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The Market’s Inner Workings

Welcome back some volatility!

With a down day in the market across the board, the volatility or fear index, caught eager bears and weaker bulls.

An odd day, as the TBTs or inverse relationship to the 20+ Year Treasury Bonds were up while the dollar was down.

Commodities and Utilities, generally safety plays, were also down.

Some brick and mortar retail stocks (GPRO, COST, LULU) helped keep Granny XRT afloat. She held the 50 -DMA and matched the indices in performance closing down just slightly under 1/2 percent.

Biotechnology, a feature yesterday along with the caveat of IBB closing out this month under 327, can take partial blame for market jitters.

However, typical relationships are changing. In the inner workings of the market, like the art installation, how do the nuts and bolts look?

Yesterday I wrote that, “IWM will confer with IBB to help point him in the right direction.”

Naturally, IWM fell. Nonetheless, the low was 147.22. That means it held support and unless it takes out 147 and drops to 144.25 or below, no reason to panic if long.

Unless you consider Transportation, IYT. Today’s low 176.18 rests critically at the top of the monthly channel it broke out from.

Therefore, in the progression of the Modern Family, here are the warning signs or key levels to watch for:

S&P 500 (SPY) A distribution day in volume but held support and bounced. Now, 155.75 pivotal resistance to watch

Russell 2000 (IWM). The 147 support held. 144.25 super important and if good, this needs to take out 150

Dow (DIA) Under 231 more trouble, but for now, a one-day reversal always needs to be confirmed a second day.

Nasdaq (QQQ) Held 147 but must get back over 148.30 to resume uptrend

KRE (Regional Banks) Tested but ultimately held the support at 56.55. Optimism about rates rising helps this

SMH (Semiconductors) Like DIA, a distribution day in volume but held support and bounced. A one-day reversal always needs to be confirmed a second day.

IYT (Transportation) 176 is so key-but mainly by next Tuesday or at the end of the month-overall, I’m finding this a good time for patience.

IBB (Biotechnology) Another one to wait for-327 must clear or this can see 300.

XRT (Retail) 40.25 is the 50 DMA we want to see her hold

XLU (Utilities) Ultimately held the 10 and 50-DMAs

GLD (Gold Trust) Closed green but would wait for a move over 122.

SLV (Silver) 16 trying hard to hold

GDX (Gold Miners) I think today was a fake out-low volume selling. I will like better now back over 23.00

XME (S&P Metals and Mining) Catching its breath

USO (US Oil Fund) Held 10.45.Needs follow through

TAN (Solar Energy) Like to see this hold at 22.50

TLT (iShares 20+ Year Treasuries) Broke 123 so now in an unconfirmed distribution phase.

UUP (Dollar Bull) 24.30 support