More sector differentiation in the markets as key levels still being tested

Biotech and semiconductors showed relative strength today, along with the Nasdaq and QQQQ's - still retaining the possibility of the QQQQ's testing just a bit higher to the $39.82 level that would retrace their entire drop from the peak of 2007. Other major indices closed off their intraday lows as they found enough support to aim for slightly higher levels tomorrow and/or Thursday. It was interesting, however, to see strength in the dollar and TLT (US bond ETF), even while LQD still stayed up, with the yen (and VIX) up, and the euro and gold fell. Oil was off too. All in all, too soon to call a deflationary turn, but enough hints to keep that potential waiting in the wings.

On the hourly charts, we might think a small fifth wave is nearing completion, which supports my morning comment about the markets on "eggshells". For that matter, in some specific items:
UNG remained above its support level so it remains viable;
DAG tested lower but closed higher, so we'll see if it gathers strength for another move up;
FXY (yen) was higher and I'm willing to give it the benefit of the doubt so long as it remains above yesterday's (Monday's) lows;
TLT - ditto, same comment as for FXY;
VXX i'm willing to have some long exposure to volatility and looking for it to remain above Friday's low (and preferably yesterday's low as well);
GLD I'm willing to remain short - also short euro - so long as below Monday's high. Thinking the same, really, about oil (USO, or can short with a bearish oil ETF) so long as below yesterday's high.

If you think there's a theme here, you're right. Although DAG bends or breaks it as a long play, but that's okay too.

There remain some interesting differences in big-picture Elliott Wave views that the markets should start to "answer" soon ... so, never a dull moment!