If One Of Those Bottles Should Happen To Fall

June 3, 2015

Mish's Daily

By Mish Schneider

Besides The Modern Family breaking out into “99 Bottles of Beer on the Wall”, as the traffic cleared, the other best event of my day is the correspondence I get from so many of you, writing to me in the same Modern Family vernacular! Awesome! Thank You!

I googled “99 Bottles..” and found that the song, purposely repetitive in nature, has mathematically and scientific inspired variants. O(log N) is an equation developed by computer scientist Donald Knuth, who proved the song has complexity in its simplicity.

Hence, our Family’s appropriate choice of song whilst it put on some mileage with all members happy except for Brother Semiconductors. However, while he mopes in the backseat of the minivan, his sympathetic sister Transportation, reminds him the Mergers and Acquisitions that rocked him to new highs the week prior-(Intel and Altera, Avago and Broadcom)-were anomalies and since he already lead the family up to current levels with all the work he did from 2012 on, his purpose for 2015 is to simply hang out.

58.47 was the March 2nd high until last week-therefore the area Semis should hold around. As for the rest-Bravo Granddad Russell 2000 for proving that he was aptly anointed “driver.” And Brava to you Grandma Retail, for busting through the 50 DMA breaking out the piggy bank and hopefully, heading to a mall. Retail will look so much better if it stays above the 50 DMA and confirms the bullish phase.

Lest I forget my fave, Regional Banks. Love you brother. We invested you in February and never broke trust. Please don’t let our faith in you go to your head, though. With Wednesday’s new highs, we are so close to locking in partial profits. Yes-we still believe you can make it $45.00-46.00!

Grandma Retail’s cajoling Transportation back into the van gave that sector some renewed confidence. 151.80 is the weekly moving average. A close above this week and off she goes!

Janet Yellen and the gang of Traffic Controllers at the Federal Reserve did a good job directing Tuesday’s traffic. Rates firmed and really, with no major damage done to commodities. Sure Gold and Silver retreated from Monday’s highs, yet, both closed above last week’s lows. Big eyes remain looking for bottoming patterns to buy.

Most soft commodities rallied. As mentioned in Sunday’s daily, I believe that, “Both roads--lower interest rates if the Fed injects and rising interest rates if the Fed follows the path of least resistance to sell the bonds they are holding--eventually lead to the same result. At some point-and timing is key-commodities will bottom and yield the next best long term investment opportunities.”

S&P 500 (SPY) Closed under the fast moving average, 212.23 now resistance to clear on a closing basis with 209.96 the 50 DMA to hold.

Russell 2000 (IWM) If this is good, it’s not too late to buy against 122 and see if it can finally bust out making new highs

Dow (DIA) 180 pivotal with 179 support and over 181.50 better

Nasdaq (QQQ) Double top possible at 111.08-16 and support to hold at 108

XLF (Financials) 24.90 the point to clear

KRE (Regional Banks) New 2015 highs

SMH (Semiconductors) Topping candle confirms but we will give it leeway to 56.50

IYT (Transportation) 151.80 the pivotal weekly moving average to hold

IBB (Biotechnology) Paused

XRT (Retail) The 50 DMA is 99.50 to hold up

IYR (Real Estate) Just as we would expect with rates firming

GLD (Gold Trust) If clears Wednesday’s highs again good sign