Stocks partially recovered again, for the second day. Still, that does not necessarily signal the end of the correction that started last Friday.
Volume declined on the upside–again.
Consumer Discretionary Stock Sector Relative Strength Ratio (XLY/SPY) rose above 5-year highs and remains bullish.
Materials Stock Sector Relative Strength Ratio (XLB/SPY) fell below 7-week lows and remains bearish.
The Art of Contrary Thinking: the various surveys of investor sentiment, Call/Put Volume Ratios, and implied option volatility all have shown bullish complacency in recent weeks. Excessive bullish sentiment sometimes precedes a shakeout to the downside.
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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 revealed to be deal stocks, sooner or later, 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
8.46% , SNA , SNAP ON
7.51% , IPG , INTERPUBLIC GRP
1.74% , EWD , Sweden Index, EWD
7.32% , HOG , HARLEY DAVIDSON
5.13% , CIEN.O , CIENA
10.70% , MI , MARSHAL & ILSLEY
5.98% , OMC , OMNICOM
4.24% , RIG , TRANSOCEAN
4.63% , SIRI , Sirius Satellite
5.04% , THD , Thailand MSCI iS, THD
4.75% , BJS , BJ SERVICES
6.50% , AIG , AMER INTL GROUP
5.64% , RF , REGIONS FINAN
7.83% , ZION , ZIONS
5.58% , BHI , BAKER HUGHES
3.89% , ITW , ILLINOIS TOOL
6.62% , THC , TENET HEALTHCARE
2.10% , SWK , STANLEY WORKS
3.39% , FPL , FPL GROUP INC
1.72% , FPX , IPOs, First Tr IPOX-100, FPX
1.48% , TMO , THERMO ELECTRON
4.58% , CR , CRANE
5.70% , NYT , NY TIMES STK A
4.34% , HMA , HEALTH MGMT STK A
2.15% , KWT , Solar Energy MV, KWT
2.34% , ADM , ARCHER DANIELS
3.21% , A , AGILENT TECH
1.51% , PSJ , Software, PSJ
4.24% , HIG , HARTFORD FINL
0.85% , ELG , Growth Large Cap, ELG
2.83% , BMC.O , BMC SOFTWARE
1.16% , UTH , Utilities H, UTH
2.38% , PTEN , Patterson-UTI Energy Inc
0.91% , LNCR , Lincare Holdings Inc
2.12% , IR , INGER RAND
3.18% , CMA , COMERICA
4.71% , JCI , JOHNSON CONTROLS
1.27% , JKG , MidCap Blend Core iS M, JKG
1.91% , TUR , Turkey MSCI iS, TUR
1.62% , IWC , Microcap Russell, IWC
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-11.59% , MTG , MGIC INVESTMENT
-5.97% , HGSI , Human Genome Sciences Inc
-0.47% , IAH , Internet Architecture H, IAH
-5.14% , NTRS , NORTHERN TRUST
-4.17% , STT , STATE STREET
-5.08% , SVU , SUPERVALU
-2.63% , Q , QWEST COMMUNICAT
-3.12% , JCP , JC PENNEY
-2.29% , PH , PARKER HANNIFIN
-2.74% , STLD , Steel Dynamics, STLD
-2.85% , PCAR , PACCAR
-1.81% , LXK , LEXMARK INTL STK A
-1.46% , GILD , Gilead Sciences Inc
-1.46% , AMGN , AMGEN
-1.83% , LVLT , LEVEL 3 COMMUNICATIONS
-1.06% , ETN , EATON
-0.80% , UNH , UNITEDHEALTH GRP
-1.33% , DOW , DOW CHEMICAL
-1.92% , IBM , IBM
-1.11% , FAST , Fastenal Company
-0.60% , HANS , Hansen Natural, HANS
-0.90% , KSS , KOHLS
-1.54% , KO , COCA COLA
-0.47% , TIN , TEMPLE INLAND
-1.61% , BIIB , BIOGEN IDEC
-0.50% , FRX , FOREST LABS STK A
-1.29% , WFMI , Whole Foods Market Inc
-0.55% , FDX , FEDEX
