“Be prepared for a notable market decline.”

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) turned bullish on 10/10/12 when the TIP/IEF 50-day SMA rose above the 200-day SMA.

Bond, iShares Barclays 7-10 Year U.S. Treasury ETF (IEF) whipsawed back above its 50-day SMA on 10/10/12, thereby turning systematically bullish again.

On 10/10/12, the Dow-Jones Industrial Average fell below a 4-month uptrend line rising from the year’s low on 6/4/12.

Energy stock sector Relative Strength Ratio (XLE/SPY) whipsawed back down below its 50-day SMA, thereby turning systematically bearish again. Absolute price turned systematically neutral when XLE fell below its 50-day SMA.

The S&P 500 (SPX: 1,432.56) fell 8.92 points or 0.62% on Wednesday, after challenging its September high but failing to make a new high last week. SPX may have found resistance near the same level it peaked at 3 weeks ago.

The technical condition of the stock market does not support the excessive optimism of the bullish majority of stock investors and traders. Fed and ECB plans to buy bonds in unlimited quantities (with fiat currencies printed out of thin air and backed by nothing but a theory and a hope) do not guarantee that stock prices will continue to rise, especially now that the news is out. Typically, action is followed by reaction, and so a downside correction seems overdue. Choosing safety over risk still appears to be the most reasonable approach for conservative traders and investors.

Corporate insiders are extremely bearish. Insiders sold 5.97 shares for each share bought in September–up from 1.6-to-1 in May 2012, up from a low of 1.04-to-1 in October 2011, and up from a long-term average of 2.25-to-1. For Nasdaq-listed stocks, insiders sold 6.17 shares for each share bought. This data is compiled by Vickers Weekly Insider Report, published by Argus Research. Reporting for MarketWatch.com, Mark Hulbert wrote, “To be sure, the stock market didn’t decline in September, notwithstanding the insiders’ selling. But, since historically the insiders have been more right than wrong, it seems risky to bet that the market will continue to escape the bearish implication of their behavior…. Note carefully that the insiders’ bearish behavior doesn’t necessarily mean the bull market is now over. However, to the extent the insiders turn out to be as right as they were on other recent occasions when their behavior was as lopsided on the sell side, we should be prepared for a notable market decline.” Separately, data provided by Bloomberg shows 40 sales for every buy by insiders of S&P 500 companies.

*For extensive coverage of major global markets with illustrative charts, take a free trial for my weekly report —
click here.
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Hedge funds and equity mutual funds both lost money last year, 2011, and some are down again this year as well.

Meanwhile, one money manager made gains for 6 consecutive quarters; see:
Robert W. Colby Asset Management, Inc. (click here).

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Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) turned systematically neutral again on 10/10/12, when it whipsawed back up above its 50-day SMA. EFA/SPY remains below its 200-day SMA, and its 50-day SMA has remained below its 200-day SMA every day since 1/14/11. EFA/SPY has been trending down for nearly 5 years, since 11/27/2007, and there is no convincing evidence of any significant change in that major long-term downtrend.
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The S&P 500 Composite 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
1474.51, high of 9/14/2012
1440.24, high of 5/19/2008
1439.15, high of 9/12/2012

