Industrial Stock Sector Relative Strength Ratio (XLI/SPY) broke down below its lows of the previous 2-years on 9/5/12, thereby confirming its preexisting major downtrend. XLI/SPY fell below its 50-day SMA on 8/27/12, thereby turning systematically bearish again.

The Dow-Jones Transportation Average absolute price closed below its lows of the previous 6 weeks on 9/5/12, thereby diverging bearishly against the Dow-Jones Industrial Average, which closed above its lows of the previous 6 weeks. The Transports fell below 50- and 200-day SMAs on 8/27/12, thereby turning systematically bearish again.

Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) fell below its lows of the previous 3 years on 9/5/12, reconfirming its preexisting bearish trend.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEF/SPY) whipsawed back above its 50-day SMA on 9/5/12, thereby turning systematically bullish again. Large Caps tend to outperform in bearish general market trends as investors seek the perceived relative safety of large size.

Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) closed slightly below its 50-day SMA on 9/5/12 turning systematically neutral again, strictly speaking.

The S&P 500 (SPX: 1,403.44) fell 1.50 points or 0.11% on Wednesday.

NYSE volume fell 13% and was 27% below its 200-day SMA. Volume fell to its lowest levels in 13 years in August, reflecting diminishing enthusiasm for stocks. NYSE Volume 50-day SMA and 200-day SMA fell to their lowest levels in 13 years, and both are trending down.

MACD and other price momentum indicators have rolled over and given sell signals.

On-Balance Volume for the SPX remains in a downtrend with bearish divergence.

NYSE Cumulative Volume of Advancing Stocks minus Volume of Declining Stocks remains weak relative to price: it recovered only a little more than 61.8% of its March-June loss while the S&P 500 recovered 100%. Clearly, volume has not been confirming the price up move.

It takes volume to push prices up. After the shorts have been forced to cover and the longs have had their fill of buying, in the absence of a fresh source of demand, stocks fall of their own weight.

While the S&P 500 Composite Price Index recovered nearly all of its April-June loss, both the percentage of these same 500 stocks that were above their 200-day SMAs and the percentage in bullish Point-and-Figure Chart uptrends recovered much less of their losses. Both indicators failed to confirm the strength in the S&P 500. Both are diverging bearishly. The percentage of these 500 stocks that are above their 50-day SMAs and the percentage above their 200-day SMAs both broke below 4-week lows on Thursday, 8/30/12.

With the stock price indexes far above their 4-year lows and still very close to the top end of their 4-year price range, downside risk may exceed upside potential for the stock market. Choosing safety over risk 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 5 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 Averages gave an early warning by diverging after 2/3/12, as the Transports turned corrective and failed to confirm higher highs by the Industrials. Again on 5/1/12, the Industrials rose to a higher closing price high while the Transports failed to rise to a higher closing price high, thereby indicating a non-confirmation and bearish divergence. On 8/17/12, the Industrials closely approached their highs of the year, but the Transports continued to lag well below their highs, thereby demonstrating a bearish divergence. The Transports fell below 50- and 200-day SMAs on 8/27/12, thereby turning systematically bearish again. The Dow-Jones Industrial, Transportation, Utility, and Composite Averages all broke down below 4-week lows on Thursday, 8/30/12. The Dow-Jones Transportation Average closed below its lows of the previous 6 weeks on 9/5/12, thereby diverging bearishly against the Dow-Jones Industrial Average, which closed above its lows of the previous 6 weeks.

NASDAQ 100/S&P 500 Relative Strength Ratio (QQQ/SPY) rose above its 50-day SMA on 8/6/12, thereby turning systematically bullish again. QQQ/SPY remains above its 200-day SMA, and its 50-day SMA has been above its 200-day SMA since 8/5/11.

iShares MSCI BRIC Fund (BKF) Relative Strength Ratio (BKF/SPY) fell below its lows of the previous 3 years on 9/4/12, reconfirming its bearish trend. Short term, BKF/SPY turned systematically bearish again on 8/14/12, when it fell below 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) fell below its lows of the previous 3 years on 9/5/12, reconfirming its preexisting bearish trend. EEM/SPY turned systematically bearish again on 8/17/12, when it fell below 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) reconfirmed a bearish major trend when it fell below its lows of the previous 9 years on 7/24/12. EFA/SPY whipsawed back down below its 50-day SMA on 9/4/12, thereby turning systematically bearish again. 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.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEF/SPY) whipsawed back above its 50-day SMA on 9/5/12, thereby turning systematically bullish again. 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) rose above its 50-day SMA on 9/4/12, thereby turning systematically neutral. IWM/SPY remains below its 200-day SMA, 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) MDY/SPY whipsawed back above its 50-day SMA on 8/28/12, thereby turning systematically neutral 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
1440.24, high of 5/19/2008
1426.68, high of 8/21/2012
1422.38, high of 4/2/2012
1418.71, high of 8/17/2012
1415.32, high of 5/1/2012

The S&P 500 Composite Potential Support
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
1379.72, 50-day SMA
1370.58, high of 5/2/2011
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
1339.79, 200-day SMA
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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Fixed-Income Investments

Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) closed slightly below its 50-day SMA on 9/5/12 turning systematically neutral again, strictly speaking. TLT remains above its 200-day SMA, and its 50-day SMA has remained above its 200-day SMA every day since 6/24/11. TLT rose to a new high on 7/24/12, thereby confirming its preexisting major uptrend. Support 124.95, 120.52, 117.44, 115.69, 114.82, 109.69, 106.08, 103.20, 102.27, 96.31, 94.83, 93.14, 89.65, and 88.14. Resistance: 130.69 and 132.22.