-0.59% , NUE , NUCOR
-0.34% , NTAP , NETWK APPLIANCE
-0.10% , GVI , Bond Interm U.S. Gov, GVI
-0.37% , FII , FED INVESTORS STK B
-0.14% , CCE , COCA COLA ENTER
-0.32% , K , KELLOGG
-1.00% , AAPL , APPLE COMPUTER
-0.33% , PEP , PEPSICO
-0.15% , HPQ , HEWLETT PACKARD
-0.38% , APOL , APOLLO GROUP
-0.07% , IP , INTL PAPER
-0.48% , S , SPRINT NEXTEL
9 major U.S. stock sectors ranked in order of long-term relative strength:
Consumer Discretionary (XLY) Bullish, Overweight. The Relative Strength Ratio (XLY/SPY) rose above 5-year highs on 4/20/10 and remains bullish. Absolute price of XLY closed above 2-year highs on 4/15/10 and remains bullish. Support 33.87, 33.15, 31.94, 31.66, 30.99, 29.90, 29.25, 28.66, 28.21 and 26.62. Resistance 35.14 and 38.25.
Industrial (XLI) Bullish, Overweight. The Relative Strength Ratio (XLI/SPY) rose above 16-month highs on 4/15/10 and remains bullish. Absolute price of XLI moved above 17-month highs on 4/15/10 and remains bullish. Support 31.27, 29.79, 29.60, and 28.15. Resistance 34.24, 34.50, and 35.00.
Technology (XLK) Neutral, Market Weight. The Relative Strength Ratio (XLK/SPY) rose above 2-month highs on 4/16/10. Absolute price moved up to a new 19-month high on 4/15/10 and remains bullish. Support 23.42, 23.07, 22.90, 22.66, 22.52, 21.30, 20.71, 20.46 and 20.09. Resistance 24.68 and 25.69.
Financial (XLF) Neutral, Market Weight. The Relative Strength Ratio (XLF/SPY) and absolute price both broke sharply below 2-week lows on 4/16/10. XLF remains neutral. Support 15.52, 15.37, and 15.12. Resistance 17.12, 17.16, and 17.87.
Materials (XLB) Neutral, Market Weight. The Relative Strength Ratio (XLB/SPY) fell below 7-week lows on 4/20/10. XLB/SPY remains bearish. Absolute price of XLB also fell below 2-week lows on 4/16/10. Support 33.40, 32.85, and 32.58. Resistance 35.16, 35.38 and 37.10.
Energy (XLE) Neutral, Market Weight. The Relative Strength Ratio (XLE/SPY) broke down below 2-week lows on 4/16/10. XLE/SPY fell below 17-month lows on 3/25/10. XLE/SPY remains bearish. Absolute price of XLE broke out above 3-month highs on 4/20/10 and remains bullish. Support 58.58, 58.27, 54.72, 52.67 and 51.34. Resistance 60.87, and 62.73.
Consumer Staples (XLP) Neutral, Market Weight. The Relative Strength Ratio (XLP/SPY) broke down below 19-month lows on 4/15/10 and remains bearish. Absolute price of XLP stalled since its high on 4/5/10 but remains bullish. Support 27.76, 27.23, 26.82, 26.49, 26.04, 25.93 and 25.71. Resistance 28.75, 29.29 and 30.29.
Health Care (XLV) Neutral, Market Weight. The Relative Strength Ratio (XLV/SPY) fell below 18-month lows on 4/15/10 but still remains technically neutral because the 50-day is still above the 200-day simple moving average. Absolute price of XLV fell below 6-week lows on 4/16/10 and turned neutral relative to 50- and 200-day averages. Support 31.46, 31.00, 30.27, 30.65 and 29.55. Resistance 32.18, 32.42, 32.69, 33.16, 33.37 and 33.74.
