Key Market Sectors Remain Above Critical Support at 50-Week MA

Did this past week really resolve which way the Modern Family wants to go from here?

In some ways yes and other ways no.

Yes

1. All are still holding their 50-week moving averages
2. remain in a bullish phase with a good bounce off the 50-WMA
3. The slopes on all the moving averages both 50 and 200 WMA are pointing up
4. Biotechnology corrected perfectly to the 200-WMA and bounced-phase is accumulation-money flow is positive

No

1. Granny remains above the 50-WMA but could not clear the 200-WMA-phase is recuperation
2. held the 200-WMA but the bounce looks weak, so IWM has more to prove
3. held the critical support above the 200-WMA, but closed the week questionable on whether it can clear the 50-WMA-phase is caution
4. look confused. After a 3-week run higher, they are closing lower for the 2nd week in a row. The phase is recuperation.

That makes the prediction for next week not so easy.

This is why we will call for a lifeline from the Family’s relatives-long bonds and junk bonds to help us.

Turning our attention to the long bonds , the evidence leans more to risk-off.

First, TLT had a golden cross in July.

Secondly, TLT is above the July 6-month calendar range.

Third, TLT outperforms .

Finally, Real motion shows us that momentum is bouncing.

If the Family is looking for reasons to raise a lot of cash, this is it.

One thing I have learned through the years—

If the market is confused, why should anyone think they shouldn’t be as well?

After all, if I am going to follow anyone’s opinion, it will always only be the opinions that the Family offers. If they are confused, I lighten up.

ETF Summary

• S&P 500 (SPY) 540 resistance with 505 next support
• Russell 2000 (IWM) 210 resistance 199 support
• Dow (DIA) 380 support
• Nasdaq (QQQ) 430 support
• Regional banks (KRE) 50-52 support
• Semiconductors (SMH) 212 support 240 resistance
• Transportation (IYT) 61 support 63.50 resistance
• Biotechnology (IBB) Could not hold recent rally-but ok if maintains a price above 135
• Retail (XRT) Time to watch Monday’s lows to hold
• iShares iBoxx Hi Yd Cor Bond ETF (HYG) 77.00 the nearest key support