The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEF/SPY) turned systematically neutral again on 10/11/12, when it fell below its 50-day SMA.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) turned systematically neutral again on 10/11/12, when it whipsawed back up above its 50-day SMA.
Gold Mining Stocks ETF/Gold Shares ETF Relative Strength Ratio (GDX/GLD) has been losing downside momentum, and the 50-day SMA could cross above the 200-day SMA in days ahead.
Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) 50-200 SMA spread has been narrowing since 8/8/12, and a crossover appears possible in weeks ahead if price holds up or rises.
The S&P 500 (SPX: 1,432. 84) rose 0.28 points or 0.02% on Thursday, following 4 consecutive daily declines. Last week, SPX challenged its September 14th high but the attempt fizzled. The failed rally attempt suggests that SPX may have found resistance near the same level it peaked at 3 weeks ago.
More than a few traders may be paying attention to SPX 1,430.53, the low of 9/26/2012, and 1,427.11, where the rising 50-day SMA now stands. In addition, a 4-month uptrend line rising from the year’s low on 6/4/12 now stands in the same vicinity. A close below these levels could lead to a quick trip below 1,400 for the SPX.
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.
*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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Stock Market Indicators
The Dow Theory signaled a Primary Tide Bear Market on 5/17/12 when both Industrials and Transports closed below their closing price lows of the previous 4 months, including the critical lows of March and April, 2012. The Dow-Jones Industrial Average rose above its closing price highs of the previous 4-years on 10/5/12, but the Dow-Jones Transportation Average remains relatively weak, closer to its 2012 low than it to its 2012 high, thereby demonstrating non confirmation and bearish divergence. On 10/10/12, the Industrials fell below a 4-month uptrend line rising from the year’s low on 6/4/12.
NASDAQ 100/S&P 500 Relative Strength Ratio (QQQ/SPY) whipsawed back down below its 50-day SMA on 9/28/12, thereby turning systematically neutral again. QQQ/SPY fell below its 200-day SMA on 10/8/12. The QQQ/SPY Ratio’s 50-day SMA has remained above the 200-day SMA since 8/5/11.
iShares MSCI BRIC Fund (BKF) Relative Strength Ratio (BKF/SPY) turned systematically neutral on 9/13/12, when it rose above its 50-day SMA. BKF/SPY remains below its 200-day SMA, and its 50-day SMA has remained below its 200-day SMA every day since 1/13/11.
Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) turned systematically neutral on 9/13/12, when it rose above its 50-day SMA. EEM/SPY remains below its 200-day SMA, and its 50-day SMA has remained below its 200-day SMA every day since 2/3/11.
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.
The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEF/SPY) turned systematically neutral again on 10/11/12, when it fell below its 50-day SMA. OEF/SPY remains above its 200-day SMA, and the 50-day SMA has been above the 200-day SMA consistently every day since 8/24/11. Large Caps tend to outperform in bearish general market trends as investors seek the perceived relative safety of large size. On the other side of the coin, Large Caps tend to underperform Mid Caps and Small Caps in bullish general market trends as investors prefer riskier and more volatile stocks.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) turned systematically neutral again on 10/11/12, when it whipsawed back up above its 50-day SMA. IWM/SPY fell below its 200-day SMA on 9/24/12, and its 50-day SMA has remained below its 200-day SMA consistently every day since 4/20/12.
The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) whipsawed back down below its 50-day SMA on 9/25/12, thereby turning systematically bearish again. MDY/SPY remains below its 200-day SMA, and its 50-day SMA has been below its 200-day SMA since 6/6/12.
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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
1427.11, 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
1368.55, 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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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, and the 50 could cross above the 200 in days ahead.
