March 20, 2017
By Mish Schneider
Are your long positions and bullish biases starting to resemble a garden of curly, rusty steel?
Do you feel like after you enter a trade you risk getting screwed?
Do you see initial momentum on each trade followed by long periods of curly compression testing your patience?
If you answered yes to all three questions, you are most likely a miniswing to position swing trader.
You probably have a smaller portfolio right now.
You may have more issues than ever before trading in the technical bubble while ignoring the plethora of news.
Last week, the market ended on a low to high note depending where you looked.
Are you wondering where to look this week?
Will the steel endure the rust or will the rust decay the steel?
While the Russell 2000, Retail, Transportation and Regional Banks fell further, Semiconductors made a new all-time high.
The NASDAQ FANG stocks either closed green or barely budged from their highs.
Biotechnology held the pivotal 295 level.
As of today, the S&P 500 and the Dow have now gone 109 days without a 1% decline.
Meanwhile, gold and 20+ Year Bonds moved higher.
Even with the softening yields, agricultural commodities except for coffee futures, plummeted. So did oil.
Utilities had a hard time.
Solar energy? Nothing to see here folks.
The volatility index or fear index held last Friday’s low but closed weaker.
Modern Family Portrait
Note that 3 of the 6 sectors are below the dotted 50-daily moving average.
Retail (XRT) is below the 50 and 200-DMA (the solid line).
The Russell 2000 holds its position above the 50-DMA.
The Semiconductors graduated from Xanax to Ecstasy.
So, where shall we look this week?
If you want that curly rusty steel garden to turn into soft cushy foam, follow the dotted lines.
S&P 500 (SPY) 235.74 in focus to hold or must make a swift comeback over 237.50
Russell 2000 (IWM) 139 next barrier to clear and 136.75 super important support to hold.
Dow (DIA) Caution unless regains 209.50
Nasdaq (QQQ) In good shape provided in holds 131.40
KRE (Regional Banks) If cannot close out March above 57.75, caution.
SMH (Semiconductors) I’ll have what she’s having
IYT (Transportation) 163.25 in focus unless it can make a move back over 167.45
IBB (Biotechnology) A March close above or below 298.85 important
XRT (Retail) Poor Granny. Back over 42 would be a reprieve
IYR (Real Estate) Sloppy chart but back above the 50 DMA
GLD (Gold Trust) 116.69 support to hold now to see this keep going
SLV (Silver) Needs to clear the 50 DMA
GDX (Gold Miners) 22.50-23.40 range to break one way or another
TAN (Solar Energy) 17.70-17.85 max risk. Back over 18 would be impressive
TLT (iShares 20+ Year Treasuries) 118 pivotal still. Over 120 interesting