BRIC Stocks Gaining Strength BUT Foreign Stocks Losing Strength?
U.S. dollar ETF (UUP) absolute price rose to its highest level in 6 months on 8/19/14, thereby reconfirming its preexisting uptrend. This RS ratio’s rising 50-day SMA no doubt will cross above the rising 200-day SMA in a day or two, thereby turning systematically bullish (from neutral).
Crude Oil, United States Oil ETF (USO) absolute price fell to its lowest price level in 6 months on 8/19/14, thereby reconfirming its preexisting medium-term downtrend.
iShares MSCI BRIC Fund (BKF) Relative Strength Ratio (BKF/SPY) rose to its highest level in 9 months on 8/19/14, thereby reconfirming its preexisting uptrend.
Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) broke down below its lows of the previous 2 years on 8/19/14. EFA/SPY has remained systematically bearish most of the time over the past 6 years.
Health Care stock sector ETF (XLV) Relative Strength Ratio (XLV/SPY) rose above its highs of the previous 5 months on 8/19/14 and remains systematically bullish. Absolute price rose to a new high on 8/19/14 and remains systematically bullish.
Materials stock sector ETF (XLB) absolute price rose to a new high on 8/19/14 and remains systematically bullish.
The S&P 500 Composite Index (SPX: 1,981.60, up 0.50%) absolute price opened higher on an upside gap and worked further upward before stabilizing at a high level in the final hour. SPX closed above the (true) open, above the midpoint of the day’s high-low range, and above the closing prices of the previous 16 trading days.
NYSE total volume rose a fraction of a percentage point to a level 20% below its 200-day SMA. Generally, rising volume confirms the direction (up or down) of a price move, but falling volume may indicate diminishing power behind a price trend, which can suggest a price reversal ahead. Volume can provide insights that are not available from the majority of indicators, which are based on price.
Although price momentum turned upward on Friday 8/8/14, it remains below bullish levels and still has a long way to go to reverse months-long bearish divergences. Short-term momentum oscillators RSI and MACD based on the SPX broke down to their lowest levels in more than 6 months on 8/7/14 , thereby confirming their preexisting downtrends. Both turned down on 7/7/14, after failing to match their highs of 6/10/14–despite higher highs for the S&P 500 Index on which these oscillators are based. Furthermore, these same momentum oscillators consistently have remained below their highs of 2012 and 2013, despite much higher highs in the S&P 500 itself in 2014. Therefore, for many months both oscillators have continued to demonstrate bearish divergence compared to the price of the underlying index, the S&P 500.
The Number of Daily Net New Highs on the NYSE (New Highs minus New Lows), now at +291, has been running below its peaks above +800 recorded in 2012 and 2013, when the S&P 500 was lower than it is now. So, this indicator still is diverging bearishly relative to last year’s levels.
Stock market sentiment indicators have been at excessive, multiyear high levels of bullishness (which is bearish), bearish momentum divergences have been accumulating, and there is a tendency for low trading volume on up days and rising trading volume on down days (generally, not always), suggesting distribution. These are challenges to a sustainable upside trend that the stock market has been ignoring for months.
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Stock Market Indicators
The Dow Theory entered a Secondary Reaction to the downside in early August, as the Dow-Jones Industrial Average made lower highs and lower lows for more than 3 weeks. Such a downside correction can last several months. The price bounce starting on 8/8/14 is only a Minor Ripple to the upside, and such short-term price moves are ignored as insignificant noise, according to the Dow Theory.
NASDAQ 100 ETF/S&P 500 ETF Relative Strength Ratio (QQQ/SPY) rose above its highs of the previous 13 years on 8/15/14 and remains systematically bullish. The absolute price of QQQ rose above its highs of the previous 13 years 8/19/14 and remains systematically bullish.
iShares MSCI BRIC Fund (BKF) Relative Strength Ratio (BKF/SPY) rose to its highest level in 9 months on 8/19/14, thereby reconfirming its preexisting uptrend. This RS ratio’s rising 50-day SMA crossed above the falling 200-day SMA on 8/1/14, thereby turning systematically bullish (from neutral).
Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) has been systematically neutral most of the time since making a low on 3/13/14. Absolute price is systematically neutral.
Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) broke down below its lows of the previous 2 years on 8/19/14. EFA/SPY has remained systematically bearish most of the time over the past 6 years.
The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEF/SPY) rose above its highs of the previous 6 months on 7/29/14 but remains systematically neutral, with 50-day SMA still below the 200-day SMA. Large Caps tend to outperform in bearish general market trends as investors seek the perceived relative stability and safety of large size. On the other hand, Large Caps tend to underperform Mid Caps and Small Caps in bullish general market trends as investors seek greater potential returns in more volatile, smaller stocks.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) fell below its lows of the previous 20 months on 7/28/14, thereby reconfirming its preexisting bearish trend. IWM/SPY 50-day SMA crossed below the 200-day SMA on 4/29/14, thereby turning systematically bearish (from neutral). Absolute price has turned weak since it peaked at 120.97 on 7/1/14.
The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) fell below its lows of the previous 19 months on 7/29/14, thereby reconfirming its preexisting bearish trend. MDY/SPY 50-day SMA crossed below the 200-day SMA on 5/9/14, thereby turning systematically bearish (from neutral). Absolute price has turned weak since it peaked at 264 on 7/1/14.
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Tangible Assets, Commodities
U.S. dollar ETF (UUP) absolute price rose to its highest level in 6 months on 8/19/14, thereby reconfirming its preexisting uptrend. This RS ratio’s rising 50-day SMA no doubt will cross above the rising 200-day SMA in a day or two, thereby turning systematically bullish (from neutral). Support 21.07 and 20.84. Resistance 21.96, 22.34, 22.98, 23.14, 23.52, 25.84, 27.19, and 28.97.
Agriculture, PowerShares DB Agriculture Fund ETF (DBA) absolute price broke down below its lows of the previous 6 months on 8/14/14, thereby reconfirming a significant downside correction. DBA crossed below its 50-day SMA on 5/9/14, thereby turning systematically neutral (from bullish). DBA appears to be heading for a systematically bearish signal, unless its existing 3-month downtrend reverses significantly.
Crude Oil, United States Oil ETF (USO) absolute price fell to its lowest price level in 6 months on 8/19/14, thereby reconfirming its preexisting medium-term downtrend. Price remains systematically neutral. Long term, USO has been in a neutral/sideways trend since bottoming at 22.74 on 2/19/09. Support 35.62, 34.97, 34.00, 32.68, 32.12, 30.79, 29.02, 26.28, and 22.74. Resistance 36.58, 38.30, 39.54, 39.64, 40.29, 41.38, 42.30, and 45.60.
Gold, SPDR Gold Shares ETF (GLD) absolute price appears to be base building in neutral trading range since hitting a bottom at 114.46 on 12/31/13. GLD price has been crisscrossing its 50-day and 200-day SMAs this year, resulting in misleading signals, typical of a range-bound market. Support: 119.42, 114.46, 113.08, and 102.28. Resistance: 129.21, 133.69, 137.62, 143.43, 149.44, 153.85, 156.80, 164.40, 166.94, 170.01, 174.07, 175.46, 177.40, and 185.85.
Gold Mining Stocks ETF/Gold Shares ETF Relative Strength Ratio (GDX/GLD) rose above its highs of the previous 11 months on 8/12/14 and remains systematically bullish. Absolute price rose above its highs of the previous 4 months on 7/9/14 and remains systematically bullish.
