U.S. Treasury Bond futures broke out above the highs of the previous 7 months, reconfirming a significant uptrend.
S&P 500 Composite (SPX, 1,267.64) rose 2.22 points or 0.18% on 6/16/11. Volume fell slightly on the NYSE, denying confirmation of the modest price upturn. Small counter trend fluctuations do not change the intermediate-term downtrend.
NASDAQ 100 Index, futures, and ETF (QQQ) absolute prices closed below 6-month lows and 200-day SMAs.
Industrial SPDR stock sector ETF absolute price broke down below 6-month lows.
Technology SPDR stock sector ETF Relative Strength Ratio (XLK/SPY) fell below 24-month lows Absolute price broke down below 6-month lows.
Emerging Markets Stocks ETF (EEM) absolute price broke down below 12-week lows.
Foreign Stocks ETF (EFA) absolute price broke down below 12-week lows.
Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) fell further below 27-month lows.
Junk/Investment-Grade Corporate Bonds Relative Strength Ratio (JNK/LQD) broke further below 9-month lows.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) fell below the lows of the previous 6 months.
John Paulson’s $9 billion Advantage Plus hedge fund is down 19.65% in 2011, according to wsj.com. There is a strategy that gained in May and June, while most other strategies lost; see:
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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
0.52% , UTH , Utilities H, UTH
0.55% , FDL , Dividend Leaders, FDL
4.53% , KR , KROGER
2.95% , GR , GOODRICH CORP
0.35% , RFV , Value MidCap S&P 400, RFV
0.57% , PPA , Aerospace & Defense, PPA
3.51% , SWY , SAFEWAY
1.65% , MDP , MEREDITH
2.82% , KMX , CarMax
0.09% , FEZ , Euro STOXX 50, FEZ
1.62% , PGN , PROGRESS ENERGY
3.56% , OMX , OFFICEMAX INC., OMX
0.21% , PIV , Value Line Timeliness MidCap Gr, PIV
3.96% , SHLD , SEARS HOLDINGS
2.66% , CAG , CONAGRA FOODS
0.32% , IOO , Global 100, IOO
1.95% , FAST , Fastenal Company
2.35% , WHR , WHIRLPOOL
3.15% , THC , TENET HEALTHCARE
2.12% , HSY , HERSHEY FOODS
2.36% , COF , CAPITAL ONE FNCL
1.05% , EXPD , Expeditors International WA
2.58% , LOW , LOWES
0.47% , IJS , Value SmallCap S&P 600 B, IJS
1.40% , MDT , MEDTRONIC
2.07% , LEN , Lennar Corp. (LEN)
1.42% , SNV , SYNOVUS
1.34% , GCI , GANNETT
1.58% , DUK , DUKE ENERGY
1.40% , DGX , QUEST DIAG
0.62% , NCR , NCR
1.30% , UTX , UNITED TECH
1.47% , IR , INGER RAND
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-0.89% , FPX , IPOs, First Tr IPOX-100, FPX
-1.87% , JNK , Bond, High-Yield Junk, JNK
-4.13% , AMD , ADV MICRO DEV
-1.10% , HHH , Internet H, HHH
-1.78% , HYG , Bond High-Yield Corporate, HYG
-1.15% , ADRA , Asia 50 BLDRS, ADRA
-2.90% , SNI , Scripps Networks Interactive
-0.42% , JKK , Growth SmallCap iS M, JKK
-2.09% , PSI , Semiconductors, PSI
-4.82% , MCO , MOODYS CORP
-0.79% , SWH , Software H, SWH
-0.52% , PSJ , Software, PSJ
-4.69% , CIEN.O , CIENA
-0.41% , EIS , Israel MSCI iS, EIS
-2.73% , FLEX , Flextronics International Ltd
-2.05% , HANS , Hansen Natural, HANS
-0.67% , MTK , Technology MS sT, MTK
-3.76% , STLD , Steel Dynamics, STLD
-1.76% , XME , Metals & Mining SPDR, XME
-1.83% , BDH , Broadband H, BDH
-1.66% , EMC , EMC
-1.12% , PGF , Financial Preferred, PGF
-2.93% , KLAC , KLA TENCOR
-2.99% , TEVA , Teva Pharmaceutical Industries Limited
-0.67% , ITF , Japan LargeCap Blend TOPIX 150, ITF
-0.77% , EZA , South Africa Index, EZA
-1.89% , PMCS , PMC SIERRA
-1.04% , ADRE , Emerging 50 BLDRS, ADRE
-1.92% , MON , MONSANTO
-0.53% , TMW , Wilshire 5000 ST TM, TMW
-1.53% , URBN , Urban Outfitters Inc.
