Industrial stock sector ETF Relative Strength Ratio (XLI/SPY) whipsawed back below its 50-day SMA on 3/7/13, thereby turning systematically neutral again.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) remains systematically bullish. Price rose to a new high on 3/7/13, confirming its preexisting uptrend.
The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) whipsawed back above its 50-day SMA on 3/7/13, thereby turning systematically bullish again. Price rose to a new high on 3/7/13, confirming its preexisting uptrend.
Most U.S. major stock price indexes rose for the 5th consecutive trading day on Thursday. The S&P 500 (SPX: 1,544.26) finished up 0.18%, the Nasdaq Composite Index fell 0.30%, the Dow Jones Industrial Average gained 0.23%, but the Dow Jones Transportation Average slumped 0.48%. Breadth was positive again: the number of Advances exceeded the number of Declines by 3 to 2.
Although most major stock price indexes remain in obvious uptrends, many daily price momentum oscillators have been diverging bearishly, under the surface, while price indexes rose to new highs. Momentum oscillators have remained below their 2011-2012 highs and below their highs of late January. For example, RSI(14) based on the S&P 500 Index, now at 65.34, peaked at 74.46 on 1/29/13. MACD(12,26,9), now at 11.54, peaked at 17.88 on 1/29/13. Bearishly diverging momentum is a problem because momentum is a leading indicator of price.
The Art of Contrary Thinking has been calling for questioning overwhelming bullish sentiment. Objective investor sentiment data clearly has demonstrated extremely high degrees of optimism and bullish complacency, matching or exceeding extremes at past market price tops. The pendulum of emotion tends to swing too far in one direction, but the market mood always reverts to the mean–eventually. Sentiment extremes are a leading indicator of price.
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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The S&P 500 Composite Potential Resistance
1576.09, high of 10/11/2007
1552.76, high of 10/31/2007
The S&P 500 Composite Potential Support
1491.69, 50-day SMA
1485.01, low of 2/26/2013
1474.51, high of 9/14/2012
1463.76, low of 1/15/2013
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
1416.55, 200-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
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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Fixed-Income Investments
Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) price whipsawed back down below its 50-day SMA on 3/5/13, thereby turning systematically bearish again. Still, TLT formed a technical base after hitting an “oversold” low at 115.51 on 2/1/13 and successfully testing that low on 2/13/13 and again on 2/20/13. Various technical oscillators showed losses of downside momentum and bullish divergences. Support 115.51, 114.82, 109.69, 106.08, 103.20, 102.27, 96.31, 94.83, 93.14, 89.65, and 88.14. Resistance: 119.67, 120.70, 123.71, 126.08, 127.19, 127.72, 130.69, and 132.22.
Bond, iShares Barclays 7-10 Year U.S. Treasury ETF (IEF) price whipsawed back down below its 50-day SMA on 3/7/13, thereby turning systematically bearish again. IEF formed a technical base after hitting an “oversold” low at 105.56 on 2/1/13 and successfully testing that low 3 times. Various technical oscillators show losses of downside momentum and bullish divergences. Support 105.56, 105.22, 104.77, 103.90, 102.51, 101.77, 101.36, 101.11, 99.79, and 97.66. Resistance: 107.38, 108.07, 108.15, 109.20, 109.32, and 109.89.
Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) whipsawed back up above its 50-day SMA on 3/5/13, thereby turning systematically bullish again. JNK/LQD has been neutral for most of the past 3 years, and it seems doubtful that this long-term trend is changing in any sustainable way. Absolute price of JNK is systematically neutral.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) fell below its 50-day SMA on 2/15/13, thereby turning systematically neutral. Longer term, TIP/IEF has been neutral for most of the past 3 years. Absolute price of TIP peaked at 123.44 on 12/6/12 and is systematically bearish.
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Tangible Assets, Commodities
U.S. dollar ETF (UUP) price rose above its highs 6-months on 3/1/13, after closing above its 200-day SMA on 2/21/13. UUP turned systematically neutral on 2/7/13, when it rose above its 50-day SMA. Longer term, UUP has been consolidating secular trend losses since bottoming at 20.84 on 5/4/11. Support 22.38, 22.15, 21.53, 21.07, and 20.84. Resistance 22.78, 22.96, 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 7 months on 3/6/13, again confirming its major bearish trend. Price turned systematically bearish on 1/11/13 when the 50-day SMA crossed down below the 200-day SMA.
