January 31, 2014
By Mish Schneider
Quote by Thomas Fuller
Social Media lead the way on Thursday with a stunning move (13.40% higher) in Facebook. Thus, NASDAQ returned to an unconfirmed bullish phase, yet remains the only one that did thus far of the four indices.
The small caps or Russell 2000s did briefly visit the 50 DMA and bullish phase but could not close above it. Therefore, we end the week and month mixed. If NASDAQ fails to confirm the bullish phase, good chance this bounce and a dead cat will have something in common.
If NASDAQ holds and the small caps catch up ending the week back in a bullish phase, perhaps the market begins February and the Chinese New Year in better shape.
Given the either or situation (and really, that tenuous right here), stay calm and neutral until we see how January concludes. One more day of patience will yield clarity for possibly the next several months.
S&P 500 (SPY) Study volume patterns, phase changes and slope of major moving averages and clearly this makes the case for a rally to sell into. Again, inconclusive, but stay frosty if long
Russell 2000 (IWM) 113.25 is the place to close above or really, vulnerable here as well
Dow (DIA) Lukewarm rally, which considering this was the first one to show fatigue, also reason for caution
Nasdaq (QQQ) Closed above the 50 DMA but in the aftermarket trading around it with the GOOG and AMZN earnings. Under Thursday lows take that as another sign of caution.
XLF (Financials) Ok it bounced, but the daily chart beginning to look like a bear flag
SMH (Semiconductors) I always want to love semis and still do, but if the market corrects, will wait for a move to 40.00 before reentering long
IYT (Transportation) Back to an unconfirmed bullish phase
IBB (Biotechnology) Great day here, but not surprising-pharma having a party-which is good if they keep coming up with good medicine but not enough to hold the market up
XRT (Retail) Inside day under the 200 DMA
IYR (Real Estate) Continues to build a base at these levels
XHB (Homebuilders) Not great looking right here
GLD Looks good then looks worse but still over the 50 DMA
USO (US Oil Fund) Gapped up and held the small gap. Now, it’s all about holding the 50 and clearing the 200 DMA
OIH (Oil Services) Could be the rally to short if rolls over Friday
XLE (Energy) Holding the 200 DMA for now
TBT (Ultrashort Lehman 20+ Year Treasuries) TLTs Inside day under the 200 DMA
UUP (Dollar Bull) Unconfirmed phase change back to recovery
CAF (China “A” Shared Fund) Watch here since cleared the 200 DMA again
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