C’mon Inner Peace; Traders Don’t Have All Day

January 9, 2017

Mish's Daily

By Mish Schneider


Sculpture on Canyon Road, Santa Fe, NM.

Besides that she looks electrified and mystical in a sort of goddess, yogi, Frankenstein way, I imagine that she gazes up for a sign on the market’s next direction.

Me too.

After all, the conflicting signals on the charts do not really add up. On the one hand, NASDAQ made a new all-time high.

Biotechnology cleared all of December’s price movement. Semiconductors retook a pivotal resistance point.

On the other hand, Retail was cast in a horror film where the skeleton-in-the-closet finally comes out to haunt everyone.

Transportation weakens and the Russell 2000 tests important near-term support for the 8th time since early December.

Yields and the U.S Dollar softened and metals rose.

Short of sitting in a lotus position with arms upstretched waiting for the universe to guide us, what other technical factors could help?

With just a bit more patience, position swing traders will soon have a reliable indicator.

The 6-month calendar range happens twice a year. We are only 5 trading days away from knowing the January 2017 calendar range.

As Geoff wrote a year ago, “January will often trend, and it can reveal new trends.” Therefore, the 6-month Calendar Range should clarify:

  1. Whether Retail, Transportation and Regional Banks are toast. At the very least, we will have a range to trade from.
  1. Whether the metals are due for a repeat of last January when they soared beyond the 6-month range. (Some of our best trades!)
  1. Whether Biotechnology hits a wall or continues to resurrect-so important to gauge speculative interest.
  1. Whether the long bonds hold in the monthly channel and continue to rise in price, hence yields continue to fall.
  1. Whether the list of 2017 long and short Picks will offer the best net gains in the next several months.

With an uncertain year ahead of us, the 6-month calendar range is not a guarantee, but a key time pivot and the potential end of one cycle and the start of the next.

Sitting in lotus indeed calms the brain, increases awareness and attentiveness and keeps your joints flexible. However, traders still need a trading strategy.

Right now swing traders, patience is for your highest good and will lead to your biggest profits.

Accepting the reality of change gives rise to equanimity. – Allan Lokos

S&P 500 (SPY) 227 pivotal area. Then, 225.50 support and above 228.34 the high.

Russell 2000 (IWM) 134.50 is big now-if breaks should see selling. 135.50-136 pivotal.  Over 138 better

Dow (DIA) 200 to clear 198.00 should hold now if good.

Nasdaq (QQQ) New all-time high. 120.00 support and 121 pivotal

KRE (Regional Banks) 55.90 resistance, 56.50 point to clear and 54.25 support that should hold

SMH (Semiconductors) 72.40 level pivotal

IYT (Transportation) Must clear 165 and hold 162 or trouble.

IBB (Biotechnology) 285 resistance and 278 nearest support

XRT (Retail) 44.00 resistance and better if it clears/closes above-less scary

IYR (Real Estate) 79 is the last swing high from back in October

GLD (Gold Trust) Resistance at 114.40 and held 111.50 support.

SLV (Silver) Like to see this fill a gap to 15.87 first and hold 15.50

GDX (Gold Miners) Inside day which makes the case for patience

USO (US Oil Fund) 12.00 is big resistance and 10.80 big support

TAN (Solar Energy) I never take my eyes away but at this point, not inspired to buy

TLT (iShares 20+ Year Treasuries) 119.50 is the place to hold for this to remain in the monthly channel. 122 resistance to clear

UUP (Dollar Bull) 26.45 is a clear pivotal number

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