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, and a crossover appears possible in weeks ahead if price holds up or rises. “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
14.29% , S , SPRINT NEXTEL
8.41% , JCP , JC PENNEY
5.83% , CTB , COOPER TIRE
8.44% , FAST , Fastenal Company
3.41% , GWW , WW GRAINGER
4.40% , DISH , EchoStar Communications
3.71% , NYT , NY TIMES STK A
3.90% , SLM.O , SLM CORP
2.03% , KSS , KOHLS
3.02% , ZION , ZIONS
1.26% , HP , Helmerich & Payne HP
2.35% , FXI , China 25 iS, FXI
1.87% , DVN , DEVON ENERGY
2.66% , XME , Metals & Mining SPDR, XME
3.34% , AET , AETNA
0.86% , BMS , BEMIS
1.76% , TIF , TIFFANY
1.99% , MET , METLIFE
0.22% , IYY , LargeCap Blend Total Market DJ, IYY
1.59% , GS , GOLDMAN SACHS
1.00% , EWQ , France Index, EWQ
0.08% , IYK , Consumer Non-Cyclical, IYK
1.25% , TE , TECO ENERGY
1.03% , PFG , PRINCIPAL FINL
2.57% , LRCX , LAM RESEARCH CORP
1.56% , XRAY , DENTSPLY International Inc
0.13% , IYH , Healthcare DJ, IYH
0.48% , ETR , ENTERGY
0.38% , VPL , Pacific VIPERs, VPL
0.91% , AGN , ALLERGAN
0.68% , MRVL , MARVELL TECHNOLOGY
1.08% , C , CITIGROUP
1.72% , IP , INTL PAPER
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-7.74% , DLTR , Dollar Tree Stores Inc
-1.57% , CTXS , CITRIX SYSTEMS
-3.56% , SWY , SAFEWAY
-1.89% , MO , ALTRIA, MO
-2.78% , FDO , FAMILY DLR STRS
-3.13% , ROST , Ross Stores Inc
-2.25% , CBS , CBS CORP.
-0.41% , IYC , Consumer Cyclical DJ, IYC
-2.31% , TYC , TYCO INTL
-2.25% , TGT , TARGET
-0.90% , WYN , Wyndham Worldwide
-1.70% , DIS , WALT DISNEY
-1.79% , T , AT&T Corp., T
-1.48% , EMN , EASTMAN CHEM
-0.45% , IYW , Technology DJ US, IYW
-0.34% , VDC , Consumer Staples VIPERs, VDC
-0.25% , VGT , Info Tech VIPERs, VGT
-1.04% , SVU , SUPERVALU
-0.41% , CTAS , CINTAS
-1.43% , KLAC , KLA TENCOR
-0.66% , SNDK , SanDisk Corporation
-0.96% , CVS , CVS
-2.00% , AAPL , APPLE COMPUTER
-0.18% , PBJ , Food & Beverage, PBJ
-0.28% , RL , Polo Ralph Lauren
-0.27% , EQR , EQUITY RESIDENT BEN INT
-0.26% , HOG , HARLEY DAVIDSON
-0.45% , XLY , Consumer Discretionary SPDR, XLY
-0.67% , PEP , PEPSICO
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
2.66% Metals & Mining SPDR, XME
2.62% Turkey MSCI iS, TUR
2.35% China 25 iS, FXI
2.09% India Earnings WTree, EPI
1.84% India PS, PIN
1.60% Austria Index, EWO
1.40% China LargeCap Growth G D H USX PS, PGJ
1.38% South Africa Index, EZA
1.33% Oil, Crude, U.S. Oil Fund, USO
1.25% WilderHill Clean Energy PS, PBW
1.23% Oil Fund PowerShares, DBO
1.15% Commodity Tracking, DBC
1.13% EMU Europe Index, EZU
1.07% Netherlands Index, EWN
1.00% France Index, EWQ
0.99% Europe 350 S&P Index, IEV
0.98% Emerging 50 BLDRS, ADRE
0.98% Italy Index, EWI
0.98% Germany Index, EWG
0.95% Spain Index, EWP
0.94% Emerging VIPERs, VWO
0.94% Basic Materials DJ US, IYM
0.93% Emerging Markets MSCI iS, EEM
0.88% Malaysia Index, EWM
0.85% Energy & Nat Res iS GS, IGE
0.85% Energy Global, IXC
0.84% Thailand MSCI iS, THD
0.83% Energy VIPERs, VDE
0.82% Mexico Index, EWW
0.81% European VIPERs, VGK
0.80% Brazil Index, EWZ
0.80% Value EAFE MSCI, EFV
0.77% Global ex U.S. LargeCap Blend, ACWX
0.75% United Kingdom Index, EWU
0.75% Energy DJ, IYE
0.75% Energy SPDR, XLE
0.73% Russia MV, RSX
0.73% Latin Am 40, ILF
0.72% Switzerland Index, EWL
0.70% Value MidCap Russell, IWS
0.69% Bond, 20+ Years Treasury, TLT
