Market Analysis for Trading on 5/31/2013

Mish Schneider | May 31, 2013

Look for an email alert/text on a new trade-however, until market shows clear direction, will not take any big risks

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Open Trade Update

Existing Position: OIH (44.89 average price of entry) Full Position

Position: Long

Current Price: 44.15

Stop:  42.67

Target: 50.00-53.00

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Existing Position: SMH Long 35.02 (1/4 position left)

Current Price: 38.78

Stop:  35.97 (raised)

Target: Holding ¼ position longer term-no specified target yet

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Existing Position: XLF 1/4 position left from 18.38 entry

Current Price: 20.17

Stop: 18.77 (raised)

First Target: Met and now have 8 ATRs
Second TargetMet at 20.00 -have ¼ position left

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Market Analysis for Trading on 5/31/2013

Although the market moved up slightly today from the established high end of the range made onMay 22nd to the low end in place from this past Tuesday (May 28th), it is still very much “boxed in” in a range.  The market remains in a firm bull phase, which is comforting at this point. That doesn’t mean we can’t or won’t see a move to test the underlying 50 day simple moving averages. Likewise, it doesn’t mean we can also take out the highs and keep going. We also cannot discount the possibility that this range will be around for a while as the market remains skeptical concerning the Fed’s back and forth policy on the future of the quantitative easing. Once investors can count more readily on a higher US dollar and higher interest rates rather than lower US dollar and lower interest rates, new trends will emerge. For now, choppy conditions, tough going.

S&P 500 (SPY) Locked under the fast moving average. Range 164-169 Subscribers: Positive Pivots in all indexes

Russell 2000 (IWM) Inside day, which at least should help tomorrow with next direction depending upon the way the range breaks up or down. Closed above the fast moving average-a positive sign

Dow (DIA) 155.14 number to clear. Under 153.48, expect more pressure

NASDAQ 100 (QQQ) Closed over the 10 DMA in its range 73-75.00

ETFs:  

GLD Gapped higher, then consolidated in a tight range. Paused at higher levels and probably good to watch to see which way today’s range breaks

XLF (Financials) Although it did not make new highs, it well outperformed again.

IBB (Biotechnology) 179 support and needs to clear recent highs 187

SMH (Semiconductors) New 2013 highs but closed just beneath the intraday high, however, did make a new closing high.

XRT (Retail) 77.00 held for now but now has to clear 78.00 to return confidence

IYT (Transportation) 116 is the number to clear as 113 the number to hold

IYR (Real Estate) Inside day. Well under the 50 DMA and back into the March trading range support

USO (US Oil Fund) Yo-yo up and down the major moving averages

OIH (Oil Services) Still friendly to this unless it fails 43.80 last day of the month

XLE (Energy) 81.00 has been a big area of support and now 84 area to clear

TBT (Ultrashort Lehman 20+ Year Treasuries) After Tuesday’s huge rally, still trading within the range of that big green candle

XOP (Oil and Gas Exploration) Inside day. Friendly here as long as 60.00 holds

UUP (Dollar Bull) Landed on the 50 DMA. Looking to see if this support holds

Bye for Now!