Crude Oil, United States Oil ETF (USO) price fell to its lowest level in 10 weeks on 3/4/13, again confirming a downtrend for the medium term. Longer term, USO has been mostly bearish since peaking at 119.17 on 7/11/08. Support 31.00, 29.02, 26.28, and 22.74. Resistance 33.75, 35.53, 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 8 months on 2/20/13. Price turned systematically bearish on 2/22/13, when the 50-day SMA fell below the 200-day SMA. Longer term, GLD has been mostly bearish since peaking at 185.85 on 9/6/11. Support: 148.27, 147.19, 143.97, 143.42, and 142.55. Resistance: 156.80, 164.40, 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 again on 12/27/12, when the 50-day SMA crossed below the 200-day SMA. Longer term, GDX/GLD has remained mostly bearish for more than 6 years, since 9/5/06.
Silver, iShares Silver Trust ETF (SLV) price fell below its lows of the previous 6 months on 2/20/13. Price turned systematically bearish on 3/1/13, when the 50-day SMA fell below the 200-day SMA. Longer term, SLV has been mostly bearish since peaking at 48.35 on 4/28/11. Support 26.87, 26.13, 25.34, 25.00, 24.44, 22.52, 20.73, and 19.44. Resistance: 28.61, 29.73, 31.41, 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 6 months on 2/28/13. SLV/GLD remains neutral below both its falling 50-day SMA and its falling 200-day SMA.
Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) fell below its lows of the previous 3 months on 3/6/13, again confirming a medium-term downtrend. JJC remains systematically neutral, below the 50-day SMA and 200-day SMA. JJC has been consolidating losses between 38.99 and 51.41 since 10/5/11. Longer term, JJC has been mostly bearish since peaking at 61.69 on 2/14/11. “Dr. Copper” is widely accepted as one of the better indicators of investor confidence (or lack thereof) in the global industrial economy, so price weakness of Copper implies a weak economic outlook.
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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
17.34% , CIEN.O , CIENA
8.95% , RSH , RADIOSHACK
4.81% , LVLT.K , LEVEL 3 COMMUNICATIONS
5.64% , SHLD , SEARS HOLDINGS
4.09% , GPS , GAP
4.94% , AMD , ADV MICRO DEV
2.49% , BA , BOEING
1.09% , PIN , India PS, PIN
0.17% , IXN , Technology Global, IXN
3.03% , KR , KROGER
1.20% , DBA , Agriculture DB PS, DBA
3.42% , THC , TENET HEALTHCARE
2.86% , APA , APACHE
1.85% , CS , Credit Suisse Group, CS
2.69% , KEY , KEYCORP
0.33% , IYW , Technology DJ US, IYW
2.38% , TWX , TIME WARNER INC
3.52% , CECO , CAREER EDUCATION CORP
0.55% , ADRE , Emerging 50 BLDRS, ADRE
1.85% , BHI , BAKER HUGHES
2.73% , CROX , CROCS Inc., CROX
3.31% , FHN , First Horizon National
0.28% , EWU , United Kingdom Index, EWU
2.25% , PRU , PRUDENTIAL FINL
0.21% , IWV , LargeCap Blend Russell 3000, IWV
0.96% , FEZ , Euro STOXX 50, FEZ
3.18% , ININ , Interactive Intelligence ININ
2.81% , ETFC , E*TRADE FINANCIAL
1.20% , PKI , PERKINELMER
0.81% , GPC , GENUINE PARTS
1.90% , PCAR , PACCAR
0.69% , XBI , Biotech SPDR, XBI
1.51% , EWZ , Brazil Index, EWZ
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-7.49% , ROST , Ross Stores Inc
-6.15% , MDP , MEREDITH
-6.57% , PETM , PETsMART Inc
-1.04% , EPU , Peru MSCI iS, EPU
-12.30% , MTG , MGIC INVESTMENT
-3.14% , TDC , Teradata Corporation, TDC
-1.99% , EQR , EQUITY RESIDENT BEN INT
-1.69% , AGN , ALLERGAN
-1.14% , SPG , SIMON PROP GRP
-1.11% , HRB , H&R BLOCK
-1.63% , DGX , QUEST DIAG
-0.65% , ICF , Realty Cohen & Steers, ICF
-2.11% , CSX , CSX
-2.78% , COH , COACH
-0.58% , COST , COSTCO WHOLESAL
-2.33% , VLO , VALERO ENERGY
-0.95% , CHKP , Check Point Software Technologies Ltd
-1.36% , NSC , NORFOLK SOUTHERN
-0.61% , URBN , Urban Outfitters Inc.