The S&P 500 Composite Potential Support
1430.53, low of 9/26/2012
1425.96, 50-day SMA
1422.38, high of 4/2/2012
1418.71, high of 8/17/2012
1415.32, high of 5/1/2012
1396.56, low of 9/4/2012
1391.04, low of 8/6/2012
1389.07, Fibonacci 78.6% of April-June 2012 range
1388.71, low of 5/3/2012
1381.50, Fibonacci 78.6% of 2007-2009 range
1380.39, high of 7/19/2012
1374.81, high of 7/3/2012
1370.58, high of 5/2/2011
1367.72, 200-day SMA
1363.49, high of 6/19/2012
1362.93, Fibonacci 61.8% of April-June 2012 range
1357.38, low of 4/10/2012
1355.70, low of 7/2/2012
1344.56, Fibonacci 50% of April-June 2012 range
1340.34, Fibonacci 23.6% of 2011-12 range
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
1326.19, Fibonacci 38.2% of April-June 2012 range
1325.41, low of 7/12/2012
1306.62, low of 6/12/2012
1303.47, Fibonacci 23.6% of April-June 2012 range
1291.98, low of 5/18/2012
1289.59, Fibonacci 38.2% of 2011-12 range
1266.74, low of 6/4/2012
1265.26, low of 1/5/2012
1262.30, low of 12/27/2011
1257.58, Fibonacci 61.8% of 2011 range
1248.58, Fibonacci 50.0% of 2011-12 range
1244.80, low of 12/7/2011
1239.73, low of 12/1/2011
1238.81, Fibonacci 78.6% of 1,576.09 high
1234.81, low of 11/3/2011
1231.04, high of 12/16/2011
1228.74, Fibonacci 61.8% of 2007-2009 range
1226.64, low of 11/9/2011
1224.57, high of 12/19/2011
1215.20, low of 12/16/2011
1207.56, Fibonacci 61.8% of 2011-12 range
1202.37, low of 12/19/2011
1158.66, low of 11/25/2011
1121.44, Fibonacci 50% of 2007-2009 range
1074.77, low of 10/4/2011
1149.16, Fibonacci 78.6% R of 2011-12 range
1014.14, Fibonacci 38.2% of 2007-2009 range
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
881.38, Fibonacci 23.6% of 2007-2009 range
869.32, low of 7/8/2009
666.79, intraday low of 3/6/2009
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Bond, iShares Barclays 7-10 Year U.S. Treasury ETF (IEF) whipsawed back above its 50-day SMA on 10/10/12, thereby turning systematically bullish again. IEF remains above its 200-day SMA, and its 50-day SMA has remained above its 200-day SMA every day since 6/21/11. Support 107.23, 106.42, 105.84, 105.22, 104.77, 103.90, 102.51, 101.77, 101.36, 101.11, 99.79, and 97.66. Resistance: 108.70, 108.99, 109.32, and 109.89.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) turned bullish on 10/10/12 when the TIP/IEF 50-day SMA rose above the 200-day SMA. TIP/IEF remains above both its 50-day SMA and 200-day SMA.
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Tangible Assets, Commodities

U.S. dollar ETF (UUP) 50-day SMA fell below its 200-day SMA on 10/2/12, thereby turning systematically bearish. UUP closed below its 50-day SMA on 8/3/12 and fell below its 200-day SMA on 8/31/12. UUP’s Support 21.57, 21.07, and 20.84. Resistance 21.94, 22.36, 22.45, 23.14, 23.52, 25.84, 27.19, 28.97.

Agriculture, PowerShares DB Agriculture Fund ETF (DBA) turned systematically neutral on 9/17/12 when price crossed below its 50-day SMA. DBA remains above its 200-day SMA, and its 50-day SMA remains above its 200-day SMA.

Crude Oil, United States Oil ETF (USO) turned systematically bearish on 9/19/12, when price fell below its 50-day SMA. USO fell below its 200-day SMA on 9/17/12. USO’s 50-day SMA remains below its 200-day SMA. Support 32.98, 32.45, 31.40, 29.02, 26.28, and 22.74. Resistance 37.17, 38.31, 40.29, 41.38, 42.30, and 45.60.

Gold, SPDR Gold Shares ETF (GLD) rose above its highs of the previous 11 months on 10/4/12. GLD turned systematically bullish on 9/20/12, when its 50-day SMA rose above its 200-day SMA. GLD price rose above its highs of the previous 7 months on 10/1/12, rose above its 200-day SMA on 8/22/12, and rose above its 50-day SMA on 8/3/12. Support: 168.34, 166.30, 159.56, 154.83, 148.27, 147.19, 143.97, 143.42, and 142.55. Resistance: 174.00, 175.46, 177.40, and 185.85.

