looks like some bottoming formation intact with overhead resistance in its path

XHB (Homebuilders) Anticipating a rate drop in its return to a bullish phase?

GLD Inside day in nowhere land 

USO (US Oil Fund) 50 DMA support close by

OIH (Oil Services) New multiyear high!

XLE (Energy) Cleared 84.00-needs to stay above it

XOP (Oil and Gas Exploration) New 2013 highs-now we are looking at 2011 highs

TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs through 104 could change the equation for rates

SGG (Sugar) Subscribers:  If this drops to 58.50 or so, we will have another opportunity

Bye for Now!