Silver, iShares Silver Trust ETF (SLV) absolute price fell below its lows of the previous 9 weeks on 8/19/14, reconfirming a medium-term downtrend that started on 7/10/14. Longer term, SLV could be attempting to form a base, or bottom, since bottoming at 17.75 on 4/27/13. Support 17.75, 16.73, 14.37, 12.27, 11.64, and 8.45. Resistance: 20.64, 21.30, 22.23, 23.84, 25.34, 27.14, 27.35, 28.50, 28.61, 29.73, 31.41, 32.72, 33.31, 34.08, 36.44, 40.23, 41.49, 42.30, 42.78, 44.71, and 48.35.
Silver/Gold ETFs Ratio (SLV/GLD) fell below its lows of the previous 12 weeks on 8/19/14, reconfirming a medium-term downtrend. The trend of SLV/GLD has pointed down most of the time since it peaked on 4/28/11, and Silver continues to underperform Gold.
Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) price broke down below a 5-month trendline and fell further below its lows of the previous 8 weeks on 8/14/14, thereby reconfirming a medium-term downtrend. Long term, JJC has been in a downtrend since topping at 61.69 on 2/14/11. “Dr. Copper” is widely accepted as one of the better indicators of investor confidence (or lack thereof) in the global industrial economy.
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Spotlight on event stocks: Here is a stock screen I designed to pick out potential event stocks, both Bullish and Bearish. Sometimes, stocks with large changes in price and volume are later revealed to be deal stocks or are the subject of some other extraordinary events, positive or negative.
Bullish Stocks: Rising Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
8.65% , TJX , TJX
4.29% , LPX , LOUISIANA PAC
3.99% , AGN , ALLERGAN
5.55% , HD , HOME DEPOT
4.04% , ROST , Ross Stores Inc
3.33% , LEN , Lennar Corp. (LEN)
0.91% , RFG , Growth MidCap S&P 400, RFG
1.84% , PETM , PETsMART Inc
0.82% , IXC , Energy Global, IXC
2.58% , RHT , Red Hat Inc.
4.52% , URBN , Urban Outfitters Inc.
0.53% , XLG , LargeCap Rydex Rus Top 50, XLG
3.85% , JCP , JC PENNEY
2.12% , LOW , LOWES
1.89% , ORCL.K , ORACLE
1.32% , EWT , Taiwan Index, EWT
1.78% , DLX , DELUXE
0.38% , PFM , Dividend Achievers PS, PFM
0.53% , RSP , LargeCap Blend S&P=Weight R, RSP
1.47% , LEG , LEGGETT & PLATT
2.02% , XHB , Homebuilders SPDR, XHB
0.42% , ONEQ , Growth LargeCap NASDAQ Fidelity, ONEQ
1.35% , MAS , MASCO
0.45% , EPP , Pacific ex-Japan, EPP
1.53% , EIX , EDISON INTL
1.49% , AVY , AVERY DENNISON
1.55% , GPS , GAP
1.02% , CCE , COCA COLA ENTER
2.81% , BBY , BEST BUY
1.65% , WY , WEYERHAEUSER
1.38% , AAPL , APPLE COMPUTER
0.49% , PWV , Value LargeCap Dynamic PS, PWV
0.72% , IGM , Technology GS, IGM
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Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-2.81% , HSP , HOSPIRA
-4.09% , S , SPRINT NEXTEL
