Never heard of him; must be some permabear or the like….LOL!
Proving once again that Mr. Market’s job is to drive you batsh*t crazy, strong earnings reports from 3M and Caterpillar as well as encouraging economic news domestically and in Europe sent the Dow Industrials up 216 points to close at 16,677.90. The S&P 500 Index gained 1.23% and the tech-heavy Nasdaq Composite rose 1.60%. Transports were strong with the Dow Transport Index jumping 2.1%. Treasury yields closed higher, confirming my suspicions from yesterday.
XBI, the S&P Biotech SPDR, rose 3.79% on above-average volume, breaking out through resistance in the 163 zone. FCG, the natural gas trust ETF, gained 3.10% after dropping sharply yesterday. Volatility declined as the market rose and XIV, the inverse VIX short-term ETN, jumped up 6.48%. URTY, the leveraged Russell 200 ETF, climbed 5.33%. Please click on the symbols for details.
The SPY ran back up to its intermediate-term resistance line, trading through it intraday but closing back at the trend line. “Former support once broken frequently acts as resistance when tested” and that axiom is really showing itself to be the case. For the first time, DIA, the Dow 30 ETF, ran up to its former support now resistance line. You can make the two charts below full-size by clicking on them:
While I had been concentrating on SPY, tomorrow I’m going to concentrate on DIA. The 60-minute chart clearly shows where the resistance is; note carefully where the low was on the final 60-minute bar: 166.20. Yesterday’s high was 166.23. Today’s close was 166.71.
Should DIA trade below yesterday’s high it’s likely it will make a run lower to try and close today’s gap open higher. That may be an opportunity to trade the short side using inverse ETFs like DOG or DXD, provided it doesn’t gap open lower tomorrow and completely wipe out the gap.
That wraps it up for me this week as I’ll be unavailable tomorrow afternoon. Subscribers Only! tomorrow will be updated over the weekend rather than after the close.
Enjoy your weekend.