Utilities (XLU) Neutral, Market Weight. The Relative Strength Ratio (XLU/SPY) fell below 3-year lows on 4/15/10 and remains bearish. Absolute price of XLU has been neutral most of the time since the peak on 12/14/09. Support 29.30, 28.45, and 28.10. Resistance 30.40, 30.50, 31.30, 31.64 and 32.08.
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Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) has been underperforming since 10/14/09. EEM/SPY trend turned bearish on 4/16/10, according to strict moving average analysis. Absolute price of EEM fell below 2-week lows on 4/16/10.
Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) has been bearish since peaking on 9/9/09. In contrast, absolute price of EFA rose above its highs of the previous 18 months on 4/14/10 and remains bullish. With RS and price trends in conflict, stand aside.
NASDAQ Composite/S&P 500 Relative Strength Ratio rose above 9-year highs on 4/16/10 and remains bullish. Absolute price of the NASDAQ closed above 18-month highs on 4/15/10 and remains bullish.
Growth Stock/Value Stock Relative Strength Ratio (IWF/IWD) fell to a 5-month low on 4/14/10. IWF/IWD remains below both 50- and 200-day simple moving averages. In contrast, absolute price of IWF rose above 18-month highs on 4/15/10 and remains bullish. When relative strength and absolute price trends are in conflict, it may be best to stand aside.
Russell 1000 Value ETF Relative Strength Ratio (IWD/SPY) rose above 6-month highs on 4/14/10 and is bullish. Absolute price of IWD rose above 17-month highs on 4/14/10 and is bullish.
The S&P 500 Equally Weighted ETF Relative Strength Ratio (RSP/SPY) rose above previous 6-year highs on 4/14/10 and remains bullish. Absolute price of RSP rose above 18-month highs on 4/15/10 and remains bullish.
The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) broke down below the lows of the previous 21 months on 4/6/10. OEX/SPX remains bearish below its falling 50- and 200-day simple moving averages, and the 50 is below the 200. Conflicting with this bearish Relative Strength trend, absolute price of OEX remains bullish relative to its moving averages.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) rose above 17-month highs on 4/16/10. Absolute price of IWM rose further above 17-month highs on 4/15/10. Both remain in bullish position relative to key moving averages.
The S&P MidCap 400/Large Cap Relative Strength Ratio (MDY/SPY) rose above 15-year highs on 4/16/10 and remains bullish. Absolute price of MDY rose above 17-month highs on 4/14/10 and remains bullish.
Crude Oil nearest futures contract price appears to have entered a correction since peaking at 87.09 on 4/6/10. Minor corrections are normal. Longer term, Oil remains bullish. Support 78.86, 77.05, 76.71, 72.60, 69.50, 68.59 and 65.05. Resistance 90.51, 98.65, and 102.84.
Gold nearest futures contract price appears to have entered a correction since peaking at 1170.7 on 4/12/10. Minor corrections are normal. Longer term, Gold remains bullish. Support 1084.8, 1045.2, 1026.9 and 989.3. Resistance 1170.7, 1196.8 and 1226.4.
Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) has turned neutral for the intermediate-term trend after stabilizing since making a low on 1/29/10. Longer term, the trend appears unfavorable, since gold mining stocks have underperformed gold bullion since 9/17/09.
Silver/Gold Ratio has partially recovered since making a low on 2/8/10 and has improved from bearish to neutral.
Copper nearest futures contract price appears to have entered a correction since peaking at 3.68 on 4/12/10. Minor corrections are normal. Longer term, Copper remains bullish. Strength in Copper suggests renewed hope about prospects for the world economy, while weakness suggests doubts. Support 3.29, 3.1505, 3.034, and 2.811. Resistance 3.795 and 4.27.
U.S. Treasury Bond nearest futures contract price recovered modestly over the past 2 weeks but remains bearish over the longer term. Support 115.15, 114.06. 113.04 and 112.15. Resistance 118.12, 119.18, 120.11 and 123.18.
