Daily Briefing Notes for the Market

I am back from 2 weeks of whirlwind travel and presenting at both the Money Show in Las Vegas and Charting Forward at StockCharts.com. I thank Geoff Bysshe, the President of MarketGauge.com for filling in for me.

After the market has absorbed bank crises, debt ceiling talk, the Fed Funds rate at 5.25%, earnings misses and beats, calls for recession, and hopes for lower inflation, we have plenty more to say.

Since I will be joining Maggie Lake and the folks at Real Vision at 4PM ET (you can find it on their channel on YouTube), I thought sharing my notes in preparation for that would be a good comeback for my Daily writing.

The S&P 500 charts show 2 different timeframes. The first is the daily chart.

SPY is in a daily bullish phase. The price is not too far from the early May peak, which sits just under the 23-month moving average or 2-year business cycle. The Real Motion indicator illustrates no real divergence, as that too is in a bullish phase.

On the weekly charts, SPY is also in a bullish phase above both the 50 and 200-WMAs. Momentum, here, has a divergence. SPY momentum sits on the 50-WMA, which sits beneath the 200-WMA or in a recuperation phase.

What do these charts suggest? Based on this, would you "sell in May, and go away?"

Market resiliency with just a touch of pessimism.

Some areas to watch:

KRE or Regional Banks -- if the price holds 37.05, then it is possible the worst is over. If that level fails, expect more bad news.

The Economic Modern Family -- regardless of what SPY is doing, the Russell 2000 (IWM) needs to hang in there and clear 180. Granny Retail XRT must hold 60.

Transportation IYT -- a bright spot and, if it clears 230, the case for more upside is clearer.

Inflation -- basic materials lag, but industrial metals, particularly copper ($3.93), played catch up.

Precious metals (gold $2028 Silver $25.70) -- These continue to outperform. With CPI PPI this week, we will know a bit more, although CORE PCE is still high.

Oil -- China consumption rose. Brent Crude Oil rallied to $77.00 per barrel. Above $80, shorts will cover and energy will rebound higher.

102 stocks made new 52-week highs today, with Shopify, O'Reilly, Shake Shack, Builders FirstSource being a few. 111 stocks made a new 52-week low; Match.com and Tyson Foods stood out.

Tech stocks -- Apple looks amazing, as do Microsoft and Nvidia. The Semiconductors ETF, SMH, is over a key monthly MA and could expand.

Dollar -- As long as it holds 100.70, neutral.

Some picks:

Live Streaming Sports and Music Country ETF Vietnam Biotech stocks Copper 

Our discretionary trading strategy is now based on finding instruments using our Complete Trader Scans that fits one of these setups:

Buying instruments close to but holding the longer-term MA Shorting instruments that have failed the shorter-term MA Buying momentum on instruments that are clearing the shorter-term MA Keeping all trading light until the SPY clears the shorter-term MA. And when/if SPY does, we will buy, but also watch to see if small caps (IWM) can get close to its MA at 200.

My prediction? SPY, QQQs, and DIA continue to rally until IWM cannot clear $200; then everything sells off again.

For more detailed trading information about our blended models, tools and trader education courses, contact Rob Quinn, our Chief Strategy Consultant, to learn more.

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Follow Mish on Twitter @marketminute for stock picks and more. Follow Mish on Instagram (mishschneider) for daily morning videos. To see updated media clips, click here.

Mish in the Media

In the Q2 edition of StockCharts TV's Charting Forward 2023, hosted by David Keller, Mish joins RRG Research's Julius de Kempenaer and Simpler Trading's TG Watkins for an roundtable discussion about the things they are seeing in, and hearing about, the markets.

Mish and Dave Keller discuss why Mish believes that yields will peak in May, what to expect next in gold, and more in this in-studio appearance on StockCharts TV's The Final Bar!

Mish explains why Grandma Retail (XRT) may become our new leading indicator on the May 4th edition of Your Daily Five.

Mish discusses the FOMC and which stock she's buying, and when on Business First AM.

Mish covers strategy for SPY, QQQ, and IWM.

Mish and Nicole Petallides discuss cycles, stagflation, commodities and some stock picks in this appearance on TD Ameritrade.

Mish talks movies and streaming stocks with Angela Miles on Business First AM.

Mish and Charles discuss zooming out, stagflation and picks outperforming stocks in this appearance on Making Money with Charles Payne.

Coming Up:

May 8th: Real Vision Daily Briefing

May 11th: Jim Pupluva, Financial Sense Podcast

May 19th: Real Vision Analysis

ETF Summary

S&P 500 (SPY): 23-month MA 420. Russell 2000 (IWM): 170 support, 180 resistance. Dow (DIA): Over the 23-month MA-only index. Nasdaq (QQQ): 329 the 23-month MA. Regional Banks (KRE): 42 now pivotal resistance. Semiconductors (SMH): Split 2:1 now above 23-month MA at 124. Transportation (IYT): 202-240 biggest range to watch. Biotechnology (IBB): 121-135 range to watch from monthly charts. Retail (XRT): 56-75 trading range to break one way or another.

Mish Schneider

MarketGauge.com

Director of Trading Research and Education