Financial stocks broke down below 2-year lows.
Energy stocks were notably weak and have been declining in my quantitative rankings for many weeks.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) fell below 11-month lows.
Gold, SPDR Gold Shares ETF (GLD) rose above all-time highs, confirming its major long-term uptrend.
Silver, iShares Silver Trust ETF (SLV) rose above 3-month highs, confirming a medium-term price uptrend.
The S&P 500 Composite (SPX, 1,123.82) rose 0.29 points or 0.03% on Monday, August 22, 2011, for a failed rally attempt within its well-established downtrend.
Typically, there is no safe place to hide in a Dow Theory Primary Tide Bear Market. Even those stocks that have held up relatively well through most of the Bear Market eventually succumb to the relentless tide of selling.
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Stock Market Indicators
NASDAQ Composite/S&P 500 Relative Strength Ratio underperformed sharply since 8/12/11, breaking down below 2-month lows and the 20-, 50-, and 200-day SMAs. Absolute price broke down below 10-month closing price lows on 8/19/11 and remains bearish.
Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) remains bearish. The EEM/SPY Ratio has been in a downtrend since peaking on 10/14/10. EEM/SPY broke down below 5-month lows on 8/8/11, remains below its 50- and 200-day SMAs, and the 50-day SMA remains below the 200-day SMA. Absolute price has been weak since 5/2/11 and broke down below 13-month lows on 8/8/11.
Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) remains bearish. The EFA/SPY Ratio has been in a major long-term downtrend since peaking on 11/27/07. EFA/SPY remains below its 50- and 200-day SMAs, and the 50-day SMA remains below the 200-day SMA. Absolute price has been weak since 5/2/11 and broke down below 11-month lows on 8/8/11.
The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) has lost upside momentum since peaking on 8/8/11. Longer term, OEX/SPX fell below 28-year lows on 5/26/11, confirming a bearish major trend. Absolute price of OEX fell below the lows of the previous 11 months on 8/9/11 and remains bearish.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) remains bearish. IWM/SPY fell below 11-month lows on 8/22/11.
The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) remains bearish. MDY/SPY fell below 11-month lows on 8/8/11, confirming a bearish major trend.
Advisory Service Sentiment: There were 46.2% Bulls versus 23.7% Bears as of 8/17/11, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear Ratio was 1.95, down slightly from 2.00 the previous week–and still indicating surprising bullish complacency in the face of dramatic stock price weakness. The 20-year median is 1.56 and the mean is 1.64.
VIX Fear Index rose to 48.00 on 8/8/11, its highest level in 14 months, since 5/21/10. VIX is in an uptrend, and it is possible for VIX to rise much higher: VIX was 89.53 on 10/24/08 during the financial crisis. Options players tend to grow more fearful as stock prices decline, and the trend of stock prices is down. 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.
The Dow Theory signaled a Primary Tide Bear Market on 8/2/11, when both the Dow-Jones Industrial Average and the Dow-Jones Transportation Average closed below their closing price lows of June, 2011.
The S&P 500 Composite (SPX, 1,123.82) rose 0.29 points or 0.03% on Monday, August 22, 2011, for a failed rally attempt within its well-established downtrend.
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
1370.58, high of 5/2/11
1359.44, high of 5/10/11
1356.48, high of 7/7/11
1347.00, high of 7/21/11
1258.07, low of 6/16/11
1249.05, low of 3/16/11
1246.73, high of 12/13/10
1238.81, Fibonacci 78.6% of 1,576.09 high
1235.05, high of 12/7/10
1234.56, low of 8/3/11
1232.85, low of 12/16/10
1228.74, Fibonacci 61.8% of 2007-2009 range
1227.08, high of 11/5/10
1208.47, high of 8/17/2010
S&P 500 Cash Index Potential Support
1101.54, low of 8/9/2010
1091.15, low of 9/7/2010
1039.70, low of 8/27/10
1039.31, Fibonacci 23.6% of June-Aug. 2010 range
1010.91, low of 7/1/2010
1008.55, Fibonacci 38.2% of 2009-2010 range
991.97, low of 9/2/2009
978.51, low of 8/17/2009
956.23, high of 6/11/2009
943.29, Gann 50.0% of 2009-2010 range
878.04, Fibonacci 61.8% of 2009-2010 range
874.17, Gann 62.5% of 2009-2010 range
869.32, low of 7/8/2009
805.17, Gann 75.0% of 2009-2010 range
785.13, Fibonacci 78.6% of 2009-2010 range
666.79, intraday low of 3/6/2009
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Fixed-Income Investments
Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) rose above the highs of the previous 2 years on 8/18/11, confirming a major uptrend. Although minor price consolidations and corrections are to be expected in bullish price trends, the dominant trend remains bullish. Support 108.10, 103.20, 102.27, 96.31, 94.83, 93.14, 89.65, and 88.14. Resistance 116.92, and 123.15.
Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) fell below 2-year lows and fell further below its 20-, 50-, and 200-day simple moving averages on 8/10/11, confirming a major bearish trend.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) has been weak since peaking on 4/8/11 and remains below 3 key SMAs, of 20, 50, and 200 days. This means fixed-income investors have been choosing the unprotected 7-10 Year U.S. Treasury Note ETF (IEF) over the inflation-protected TIPs. Fixed-income investors are not worried about inflation.
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Tangible Assets, Commodities
U.S. dollar ETF (UUP) fell below 3-month lows on 8/17/11, suggesting a medium-term downtrend. The sideways Continuation Pattern (which suggests that the previous major long-term downtrend probably will resume) since the low of 20.84 on 5/4/11 now appears to be “rolling over”, that is, showing a bearish bias. Support 20.84. Resistance 21.41, 21.74, 21.86, and 22.21.
Agriculture, PowerShares DB Agriculture Fund ETF (DBA) price rose above the highs of the previous 3 months intraday on 8/22/11 but failed to close above those highs. The probability of another whipsaw appears high. Avoid.
Crude Oil, United States Oil ETF (USO) turned down again last week. Oil fell below the lows of the previous 2 years on 8/9/11, again confirming a major downtrend. Support 30.31, 26.28, 22.74. Resistance 34.63, 35.14, 39.25, 40.74, and 45.60.
Gold, SPDR Gold Shares ETF (GLD) rose above all-time highs on 8/22/11, confirming its major long-term uptrend. Although minor price consolidations and corrections are to be expected in any trend, the dominant trend remains persistently bullish. In a world of too much debt, weak currencies, and self-serving politicians running amok, investors around the globe seek the safety of gold as the only forever-true money. Support: 159.68, 156.11, 154.10, 153.61, 147.19, 143.97, 143.42, and 142.55. Resistance: none.
Gold Mining Stocks ETF/ Gold Shares ETF Relative Strength Ratio (GDX/GLD) fell below 29-month lows on 8/8/11, again confirming a bearish major trend for the long term.
Silver, iShares Silver Trust ETF (SLV) rose above 3-month highs on 8/22/11, confirming a medium-term price uptrend. Support 36.04, 35.29, 34.02, and 31.97. Resistance: 44.71 and 48.35.
Silver/Gold ETFs Ratio (SLV/GLD) has been mostly weak since peaking on 4/28/11. This means investors prefer Gold over Silver.
Copper, iPath DJ-UBS Copper TR Sub-Idx ETN (JJC ) fell below the lows of the previous 8 months on 8/10/11, again confirming a significant downtrend. Weakness in Copper suggests doubts about the economic outlook. Support 50.59 and 49.00. Resistance: 53.32, 54.29, 56.64, 57.48, 59.06, 60.04, and 61.69.
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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
2.99% , EIS , Israel MSCI iS, EIS
6.76% , DYN , DYNEGY
5.72% , SIL , Silver Miners Global X, SIL
0.80% , PKB , Building & Construction, PKB
4.19% , BIG , BIG LOTS
1.90% , FEU , Value LargeCap Euro STOXX 50 DJ, FEU
1.72% , CVG , CONVERGYS
1.49% , FEZ , Euro STOXX 50, FEZ
0.86% , TTH , Telecom H, TTH
2.96% , RHI , ROBERT HALF
1.40% , VIA , VIACOM INC. (New)
2.43% , BHH , Internet B2B H, BHH
2.70% , COH , COACH
1.28% , PMR , Retail, PMR
2.79% , GPC , GENUINE PARTS
4.63% , NEM , NEWMONT MINING
0.16% , PIV , Value Line Timeliness MidCap Gr, PIV
2.93% , TIF , TIFFANY
4.16% , URBN , Urban Outfitters Inc.