-1.13% , TUP , TUPPERWARE
-0.73% , CLX , CLOROX
-0.33% , LQD , Bond, Corp, LQD
-0.91% , AMAT , APPLIED MATERIAL
-0.47% , VRSN , VeriSign Inc
-0.77% , TLT , Bond, 20+ Years Treasury, TLT
-0.50% , CAH , CARDINAL HEALTH
-0.45% , XLU , Utilities SPDR, XLU
-0.41% , LAMR , Lamar Advertising Company
-1.44% , EMC , EMC
-0.46% , IYT , Transportation Av DJ, IYT
-0.08% , AON , AON
-0.21% , PJP , Pharmaceuticals, PJP
-0.15% , GVI , Bond Interm U.S. Gov, GVI
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
1.54% Networking, IGN
1.53% India Earnings WTree, EPI
1.51% Brazil Index, EWZ
1.27% Sweden Index, EWD
1.26% France Index, EWQ
1.23% Oil, Crude, U.S. Oil Fund, USO
1.20% Agriculture DB PS, DBA
1.18% Belgium Index, EWK
1.12% Italy Index, EWI
1.10% EMU Europe Index, EZU
1.10% Austria Index, EWO
1.09% India PS, PIN
1.05% Spain Index, EWP
1.03% Oil Fund PowerShares, DBO
0.93% Financial Services DJ, IYG
0.91% Germany Index, EWG
0.87% Netherlands Index, EWN
0.82% Latin Am 40, ILF
0.79% Semiconductor SPDR, XSD
0.78% European VIPERs, VGK
0.76% Switzerland Index, EWL
0.72% Financial SPDR, XLF
0.70% Hong Kong Index, EWH
0.69% Biotech SPDR, XBI
0.67% Europe 350 S&P Index, IEV
0.67% Commodity Tracking, DBC
0.63% Capital Markets KWB ST, KCE
0.61% Financial DJ US, IYF
0.61% Microcap Russell, IWC
0.59% Financials VIPERs, VFH
0.58% Energy & Nat Res iS GS, IGE
0.55% Energy Global, IXC
0.55% Emerging 50 BLDRS, ADRE
0.55% SmallCap Value S&P 600 iS, IJS
0.52% Energy DJ, IYE
0.51% Energy SPDR, XLE
0.49% Metals & Mining SPDR, XME
0.48% SmallCap Blend S&P 600 iS, IJR
0.48% SmallCap Blend Russell 2000 iS, IWM
0.47% SmallCap Value Russell 2000 iS, IWN
0.47% Growth SmallCap VIPERs, VBK
0.47% Energy VIPERs, VDE
0.46% MidCap Value S&P 400 iS, IJJ
0.46% Dividend ex-U.S. DJ iS, IDV
0.46% Semiconductor iS IGW, SOXX
0.45% SmallCap Growth Russell 2000 iS, IWO
0.43% Info Tech VIPERs, VGT
0.43% Growth EAFE MSCI, EFG
0.42% SmallCap Growth S&P 600 iS, IJT
0.42% Telecom DJ US, IYZ
0.41% Value SmallCap VIPERS, VBR
0.41% Malaysia Index, EWM
0.40% Pacific ex-Japan, EPP
0.38% Value LargeCap Dynamic PS, PWV
0.37% Small Cap VIPERs, VB
0.37% Singapore Index, EWS
0.33% MidCap Blend S&P 400 iS, IJH
0.33% Australia Index, EWA
0.33% Technology DJ US, IYW
0.32% Value MidCap Russell, IWS
0.30% Global ex U.S. LargeCap Blend, ACWX
0.30% Taiwan Index, EWT
0.29% Bond Ex-US Treas, BWX
0.29% LargeCap Blend S&P=Weight R, RSP
0.29% Foreign LargeCap EAFE MSCI iS, EFA
0.28% Canada Index, EWC
0.28% Materials SPDR, XLB
