The Market Clings and Basks

Crevice spiny lizards are typically shy and nervous. If approached, they will scuttle up rock faces or into crevices so that predators cannot reach them.

They prefer semi-arid habitats where there are numerous holes and easily accessible cracks.

Their climbing skill and small size makes them very fun to keep.

The market shares similar characteristics. A bit nervous, the market has taken to scuttling up into crevices for shelter.

At the same time, the market’s climbing skills has made it very fun to keep if you are a bull on a green day.

Interestingly, as the market climbed up in price today, so did the typical “safety” trades.

Although the market remains adept at avoiding predators, should we worry about its constant retreat into numerous holes and cracks?

Terrestrial lizards appreciate a rocky outcrop directly under their basking spot. They like when they can cling to safety while they bask.

The Modern Family shares similar characteristics.

The Russell 2000 while basking, made another attempt at piercing the 50 day moving average.

Later in the day, IWM escaped into a crevice. Althouh IWM closed green, the price is well below the point where it would change from a warning to bullish phase.

Last week I left Biotechnology as a holdout in a bullish phase. Upon my return, IBB is now in a warning phase.

Nevertheless, with a wall of support at 285.00, a break might put IBB into more permanent hiding. Through 295 though, this lizard shall bask again.

Regional Banks (KRE), also in a warning phase, has escaped into a crack not so easily accessible.

Transportation is currently out basking. IYT may want to shake off its warning phase. It will take more to convince this nervous sector to stay in the sun.

To a degree, Retail followed her Trans offspring. XRT basked over 42.00. Now the real test will be if XRT can return and close over the 50 DMA at 42.55.

Noteworthy is that the only member of the Family still in a Bullish Phase is Semiconductors. As the female, SMH can lay an egg and take that offspring with her back over 80.00. It’s within her reach.

Nonethelesss, should she feel threatened, a break of 77.50 will force the whole Family into a much bigger hole.

With all this market action clinging onto rocks, the volatility index strengthened and could reverse trends from Bearish to Recovery. Furthermore, the interest rate yields declined and the dollar softened.

So yes, the spiny lizard may be fun to keep for now. However, generally limited to a certain habitat, they do not do well when removed from it.

S&P 500 (SPY) 234.64 is the 50 DMA that must hold on a closing basis. 237 a much better situation if clears

Russell 2000 (IWM) 133 important support to hold. Through 137 much better

Dow (DIA) 205.50-206 important 50 DMA support.

Nasdaq (QQQ) Back under the monthly Bollinger band-warning.

KRE (Regional Banks) 51.50 important support. 55.20 key area to get above

SMH (Semiconductors) 77.50 to hold, 80 must clear.

IYT (Transportation)162.75 key to hold with 166.65 the point to clear

IBB (Biotechnology) This must clear over 295 and hold 285.

XRT (Retail) 42.00 pivotal

IYR (Real Estate) 79.00 the 200 DMA to hold

GLD (Gold Trust) 120.10 the 200 DMA with 118 pivotal

SLV (Silver) Tested and held the 50 DMA at 16.85

GDX (Gold Miners) Like that it is holding the recovery phase

USO (US Oil Fund) What we want to see is a weekly close over 11.02

XOP (Oil & Gas Exploration) 37.40 should hold if good and 38 should clear

TAN (Solar Energy) Cleared 17.50 with volume. Should not fail 17 if good

TLT (iShares 20+ Year Treasuries) 121 pivotal and if breaks 119.75 now looks like higher rates in store

UUP (Dollar Bull) 25.96-26.01 pivotal support