-1.14% , VIAB.O , VIACOM STK B
-0.46% , IYZ , Telecom DJ US, IYZ
-0.90% , SLV , Silver Trust iS, SLV
-0.57% , SYMC , SYMANTEC
-1.00% , USO , Oil, Crude, U.S. Oil Fund, USO
-0.54% , DBO , Oil Fund PowerShares, DBO
-0.28% , NTRS , NORTHERN TRUST
-0.96% , CVG , CONVERGYS
-0.14% , TLH , Bond 10-20 Year US Treas, TLH
-0.15% , GLW , CORNING
-0.21% , PGJ , China LargeCap Growth G D H USX PS, PGJ
-0.62% , WYN , Wyndham Worldwide
-0.25% , MUB , Bond Muni ATM-Free S&P iS, MUB
-0.16% , VZ , VERIZON COMMS
-0.90% , ZEUS , Olympic Steel, ZEUS
-0.14% , AGG , Bond, Aggregate, AGG
-0.36% , CIEN.N , CIENA
-0.20% , INTC , INTEL
-1.01% , IR , INGER RAND
-0.09% , PTEN , Patterson-UTI Energy Inc
-0.05% , EWP , Spain Index, EWP
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
2.06% , Turkey MSCI iS, TUR
2.02% , Homebuilders SPDR, XHB
1.76% , Brazil Index, EWZ
1.58% , Hong Kong Index, EWH
1.32% , Taiwan Index, EWT
1.27% , Utilities SPDR, XLU
1.19% , Utilities VIPERs, VPU
1.14% , Semiconductor SPDR, XSD
1.04% , Russia MV, RSX
1.01% , Latin Am 40, ILF
0.82% , Technology DJ US, IYW
0.82% , Energy Global, IXC
0.77% , Energy DJ, IYE
0.77% , Energy SPDR, XLE
0.76% , Info Tech VIPERs, VGT
0.75% , Consumer Discretionary SPDR, XLY
0.75% , Energy & Nat Res iS GS, IGE
0.74% , WilderHill Clean Energy PS, PBW
0.73% , Energy VIPERs, VDE
0.71% , Dividend High Yield Equity PS, PEY
0.71% , Semiconductor iS IGW, SOXX
0.71% , Dividend U.S. DJ iS, DVY
0.68% , Networking, IGN
0.66% , Growth VIPERs, VUG
0.66% , Health Care SPDR, XLV
0.63% , MidCap Growth S&P 400 iS, IJK
0.63% , Switzerland Index, EWL
0.63% , Technology SPDR, XLK
0.61% , LargeCap Growth S&P 500 iS, IVW
0.60% , MidCap S&P 400 SPDRs, MDY
0.59% , Emerging 50 BLDRS, ADRE
0.59% , MidCap Blend S&P 400 iS, IJH
0.58% , Emerging VIPERs, VWO
0.57% , Growth SmallCap VIPERs, VBK
0.56% , QQQ Nasdaq 100 Trust, QQQ
0.56% , South Korea Index, EWY
0.56% , LargeCap Growth Russell 1000 iS, IWF
0.55% , LargeCap Blend S&P 500 iS, IVV
0.53% , MidCap Value S&P 400 iS, IJJ
0.53% , LargeCap Blend S&P=Weight R, RSP
0.52% , S&P 500 SPDRs LargeCap Blend, SPY
0.52% , LargeCap VIPERs, VV
0.52% , LargeCap Blend Russell 1000 iS, IWB
0.50% , Singapore Index, EWS
0.50% , MidCap Russell, IWR
0.50% , Blend Total Market VIPERs, VTI
0.50% , Netherlands Index, EWN
0.49% , DIAMONDS (DJIA), DIA
0.49% , LargeCap Blend Russell 3000 iS, IWV
0.49% , Value LargeCap Dynamic PS, PWV
0.49% , LargeCap Blend S&P 100, OEF
0.49% , Value MidCap Russell, IWS
0.49% , Dividend SPDR, SDY
0.47% , Small Cap VIPERs, VB
0.47% , Emerging Markets MSCI iS, EEM
0.46% , Value SmallCap VIPERS, VBR
0.46% , Growth MidCap Russell, IWP
0.45% , Dividend Appreciation Vipers, VIG
0.45% , Germany Index, EWG
0.45% , Pacific ex-Japan, EPP
0.44% , Pacific VIPERs, VPL