-0.42% , RFG , Growth MidCap S&P 400, RFG
-1.59% , LRCX , LAM RESEARCH CORP
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9 major U.S. stock sectors ranked in order of long-term relative strength — Now available by subscription:
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Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) has been trading with a bearish bias since peaking on 10/14/10. The Ratio remains below the 200-day SMA, is below the 50-day SMA, and the 50-day SMA remains below the 200-day SMA. Absolute price broke down below 12-week lows on 6/16/11.
Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) has been trading with a bearish bias since peaking on 11/27/07. The Ratio remains below the 200-day SMA, is below the 50-day SMA, and the 50-day SMA remains below the 200-day SMA. Absolute price broke down below 12-week lows on 6/16/11.
NASDAQ Composite/S&P 500 Relative Strength Ratio entered a downside correction since peaking on 1/18/11 and fell below 12-week lows on 6/16/11. Absolute price closed below its 12-week closing price lows and its 200-day SMA on 6/16/11.
The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) fell further below 28-year lows on 5/26/11, again reconfirming its preexisting bearish major trend. Absolute price closed below its 12-week lows and its 200-day SMA on 6/15/11.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) broke down further below 4-month lows on 6/13/11 and has been in a downside correction since 4/5/11.
The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) fell below 13-week lows on 6/13/11. Price also fell below 13-week lows.
Crude Oil nearest futures contract price closed slightly higher on 6/16/11, but that does not change the short-term downtrend. Oil broke down below the lows of the past 4 months on 6/15/11, signaling a significant downtrend. Recent data from the Commodity Futures Trading Commission showed hedge-fund and other money managers increased net long positions in Oil–which could prove to be bearish when this hot money rushes for the exits. On 5/3/11, when Crude Oil was 111.56, I wrote, “Crude Oil nearest futures contract price fell below the lows of the previous 7 trading days on 5/3/11, suggesting a short-term price pullback.” Support 94.63, 87.09, 83.85, 83.55, 80.28, 80.06, 79.84, 79.25, 78.86, 73.52, 72.63, 70.76, 70.35, 69.51, 68.59, 67.15, 65.05, and 64.24. Resistance 103.39, 104.60, 105.16, 114.83, 115.27, 120.42, 130.0, and 147.27.
Gold nearest futures contract price closed slightly higher on 6/16/11, but that does not change the short-term downtrend. Gold broke down below 2-week lows on 6/13/11, confirming a short-term downtrend. On 6/9/11, when Gold was 1542.7, I noted that the Gold “price appears to have stalled out since 6/6/11. Gold’s 5-week countertrend bounce might be weakening. Reward/Risk does not appear attractive. It seems possible that Gold has finally topped out at 1577.4 after rising 132% from 681 in October, 2008.” Support: 1462.5, 1445.0, 1411.5, 1380.7, 1419.5, 1351.4, 1309.1, 1307.7, 1297.0, 1274.8, 1270.5, 1232.4, 1210.9, 1191.5, and 1155.6. Resistance: 1577.4.
Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) fell further below 27-month lows on 6/16/11. The Ratio has been falling steeply since 4/8/11 and remains bearish.
