Mish’s Daily: Weekly Update on the Economic Modern Family
Mish’s Daily: Weekly Update on the Economic Modern Family
Written by Michele ‘Mish’ Schneider
This past week, we saw the Gordian Knot tied tighter.
As far as the events of the past week and fundamental news review-I am leaving that to my esteemed colleague Donn Goodman to cover in the content area of the Market Outlook.
Keith covers the risk assets and produces a video, so I highly recommend you sign up to receive it in your mailbox.
For this version of the Daily, I want to get right down to the technical analysis of the Economic Modern Family with actionable plans.
It should not come as a surprise to see the Family diverge even further than where it has been over the last 2 months.
Granny Retail XRT still clings to clutch support with 74.75 pivotal.
That means this week, XRT must hold that level and get back above 76.00 to instill confidence.
Granddad Russell 2000 IWM (along with Granny in weekly accumulation phases), also must hold at the past week lows or around 198. Plus, if IWM can get back over 202, stories of how undervalued small caps are, we could begin to think perhaps they are undervalued enough.
On the flipside, here are 2 Family members causing us more concern.
Transportation IYT, a sector many are talking about besides us, has closed the week below the 50-week moving average.
If IYT cannot recover this next week, I would be hard pressed to load up on equities right now-ANY equities.
(Commodities could be a different story)
Regional Banks KRE have also broken the 50-WMA for the first time since last December.
That could be a huge warning as bank failures may not be off the table. Nonetheless, we will watch to see if KRE recovers or not this coming week.
Biotechnology IBB still intrigues me.
While yet to clear the 200-week moving average, IBB remains steadfast while it continues to hold the 135 area.
If IBB can pop over 138 and stay there, I imagine we could see more upside. I have a few biotech drugs on the radar.
And of course, there is our Sister Semiconductors SMH.
Really, that woman has wings.
But for how long if her Family sputters more?
And here’s the rub.
If the Family hangs tough or rallies from here, we see no topping pattern in SMH yet. However, should we see more Family weakness, then a move under 240 would be a warning.
Our last member of the Family is Bitcoin $BYCUSD.
I don’t love that it closed the week (it does trade 24/7) under 66,000.
And on a daily chart, it looks like a double top is possible.
On a weekly basis, the price is fine.
But the 50-WMA is far from current levels.
Bulls do not want to see 45,000.
BTC takes out the recent highs-that is another story.
However, under 60k, 45,000 would be a reasonable next target.
By the way, all this accompanies Long Bonds TLT, which have cleared the 50-WMA handily.
And if they do it again next week-hello stagflation for real-and maybe a steppingstone to recession. But that takes us back to the Gordian Knot-who unties it first.
Educational purposes only, not official trading advice.
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Coming Up:
June 17 BBC Singapore
June 19th Fox Business
June 21 Schwab
June 24 Benzinga Pre-Market Prep
June 24 CNA Asia
June 27 Live coaching
July 2 Yahoo Finance
July Date TBD Wealth 365
Weekly: Business First AM, stockpick.app
ETF Summary
S&P 500 (SPY) 545 target sticks and will look uglier under 532
Russell 2000 (IWM) 198-202 tightest range to watch
Dow (DIA) Back in a warning phase so another key to the puzzle not looking so hot
Nasdaq (QQQ) All-time highs yet again, which is still hard to argue with
Regional banks (KRE) Watching the range 45-50 CAREFULLY
Semiconductors (SMH) Unless this breaks 250-strong and on ATHs
Transportation (IYT) Broke the 200-DMA for an unconfirmed phase change to Distribution
Biotechnology (IBB) 135 support 140 resistance-big eyes here this week
Retail (XRT) Hanging onto the 50-DMA like her life depends on it-cause it does
iShares iBoxx Hi Yd Cor Bond ETF (HYG) The Daily chart has left an exhaustion gap top. Not all together broken yet, but watching
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