0.44% , SmallCap Value S&P 600 iS, IJS
0.43% , Canada Index, EWC
0.43% , SmallCap Growth S&P 600 iS, IJT
0.43% , Malaysia Index, EWM
0.43% , LargeCap Value S&P 500 iS, IVE
0.41% , LargeCap Value Russell 1000 iS, IWD
0.40% , Global LargeCap Blend MSCI iS, ACWI
0.37% , SmallCap Blend S&P 600 iS, IJR
0.37% , Value VIPERs, VTV
0.36% , Basic Materials DJ US, IYM
0.35% , SmallCap Growth Russell 2000 iS, IWO
0.35% , SmallCap Blend Russell 2000 iS, IWM
0.34% , Microcap Russell, IWC
0.34% , SmallCap Value Russell 2000 iS, IWN
0.34% , Growth EAFE MSCI, EFG
0.34% , Global ex U.S. LargeCap Blend, ACWX
0.32% , India PS, PIN
0.31% , SmallCap Blend EAFE MSCI iS, SCZ
0.31% , Water Resources, PHO
0.31% , India Earnings WTree, EPI
0.30% , Global 100, IOO
0.30% , Materials SPDR, XLB
0.29% , Bond, Emerging Mkt JPM iS, EMB
0.27% , Consumer Staples SPDR, XLP
0.27% , Mexico Index, EWW
0.25% , REIT Wilshire, RWR
0.24% , Industrial SPDR, XLI
0.24% , Foreign LargeCap EAFE MSCI iS, EFA
0.24% , France Index, EWQ
0.24% , Financials VIPERs, VFH
0.23% , Dividend ex-U.S. DJ iS, IDV
0.21% , Realty Cohen & Steers, ICF
0.21% , REIT VIPERs, VNQ
0.21% , Metals & Mining SPDR, XME
0.20% , Sweden Index, EWD
0.20% , Commodity Tracking, DBC
0.19% , Europe 350 S&P Index, IEV
0.18% , Financial DJ US, IYF
0.18% , Financial Services DJ, IYG
0.18% , Financial SPDR, XLF
0.16% , European VIPERs, VGK
0.14% , Value EAFE MSCI, EFV
0.13% , EMU Europe Index, EZU
0.12% , Transportation Av DJ, IYT
0.12% , Belgium Index, EWK
0.11% , Austria Index, EWO
0.11% , Australia Index, EWA
0.08% , Japan Index, EWJ
0.08% , Real Estate US DJ iS, IYR
0.07% , Bond, High-Yield Junk, JNK
0.07% , China 25 iS, FXI
0.06% , Financial Preferred, PGF
0.05% , Dividend International, PID
0.04% , Indonesia MV, IDX
0.00% , Bond, 1-3 Year Treasury, SHY
0.00% , Bond Treasury Short-Term iS, SHV
-0.03% , Bond, High Yield Corp iBoxx iS, HYG
-0.04% , Thailand MSCI iS, THD
-0.05% , Spain Index, EWP
-0.05% , Preferred Stock iS, PFF
-0.07% , Bond, Long-Term Corp iBoxx iS, LQD
-0.07% , Capital Markets KWB ST, KCE
-0.10% , United Kingdom Index, EWU
-0.11% , Bond, 10 Year Treasury, IEF
-0.14% , Bond, Intermediate US Aggregate iS, AGG
-0.18% , Bond, TIPS U.S. Treasury iS, TIP
-0.21% , China LargeCap Growth G D H USX PS, PGJ
-0.22% , Gold Shares S.T., GLD
-0.25% , Bond, Muni S&P ATM-Free iS, MUB
-0.27% , Frontier Markets Guggenheim , FRN
-0.31% , Biotech SPDR, XBI
-0.31% , Bond, 20+ Years Treasury, TLT
-0.35% , Bond Ex-US Treas, BWX
-0.44% , South Africa Index, EZA
-0.46% , Telecom DJ US, IYZ
-0.52% , Bear, Short S&P 500, SH
-0.54% , Oil Fund PowerShares, DBO
-0.58% , Italy Index, EWI
-0.64% , Chile MSCI iS, ECH
-0.90% , Silver Trust iS, SLV
-1.00% , Oil, Crude, U.S. Oil Fund, USO
-1.18% , Agriculture DB PS, DBA