Silver nearest futures contract price closed slightly higher on 6/16/11, but that does not change the short-term downtrend. Silver broke down below 3-week lows on 6/13/11, reconfirming a downside correction. Silver fell 35% from 49.82 on 4/25/11 to 32.3 on 5/12/11, breaking down below 10-week lows. On 5/2/11, when Silver was 46.084, I wrote, “Silver nearest futures contract price broke sharply below the lows of the previous 2 weeks. The short-term price trend has turned down. If this downtrend continues, it could have implications for inflation expectations.” Support 32.3, 31.695, 31.61, 30.265, 29.635, 26.30, 24.98, and 22.84. Resistance: 38.845, 39.38, 39.47, 49.82, 49.845 and 50.35.
Silver/Gold Ratio entered a steep downtrend since the peak on 4/28/11. Although the Ratio has stabilized somewhat since making a low on 5/16/11, it probably remains bearish.
Copper nearest futures contract price has been trading choppy/sideways for the past few weeks. Longer term, Copper broke down below previous 5-month lows on 5/12/11, confirming an intermediate-term correction, if not a bear market. Weakness in Copper suggests doubts about the economic outlook. Support 3.9505, 3.8535, 3.846, 3.6065, 3.3930, 3.1775, 2.9285, 2.8555, 2.8445, and 2.72. Resistance: 4.2125, 4.402, 4.533, 4.554, 4.6495, 4.6535, and 4.6575.
U.S. Treasury Bond nearest futures contract price broke out above the highs of the previous 7 months on 6/16/11, reconfirming a significant uptrend. In its favor, nearly everyone has been talking bearish on Bonds this year, so the Bond is rising up off an extreme oversold condition. Support 123.23, 123.18, 120.20, 119.15, 117.28, 117.04, 116.26, 115.15, 114.06, 113.04, and 112.15. Resistance 127.19, 128.00 129.14, 129.27, 132.26, 133.00, 135.12, 135.19, 136.31, 137.31, and 142.31.
Junk/Investment-Grade Corporate Bonds Relative Strength Ratio (JNK/LQD) broke further below 9-month lows on 6/16/11. Absolute price of JNK also broke down below 9-month lows on 6/16/11. Both confirm a bearish trend for JNK.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) fell below the lows of the previous 6 months on 6/16/11, again reconfirming a significant downtrend. TIP/IEF entered a downtrend after peaking on 4/8/11. This downtrend means that fixed-income investors prefer the unprotected 7-10 Year U.S. Treasury Note ETF (IEF) over the inflation-protected TIPs. Inflation expectations are still waning.
The U.S. dollar nearest futures contract price jumped sharply higher, closing above the highs of the past 2 weeks on 6/15/11. This is a bullish indication for the short-term trend. In addition, the larger trend of the USD has been firming since making the low at 73.325 on 5/2/11. Support 73.88, 73.515, 73.325, 72.86, and 70.80. Resistance 76.54, 76.87, 77.675, 78.98, 79.34, 81.635, 81.935, 82.02, 83.64, 84.73, 85.36, 86.71, 88.80, 89.22, 89.71, and 92.53.
Advisory Service Sentiment: There were 37% Bulls versus 26% Bears as of 6/15/11, according to the weekly Investors Intelligence survey of stock market newsletter advisors. This is near normal, since the Ratio’s 20-year range is 0.41 to 3.74, the median is 1.56, and the mean is 1.64. Note that Advisory Service Sentiment as of 4/6/11 rose to 3.65, its highest level in the 8 years since the 20-year high of 3.74 set on 6/18/03. The market has been working off that excess by correcting to the downside.
VIX Fear Index rose above 3-month highs to 22.73 on 6/16/11, indicating a relatively modest uptick in fear. For comparison, there was a brief spike up to an intraday peak of 31.28 on 3/16/11. 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 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.
As of the close on June 6, 2011, the Dow Theory confirmed a Secondary Reaction (a significant downside correction) for the general stock market, as the Dow Industrials and Transports both closed below 10-week lows. Previously, as of June 1, 2011, the Dow Theory gave a warning of a significant downside correction for the general stock market, as the Dow Industrials and Transports both closed below 5-week lows.
