February 13, 2017
By Mish Schneider
In keeping with my theme of gauging the internal breadth of the market through the Modern Family. Monday’s strong session was not without disparity.
Regional Banks (KRE) made early gains and even posted a new all-time high. However, KRE ended the session closer to its intraday lows.
Sister Semiconductors (SMH) rose by over1%. Yet amazingly, did not do much as far as price levels, rather hovering just above the all-time highs.
The Russell 2000 (IWM) came within inches of the top of the monthly channel near 140 with a high today of 139.21. Somewhat ominously though, it ended the day just slightly up on the session.
Before we even go further, these 3 members of the family did ok, but not nearly enough to wow us.
Could this price action be a harbinger of a more somber week ahead of us?
If you look at Grandma Retail (XRT), you’d think she lives in a completely different world. Down over 1%, XRT failed to hold above the 200 DMA.
Transportation (IYT), which now has 3 highs at 171.15 level, could very well hold the key. Should IYT fail 168 now, triple tops are not out of the question. Conversely, if IYT rallies beyond the triple tops, it will boost confidence all around.
Over the weekend, I wrote that Biotechnology “is the Modern Family’s symbol of speculative interest.”
Today, IBB rose above 285, a pivotal point. But it did so on low volume. Therefore, one can conclude that specs came in, but not with heart and soul.
So here we are, the Modern Family and me, standing at the “Entrance” of the “Market Today.” We want to go in and spend lots of strong U.S. Dollars. In fact, we already have.
Nevertheless, without all members equally enthusiastic, the optimism remains tempered.
One of the best stock performers today? World Wrestling Federation (WWE). Ironic really, considering how the family is wrestling with this recent rally.
S&P 500 (SPY) Yet another new all-time high. 240 in sight with parabolic price action
Russell 2000 (IWM) New closing highs by just one tick, sloppy close 137.70 price to hold
Dow (DIA) Unless this break 200, parabolic price action can lead anywhere
Nasdaq (QQQ) 126.50 is new pivotal area short term to hold and going parabolic
KRE (Regional Banks) 56.73 is the January 6-month calendar range to clear on closing basis, sloppy close with 55.85 as important support
SMH (Semiconductors) 75.40 still pivotal as breakout over recent compression
IYT (Transportation) 171.15 the triple top number to clear. 168 must hold
IBB (Biotechnology) 287 big resistance to clear as 6-month calendar range high with 277 big support
XRT (Retail) having issues and sitting on 6-month calendar range low, a close below 43.25 means trouble for this lagging sector
IYR (Real Estate) 79.00 the 200 DMA
GLD (Gold Trust) Held where it needed to. 120.65 the 200 DMA
SLV (Silver) Inside day just under the 200 DMA it cleared last Friday
GDX (Gold Miners) Closed back under the 200 DMA with a quiet inside day
USO (US Oil Fund) 11.60 next point to clear. 11.00 closest support
TAN (Solar Energy) Cleared 18.00. Now see if it holds it
TLT (iShares 20+ Year Treasuries) 120 now key support
UUP (Dollar Bull) 25.80 support 26.20 resistance