June 4, 2014
By Mish Schneider
All things considered, the market tied itself up into a tidy little bullish looking package on Wednesday with the expected follow through in the certain sectors we have been focused on.
The bow the package needs and now most encouraging is the Russell 2000s testing Tuesday’s low and the 200 DMA once again leaving a bullish engulfing pattern and a tease of the 50 DMA which it could easily blow through Thursday or Friday.
Retail caught up and ended with an unconfirmed phase change to bullish while Biotechnology broke out above several days of consolidation. Regional Banks rested with an inside day while the sector on steroids-Semiconductors continued the journey to new highs.
Interest Rates (TLTs) held steady at the 50 DMA and most likely will remain lackluster until post jobs report this Friday.
Everything is panning out the way the Fed wants the market to believe- US economy will continue to grow-good for the stock market in what seems even more likely now than when I first wrote about it-a summer rally.
2014 is nearly ½ over. Hot off the twitter press, here are some of today’s comments from a few premium subscribers:
M. Shah @manishashah3 Your mentoring has helped me a lot. Trying to find pearls and have reasons for every entry and exit.
E. Williams @ElnoraWilliams Thank you Mish for guiding us through this market ... liked the way you traded LVS today ... wouldn't have known to do that!
John K. @khnjohn Good work Mish in a tough environment. Much appreciated.
M. Knapp @TraderTechsYou have kept us positive in a market that is an absolute shredder and a widow-maker in 2014!One more thing - I joined this service to learn, not to hire a nursemaid, and what I have learned to date, is of great value.
Thank you followers!
S&P 500 (SPY) Day 7 of the breakaway gap with the prescribed rest.
Russell 2000 (IWM) The 50 DMA and then 112.93 areas to clear-otherwise, the next penetration of the 200 DMA won’t stick
Dow (DIA) Resting
Nasdaq (QQQ) After4 days of consolidation new high close-AAPL big reason
XLF (Financials) Looking better
KRE (Regional Banks) watch the 50 DMA after an inside day
SMH (Semiconductors) Rocket job!
IYT (Transportation) Inside day so could just be resting
IBB (Biotechnology) Broke above the congestion and now has to hold around 242
XRT (Retail) Great move off the converging moving averages. 84.00 support to hold
IYR (Real Estate) Resting
ITB (US Home Construction) More consolidation which I like if holds 23.75 level-today's low 23.76
GLD Reversal not confirmed and looks like a new leg down likely
OIH (Oil Services) Inside day
XLE (Energy) Look here after 2 inside days
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs down a lot now so perhaps some bounce with the 50 DMA so close
UUP (Dollar Bull) Closest its been to the 200 DMA since a year ago
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