As the SPY corrects a bit from the recent run-up to all-time highs, we still have keen eyes on other sectors.
Looking at four areas of the Economic Modern Family:
Retail XRT, Small Caps IWM, Regional Banks KRE, and Biotechnology IBB, are all up big since last October and are paused for a breakout over recent highs if
- The yields soften from here
- The dollar DXY breaks down back under 103.70 area
Thus far, the narrative remains more soft landing than anything else, while gold remains the mirror reflecting potential cracks
Hence, for equities we are recommending more patience especially ahead of the election.
The market is choppy and volatile
And we still see commonalities among the 2 Presidential candidates
- Pro bitcoin-which looks also ready to break out of its consolidation
- Not dealing with soaring debt and rising government spending
- In favor of defense spending and reshoring goods to US
Elsewhere,
Good news on Tesla (NASDAQ:TSLA) yet a run to resistance unless clears 260
Gold taking a pause but remains resilient
Silver big breakout over 32.50 now support
Palladium just had a huge run
Oil holding $70
Natural Gas looking better-watch the chart of LNG
Inflation is not going down, but not rising as of yet-it could but until it does, we believe that outside of current positions in gold and silver, commodity investing is also a bit premature
We have eyes on China.
After a huge run, many names like Alibaba (NYSE:BABA), are on pause awaiting softer US dollar and election results.
Tariffs are a concern; hence BRICS has moved forward but not yet impacting US markets.
While our models remain long the indices, we are advising our clients to sit back and wait.
Our current positions have protective stops in place while we wait in case the market has a more serious correction
Plus, I am advising clients to watch the ETFs (XRT, IWM, IBB, and KRE) rather than individual names for the next investments once the trading ranges are reconciled.
There will be no weekend Daily. Look for the weekly Outlook published on Sunday.
ETF Summary
- (Pivotal means short-term bullish above that level and bearish below)
- S&P 500 (SPY) 575 support 585 resistance
- Russell 2000 (IWM) 215 support 227 resistance
- Dow (DIA) 420 support
- Nasdaq (QQQ) 485 pivotal support 500 resistance
- Regional banks (KRE) 60 pivotal
- Semiconductors (SMH) 242 support 265 resistance
- Transportation (IYT) 69.50 support
- Biotechnology (IBB) 140 support and like better over 142
- Retail (XRT) 74-75 support to hold
- iShares iBoxx Hi Yd Cor Bond ETF (HYG) 79.50 nearest key support