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POSITION: Long Healthcare (XLV), Long Consumer Discretionary (XLY)

Recognizing the 1232 TRADE break yesterday was important. That’s now immediate-term TRADE resistance. Trying to find another immediate-term trading low is not as easy as it was when holding 1232.

Across our 3 risk management durations, these are the lines that matter to me most: 

  1. Long-term TAIL resistance = 1270 (the highs for both 2011 and Q4 likely are in)
  2. TRADE resistance = 1232
  3. TRADE support = 1212 

Breaking 1212, puts 1204 in play (intermediate-term TREND support). On the way down, I want to be buying US Consumption stocks as that’s where you’ll get paid with a Strong Dollar – a less levered and less cyclical America.

With the SP500 down for both November and December, versus late October expectations this is a Bad Santa if I have ever seen one.


Keith R. McCullough
Chief Executive Officer

Bad Santa: SP500 Levels, Refreshed - SPX