Junk/Investment-Grade Corporate Bonds Relative Strength Ratio (JNK/LQD) rose above 3-month highs on 4/15/10 and remains bullish. Absolute price of JNK also rose above 3-month highs on 4/15/10 and remains bullish.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) rose to a 2-month high on 4/15/10 and remains bullish. This means investors prefer more inflation protection. Absolute price of TIP rose to a 4-week high on 4/16/10 and remains bullish.
The U.S. dollar nearest futures contract price appears to have entered a correction since peaking at 82.52 on 3/25/10. Minor corrections are normal. Longer term, USD remains bullish. Support 80.14, 79.73, 79.61, 78.83, 78.20, 76.74 and 75.90. Resistance 82.52, 83.145 and 83.335.
The Art of Contrary Thinking: The various surveys of investor sentiment are best considered as background factors. The majority of investors can be right for a long time before a major trend finally changes course. The Art of Contrary Thinking is best used together with more precise market timing tools.
Advisory Service Sentiment: There were 51.1% Bulls versus 18.9% Bears as of 4/14/10, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear ratio rose to 2.70, up from 2.59 the previous week. The current Bull/Bear ratio is still below its peak at 3.36 set on 1/13/10, which was the highest bullish sentiment in 6 years. The 20-year range is 0.41 to 3.74, the median is 1.51, and the mean is 1.57.
VIX Fear Index fell to a 33-month low of 15.23 on 4/12/10. A low and falling VIX suggests bullish complacency. VIX is down from a closing high of 80.86 set on 11/20/08. VIX is a market estimate of expected constant 30-day volatility, calculated by weighting S&P 500 Index CBOE option bid/ask quotes spanning a wide range of strike prices for the two nearest expiration dates.
VXN Fear Index fell to a 31-month low of 15.53 on 4/14/10. A low and falling VXN suggests bullish complacency. VXN is down from a closing high of 80.64 set on 11/20/08. VXN measures NASDAQ Volatility using a method comparable to that used for VIX.
ISEE Call/Put Ratio rose to 1.85 on 4/15/10, a high level that indicates extreme bullish sentiment, which might be taken as a sign to be alert. Its 2-year mean is 1.20, and its typical range is 0.69 to 1.71, which represents two standard deviations from the mean.
CBOE Put/Call Ratio fell to 0.32 on 4/14/10, a low level that indicates extreme bullish sentiment, which might be taken as a sign to be alert. The 2-year mean is 0.70, and the typical range is 0.44 to 0.96, which represents two standard deviations from the mean.
The Dow Theory again confirmed a Bullish Major Trend on 4/15/10, when both the Dow-Jones Industrial Average and the Dow-Jones Transportation Average closed above their closing price highs of the previous 18 months. The Dow Theory signaled the current Primary Tide Bull Market on 7/23/09, when both the Dow-Jones Industrial Average and the Dow-Jones Transportation Average closed above their closing price highs of the previous 6 months. That 7/23/09 bullish signal reversed the previous bearish signal: the two Averages signaled a Primary Tide Bear Market on 11/21/07, when both Averages closed below their closing price lows of August 2007.
S&P 500 Composite (SPX) absolute price rose above 18-month highs on 4/15/10, again confirming its bullish trend. Support 1175.12, 1141.45, 1116.11, 1086.02, 1078.46, 1069.97, 1044.50, 1036.31 and 1029.54. Resistance 1213.92, 1220.03 and 1228.74.