Gold Mining Stocks ETF/Gold Shares ETF Relative Strength Ratio (GDX/GLD) rose above its 50-day SMA on 8/16/12, thereby turning systematically neutral. GDX/GLD rose above its 200-day SMA on 9/13/12 . The GDX/GLD 50-day SMA has remained below its 200-day SMA every day since 2/22/11, although that 50-200 spread has been narrowing since 9/5/12.

Silver, iShares Silver Trust ETF (SLV) turned systematically bullish on 10/1/12 when its price 50-day SMA crossed above the 200-day SMA. Support 32.40, 31.46, 29.28, 26.87, 26.13, 25.34, 25.00, 24.44, 22.52, 20.73, and 19.44. Resistance: 34.08, 36.44, 40.23, 41.49, 42.30, 42.78, 44.71, and 48.35.

Silver/Gold ETFs Ratio (SLV/GLD) turned systematically bullish on 10/9/12 when its 50-day SMA crossed above the 200-day SMA. SLV/GLD crossed above its 50-day SMA on 8/16/12 and crossed above its 200-day SMA on 8/31/12.

Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) price rose above its 50-day SMA on 8/21/12, thereby turning systematically neutral. Price rose above its 200-day SMA on 9/7/12. JJC remains systematically neutral because its 50-day SMA has remained below its 200-day SMA every day since 5/31/12. The 50-200 SMA spread has been narrowing since 8/8/12, although the spread is not tight and a crossover is not likely in days ahead. Dr. Copper” is 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
5.15% , FDX , FEDEX
7.50% , YUM , YUM BRANDS
4.56% , SIRI , Sirius Satellite
1.92% , COST , COSTCO WHOLESAL
3.06% , JNY , JONES APPAREL
1.73% , WMT , WAL MART STORES
2.24% , LM , LEGG MASON
2.45% , DLTR , Dollar Tree Stores Inc
1.70% , MTB , M&T BANK
1.02% , UIS , UNISYS
0.43% , ICF , Realty Cohen & Steers, ICF
1.19% , TUP , TUPPERWARE
1.49% , AIV , APT INV MNGMT
0.94% , JPM , J P MORGAN CHASE
0.68% , SH , Short 100% S&P 500, SH
1.89% , PGR , PROGRESSIVE OHIO
0.25% , SWY , SAFEWAY
0.52% , PSQ , Short 100% QQQ, PSQ
0.80% , XL , XL CAPITAL STK A
0.45% , MYY , Short 100% MidCap 400, MYY
0.35% , SRCL , Stericycle, SRCL
0.55% , GNW , GENWORTH FINANCIAL
0.76% , D , DOMINION RSCS
0.61% , BAX , BAXTER INTL
0.12% , VFH , Financials VIPERs, VFH
0.04% , MUB , Bond Muni ATM-Free S&P iS, MUB
0.27% , NCR , NCR
0.01% , IYT , Transportation Av DJ, IYT
0.08% , SYMC , SYMANTEC
0.04% , FMCN , Focus Media, FMCN

Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-5.39% , HRB , H&R BLOCK
-6.15% , VLO , VALERO ENERGY
-3.36% , CMI , CUMMINS
-0.11% , PWB , Lg Cap Growth PSD, PWB
-4.18% , CVX , CHEVRONTEXACO
-0.74% , VIS , Industrials VIPERs, VIS
-3.09% , ETN , EATON
-0.60% , OEF , LargeCap Blend S&P 100, OEF
-2.75% , PH , PARKER HANNIFIN
-2.85% , VIAB.O , VIACOM STK B
-2.23% , PCAR , PACCAR
-4.60% , AA , ALCOA
-2.98% , NTAP , NETWK APPLIANCE
-3.28% , SNV , SYNOVUS
-2.16% , ODP , OFFICE DEPOT
-1.68% , BLL , BALL
-0.87% , EWP , Spain Index, EWP
-2.57% , HAR , Harman International
-2.91% , JCI , JOHNSON CONTROLS
-2.46% , MBI , MBIA
-1.88% , CAT , CATERPILLAR
-0.48% , DBA , Agriculture DB PS, DBA
-0.65% , VO , MidCap VIPERs, VO
-2.25% , QLGC , QLOGIC
-1.99% , HD , HOME DEPOT
-2.28% , ISIL , INTERSIL CORP
-2.08% , HES , AMERADA HESS
-1.57% , DDS , DILLARD STK A
-1.03% , ERIC.O , LM Ericsson Telephone Company
-3.60% , COH , COACH
-2.09% , APOL , APOLLO GROUP
-0.94% , VAW , Materials VIPERs, VAW
-1.14% , NWSA , News Corporation, NWSA
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
1.16% Turkey MSCI iS, TUR
1.10% South Africa Index, EZA
0.71% Bond, 20+ Years Treasury, TLT
0.69% China 25 iS, FXI
0.68% Bear, Short S&P 500, SH
0.43% Realty Cohen & Steers, ICF
0.40% REIT VIPERs, VNQ
0.37% Silver Trust iS, SLV
0.36% REIT Wilshire, RWR
0.27% Financial Preferred, PGF
0.26% Financial Services DJ, IYG
0.26% Bond Ex-US Treas, BWX
0.24% Bond, 10 Year Treasury, IEF
0.20% Preferred Stock iS, PFF
0.18% Bond, Long-Term Corp iBoxx iS, LQD
0.17% Australia Index, EWA
0.16% Bond, Intermediate US Aggregate iS, AGG
0.12% Real Estate US DJ iS, IYR
0.12% Financials VIPERs, VFH
0.04% Bond, Muni S&P ATM-Free iS, MUB
0.03% Financial DJ US, IYF
0.02% Bond, Emerg Mkt JPM iS, EMB
0.01% Transportation Av DJ, IYT
0.00% Bond Treasury Short-Term iS, SHV
-0.01% Bond, 1-3 Year Treasury, SHY
-0.02% European VIPERs, VGK
-0.02% SmallCap Growth S&P 600 iS, IJT
-0.04% Microcap Russell, IWC
-0.04% Telecom DJ US, IYZ
-0.05% China LargeCap Growth G D H USX PS, PGJ
-0.06% Financial SPDR, XLF
-0.09% Gold Shares S.T., GLD
-0.10% Dividend High Yield Equity PS, PEY
-0.10% Frontier Markets Guggenheim , FRN
-0.11% Bond, TIPS U.S. Treasury iS, TIP
-0.11% Pacific ex-Japan, EPP
-0.12% Switzerland Index, EWL
-0.13% Germany Index, EWG
-0.14% France Index, EWQ
-0.15% Bond, High-Yield Junk, JNK
-0.15% SmallCap Value S&P 600 iS, IJS
-0.16% SmallCap Blend Russell 2000 iS, IWM
-0.16% Utilities SPDR, XLU
-0.17% Commodity Tracking, DBC
-0.18% SmallCap Growth Russell 2000 iS, IWO
-0.18% Value SmallCap VIPERS, VBR
-0.22% SmallCap Value Russell 2000 iS, IWN
-0.22% Value EAFE MSCI, EFV
-0.22% SmallCap Blend S&P 600 iS, IJR
-0.23% Utilities VIPERs, VPU
-0.23% Small Cap VIPERs, VB
-0.24% Italy Index, EWI
-0.24% Bond, High Yield Corp iBoxx iS, HYG