3.10% , ECL , ECOLAB
0.38% , SCZ , Small Cap EAFE MSCI iS, SCZ
0.31% , PST , 200% Short Bond 7-10 Yr T, PST
0.71% , PSI , Semiconductors, PSI
0.74% , SWH , Software H, SWH
2.54% , IAU , Gold COMEX iS, IAU
2.63% , EWI , Italy Index, EWI
0.87% , CR , CRANE
0.08% , NYC , LargeCap Blend NYSE Composite iS, NYC
0.64% , EFG , Growth EAFE MSCI, EFG
1.58% , EZA , South Africa Index, EZA
0.06% , JKH , MidCap Growth iS M, JKH
0.64% , QLD , Ultra QQQ Double, QLD
0.45% , PGN , PROGRESS ENERGY
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-0.87% , RFV , Value MidCap S&P 400, RFV
-10.53% , MTG , MGIC INVESTMENT
-3.21% , LNCR , Lincare Holdings Inc
-0.48% , BDH , Broadband H, BDH
-7.89% , BAC , BANK OF AMERICA
-4.70% , GS , GOLDMAN SACHS
-4.07% , PTEN , Patterson-UTI Energy Inc
-1.32% , MAS , MASCO
-2.26% , LH , LAB CRP OF AMER
-3.23% , LPX , LOUISIANA PAC
-2.88% , AVY , AVERY DENNISON
-3.84% , HIG , HARTFORD FINL
-2.96% , X , US STEEL CORP
-3.39% , SIRI , Sirius Satellite
-2.15% , PXE , Energy Exploration & Prod, PXE
-4.74% , MBI , MBIA
-4.68% , S , SPRINT NEXTEL
-1.59% , PIC , Insurance, PIC
-0.44% , RPV , Value S&P 500, RPV
-2.24% , ODP , OFFICE DEPOT
-1.49% , STLD , Steel Dynamics, STLD
-0.16% , TLH , Bond 10-20 Year US Treas, TLH
-2.55% , DOW , DOW CHEMICAL
-0.28% , VPU , Utilities VIPERs, VPU
-2.30% , ASH , ASHLAND
-0.74% , PNW , PINNACLE WEST
-0.30% , RZV , Value SmallCap S&P 600, RZV
-0.60% , PXN , Nanotech Lux, PXN
-2.18% , EIX , EDISON INTL
-2.98% , ETFC , E*TRADE FINANCIAL
-1.16% , FMCN , Focus Media, FMCN
-1.11% , MWV , MEADWESTVACO
-0.82% , VDE , Energy VIPERs, VDE
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
5.72% Silver Miners Global X, SIL
2.63% Italy Index, EWI
2.58% Gold Shares S.T., GLD
2.28% Silver Trust iS, SLV
2.11% India PS, PIN
1.91% Sweden Index, EWD
1.87% Oil, Crude, U.S. Oil Fund, USO
1.58% South Africa Index, EZA
1.53% Spain Index, EWP
1.48% India Earnings WTree, EPI
1.47% European VIPERs, VGK
1.36% United Kingdom Index, EWU
1.28% Oil Fund PowerShares, DBO
1.26% France Index, EWQ
1.25% Austria Index, EWO
1.16% Europe 350 S&P Index, IEV
1.03% EMU Europe Index, EZU
0.97% Value EAFE MSCI, EFV
0.95% Dividend International, PID
0.93% Netherlands Index, EWN
0.90% Frontier Markets Guggenheim , FRN
0.88% Mexico Index, EWW
0.85% Belgium Index, EWK
0.73% Russia MV, RSX
0.64% Growth EAFE MSCI, EFG
0.64% EAFE Index, EFA
0.63% Agriculture DB PS, DBA
0.62% Taiwan Index, EWT
0.61% Semiconductor iS IGW, SOXX
0.61% Switzerland Index, EWL
0.60% Global 100, IOO
0.58% Info Tech VIPERs, VGT
0.58% Latin Am 40, ILF
0.53% Technology SPDR, XLK
0.52% Technology DJ US, IYW
0.48% Emerging 50 BLDRS, ADRE
0.46% Water Resources, PHO
0.42% Metals & Mining SPDR, XME
0.40% Realty Cohen & Steers, ICF
0.40% Global ex US ACWI iS, ACWX
0.38% Small Cap EAFE MSCI iS, SCZ
0.38% Semiconductor SPDR, XSD
0.38% Industrial SPDR, XLI
0.36% Chile MSCI iS, ECH
0.36% DIAMONDS (DJIA), DIA
0.36% Turkey MSCI iS, TUR
