AAII Sentiment shows that individual investors are extremely bullish. As of 1/10/13, there are 46.45% bulls, 26.63% neutral, and 26.92%b bears. This is the highest percentage of bulls in 11 months, since 2/9/12.
Short interest in stocks listed on NYSE and Nasdaq both fell 5%, to 12.9 billion and 7.2 billion, respectively, in December. A decline in short interest means less potential demand for stocks when shorts cover.
Technology stock sector Relative Strength Ratio (XLK/SPY) fell below its lows of the previous 16 months on 1/10/13, confirming a systematically bearish major trend.
Utilities stock sector Relative Strength Ratio (XLK/SPY) fell below its lows of the previous 20 months on 1/10/13, confirming a systematically bearish major trend.
The Dow-Jones Transportation Average rose further above its 2012 highs, but the Dow-Jones Industrial Average stubbornly remained below its 2012 highs, thereby demonstrating non confirmation and bearish divergence.
The S&P 500 (SPX: 1,472.12 ) rose 11.10 points or 0.76% on Thursday in 11% more active trading. SPX closed above its closing price levels of the previous 5 years. SPX remained below its intraday high of 1474.51 on 9/14/2012, however.
23 of 141 active ETFs confirmed the strength of S&P 500 by closing above previous 5-year closing price highs. These strong ETFs are listed here in order of their major trend relative strength:
Mexico Index, EWW
Consumer Discretionary SPDR, XLY
MidCap Value S&P 400 iS, IJJ
MidCap S&P 400 SPDRs, MDY
Health Care SPDR, XLV
MidCap Blend S&P 400 iS, IJH
Value MidCap Russell, IWS
Growth SmallCap VIPERs, VBK
Microcap Russell, IWC
SmallCap Blend Russell 2000 iS, IWM
Small Cap VIPERs, VB
LargeCap Blend S&P=Weight R, RSP
SmallCap Growth S&P 600 iS, IJT
MidCap Russell, IWR
Value LargeCap Dynamic PS, PWV
SmallCap Growth Russell 2000 iS, IWO
Growth MidCap Russell, IWP
LargeCap Blend Russell 3000 iS, IWV
Blend Total Market VIPERs, VTI
LargeCap Blend Russell 1000 iS, IWB
LargeCap VIPERs, VV
Dividend Appreciation Vipers, VIG
Dividend SPDR, SDY
The Art of Contrary Thinking calls for questioning popular optimism. Investor sentiment data indicated alarming degrees of optimism and bullish complacency in recent weeks, matching or exceeding extremes in September, 2012, when many stock price indexes hit peaks and reversed to the downside. Elevated levels of optimism are bearish because when the majority is extremely bullish, investors are already fully invested in the market. Once everyone who is going to buy has already bought, stocks are vulnerable to a downside shakeout. The pendulum of emotion tends to swing too far in one direction, but the market mood always reverts to the mean.
U.S. dollar ETF (UUP) turned systematically bearish again on 1/10/13 when whipsawed back down below its 50-day SMA and a 6-months long downtrend line.
Our clients’ separately managed accounts made gains in 6 of the past 7 consecutive quarters; see:
Robert W. Colby Asset Management, Inc. (click here).
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VIX Fear Index collapsed to 13.22 on 1/9/13 from 23.23 on 12/28/12. This indicates a rapid shift to bullish complacency from worried concern. 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 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
The S&P 500 Composite Potential Support
1467.94, high of 1/4/13
1464.02, high of 10/18/2012
1451.64, low on 1/8/13
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
1425.48, Fibonacci 23.6% of June-Sept ’12 range
1424.41, Fibonacci 61.8% of Sept-Nov ’12 range
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
1415.90, 50-day SMA
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
1395.14, Fibonacci 38.2% of June-Sept 2012 range
1392.50, 200-day SMA
1391.04, low of 8/6/2012
1388.71, low of 5/3/2012
1385.43, low of 11/28/2012
1381.50, Fibonacci 78.6% of 2007-2009 range
1380.39, high of 7/19/2012
1374.81, high of 7/3/2012
1370.62, Fibonacci 50.0% of June-Sept 2012 range
1370.58, high of 5/2/2011
1363.49, high of 6/19/2012
1357.38, low of 4/10/2012
1355.70, low of 7/2/2012
1346.11, Fibonacci 61.8% of June-Sept 2012 range
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
1311.20, Fibonacci 78.6% of June-Sept 2012 range
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
1257.58, Fibonacci 61.8% of 2011 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
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
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) turned systematically bearish again on 1/10/13 when whipsawed back down below its 50-day SMA and a 6-months long downtrend line. UUP fell below its 200-day SMA on 8/31/12, and the 50-day SMA fell below the 200-day SMA on 10/2/12. Support 21.57, 21.07, and 20.84. Resistance 22.05, 22.30, 22.45, 23.14, 23.52, 25.84, 27.19, 28.97.