-0.26% Austria Index, EWO
-0.27% Europe 350 S&P Index, IEV
-0.27% Hong Kong Index, EWH
-0.28% Dividend ex-U.S. DJ iS, IDV
-0.28% Foreign LargeCap EAFE MSCI iS, EFA
-0.29% Growth SmallCap VIPERs, VBK
-0.32% Netherlands Index, EWN
-0.32% Homebuilders SPDR, XHB
-0.32% Global LargeCap Blend MSCI iS, ACWI
-0.35% United Kingdom Index, EWU
-0.35% Growth EAFE MSCI, EFG
-0.36% SmallCap Blend EAFE MSCI iS, SCZ
-0.40% Technology SPDR, XLK
-0.41% Thailand MSCI iS, THD
-0.42% Consumer Staples SPDR, XLP
-0.42% Biotech SPDR, XBI
-0.43% Chile MSCI iS, ECH
-0.43% MidCap Growth S&P 400 iS, IJK
-0.45% MidCap Value S&P 400 iS, IJJ
-0.46% EMU Europe Index, EZU
-0.47% LargeCap Growth Russell 1000 iS, IWF
-0.48% Agriculture DB PS, DBA
-0.48% Indonesia MV, IDX
-0.49% MidCap S&P 400 SPDRs, MDY
-0.50% Growth VIPERs, VUG
-0.50% Capital Markets KWB ST, KCE
-0.50% QQQ Nasdaq 100 Trust, QQQ
-0.51% Emerging VIPERs, VWO
-0.52% Info Tech VIPERs, VGT
-0.52% MidCap Blend S&P 400 iS, IJH
-0.53% Technology DJ US, IYW
-0.53% Dividend U.S. DJ iS, DVY
-0.53% Global ex U.S. LargeCap Blend, ACWX
-0.54% Emerging 50 BLDRS, ADRE
-0.54% Pacific VIPERs, VPL
-0.55% Dividend SPDR, SDY
-0.58% Global 100, IOO
-0.58% LargeCap Blend Russell 3000 iS, IWV
-0.58% LargeCap Blend Russell 1000 iS, IWB
-0.58% Dividend International, PID
-0.58% Blend Total Market VIPERs, VTI
-0.60% LargeCap Blend S&P 100, OEF
-0.61% Emerging Markets MSCI iS, EEM
-0.61% Malaysia Index, EWM
-0.61% LargeCap VIPERs, VV
-0.61% Growth MidCap Russell, IWP
-0.62% Consumer Discretionary SPDR, XLY
-0.63% LargeCap Blend S&P 500 iS, IVV
-0.63% MidCap Russell, IWR
-0.63% Value MidCap Russell, IWS
-0.64% S&P 500 SPDRs LargeCap Blend, SPY
-0.64% LargeCap Growth S&P 500 iS, IVW
-0.65% Oil Fund PowerShares, DBO
-0.65% LargeCap Value S&P 500 iS, IVE
-0.66% Value VIPERs, VTV
-0.68% Taiwan Index, EWT
-0.69% LargeCap Blend S&P=Weight R, RSP
-0.71% LargeCap Value Russell 1000 iS, IWD
-0.74% Health Care SPDR, XLV
-0.75% Singapore Index, EWS
-0.78% Japan Index, EWJ
-0.81% Brazil Index, EWZ
-0.82% Water Resources, PHO
-0.83% Sweden Index, EWD
-0.84% Dividend Appreciation Vipers, VIG
-0.87% Spain Index, EWP
-0.87% Belgium Index, EWK
-0.89% Latin Am 40, ILF
-0.90% Mexico Index, EWW
-0.91% Canada Index, EWC
-0.92% Value LargeCap Dynamic PS, PWV
-0.93% Industrial SPDR, XLI
-0.93% Basic Materials DJ US, IYM
-0.93% Russia MV, RSX
-0.97% DIAMONDS (DJIA), DIA
-0.99% Energy Global, IXC
-0.99% WilderHill Clean Energy PS, PBW
-0.99% Oil, Crude, U.S. Oil Fund, USO
-1.01% Metals & Mining SPDR, XME
-1.09% Materials SPDR, XLB
-1.13% India PS, PIN
-1.36% Semiconductor SPDR, XSD
-1.38% Semiconductor iS IGW, SOXX
-1.39% Energy & Nat Res iS GS, IGE
-1.51% Networking, IGN
-1.71% South Korea Index, EWY
-1.74% India Earnings WTree, EPI
-1.76% Energy VIPERs, VDE
-1.80% Energy DJ, IYE
-1.87% Energy SPDR, XLE