February 11, 2014
By Mish Schneider
Shirley Temple R.I.P
A couple of notable features of the day after figuring this session would be more decisive. First, SPY or S&P 500 climbed back to a bullish phase. NASDAQ came 3 ticks from the 2014 high made in January yet managed a new high 2014 close.
Dow, a bit of a different story as it could not clear the 50 DMA, which most likely means any sell off from here, will hit that index. The Russell 2000s or IWM, same thing. Volume all around gave the market a second accumulation day (when the volume on a green day exceeds the volume from the day prior).
Sectors and groups-the weaker ones got some relief such as Oil Services, Homebuilders (back over the 50 DMA) and Financials (also back over the 50 DMA). Although many others rallied with the indices, no phase improvements. Most concerning Retail, even with several days of strength touched but could not clear the 200 DMA.
Big winners were China and Emerging Markets, most likely relieved to hear Yellen’s willingness to support the economy anyway the FED can.
Going forward, focus has to be on the Dow and Russells. The leaders have done what they can, but without these 2 groups, not saying rally over over-but the theme of 2014, caution on the instruments you choose to buy, remain judicious.
S&P 500 (SPY) 180.98 the 50 DMA now key to hold.
Russell 2000 (IWM) Must hold today’s lows or market should get spooked.
Dow (DIA) 160.72 the 50 DMA-like to see it clear and not ruling out that possibility-a gap over-special
Nasdaq (QQQ) 89.00 the 2014 highs
XLF (Financials) Unconfirmed phase change to bullish which means like to see this defend 21.50
SMH (Semiconductors) Remember when I wrote if this gets down to 40.00 buy it?
IYT (Transportation) Didn’t make it over the 50 DMA
IBB (Biotechnology) New highs, of course
XRT (Retail) 81.48 the Promised Land
IYR (Real Estate) A bit extended here
XHB (Homebuilders) An unconfirmed bullish phase marginally
OIH (Oil Services) Cleared the 200 DMA and the 50 DMA-big winner
XLE (Energy) 85.00 some resistance
XOP (Oil and Gas Exploration) Right to the 50 DMA but didn’t cross
TBT (Ultrashort Lehman 20+ Year Treasuries) Cleared the resistance from Friday which could mean more upside here for next couple of days
EWG (Germany) Gapped over and held the 50 DMA handily
JO (Coffee) 2 inside days