August 9, 2017
By Mish Schneider
Saw this piece locally. I love it!
The sculptor explores iron as a profoundly symbolic material.
He believes that iron’s “regenerative matter, aesthetic malleability and cultural meaning resonate…”
The name of the piece is “Everything at Hand.”
Much the same can be said for the market.
If iron is symbolic of regeneration and aesthetic malleability, then certainly, the market is made of iron.
And given that the Dow barely budged after Trump’s North Korea statements, this market remains equipped to take “everything at hand.”
Tillerson tried to walk back the severity of Trump’s threats, which helped.
Nevertheless, divorcing ourselves from current events and looking solely at the technical price patterns, what resonates?
For starters, the Russell 2000 (IWM) cleared the top of the monthly channel in July but did not wind up closing above it.
This month, IWM has fallen further from the top of the channel resistance and is in a Warning Phase. Big eyes here.
Semiconductors (SMH), which has been the strongest of the sectors, lives aesthetically above the 50-DMA thus far, therefore bullish.
If SMH can regain momentum to the upside, what resonates is the iron will of the corporate buyers to keep the market alive.
Transportation (IYT) has more room on the downside before we can say “it’s over.”
Can IYT regenerate?
Best case scenario is if the government can pass some sort of legislative infrastructure policy. And avoid a war.
Regional Banks (KRE) went into an unconfirmed warning phase today.
Even with Fed talk of raising rates and reducing the balance sheet, KRE proves that the community banks are not so malleable to be fully convinced rates will go up.
As mentioned in earlier blogs, the market might immediately feel the heat of higher rates, but it could also resonate as confidence in the economy.
Speculators sold a chunk of their long holdings in Biotechnology (IBB). Again, not a deal breaker as IBB remains in a bullish phase. However, worthy of keeping an eye on.
Retail (XRT) tested but held its 50-DMA hence recovery phase.
Like the sculpture, the Modern Family has issues. Yet overall, everything is still at hand.
S&P 500 (SPY) Reversal? Broke 246.83 now pivotal but not 245.68, the July 27th low.
Russell 2000 (IWM) Broke below the 100 DMA. It also broke below the 50 WMA. That puts 134 in focus.
Dow (DIA) 219.60 is the underlying 10 DMA as nearest support
Nasdaq (QQQ) 144 pivotal. 142.30 the 7/27 support.
KRE (Regional Banks) Unconfirmed warning phase now resting on the 200 DMA.
SMH (Semiconductors) Now watching the 50 DMA at 85.60
IYT (Transportation) 164.75 the 200 DMA with 166.50 resistance
IBB (Biotechnology) 308.50 major support with 320 the place to clear
XRT (Retail) 40.40 the 50-DMA.
IYR (Real Estate) 80.00 pivotal and 79.50 some support
GLD (Gold Trust) 121.88 the high in June
SLV (Silver) 15.25 support. Over 16 looks good
GDX (Gold Miners) 22.60 pivotal
USO (US Oil Fund) 9.95 pivotal. 10.60 big resistance to clear
TAN (Solar Energy) If gets down near 20.00-a gift
TLT (iShares 20+ Year Treasuries) Over 124.86 the 50 DMA for an unconfirmed bullish phase.
VXX (Volatility Index) fear back in the market
UUP (Dollar Bull) Returned over the 200-week moving average at 24.20. Now pivotal number
FXI (China) Possible exhaustion gap top if cannot get back to 43.20