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The S&P 500 Composite Potential Resistance
1991.39, high of 7/24/2014
The S&P 500 Composite Potential Support
1958.11, 50-day SMA
1904.78, low of 8/7/2014
1902.17, high of 5/13/2014
1897.28, high of 4/4/2014
1869.60, 200-day SMA
1859.79, low of 5/7/2014
1850.61, low of 4/28/2014
1813.55, high of 11/29/2013
1737.92, low of 2/5/2014
1729.86, high of 9/19/2013
1711.57, high of 10/15/2013
1709.67, high of 8/2/2013
1703.85, high of 9/26/2013
1700.18, high of 8/8/2013
1698.78, high of 7/23/2013
1696.81, high of 8/13/2013
1696.55, high of 10/1/2013
1695.93, low of 10/15/2013
1687.18, high of 5/22/2013
1687.11, low of 9/27/2013
1676.03, low of 7/26/2013
1674.99, low of 9/30/2013
1672.40, high of 9/9/2013
1671.84, low of 7/16/2013
1670.36, low of 10/3/2013
1669.51, high of 8/26/2013
1654.19, high of 6/18/2013
1654.18, high of 7/9/2013
1652.61, low of 8/16/2013
1646.47, low of 10/9/2013
1629.05, low of 8/27/2013
1560.33, low of 6/24/2013
1536.03, low of 4/18/2013
1530.94, high of 2/19/2013
1485.01, low of 2/26/2013
1474.51, high of 9/14/2012
1451.64, low on 1/8/2013
1448.00, high of 12/19/2012
1440.24, high of 5/19/2008
1439.15, high of 9/12/2012
1438.59, high of 12/12/2012
1434.27, high of 11/2/2012
1432.82, low of 12/20/2012
1430.53, low of 9/26/2012
1426.76, low of 12/12/2012
1425.53, low of 10/12/2012
1423.73, high of 12/3/2012
1422.58, low of 12/21/2012
1422.38, high of 4/2/2012
1422.06, low of 10/22/2012
1421.12, high of 10/25/2012
1420.34, high of 12/7/2012
1419.70, high of 11/29/2012
1418.71, high of 8/17/2012
1415.32, high of 5/1/2012
1409.16, high of 11/23/2012
1403.28, low of 10/26/12
1401.58, low of 12/28/12
1398.11, low of 12/31/2012
1397.68, low of 11/26/2012
1396.56, low of 9/4/2012
1391.04, low of 8/6/2012
1388.71, low of 5/3/2012
1385.43, low of 11/28/2012
1380.39, high of 7/19/2012
1374.81, high of 7/3/2012
1370.58, high of 5/2/2011
1363.49, high of 6/19/2012
1357.38, low of 4/10/2012
1343.35, low of 11/16/2012
1340.03, low of 3/6/2012
1335.52, high of 6/11/2012
1334.93, high of 5/31/2012
1329.24, low of 7/24/2012
1329.05, high of 6/7/2012
1328.49, high of 5/22/2012
1325.41, low of 7/12/2012
1306.62, low of 6/12/2012
1291.98, low of 5/18/2012
1266.74, low of 6/4/2012
1265.26, low of 1/5/2012
1262.30, low of 12/27/2011
1244.80, low of 12/7/2011
1239.73, low of 12/1/2011
1234.81, low of 11/3/2011
1231.04, high of 12/16/2011
1226.64, low of 11/9/2011
1224.57, high of 12/19/2011
1215.20, low of 12/16/2011
1202.37, low of 12/19/2011
1158.66, low of 11/25/2011
1074.77, low of 10/4/2011
1010.91, low of 7/1/2010
991.97, low of 9/2/2009
978.51, low of 8/17/2009
956.23, high of 6/11/2009
869.32, low of 7/8/2009
666.79, intraday low of 3/6/2009
