Market Analysis for Trading on 1/14/2014: What Good Are Horses If We Die of Thirst?

Mish Schneider | January 14, 2014

The first day of 2014 began with negative price action. Now, as we approach the 2 week mark, the writing appears to be on the wall.

With the spectacular moves in certain sectors and with only a few longs, I admit, I felt like we had missed the party boat.

However, as a student of calendar ranges, I figured that if another party boat began to load at the dock, we’d be sure to board and if not, we’d be happy safely on terra firma.

I’m not suggesting we all head home just yet. The phase in the overall indices remain bullish. Nonetheless, everyone needs a toolbox more diverse than buy the dip and hold. Begin with a solid understanding of the macro picture. From there, study the sectors/groups. After that, have a stop loss, target and timeframe in mind.

Lastly, notice how quiet the amateurs on twitter become.

S&P 500 (SPY) 181.60 area has been support with the 50 DMA next stop thereafter. I’d be surprised to see a rally from here, but not surprised to see digestion with 183 now resistance Subscribers: Negative pivots

Russell 2000 (IWM) 112 the 50 DMA with resistance now at 114.10 area should this come in weaker

Dow (DIA) Broke the runaway gap. Now, 163.50 resistance with support underneath at the 50 DMA 160.30

Nasdaq (QQQ) 85.11 the 50 DMA

XLF (Financials) Pretty significant fall from the highs. Bank stocks report this week

SMH (Semiconductors) One big reason I did not start out enthusiastic was because my semis left a nasty reversal candle from the mutli-year highs

IYT (Transportation) Possible reversal candle from highs but still a good place to look for any strength

IBB (Biotechnology) Could have been it for now-but lots of underlying support

XRT (Retail) Nasty ahead of retail sales.

IYR (Real Estate) Confirmed recovery phase showing the basing action in play from last week if holds above 63.60

GLD Unconfirmed phase change to recovery

OIH (Oil Services) 200 DMA in its midst

XLE (Energy) Decisive action and not in a good way

XOP (Oil and Gas Exploration) the 200 DMA real close here too

TBT (Ultrashort Lehman 20+ Year Treasuries) A sign of weakness since the FED will taper and yet, rates continue to drop

UUP (Dollar Bull) 21.60 a spot to watch

IFN (India Fund) Subscribers: A weekly close over 20.00 will be a signal to go in in spite of the island top

EWW (Mexico) Subscribers: Inside day and still very much on my radar over Friday’s high

CORN (Corn) Subscribers: Couldn’t clear the 50 DMA but did confirm the slingshot

BAL (Cotton) Subscribers: 53.35 is the 200 DMA to clear as my focus continues to head into commodities

SGG (Sugar) Subscribers: Watch for a gap higher above 52.56 for possible island bottom

Bye for Now!