S&P 500 Cash Index Potential Resistance
1576.09, high of 10/11/2007
1552.76, high of 10/31/2007
1523.57, high of 12/11/2007
1498.85, high of 12/26/2007
1440.24, high of 5/19/2008
1406.32, high of 5/29/2008
1381.50, Fibonacci 78.6% of 2007-2009 range
1366.59, high of 6/17/2008
1335.63, high of 6/25/2008
1313.15, high of 8/11/2008
1274.42, high of 9/8/2008
1255.09, high of 9/12/2008
1238.81, Fibonacci 78.6% of 1,576.09 high
1228.74, Fibonacci 61.8% of 2007-2009 range
1220.03, high of 9/25/2008
1213.92, high of 4/16/2010
S&P 500 Cash Index Potential Support
1175.12, low of 4/9/2010
1141.45, low of 3/15/2010
1116.11, high of 3/1/2010
1086.95, Fibonacci 38.2% of 2/5-2/19/10 range
1086.02, low of 2/25/2010
1078.46, Fibonacci 50.0% of 2/5-2/19/10 range
1069.97, Fibonacci 61.8% of 2/5-2/19/10 range
1044.50, low of 2/5/2010
1036.31, Fibonacci 23.6% of 2009-2010 range
1029.54, Gann 25.0% of 2009-2010 range
1029.38, low of 11/2/2009
1019.95, low of 10/2/2009
991.97, low of 9/2/2009
978.51, low of 8/17/2009
969.08, Gann 37.5% of 2009-2010 range
965.69, Fibonacci 38.2% of 2009-2010 range
956.23, high of 6/11/2009
908.62, Gann 50.0% of 2009-2010 range
869.32, low of 7/8/2009
851.55, Fibonacci 61.8% of 2009-2010 range
666.79, intraday low of 3/6/2009
One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
5.04% Thailand MSCI iS, THD
2.15% Energy DJ, IYE
2.14% Natural Resource iS GS, IGE
2.10% China LargeCap Growth G D H USX PS, PGJ
2.02% Energy VIPERs, VDE
1.95% Energy SPDR, XLE
1.91% Turkey MSCI iS, TUR
1.89% Canada Index, EWC
1.88% WilderHill Clean Energy PS, PBW
1.85% Energy Global, IXC
1.79% Indonesia MV, IDX
1.75% REIT Wilshire, RWR
1.74% Sweden Index, EWD
1.69% REIT VIPERs, VNQ
1.66% Realty Cohen & Steers, ICF
1.65% Italy Index, EWI
1.63% Semiconductor SPDR, XSD
1.62% China 25 iS, FXI
1.62% Homebuilders SPDR, XHB
1.62% Microcap Russell, IWC
1.60% Growth SmallCap VIPERs, VBK
1.57% Real Estate US DJ, IYR
1.54% Value MidCap Russell, IWS
1.52% Value SmallCap VIPERS, VBR
1.52% Water Resources, PHO
1.50% Small Cap VIPERs, VB
1.49% Financials VIPERs, VFH
1.46% MidCap Russell, IWR
1.45% Value SmallCap S&P 600, RZV
1.44% Australia Index, EWA
1.41% Value MidCap S&P 400 B, IJJ
1.39% United Kingdom Index, EWU
1.37% Financial DJ US, IYF
1.36% SmallCap Russell 2000, IWM
1.36% Value SmallCap S&P 600 B, IJS
1.36% Growth BARRA Small Cap 600, IJT
1.35% LargeCap Blend S&P=Weight R, RSP
1.35% Russia MV, RSX
1.33% Value SmallCap Russell 2000, IWN
1.33% Financial SPDR, XLF
1.31% MidCap S&P 400 SPDRs, MDY
1.31% Semiconductor iS GS, IGW
1.31% Financial Services DJ, IYG
1.31% Networking, IGN
1.30% Growth SmallCap R 2000, IWO
1.29% MidCap S&P 400 iS, IJH