0.28% Global LargeCap Blend MSCI iS, ACWI
0.28% United Kingdom Index, EWU
0.28% Emerging Markets MSCI iS, EEM
0.27% Thailand MSCI iS, THD
0.26% China LargeCap Growth G D H USX PS, PGJ
0.26% QQQ Nasdaq 100 Trust, QQQ
0.26% Value EAFE MSCI, EFV
0.25% Emerging VIPERs, VWO
0.25% MidCap S&P 400 SPDRs, MDY
0.25% MidCap Russell, IWR
0.25% Value VIPERs, VTV
0.24% LargeCap Blend S&P 100, OEF
0.24% Blend Total Market VIPERs, VTI
0.24% Global 100, IOO
0.23% Technology SPDR, XLK
0.23% Basic Materials DJ US, IYM
0.23% LargeCap VIPERs, VV
0.22% LargeCap Value Russell 1000 iS, IWD
0.22% Financial Preferred, PGF
0.21% DIAMONDS (DJIA), DIA
0.21% LargeCap Blend Russell 3000 iS, IWV
0.21% LargeCap Value S&P 500 iS, IVE
0.20% Growth VIPERs, VUG
0.19% LargeCap Blend Russell 1000 iS, IWB
0.18% China 25 iS, FXI
0.18% Dividend International, PID
0.18% S&P 500 SPDRs LargeCap Blend, SPY
0.17% LargeCap Blend S&P 500 iS, IVV
0.17% Consumer Discretionary SPDR, XLY
0.16% Frontier Markets Guggenheim , FRN
0.15% Bond, High Yield Corp iBoxx iS, HYG
0.14% LargeCap Growth Russell 1000 iS, IWF
0.14% LargeCap Growth S&P 500 iS, IVW
0.13% Growth MidCap Russell, IWP
0.12% MidCap Growth S&P 400 iS, IJK
0.09% Indonesia MV, IDX
0.09% Bond, High-Yield Junk, JNK
0.08% Dividend SPDR, SDY
0.07% Industrial SPDR, XLI
0.06% Dividend Appreciation Vipers, VIG
0.02% Preferred Stock iS, PFF
0.00% WilderHill Clean Energy PS, PBW
0.00% Dividend High Yield Equity PS, PEY
0.00% Consumer Staples SPDR, XLP
0.00% Chile MSCI iS, ECH
0.00% Bond Treasury Short-Term iS, SHV
-0.02% SmallCap Blend EAFE MSCI iS, SCZ
-0.02% Bond, 1-3 Year Treasury, SHY
-0.07% Health Care SPDR, XLV
-0.10% Russia MV, RSX
-0.15% Dividend U.S. DJ iS, DVY
-0.15% Turkey MSCI iS, TUR
-0.19% Bear, Short S&P 500, SH
-0.20% Homebuilders SPDR, XHB
-0.21% Bond, Intermediate US Aggregate iS, AGG
-0.22% Water Resources, PHO
-0.26% Pacific VIPERs, VPL
-0.29% Mexico Index, EWW
-0.32% Utilities VIPERs, VPU
-0.33% Bond, Long-Term Corp iBoxx iS, LQD
-0.35% Gold Shares S.T., GLD
-0.35% Bond, Emerging Mkt JPM iS, EMB
-0.36% Real Estate US DJ iS, IYR
-0.37% Bond, TIPS U.S. Treasury iS, TIP
-0.38% Bond, 10 Year Treasury, IEF
-0.40% Bond, Muni S&P ATM-Free iS, MUB
-0.45% Utilities SPDR, XLU
-0.46% Transportation Av DJ, IYT
-0.47% South Korea Index, EWY
-0.47% REIT VIPERs, VNQ
-0.58% REIT Wilshire, RWR
-0.65% Realty Cohen & Steers, ICF
-0.68% Silver Trust iS, SLV
-0.76% South Africa Index, EZA
-0.77% Bond, 20+ Years Treasury, TLT
-0.96% Japan Index, EWJ
