The Stock Market Hires a Bug Bouncer

Michele Schneider

As we were gassing the car up the other day, a pick-up truck idled at the next pump.

When I saw the logo of a termite holding a barbell embossed on the side of the truck, I grabbed my iPhone to photograph it. (Visual motivation is everywhere! – see photo and charts below)

The owner of the truck popped out. He operates an extermination service called The Bug Bouncer.

Today, the bug bouncer showed up to exterminate the termites who have been eating away at the bulls in the economic Modern Family.

In particular, the Russell 2000 ETF (IWM) benefitted from the bug spray.

IWM recaptured the 200-daily moving average and went back into an unconfirmed Accumulation Phase.

Not everyone in the Modern Family did as well, however.

Although they all had gains in price, some were merely stunned by the bug spray.

Looking at the weekly charts, besides the Russell 2000’s, the Transportation Sector ETF (IYT) looks as if it shed some termites. 

As for the rest, the sector still “bugged” by sellers is the Retail Sector ETF (XRT) – also know as “Granny”.

Indeed, XRT did rally today over 1%. 

But that doesn’t tell the whole story.

XRT (along with Regional Banks KRE) remain under their 50-week moving averages (blue line).

What could happen, is that by the time XRT and KRE reach their 50-WMAs, IWM, SMH, IBB and IYT will make new swing highs.  

And then, we will know whether the bug bouncer did his job well, or whether mayflies will replace termites.

S&P 500 (SPY)  – Swing high at 288.91. 287.37 pivotal support held perfectly. 

Russell 2000 (IWM) – Unconfirmed accumulation phase. 156.36 must hold.

Dow (DIA) – 263.61 now pivotal. Under 261.00 can see 258.

Nasdaq (QQQ)  – Made a new Swing high at 185.53

KRE (Regional Banks) – 53.40 pivotal resistance.

SMH (Semiconductors) – Swing high at 112.89

IYT (Transportation) – Swing high at 193.78.

IBB (Biotechnology)  – 115 key pivotal resistance.

XRT (Retail) – 45.50 now pivotal.

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.

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