On 5/2/11, when the S&P 500 Composite (SPX) was 1,358.59, I warned, “The majority of major stock price indexes opened higher on gaps but reversed to close with losses on the day. This may signal exhaustion of the short-term uptrend. Sentiment indicators have been suggesting that the stock market may be over loved and overbought. And in view of the sharp reversals in the metal commodities, the so-called “inflation trade”, when speculators buy stocks and sell fixed-income instruments based on expectations of rising price levels for goods and services, may be on thin ice.”
Based on the daily SPX, momentum indicators gave bearish divergence warnings in April; that is, they never made it back to their February peaks when the price indexes rose to higher highs. These bearish divergence warnings are still in effect.
S&P 500 Composite (SPX, 1,267.64) rose 2.22 points or 0.18% on 6/16/11. Volume fell slightly on the NYSE, denying confirmation of the modest price upturn. Small counter trend fluctuations do not change the intermediate-term 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
1370.50, high of 5/2/11
1359.44, high of 5/10/11
1346.82, high of 5/19/11
1294.70, low of 4/18/11
S&P 500 Cash Index Potential Support
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
1232.85, low of 12/16/10
1228.74, Fibonacci 61.8% of 2007-2009 range
1227.08, high of 11/5/10
1173.00, low of 11/16/10
1171.70, low of 10/27/10
1166.74, low of 10/20/10
1159.71, low of 10/19/10
1,151.41, low of 10/7/10
1,131.87, low of 10/4/10
1122.79, low of 9/23/2010
1114.63, low of 9/15/2010
1110.88, low of 9/10/2010
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
One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
0.82% Realty Cohen & Steers, ICF
0.81% Consumer Staples SPDR, XLP
0.79% Utilities VIPERs, VPU
0.79% Utilities SPDR, XLU
0.79% REIT VIPERs, VNQ
0.76% REIT Wilshire, RWR
0.70% Real Estate US DJ, IYR
0.60% Microcap Russell, IWC
0.59% Dividend SPDR, SDY
0.57% Dividend Appreciation Vipers, VIG
0.55% Homebuilders SPDR, XHB
0.55% DIAMONDS (DJIA), DIA
0.54% Financial SPDR, XLF
0.50% Financials VIPERs, VFH
0.49% Dividend DJ Select, DVY
0.47% Value SmallCap Russell 2000, IWN
0.47% Value SmallCap S&P 600 B, IJS
0.46% Financial DJ US, IYF
0.45% Bond, 20+ Years Treasury, TLT
0.43% Value S&P 500 B, IVE
0.41% Bond Muni ATM-Free S&P iS, MUB
0.39% Value VIPERs, VTV
0.35% Industrial SPDR, XLI
0.35% Dividend High Yield Equity PS, PEY
0.34% Financial Services DJ, IYG
0.33% SmallCap S&P 600, IJR
0.32% Global 100, IOO
0.30% LargeCap Blend S&P 100, OEF
0.28% Bond, 10 Year Treasury, IEF
0.27% Value 1000 Russell, IWD
0.24% Bond Ex-US Treas, BWX
0.23% SmallCap Russell 2000, IWM
0.22% Value LargeCap Dynamic PS, PWV
0.22% S&P 500 SPDRs LargeCap Blend, SPY
0.19% Value SmallCap VIPERS, VBR
0.18% S&P 500 iS LargeCap Blend, IVV
0.17% Value MidCap S&P 400 B, IJJ
0.17% Health Care SPDR, XLV
0.17% Blend Total Market VIPERs, VTI
0.16% LargeCap 1000 R, IWB
0.15% Energy SPDR, XLE
