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The Market’s Contagious Buzz — What About the China/Russian Brah-Fest?

The market buzz can be quite contagious.

“Market didn’t collapse on the bank news-must be bullish.””Yellen will save the day buy making sure depositors are safe.”Yellen herself: “We have an economy that is performing very well.”

And of course, we all know that tomorrow is the big FOMC day — .25% to a pause on the table.

Meanwhile, far away but not SO far away, we have the bromance between Putin and Xi. And they are creating their own contagious sentiments.

Looking at the S&P 500 chart on a weekly timeframe, SPY needs a weekly close over the blue line or the 50-week moving average at 395-396. That would put the index in a bullish phase. Even then, the hurdles of the persistent trading range using the 23-month moving average remains. Furthermore, the Real Motion indicator shows us that the SPY has not cleared the blue line (50-WMA) since January 2022.

Momentum is HUGE here and worth watching. As is everybody’s favorite index, along with some choice names — NASDAQ.

But back to our burgeoning bromance. These two are making some headlines of their own, such as:

“Russia-China Joint Statement: We are seriously concerned about U.S. Military Biological Activities Carried Out on Their Territory and Abroad,””China has shipped more than $12 million in drones to Russia since it invaded Ukraine”, per NYT.”In the year since Russia invaded Ukraine, roiling energy markets across the globe, China’s appetite for Moscow’s oil, gas and coal has grown apace, with imports rising by more than half.””Russia says it’s close to reaching its pledged 500,000 b/d oil production cut-Moscow adds that it will sustain the output cut until July.” “China is giving a handful of its most successful chip companies easier access to subsidies and more control over state-backed research, as tightening US controls on access to advanced technology force a major rethink in Beijing’s approach to supporting the sector.”

Can this amount to much? Yes.

Will it? I have yet to change my mind about chaos and a potential Supercycle in commodities.

And I am far from alone.

“Goldman Sachs expects a commodities Supercycle driven by China and the capital flight from energy markets and investment this month after concerns triggered by the banking sector. As losses mounted, it spilled into commodities.”

As always, price pays most. Open mindedness pays the big bucks, and opportunities are always there. Risk/reward matters most.

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

Mish sits down with Kristen on Cheddar TV’s closing bell to talk what Gold is saying and more.

Mish and Dave Keller of StockCharts look at longer term charts and discuss action plans on the Thursday, March 17 edition of StockCharts TV’s The Final Bar.

Mish covers current market conditions strengths and weaknesses in this appearance on CMC Markets.

Mish sees opportunity in Vietnam, is trading SPX as a range, and likes semiconductors, as she explains to Dale Pinkert on ForexAnalytix’s F.A.C.E. webinar.

Mish and Nicole discuss specific stock recommendations and Fed expectations on TD Ameritrade.

Coming Up:

March 22nd: The RoShowPod with Rosanna Prestia

March 24th: Opening Bell with BNN Bloomberg

March 30th: Your Daily Five, StockCharts TV

March 31st: Festival of Learning Real Vision “Portfolio Doctor”

April 24-26: Mish at The Money Show in Las Vegas

May 2-5: StockCharts TV Market Outlook

ETF Summary

S&P 500 (SPY): 400 key resistance now.Russell 2000 (IWM): 170-180 range now.Dow (DIA): Still has work to do–324 the 200-DMA to hold.Nasdaq (QQQ): 328 is the 23-month MA resistance, and now a bit overbought on the indicators.Regional Banks (KRE): 44 support, 50 resistance.Semiconductors (SMH): New high, then retreat–no confirmed reversal yet, though.Transportation (IYT): Holding the 200-WMA, but has to clear the 200-DMA at 224.Biotechnology (IBB): Over 127.50 impressive.Retail (XRT): 60 big support and 64 big resistance.

Mish Schneider

Director of Trading Research and Education

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