Stock Trading-What Now?

August 2, 2011

Mish's Daily

By Mish Schneider


SPY If we get 2 closes in a row beneath 128.70 that would put it in a Distribution Phase. Now, 4 Distribution days in volume. The signs have been there since the island top back in July. The slope on the 50 never turned positive. In hindsight, this index was telling us all along about the issues with the economy both here and globally.  125.28 was the low in March. Will watch to see if holds that level. Back over the 50 weekly would be encouraging at least for a short term pop.

QQQ 56.06 down to 56.00 the 160 EMA and 200 DMA support levels. 54.85 the 50 weekly moving average. I have written articles about the slope of the moving averages. Clearly, when the 50 DMA slope turned negative another warning sign. This index will be a primary focus for either a bounce over the FTP  or a failure of that level with an OR high failure for a continued short.

IWM Confirmed Distribution Phase with two closes under the 200 DMA. Unless this rallies and closes above the 50 weekly moving average, continue to sell rallies

ETFs:

GLD Flight to quality and once this got moving, the tell tale sign. Now, watch for 160.70 to hold.

SLV 40.35 recent high so for now underperforming GLD. 39.45 area to hold  or would consider the possibility of a reversal, especially if it breaks 39.00

OIH ChartOIH** Another major focus as the 50 DMA still holding and sloping up. Will watch for an entry on the basis of the opening range.

IYT I wrote about the trouble this was telling us a while back and it has dropped 10% since then. 88.90 was the March low. If by some miracle that holds, could be a sign for some rally.

IYR** tested and closed below the 200 DMA. Still holding the 50 weekly MA. Over the 200 DMA watch for possibility of a bounce.

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