0.36% QQQ Nasdaq 100 Trust, QQQ
0.36% Canada Index, EWC
0.33% Growth MidCap 400 B, IJK
0.31% Growth S&P 500/BARRA, IVW
0.30% Consumer Staples SPDR, XLP
0.29% Consumer Discretionary SPDR, XLY
0.29% Dividend Appreciation Vipers, VIG
0.28% Pacific VIPERs, VPL
0.24% Pacific ex-Japan, EPP
0.23% Dividend SPDR, SDY
0.21% Japan Index, EWJ
0.19% Growth 1000 Russell, IWF
0.19% Real Estate US DJ, IYR
0.17% Commodity Tracking, DBC
0.14% Growth VIPERs, VUG
0.14% Energy Global, IXC
0.14% Bond Muni ATM-Free S&P iS, MUB
0.14% LargeCap Blend S&P=Weight R, RSP
0.14% REIT Wilshire, RWR
0.13% Australia Index, EWA
0.13% MidCap S&P 400 SPDRs, MDY
0.12% Bond, High-Yield Corporate, HYG
0.11% REIT VIPERs, VNQ
0.10% MidCap S&P 400 iS, IJH
0.10% Growth MidCap Russell, IWP
0.09% MidCap Russell, IWR
0.08% S&P 500 SPDRs LargeCap Blend, SPY
0.08% Networking, IGN
0.03% LargeCap Blend Russell 3000, IWV
0.02% LargeCap Blend S&P 100, OEF
0.02% Blend Total Market VIPERs, VTI
0.00% Value SmallCap S&P 600 B, IJS
0.00% Singapore Index, EWS
0.00% S&P 500 iS LargeCap Blend, IVV
0.00% Materials SPDR, XLB
0.00% Hong Kong Index, EWH
0.00% Germany Index, EWG
0.00% Bond Treasury Short-Term iS, SHV
-0.01% Dividend High Yield Equity PS, PEY
-0.01% Growth BARRA Small Cap 600, IJT
-0.01% Bond, 1-3 Year Treasury, SHY
-0.01% Growth SmallCap VIPERs, VBK
-0.02% LargeCap 1000 R, IWB
-0.02% LargeCap VIPERs, VV
-0.02% Value VIPERs, VTV
-0.03% Bond, TIPS, TIP
-0.04% Dividend DJ Select, DVY
-0.04% Value MidCap S&P 400 B, IJJ
-0.06% Value LargeCap Dynamic PS, PWV
-0.06% Bond EmrgMkt JPM iS, EMB
-0.06% Health Care SPDR, XLV
-0.08% Homebuilders SPDR, XHB
-0.08% Small Cap VIPERs, VB
-0.10% Emerging VIPERs, VWO
-0.10% Emerging Markets, EEM
-0.10% Value MidCap Russell, IWS
-0.10% Value SmallCap Russell 2000, IWN
-0.11% Value 1000 Russell, IWD
-0.12% SmallCap S&P 600, IJR
-0.13% Bond, Aggregate, AGG
-0.13% Capital Markets KWB ST, KCE
-0.17% Transportation Av DJ, IYT
-0.18% Growth SmallCap R 2000, IWO
-0.18% Bond, 10 Year Treasury, IEF
-0.19% Basic Materials DJ US, IYM
-0.20% Value SmallCap VIPERS, VBR
-0.21% Malaysia Index, EWM
-0.23% Value S&P 500 B, IVE
-0.25% Utilities SPDR, XLU
-0.25% Bond, 20+ Years Treasury, TLT
-0.27% Brazil Index, EWZ
-0.27% Bond Ex-US Treas, BWX
-0.27% Energy & Nat Res iS GS, IGE
-0.28% Utilities VIPERs, VPU
-0.29% Telecom DJ US, IYZ
-0.29% Thailand MSCI iS, THD
-0.35% SmallCap Russell 2000, IWM
-0.37% Bond, Corp, LQD
-0.47% WilderHill Clean Energy PS, PBW
-0.48% Bond, High-Yield Junk, JNK
-0.49% Indonesia MV, IDX
-0.59% China 25 iS, FXI
-0.61% Energy DJ, IYE
-0.61% Microcap Russell, IWC
-0.73% Preferred Stock iS, PFF
-0.81% Energy SPDR, XLE
-0.82% Energy VIPERs, VDE
-0.91% Financial DJ US, IYF
-0.97% Financial Preferred, PGF
-1.06% Financials VIPERs, VFH
-1.08% South Korea Index, EWY
-1.12% China LargeCap Growth G D H USX PS, PGJ
-1.24% Financial SPDR, XLF
-1.26% Financial Services DJ, IYG
-1.46% Biotech SPDR, XBI