Agriculture, PowerShares DB Agriculture Fund ETF (DBA) price fell below its lows of the previous 6 months on 1/4/13. DBA turned systematically neutral on 11/30/12 when price crossed back down below its 50-day SMA. The 50-day SMA remains above the 200-day SMA, although the 50-200 spread has been narrowing, and the two SMAs are likely to cross bearishly in days ahead.
Crude Oil, United States Oil ETF (USO) price rose above its highs of the previous 2 months on 1/2/13. USO turned systematically neutral on 12/26/12, when price rose back above its 50-day SMA. USO price fell below its 200-day SMA on 9/17/12, and the 50-day SMA has remained below its 200-day SMA consistently every day since 6/7/12. Support 31.00, 29.02, 26.28, and 22.74. Resistance 34.70, 37.17, 38.31, 40.29, 41.38, 42.30, and 45.60.
Gold, SPDR Gold Shares ETF (GLD) price fell below its lows of the previous 4 months on 12/20/12. GLD turned systematically neutral on 11/27/12, when price fell below its 50-day SMA. Support: 158.39, 157.40, 154.83, 148.27, 147.19, 143.97, 143.42, and 142.55. Resistance: 164.14, 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) turned systematically bearish on 12/27/12 when the 50-day SMA crossed below the 200-day SMA.
Silver, iShares Silver Trust ETF (SLV) price turned systematically neutral on 12/13/12 when it fell below its 50-day SMA. Support 28.61, 27.97, 26.87, 26.13, 25.34, 25.00, 24.44, 22.52, 20.73, and 19.44. Resistance: 30.04, 30.47, 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 4 months on 12/20/12. SLV/GLD turned systematically neutral on 12/14/12 when it fell below its 50-day SMA.
Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) turned systematically neutral on 12/26/12, when it rose above its 50-day SMA. Long term, JJC has been consolidating losses in Triangle chart pattern trading range between 38.99 and 51.41 for more than a year since October 2011. “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
14.14% , SVU , SUPERVALU
2.52% , VIA.O , VIACOM INC. (New)
3.23% , LM , LEGG MASON
5.97% , BIDU , Baidu, Inc., BIDU
1.73% , PGR , PROGRESSIVE OHIO
3.13% , FLR , FLUOR
4.76% , MBI , MBIA
4.64% , URBN , Urban Outfitters Inc.
3.38% , RFMD , RF Micro Devices Inc
1.70% , PMCS , PMC SIERRA
2.29% , R , RYDER SYSTEM
2.27% , AON , AON
2.67% , F , FORD MOTOR
0.88% , CLX , CLOROX
1.75% , IEV , Europe 350 S&P Index, IEV
2.11% , RYAAY , Ryanair Holdings plc
1.92% , ETFC , E*TRADE FINANCIAL
1.63% , EWG , Germany Index, EWG
2.31% , STJ , ST JUDE MEDICAL
1.05% , IYF , Financial DJ US, IYF
2.82% , PRU , PRUDENTIAL FINL
2.34% , EWP , Spain Index, EWP
2.58% , RDC , ROWAN COMPANIES
2.15% , SYMC , SYMANTEC
2.10% , EL , Estee Lauder
0.29% , IGV , Software, IGV
2.20% , NWSA , News Corporation, NWSA
1.54% , FEU , Value LargeCap Euro STOXX 50 DJ, FEU
