Should Stock Market Bulls Stay Positive?

This guy is my hero.

Standing on the corner, holding up this sign, he got my attention.

He readily engaged in conversation. He did not ask for money, so I asked him if he needed any. 

He said, “it couldn’t hurt.”

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Stock market bulls are in a similar scenario.

They are standing on a corner, trying to stay positive, while discreetly holding out their hand hoping for money.

Was today’s market rally too shallow for any real positive change?

The Semiconductors ETF (SMH) could not hold early gains and closed well under last week’s low of 113.49. Plus SMH had an inside day.

The Transportation ETF (IYT) also had an inside day. Good news, it held 190. Not so good news, the rally was really shallow, with IYT ending the day down .28%

The Retail Sector ETF (XRT), our biggest concern, held the 200-week MA. It could not clear back over the 50-DMA thereby, confirming the bearish phase.

Regional Banks KRE closed red. Under 54.20, it will be hard to “stay positive.”

Biotechnology IBB closed basically flat. That does not exactly invoke bullish confidence.

Finally, the Russell 2000, IWM, also with an inside day, acted poorly. That’s a more immediate concern. With the recent leadership, the Russell’s now make us wonder if that’s sustainable.

Inside days are perfect pause todays. Statistically, the way the range breaks dictates the next direction.

Therefore, bulls can continue to hang out on a street corner with their positive message. However, they better look both ways before they cross the street in hopes of finding money. 

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S&P 500 (SPY)  – 290 quickly went from support to resistance. The 50-Day Moving Average is at 285.20

Russell 2000 (IWM) – 157.15 the 50-Weekly Moving Average is the pivotal resistance. With 155.55 next level to hold.

Dow (DIA)  – 260 is now pivotal as this broke the 50-Day Moving Average and has confirmed the caution phase.

Nasdaq (QQQ)  – 188.67 now resistance. The 50-Day Moving Average support is at 182.00

KRE (Regional Banks) – 55.90 the 200-Day Moving Average resistance now with 54.20 the next area of support.

SMH (Semiconductors) – 110 the 50-Day Moving Average.

IYT (Transportation) – Holding the support at 190.

IBB (Biotechnology)  – 105.75 pivotal area with 103.50 support.

XRT (Retail) – Confirmed bearish phase.

Twitter:  @marketminute

The author may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.