A Week In, How’s Our Brown Earth Dog Doing?

With a rangebound market and warning phases in 2 of the 6 Modern Family members, our dog, for now, is sitting in a standing 1922 railway car.

NASDAQ (QQQ) and Semiconductors (SMH) are in bullish phases and the weekly charts all show underlying support.

The S&P 500 (SPY), also rangebound, did manage to go back into an unconfirmed bullish phase. It will need to have a second close over 272.50 to confirm.

Last weekend, the Daily, “Does Your Dog Bite?,” explored the many predictions for the market and the current administration in this new Chinese Year of the Brown Earth Dog.

With warnings about both finance and upheaval in the Trump administration, the week of February 16th ended with confirmed bullish phases in QQQs, SMH, Biotechnology (IBB) the Dow (DIA) and Retail (XRT.)

One week later and SPY (unconfirmed), DIA (unconfirmed), Russell 2000 (IWM) unconfirmed, Biotechnology (IBB) also unconfirmed, QQQs, and SMH have that distinction.

The rest deteriorated in phase since 2/16.

Granted, the market is now rangebound. This makes total sense after the recent vamping up of volatility.

However, going into this week, we expect the ranges to reconcile one way or another.

Our brown earth dog wonders, “Once this train gets moving, do I want to go north or south?

On the weekly chart, the SPY has had 2 inside weeks, which means that this past week was inside the trading range of the week prior, which was inside the trading range of the week before.

What better way to specifically see how the charts are reflecting the hesitation of commitment from both the bulls and bears at this time.

Although most of The Modern Family ended the week near the top of the recent trading range, they all are nonetheless, rangebound. Here again are the trading ranges we are watching.

Semiconductors (SMH) range to break 102-106 (in bullish phase).

Regional Banks (KRE) in a bullish phase, range to break- 60.50-63.50.

Biotechnology (IBB) in an unconfirmed bullish phase, range to break- 107.50-111.50.

Retail (XRT) in warning, range to break-44.50-46.10

Russell 2000 (IWM), in an unconfirmed bullish phase, range to break-150-154. (closed right at the top of the range).

Transportation (IYT), in warning, range to break-185-193.

A step back in time, the Great Railroad Strike of 1922 was the largest railroad work stoppage since the one before in 1894. The walkout was due to a cut in wages. With the economy improving, the labor force lost, while the railroad corporations, using the National Guard and scabs to replace the striking workers, profitted.

Not so dissimilar to the current economic environment today.  In the Year of the Brown Earth Dog, Lee Shing Chak predicts Trump, born the Year of the Fire Dog, will see further upheaval…which could “affect the world.”

Yet, as we traders and our German Shorthair Pointer are merely passengers on this train, we must equally prepare for upheaval or resolution.

I will be on the @Benzinga PreMarket Prep show on Wednesday, February 28 at 8:35 AM EST! Tune in here. premarket.benzinga.com

S&P 500 (SPY) Trading range to break 272-276.

Russell 2000 (IWM) Range to break-150-154. Closed right at the top of the range which means a gap higher could be followed, while a gap lower gives you a perfect resistance point to use.

Dow (DIA) 250 pivotal. Must clear 255.

Nasdaq (QQQ) Range to break 164-168. Closed right at the top of the range which means a gap higher could be followed, while a gap lower gives you a perfect resistance point to use.