Market Analysis for Trading on 6/12/2013

Mish Schneider | June 11, 2013

Open Trade Update

Existing Position: OIH long ½ Position

Current Price: 42.73

Stop: 42.34 (lowered but watch for an email/text alert for adjustment)

Target: 50.00-53.00


Open Trade Update

Existing Position: GE Long 23.86

Current Price: 23.56

Stop: 22.49 (Also might be adjusted depending upon market condition)

Target: 29.25


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

Current Price: 37.81

Stop: 35.79 (raised)

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


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

Current Price: 19.66

Stop: 18.77

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


Real Estate and Homebuilders gave the market an early warning once neither was able to rally off of the major moving averages. The initial reaction appeared to be more rate driven. Today, rates dropped in a risk-off type of scenario, but also because the Federal Reserve, meeting on June 20th, hinted at keeping the faucet flowing. However, if the market is under pressure when rates both rise and fall, will the real culprit please stand up? Uncertainty is the number 1 enemy of a stable market. Interestingly enough, the Biotech group well outperformed today. Now, we are back into some critical support levels in some of the other groups.

S&P 500 (SPY) Distribution day in volume with some head’s up after yesterday it could not clear the high from the week before. This indicates a likely continuation in the correction, but the trend is still bullish. Subscribers: Negative Pivots in all

Russell 2000 (IWM) Somehow, even down 1%, it doesn’t look that bad on the daily chart. I find the small caps a really good place to go for clarity. With a doji day, clearly, I am not alone in the hesitation of what direction is next.

Dow (DIA) This closed better than the small caps, but the daily looks more vulnerable. The 50 DMA might not lend much support next time it visits it

NASDAQ 100 (QQQ) Sort of held Friday’s low with also a doji candle (opening and closing price virtually the same). At best, a good correction and not an intermediate top. Worst case, a top and trip back to 70.00 in store


GLD 135 resistance with 130 a very substantial area of support-with sentiment still bearish

XLF (Financials) 19.50 was pivotal last week

IBB (Biotechnology) 180 has to clear for today to be more than a one day rally

SMH (Semiconductors) 37.00 some support although like to see 37.50 hold up

XRT (Retail) Still doing better than the other groups as it remains over the fast moving average.

IYT (Transportation)The 50 DMA and 111 are really close together making that a key level to hold or fold

IYR (Real Estate) Well, we sure knew the 200 DMA would not offer support the next time down. Subscribers: We are now on slingshot alert-wishful thinking maybe

USO (US Oil Fund) Held the major moving averages

OIH (Oil Services) Unconfirmed warning phase now

TBT (Ultrashort Lehman 20+ Year Treasuries) Reversal candle that looks a lot more powerful than the one from May 31st. TLT through 114 will confirm it

XOP (Oil and Gas Exploration)Sitting out to see how 59-60 level holds

XHB (Homebuilders) Subscribers: Confirmed warning with 29.50 some support

UUP (Dollar Bull) Oversold