Market Analysis for Trading on 3/13/2014

Mish Schneider | March 12, 2014

I had 2 areas I wanted to see defended as starters. In the small caps it was 118 and in the Dow 163. Both were defended by the end of Wednesday’s session.

NASDAQ closed well with S&P 500 a bit weaker. But, we are not out of the woods. If you are familiar with floor trader pivots, all indices must now cross R1 to turn the bias back to positive even in the current bull phases.

Otherwise, this was nothing more than a bounce into resistance.

Here is a repeat of the 4 possible scenarios one last time, as I am going on vacation and leaving the helm to Matthew Mullins, Assistant Director of Trading Education and Research and Rock Star of the Daytrading Room!

1) The blow off top pattern is still playing out

2) The market is digesting the recent rally through time rather than price

3) The market is digesting while it works off overbought conditions, and pretty much will continue to be range bound for a while longer

4) The market is not merely digesting, but fueling for a blast off from last Tuesday’s high with much higher levels to come

S&P 500 (SPY) 187.80 reverses the correction while 184 is underlying support Subscribers: Negative pivots in all

Russell 2000 (IWM) 118.95 next hurdle. 115 next stop if cannot clear it

Dow (DIA) 163 remains pivotal, 163.75 to clear and 161.45 support at the 50 DMA

Nasdaq (QQQ) 90.95 to clear, 90.00 pivotal, big drop to 88 the 50 DMA

XLF (Financials) Stopped at 22.00 and closed ok. Over 22.18 looks a lot better

SMH (Semiconductors) They didn’t disappoint and look really strong

IYT (Transportation) Also a really good sector to watch now for more upside

IBB (Biotechnology) Digesting recent correction

XRT (Retail) Clean correction and another favorite group to watch

IYR (Real Estate) Over 68.65 looks a lot better

XHB (Homebuilders) Held the 50 DMA

GLD Gapped up-not quite a runaway, but a bit of a breakaway on new 6 month highs

USO (US Oil Fund) Held the 50 DMA-note the island top mentioned back on 03/04.

XOP (Oil and Gas Exploration) Held the 50 DMA

EEM (Emerging Markets) Subscribers: Held some support today

FXI (China Large Cap Fund) Subscribers: Possible slingshot bottom today if follows through over R1 33.97

CORN (Corn) Subscribers: Now looking at the 200 DMA to clear

BAL (Cotton) Subscribers: Nice candle near the highs

JO (Coffee) Subscribers: Possible top but could have said that many times last couple of months

SGG (Sugar) Subscribers: Held the 200 DMA

Bye for Now!