April 22, 2014
By Mish Schneider
The good news is that the S&P 500 negated the recent topping action and closed above the last swing high 187.17. The not quite bad news-let’s call it more sobering news-is that the small capsor Russell 2000s couldn’t quite make it back up to the 50 DMA (nor could NASDAQ) leaving the not so dynamic duo in warning phases.
As much as I appreciate the rally over the last 5 days, and I do, red flags loom. One big one is theinterest rates-like to see the rally accompany firming rates rather than the artificially low ones the Fed hath created.
2014 or The Year of the Horse-has been one more of a hybrid-a mule! Stubborn, beast of burden, carrying a load up hill then falling down at the crests-not as sure footed as a purebred.
With lots of earnings still ahead of us, and an incredulous bunch of investors mainly due to theconstant rotation of instruments that gain strength then fall to exhibit weakness, we continue to play it relatively safe. Oh, yes, and we still love soft commodities.
S&P 500 (SPY) 187.15 is now support to hold with the April highs 189.70
Russell 2000 (IWM) 115.84 the overhead 50 DMA with 113.50 area to defend now
Dow (DIA) April high 166.06 and now, 164.30 area to defend
Nasdaq (QQQ) 88.58 the 50 DMA overhead and could not even clear 87.88 the April 10th high-if market rolls over look here
XLF (Financials) Unconfirmed bullish phase if it holds above 21.90
SMH (Semiconductors) That high to clear from 4/10 is 46.03 with the 10 DMA at 44.96 the support
IYT (Transportation) Exactly what I thought-jetted to new highs-one really good sign
IBB (Biotechnology) 234.57 key to clear of this move was no more than a run to resistance
XRT (Retail) Touched the 200 DMA-question is can it clear it?
IYR (Real Estate) March high 69.33
GLD Right on the month moving average which means has to hold or could be in bigger trouble
USO (US Oil Fund) Just like that, new highs then dump
TBT (Ultrashort Lehman 20+ Year Treasuries) If TLT clears 110.67 the bulls will come back. For now, I am waiting for the shoe to drop
PHO (Power Shares Water Resources) Couldn’t quite clear the 50 DMA
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