1.31% , IYG , Financial Services DJ, IYG
0.16% , PMR , Retail, PMR
1.75% , HRB , H&R BLOCK
3.67% , MS , MORGAN STANLEY
0.90% , IXC , Energy Global, IXC
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-4.52% , TIF , TIFFANY
-1.39% , NWL , NEWELL RUBBER
-2.01% , NBR , NABORS
-1.21% , MKC , MCCORMICK
-2.21% , FAST , Fastenal Company
-1.76% , YHOO , YAHOO
-0.97% , AMGN , AMGEN
-0.71% , EMC , EMC
-0.64% , GWW , WW GRAINGER
-0.60% , PSQ , Short 100% QQQ, PSQ
-0.62% , DOG , Short 100% Dow 30, DOG
-0.89% , AZO , AUTOZONE
-0.58% , MWV , MEADWESTVACO
-0.90% , MSFT , MICROSOFT
-0.31% , WMT , WAL MART STORES
-1.05% , ATI , ALLEGHENY TECH
-0.90% , THC , TENET HEALTHCARE
-0.50% , EZA , South Africa Index, EZA
-0.38% , STI , SUNTRUST BANKS
-0.44% , APC , ANADARKO PETRO
-0.41% , WYN , Wyndham Worldwide
-0.81% , COH , COACH
-0.52% , DD , DU PONT
-0.19% , KO , COCA COLA
-0.52% , TYC , TYCO INTL
-0.79% , IP , INTL PAPER
-0.33% , AIV , APT INV MNGMT
-0.18% , HON , HONEYWELL INTL
-0.63% , PH , PARKER HANNIFIN
-1.74% , VRSN , VeriSign Inc
-0.07% , MJN , Mead Johnson Nutrition
-0.47% , PLD , PROLOGIS TRUST
-0.60% , CMI , CUMMINS
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
2.97% Italy Index, EWI
2.34% Spain Index, EWP
2.24% Netherlands Index, EWN
2.19% Belgium Index, EWK
2.08% China LargeCap Growth G D H USX PS, PGJ
1.86% EMU Europe Index, EZU
1.75% Europe 350 S&P Index, IEV
1.71% Taiwan Index, EWT
1.63% Germany Index, EWG
1.61% European VIPERs, VGK
1.60% Value EAFE MSCI, EFV
1.47% Silver Trust iS, SLV
1.45% Semiconductor iS IGW, SOXX
1.42% Austria Index, EWO
1.37% France Index, EWQ
1.37% Sweden Index, EWD
1.35% Switzerland Index, EWL
1.33% SmallCap Blend EAFE MSCI iS, SCZ
1.31% Financial Services DJ, IYG
1.28% Global 100, IOO
1.28% Foreign LargeCap EAFE MSCI iS, EFA
1.27% Financial SPDR, XLF
1.27% China 25 iS, FXI
1.27% Dividend ex-U.S. DJ iS, IDV
1.21% South Korea Index, EWY
1.18% Emerging 50 BLDRS, ADRE
1.17% Semiconductor SPDR, XSD
1.14% Australia Index, EWA
1.14% Global ex U.S. LargeCap Blend, ACWX
1.10% Growth EAFE MSCI, EFG
1.10% Singapore Index, EWS
1.07% Global LargeCap Blend MSCI iS, ACWI
1.06% Energy & Nat Res iS GS, IGE
1.06% Dividend International, PID
1.05% United Kingdom Index, EWU
1.05% Pacific ex-Japan, EPP
1.05% Financial DJ US, IYF
1.02% Financials VIPERs, VFH
1.02% Mexico Index, EWW
0.98% Capital Markets KWB ST, KCE
0.96% Brazil Index, EWZ
0.95% Energy VIPERs, VDE
0.93% Pacific VIPERs, VPL
0.93% Gold Shares S.T., GLD
0.91% Energy SPDR, XLE
0.90% Energy Global, IXC
0.89% Telecom DJ US, IYZ
0.89% Emerging VIPERs, VWO
0.89% Value LargeCap Dynamic PS, PWV
0.89% Chile MSCI iS, ECH
0.88% Energy DJ, IYE
0.88% Value VIPERs, VTV
0.87% Canada Index, EWC
0.87% Emerging Markets MSCI iS, EEM
0.86% Oil, Crude, U.S. Oil Fund, USO
0.84% Latin Am 40, ILF
0.84% Russia MV, RSX