0.68% Financial Services DJ, IYG
0.65% Dividend International, PID
0.64% Foreign LargeCap EAFE MSCI iS, EFA
0.59% Capital Markets KWB ST, KCE
0.58% Australia Index, EWA
0.56% Financial SPDR, XLF
0.56% Japan Index, EWJ
0.55% Bond, Emerg Mkt JPM iS, EMB
0.55% Chile MSCI iS, ECH
0.54% Bond, High Yield Corp iBoxx iS, HYG
0.54% Pacific ex-Japan, EPP
0.53% Growth EAFE MSCI, EFG
0.53% Networking, IGN
0.53% MidCap Value S&P 400 iS, IJJ
0.53% Canada Index, EWC
0.52% Value SmallCap VIPERS, VBR
0.51% MidCap S&P 400 SPDRs, MDY
0.50% Dividend ex-U.S. DJ iS, IDV
0.48% Agriculture DB PS, DBA
0.47% Financial DJ US, IYF
0.47% MidCap Blend S&P 400 iS, IJH
0.46% SmallCap Value Russell 2000 iS, IWN
0.45% Financials VIPERs, VFH
0.44% Biotech SPDR, XBI
0.44% MidCap Russell, IWR
0.42% LargeCap Blend S&P=Weight R, RSP
0.42% Global 100, IOO
0.42% MidCap Growth S&P 400 iS, IJK
0.41% Materials SPDR, XLB
0.40% Growth SmallCap VIPERs, VBK
0.39% Small Cap VIPERs, VB
0.39% Semiconductor SPDR, XSD
0.39% Global LargeCap Blend MSCI iS, ACWI
0.38% South Korea Index, EWY
0.38% Pacific VIPERs, VPL
0.38% Singapore Index, EWS
0.36% Microcap Russell, IWC
0.36% SmallCap Blend Russell 2000 iS, IWM
0.35% Bond, High-Yield Junk, JNK
0.33% Bond, Long-Term Corp iBoxx iS, LQD
0.33% Preferred Stock iS, PFF
0.32% LargeCap Value Russell 1000 iS, IWD
0.31% Indonesia MV, IDX
0.30% Industrial SPDR, XLI
0.30% Semiconductor iS IGW, SOXX
0.29% SmallCap Growth Russell 2000 iS, IWO
0.28% Gold Shares S.T., GLD
0.27% Financial Preferred, PGF
0.26% SmallCap Blend EAFE MSCI iS, SCZ
0.24% SmallCap Value S&P 600 iS, IJS
0.24% Dividend SPDR, SDY
0.24% Belgium Index, EWK
0.24% Telecom DJ US, IYZ
0.24% SmallCap Blend S&P 600 iS, IJR
0.21% LargeCap Value S&P 500 iS, IVE
0.21% Water Resources, PHO
0.20% Frontier Markets Guggenheim , FRN
0.20% Growth MidCap Russell, IWP
0.18% Value LargeCap Dynamic PS, PWV
0.18% Bond Ex-US Treas, BWX
0.17% SmallCap Growth S&P 600 iS, IJT
0.15% Blend Total Market VIPERs, VTI
0.13% Utilities VIPERs, VPU
0.12% Bond, Intermediate US Aggregate iS, AGG
0.12% Value VIPERs, VTV
0.11% Utilities SPDR, XLU
0.09% LargeCap Blend Russell 3000 iS, IWV
0.09% Bond, 10 Year Treasury, IEF
0.09% LargeCap VIPERs, VV
0.08% LargeCap Blend Russell 1000 iS, IWB
0.07% Health Care SPDR, XLV
0.07% Sweden Index, EWD
0.06% LargeCap Blend S&P 500 iS, IVV
0.06% S&P 500 SPDRs LargeCap Blend, SPY
0.03% Dividend Appreciation Vipers, VIG
0.02% Real Estate US DJ iS, IYR
0.01% REIT Wilshire, RWR
0.00% Dividend High Yield Equity PS, PEY
-0.01% Bond, Muni S&P ATM-Free iS, MUB
-0.01% Bond Treasury Short-Term iS, SHV
-0.01% Bond, 1-3 Year Treasury, SHY
-0.01% Growth VIPERs, VUG
-0.04% Realty Cohen & Steers, ICF
-0.04% LargeCap Growth S&P 500 iS, IVW
-0.05% Dividend U.S. DJ iS, DVY
-0.06% Bear, Short S&P 500, SH
-0.08% REIT VIPERs, VNQ
-0.09% Bond, TIPS U.S. Treasury iS, TIP
-0.11% LargeCap Blend S&P 100, OEF
-0.11% Transportation Av DJ, IYT
-0.11% DIAMONDS (DJIA), DIA
-0.15% LargeCap Growth Russell 1000 iS, IWF
-0.15% Silver Trust iS, SLV
-0.22% Consumer Staples SPDR, XLP
-0.23% Taiwan Index, EWT
-0.25% Info Tech VIPERs, VGT
-0.31% QQQ Nasdaq 100 Trust, QQQ
-0.33% Hong Kong Index, EWH
-0.40% Technology SPDR, XLK
-0.45% Technology DJ US, IYW
-0.45% Consumer Discretionary SPDR, XLY
-0.76% Homebuilders SPDR, XHB