1.28% South Africa Index, EZA
1.27% Utilities SPDR, XLU
1.27% Growth MidCap 400 B, IJK
1.26% Value 1000 Russell, IWD
1.25% SmallCap S&P 600, IJR
1.24% Dividend International, PID
1.23% South Korea Index, EWY
1.22% Consumer Discretionary SPDR, XLY
1.18% Emerging Markets, EEM
1.18% Germany Index, EWG
1.18% Malaysia Index, EWM
1.16% Emerging VIPERs, VWO
1.16% Industrial SPDR, XLI
1.15% Netherlands Index, EWN
1.14% Growth MidCap Russell, IWP
1.12% Utilities VIPERs, VPU
1.11% Mexico Index, EWW
1.10% Pacific ex-Japan, EPP
1.08% EMU Europe Index, EZU
1.08% Bond, High-Yield Corporate, HYG
1.07% European VIPERs, VGK
1.03% Value VIPERs, VTV
1.00% Value S&P 500 B, IVE
1.00% Dividend DJ Select, DVY
0.99% LargeCap Blend Russell 3000, IWV
0.95% Blend Total Market VIPERs, VTI
0.91% Singapore Index, EWS
0.91% S&P 500 iS LargeCap Blend, IVV
0.91% LargeCap 1000 R, IWB
0.89% S&P 500 SPDRs LargeCap Blend, SPY
0.89% Global ex US ACWI iS, ACWX
0.87% Transportation Av DJ, IYT
0.86% LargeCap VIPERs, VV
0.85% Europe 350 S&P Index, IEV
0.83% Emerging 50 BLDRS, ADRE
0.82% Dividend SPDR, SDY
0.81% India Earnings WTree, EPI
0.81% Brazil Index, EWZ
0.79% Commodity Tracking, DBC
0.76% Global 100, IOO
0.76% Telecom DJ US, IYZ
0.74% Value LargeCap Dynamic PS, PWV
0.74% Growth VIPERs, VUG
0.72% Growth S&P 500/BARRA, IVW
0.71% Dividend High Yield Equity PS, PEY
0.67% Metals & Mining SPDR, XME
0.66% India PS, PIN
0.65% Info Tech VIPERs, VGT
0.65% Agriculture DB PS, DBA
0.62% Growth 1000 Russell, IWF
0.62% EAFE Index, EFA
0.58% LargeCap Blend S&P 100, OEF
0.58% Value EAFE MSCI, EFV
0.58% Dividend Appreciation Vipers, VIG
0.58% Silver Trust iS, SLV
0.55% Technology SPDR, XLK
0.53% Growth EAFE MSCI, EFG
0.51% Technology DJ US, IYW
0.51% Growth LargeCap NASDAQ 100, QQQQ
0.49% Preferred Stock iS, PFF
0.48% Austria Index, EWO
0.48% France Index, EWQ
0.47% Taiwan Index, EWT
0.47% Oil, Crude, U.S. Oil Fund, USO
0.39% Latin Am 40, ILF
0.37% Hong Kong Index, EWH
0.36% Bond, 20+ Years Treasury, TLT
0.35% Pacific VIPERs, VPL
0.34% Basic Materials DJ US, IYM
0.32% Bond Ex-US Treas, BWX
0.32% Materials SPDR, XLB
0.30% Switzerland Index, EWL
0.30% Biotech SPDR, XBI
0.29% Bond EmrgMkt JPM iS, EMB
0.28% Consumer Staples SPDR, XLP
0.28% Gold Shares S.T., GLD
0.28% Spain Index, EWP
0.24% Bond, TIPS, TIP
0.23% DIAMONDS (DJIA), DIA
0.23% Small Cap EAFE MSCI iS, SCZ
0.22% Health Care SPDR, XLV
0.22% Chile MSCI iS, ECH
0.22% Bond, Corp, LQD
0.16% Bond, Aggregate, AGG
0.08% Capital Markets KWB ST, KCE
0.08% Belgium Index, EWK
0.06% Financial Preferred, PGF
0.04% Bond, 10 Year Treasury, IEF
0.01% Bond, 1-3 Year Treasury, SHY
0.01% Bond Muni ATM-Free S&P iS, MUB
-0.38% Japan Index, EWJ