0.84% LargeCap Value S&P 500 iS, IVE
0.83% LargeCap Value Russell 1000 iS, IWD
0.82% Frontier Markets Guggenheim , FRN
0.82% Japan Index, EWJ
0.80% LargeCap Blend S&P 100, OEF
0.80% S&P 500 SPDRs LargeCap Blend, SPY
0.76% LargeCap Blend S&P 500 iS, IVV
0.70% LargeCap VIPERs, VV
0.70% Health Care SPDR, XLV
0.69% Blend Total Market VIPERs, VTI
0.69% LargeCap Blend Russell 1000 iS, IWB
0.66% Malaysia Index, EWM
0.65% Hong Kong Index, EWH
0.65% India PS, PIN
0.64% LargeCap Growth S&P 500 iS, IVW
0.64% Technology DJ US, IYW
0.63% LargeCap Blend Russell 3000 iS, IWV
0.62% DIAMONDS (DJIA), DIA
0.60% LargeCap Blend S&P=Weight R, RSP
0.60% QQQ Nasdaq 100 Trust, QQQ
0.59% Consumer Staples SPDR, XLP
0.58% Consumer Discretionary SPDR, XLY
0.57% Oil Fund PowerShares, DBO
0.57% Transportation Av DJ, IYT
0.56% Water Resources, PHO
0.55% Growth VIPERs, VUG
0.51% Technology SPDR, XLK
0.51% Dividend Appreciation Vipers, VIG
0.50% Value MidCap Russell, IWS
0.49% Industrial SPDR, XLI
0.48% LargeCap Growth Russell 1000 iS, IWF
0.46% Dividend U.S. DJ iS, DVY
0.46% India Earnings WTree, EPI
0.45% Info Tech VIPERs, VGT
0.45% Dividend SPDR, SDY
0.45% Utilities VIPERs, VPU
0.44% MidCap Russell, IWR
0.44% Materials SPDR, XLB
0.43% Bond Ex-US Treas, BWX
0.43% Utilities SPDR, XLU
0.42% Basic Materials DJ US, IYM
0.36% Commodity Tracking, DBC
0.34% MidCap Value S&P 400 iS, IJJ
0.31% Dividend High Yield Equity PS, PEY
0.30% Turkey MSCI iS, TUR
0.28% SmallCap Value Russell 2000 iS, IWN
0.28% Value SmallCap VIPERS, VBR
0.28% Networking, IGN
0.26% Growth MidCap Russell, IWP
0.24% Real Estate US DJ iS, IYR
0.23% SmallCap Blend Russell 2000 iS, IWM
0.22% Microcap Russell, IWC
0.21% MidCap S&P 400 SPDRs, MDY
0.17% SmallCap Growth S&P 600 iS, IJT
0.17% Bond, High-Yield Junk, JNK
0.17% Bond, High Yield Corp iBoxx iS, HYG
0.16% Financial Preferred, PGF
0.15% Growth SmallCap VIPERs, VBK
0.14% Small Cap VIPERs, VB
0.14% Realty Cohen & Steers, ICF
0.14% SmallCap Blend S&P 600 iS, IJR
0.12% MidCap Blend S&P 400 iS, IJH
0.12% SmallCap Value S&P 600 iS, IJS
0.11% Agriculture DB PS, DBA
0.10% REIT VIPERs, VNQ
0.10% SmallCap Growth Russell 2000 iS, IWO
0.08% Biotech SPDR, XBI
0.05% Preferred Stock iS, PFF
0.05% Bond, Long-Term Corp iBoxx iS, LQD
0.01% REIT Wilshire, RWR
0.00% Bond Treasury Short-Term iS, SHV
-0.01% Bond, Intermediate US Aggregate iS, AGG
-0.01% Bond, 1-3 Year Treasury, SHY
-0.02% MidCap Growth S&P 400 iS, IJK
-0.02% Bond, Emerg Mkt JPM iS, EMB
-0.06% Bond, Muni S&P ATM-Free iS, MUB
-0.07% Metals & Mining SPDR, XME
-0.07% Homebuilders SPDR, XHB
-0.09% Bond, TIPS U.S. Treasury iS, TIP
-0.28% Thailand MSCI iS, THD
-0.28% Bond, 20+ Years Treasury, TLT
-0.29% Bond, 10 Year Treasury, IEF
-0.50% South Africa Index, EZA
-0.72% Bear, Short S&P 500, SH
-0.91% WilderHill Clean Energy PS, PBW
-1.09% Indonesia MV, IDX
