If you’re having a hard time figuring out what the market is going to do next, start thinking about the trading range. The 2023 outlook gives reasons for a range potential of 1000 points in the SPY of 3200-4200. We add that the NASDAQ 100 can head towards 330 via QQQ before peaking and then slide to 230 support just as easily.
Think about it, too – the relationship between high yield/high debt and 20+ year bonds is as muddled as you are. On the one hand, high yield is finally starting to outperform risky longs. (See down arrow.) On the other hand, the real momentum indicator showed mean reversion in junk bonds. (See up arrow.)
(Check out our Big View this weekend for the latest on key market internals)
So the indices get stuck. Bonding relationships are deadlocked. Economic data is stuck. Recession coming or soft landing achieved? plugged. What about inflation, geopolitical stress, climate issues and food shortages, along with calls for wage increases and social unrest?
plugged.
Maybe the Economic Modern Family can help.
The Russell 2000 (IWM) or grandfather of Economic modern familyhad a gold cross and surpassed the December highs (though not the August highs). 202 is the main resistance of the 23-month MA. Real Motion shows new heights in dynamics. A positive.
Triple play shows lead over benchmark. A positive.
Granny Retail (XRT) is showing similar technical patterns.
Forget the rest and look at grandma and grandpa, one should think of blue skies. Look at the 23-month moving average at 78.00 and we see XRT trading well below this level.
Until proven otherwise, trade with the understanding that the market is nearing the top of the range. Also, don’t be too complacent when inflation is at its peak – we still see a potential train wreck. However, the modern family has an amazing track record. That means above these range resistance values you follow their lead.
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https://www.youtube.com/watch?v=KpANMvNES3s
Mish shares her views on how to approach earnings news from Apple, Amazon and Alphabet, and provides a technical outlook on how earnings results could impact the S&P 500 and Nasdaq 100 in this appearance on CMC Markets.
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In this appearance on CMC Markets, Mish delves into her favorite commodities trades for the week and gives her technical take on trading opportunities for gold, oil, copper, silver and sugar.
- S&P 500 (SPY): Aim 420 with support from 390-400.
- Russell 2000 (IWM): 190 now support and 202 main resistance.
- Dow (DIA): 343.50 resistance and the high of the 6-month calendar range.
- Nasdaq (QQQ): 300 is now the crucial range.
- Regional Banks (KRE): 65.00 resistance.
- Semiconductor (SMH): 246 is the 23-month moving average – can it hold? Sister Semis was the rabbit last week.
- Transport (IYT): It’s like chips riding a bullet train – this 23-month MA is 244 – we’re back below that level.
- Biotechnology (IBB): lateral action.
- Retail (XRT): 78.00 the 23-month MA resistance; next support 68.00.
Misch Schneider
MarketGauge.com
Director of Trade Research and Education
Misch Schneider serves as director of trading education at MarketGauge.com. For nearly 20 years, MarketGauge.com has provided financial information and training to thousands of individuals, major financial institutions and publications such as Barron’s, Fidelity, ILX Systems, Thomson Reuters and Bank of America. In 2017, MarketWatch, owned by Dow Jones, named Mish one of the top 50 financial professionals to follow on Twitter. In 2018, Mish was the winner of Top Stock Pick of the year for RealVision.