0.15% Energy DJ, IYE
0.13% Malaysia Index, EWM
0.12% LargeCap VIPERs, VV
0.12% Growth BARRA Small Cap 600, IJT
0.11% Energy VIPERs, VDE
0.11% LargeCap Blend Russell 3000, IWV
0.07% Value MidCap Russell, IWS
0.07% Bond, Aggregate, AGG
0.05% Small Cap VIPERs, VB
0.03% Capital Markets KWB ST, KCE
0.02% Thailand MSCI iS, THD
0.01% Bond, 1-3 Year Treasury, SHY
0.01% Bond Treasury Short-Term iS, SHV
0.00% LargeCap Blend S&P=Weight R, RSP
0.00% Growth 1000 Russell, IWF
-0.01% Transportation Av DJ, IYT
-0.03% Spain Index, EWP
-0.04% Telecom DJ US, IYZ
-0.05% Europe 350 S&P Index, IEV
-0.05% Energy Global, IXC
-0.05% MidCap S&P 400 iS, IJH
-0.06% Italy Index, EWI
-0.06% Growth S&P 500/BARRA, IVW
-0.07% Bond, TIPS, TIP
-0.09% Growth SmallCap VIPERs, VBK
-0.09% India PS, PIN
-0.09% Growth SmallCap R 2000, IWO
-0.10% Gold Shares S.T., GLD
-0.11% EMU Europe Index, EZU
-0.14% MidCap S&P 400 SPDRs, MDY
-0.14% Biotech SPDR, XBI
-0.14% MidCap Russell, IWR
-0.15% Germany Index, EWG
-0.16% Growth VIPERs, VUG
-0.16% Water Resources, PHO
-0.18% Value EAFE MSCI, EFV
-0.19% Switzerland Index, EWL
-0.19% Bond, Corp, LQD
-0.24% Consumer Discretionary SPDR, XLY
-0.24% Technology SPDR, XLK
-0.25% Oil Fund PowerShares, DBO
-0.27% France Index, EWQ
-0.27% Turkey MSCI iS, TUR
-0.30% European VIPERs, VGK
-0.31% Growth MidCap 400 B, IJK
-0.34% EAFE Index, EFA
-0.35% Japan Index, EWJ
-0.36% Growth MidCap Russell, IWP
-0.37% Global ex US ACWI iS, ACWX
-0.39% QQQ Nasdaq 100 Trust, QQQ
-0.40% Technology DJ US, IYW
-0.41% Commodity Tracking, DBC
-0.43% Oil, Crude, U.S. Oil Fund, USO
-0.44% India Earnings WTree, EPI
-0.46% Agriculture DB PS, DBA
-0.47% Netherlands Index, EWN
-0.48% Growth EAFE MSCI, EFG
-0.50% Energy & Nat Res iS GS, IGE
-0.52% Pacific VIPERs, VPL
-0.58% Belgium Index, EWK
-0.58% Russia MV, RSX
-0.58% Sweden Index, EWD
-0.60% Bond EmrgMkt JPM iS, EMB
-0.60% Info Tech VIPERs, VGT
-0.61% China 25 iS, FXI
-0.66% Silver Trust iS, SLV
-0.69% Mexico Index, EWW
-0.70% Dividend International, PID
-0.71% Hong Kong Index, EWH
-0.76% Emerging Markets, EEM
-0.77% South Africa Index, EZA
-0.79% Emerging VIPERs, VWO
-0.81% Austria Index, EWO
-0.83% Small Cap EAFE MSCI iS, SCZ
-0.88% South Korea Index, EWY
-0.89% Singapore Index, EWS
-0.91% Pacific ex-Japan, EPP
-0.91% Australia Index, EWA
-0.94% Chile MSCI iS, ECH
-0.94% Preferred Stock iS, PFF
-0.97% United Kingdom Index, EWU
-0.98% Materials SPDR, XLB
-1.04% Emerging 50 BLDRS, ADRE
-1.06% Taiwan Index, EWT
-1.08% Canada Index, EWC
-1.12% Financial Preferred, PGF
-1.14% Networking, IGN
-1.14% Frontier Markets Guggenheim , FRN
-1.15% Semiconductor iS IGW, SOXX
-1.22% Basic Materials DJ US, IYM
-1.22% Latin Am 40, ILF
-1.23% Brazil Index, EWZ
-1.34% China LargeCap Growth G D H USX PS, PGJ
-1.40% WilderHill Clean Energy PS, PBW
-1.60% Indonesia MV, IDX
-1.68% Semiconductor SPDR, XSD
-1.76% Metals & Mining SPDR, XME
-1.78% Bond, High-Yield Corporate, HYG
-1.87% Bond, High-Yield Junk, JNK
-2.02% Silver Miners Global X, SIL