Bond, iShares Barclays 7-10 Year U.S. Treasury ETF (IEF) rose above its 50-day SMA on 8/31/12 turning systematically bullish again. IEF remains above its 200-day SMA, and its 50-day SMA has remained above its 200-day SMA every day since 6/21/11. IEF rose to a new high on 7/24/12, thereby confirming its preexisting major uptrend. Support 107.92, 106.42, 105.84, 105.22, 104.77, 103.90, 102.51, 101.77, 101.36, 101.11, 99.79, and 97.66. Resistance: 109.32 and 109.89.

Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) whipsawed back down below its 50-day SMA on 9/4/12, thereby turning systematically bearish again. JNK/LQD remains below its 200-day SMA, and its 50-day SMA fell below its 200-day SMA on 6/1/12.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) whipsawed back up above its 50-day SMA on 9/4/12, thereby turning systematically neutral. TIP/IEF remains below its 200-day SMA, and its 50-day SMA crossed below its 200-day SMA on 6/27/12.
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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
19.25% , ODP , OFFICE DEPOT
4.30% , SWY , SAFEWAY
3.21% , MJN , Mead Johnson Nutrition
3.13% , S , SPRINT NEXTEL
3.32% , GS , GOLDMAN SACHS
2.28% , DIS , WALT DISNEY
0.66% , EWG , Germany Index, EWG
2.14% , PTEN , Patterson-UTI Energy Inc
5.06% , CTB , COOPER TIRE
5.95% , SEE , SEALED AIR
3.16% , KMX , CarMax
2.18% , TWX , TIME WARNER INC
1.98% , HIG , HARTFORD FINL
1.04% , MTB , M&T BANK
2.21% , SPLS , STAPLES
7.51% , RSH , RADIOSHACK
0.14% , JKF , Value LargeCap iS M, JKF
3.47% , GT , GOODYEAR TIRE
2.62% , ADBE , ADOBE SYS
1.66% , MCK , MCKESSON CORP
1.24% , PWER , POWER ONE
2.64% , AM , AMER GREETINGS STK A
1.81% , JCP , JC PENNEY
2.33% , SNV , SYNOVUS
1.64% , MU.O , MICRON TECH
0.98% , KR , KROGER
2.11% , PHM , PULTE HOMES
0.22% , PWO , OTC Dynamic PS, PWO
1.15% , LLY , ELI LILLY
0.36% , RYAAY , Ryanair Holdings plc
1.40% , BCR , C R BARD
5.21% , DV , DeVry, Inc.
2.03% , BSX , BOSTON SCIENT

Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-0.66% , ITF , Japan LargeCap Blend TOPIX 150, ITF
-0.57% , COF , CAPITAL ONE FNCL
-3.57% , AMD , ADV MICRO DEV
-1.99% , FDX , FEDEX
-3.20% , RIG , TRANSOCEAN
-0.32% , PWB , Lg Cap Growth PSD, PWB
-0.79% , PBE , Biotech & Genome, PBE
-2.39% , UPS , UNITED PARCEL STK B
-1.78% , DLTR , Dollar Tree Stores Inc
-0.13% , IXN , Technology Global, IXN
-4.20% , MAS , MASCO
-0.28% , JKE , Growth LargeCap iS M, JKE
-0.87% , XSD , Semiconductor SPDR, XSD
-0.23% , RPG , Growth S&P 500, RPG
-1.49% , DOV , DOVER
-1.06% , CBS , CBS CORP.
-1.04% , IYT , Transportation Av DJ, IYT
-1.14% , CPWR , COMPUWARE
-2.42% , AXP , AMERICAN EXPRESS
-2.21% , BC , BRUNSWICK
-1.30% , KSU , Kansas City Southern, KSU
-2.38% , COP , CONOCOPHILLIPS
-1.79% , CAH , CARDINAL HEALTH
-1.63% , FE , FIRSTENERGY
-1.55% , ABC , AMERISOURCEBERGN
-0.82% , MBI , MBIA
-1.18% , XLNX , XILINX
-0.13% , FEU , Value LargeCap Euro STOXX 50 DJ, FEU
-1.76% , WPO , Washington Post
-0.60% , EWP , Spain Index, EWP
-1.22% , QLGC , QLOGIC
-2.48% , UNP , UNION PACIFIC
-0.42% , PIN , India PS, PIN
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
0.95% Brazil Index, EWZ
0.70% Latin Am 40, ILF
0.66% Germany Index, EWG
0.64% Turkey MSCI iS, TUR
0.64% Frontier Markets Guggenheim , FRN
0.54% Telecom DJ US, IYZ
0.51% Switzerland Index, EWL
0.45% Materials SPDR, XLB
0.38% Thailand MSCI iS, THD
0.37% Metals & Mining SPDR, XME
0.35% Microcap Russell, IWC
0.28% Basic Materials DJ US, IYM
0.23% Bond, Muni S&P ATM-Free iS, MUB
0.22% Bond Ex-US Treas, BWX
0.21% Bond, Emerg Mkt JPM iS, EMB
0.18% Mexico Index, EWW
0.17% Oil, Crude, U.S. Oil Fund, USO
0.17% Bond, TIPS U.S. Treasury iS, TIP
0.15% Consumer Discretionary SPDR, XLY
0.14% LargeCap Blend S&P 500 iS, IVV
0.14% Value LargeCap Dynamic PS, PWV
0.13% Preferred Stock iS, PFF
0.11% DIAMONDS (DJIA), DIA
0.10% France Index, EWQ
0.09% LargeCap Value S&P 500 iS, IVE
0.09% Value VIPERs, VTV
0.09% LargeCap Value Russell 1000 iS, IWD
0.07% Austria Index, EWO
0.07% European VIPERs, VGK
0.06% Europe 350 S&P Index, IEV
0.06% SmallCap Value Russell 2000 iS, IWN
0.05% Financial Preferred, PGF
0.05% Bond, High-Yield Junk, JNK
0.04% Bond, Long-Term Corp iBoxx iS, LQD
0.04% Oil Fund PowerShares, DBO
0.03% LargeCap Blend S&P 100, OEF
0.03% Bear, Short S&P 500, SH
0.03% Emerging 50 BLDRS, ADRE
0.03% Health Care SPDR, XLV
0.02% SmallCap Blend Russell 2000 iS, IWM
0.01% Bond, High Yield Corp iBoxx iS, HYG
0.00% Netherlands Index, EWN
0.00% Financial SPDR, XLF
0.00% Bond, Intermediate US Aggregate iS, AGG
0.00% Bond, 1-3 Year Treasury, SHY
0.00% Bond Treasury Short-Term iS, SHV
0.00% Blend Total Market VIPERs, VTI
-0.03% Capital Markets KWB ST, KCE
-0.03% Global 100, IOO
-0.04% LargeCap Blend Russell 3000 iS, IWV
-0.04% Canada Index, EWC
-0.04% Bond, 10 Year Treasury, IEF
-0.04% LargeCap Blend Russell 1000 iS, IWB
-0.04% Value MidCap Russell, IWS
-0.05% LargeCap VIPERs, VV
-0.05% Small Cap VIPERs, VB
-0.05% SmallCap Growth Russell 2000 iS, IWO
-0.06% Real Estate US DJ iS, IYR
-0.07% Technology DJ US, IYW
-0.07% Indonesia MV, IDX
-0.07% Growth EAFE MSCI, EFG
-0.07% Financial Services DJ, IYG
-0.08% Singapore Index, EWS
-0.08% Belgium Index, EWK
-0.08% Growth VIPERs, VUG
-0.08% Value SmallCap VIPERS, VBR
-0.09% S&P 500 SPDRs LargeCap Blend, SPY
-0.10% LargeCap Blend S&P=Weight R, RSP
-0.10% Technology SPDR, XLK
-0.10% QQQ Nasdaq 100 Trust, QQQ
-0.10% Gold Shares S.T., GLD
-0.10% SmallCap Blend S&P 600 iS, IJR
-0.11% Info Tech VIPERs, VGT
-0.12% SmallCap Growth S&P 600 iS, IJT
-0.12% LargeCap Growth Russell 1000 iS, IWF
-0.12% Dividend SPDR, SDY
-0.13% Dividend ex-U.S. DJ iS, IDV
-0.14% MidCap Russell, IWR
-0.14% EMU Europe Index, EZU
-0.14% Dividend U.S. DJ iS, DVY
-0.14% Financial DJ US, IYF
-0.14% SmallCap Value S&P 600 iS, IJS
-0.15% Growth SmallCap VIPERs, VBK
-0.15% Chile MSCI iS, ECH
-0.16% Financials VIPERs, VFH
-0.16% MidCap S&P 400 SPDRs, MDY
-0.17% Consumer Staples SPDR, XLP
-0.18% Global LargeCap Blend MSCI iS, ACWI
-0.18% MidCap Value S&P 400 iS, IJJ
-0.18% United Kingdom Index, EWU
-0.18% REIT VIPERs, VNQ
-0.18% LargeCap Growth S&P 500 iS, IVW
-0.19% Realty Cohen & Steers, ICF
-0.20% Energy VIPERs, VDE
-0.21% Dividend High Yield Equity PS, PEY
-0.22% MidCap Blend S&P 400 iS, IJH
-0.22% MidCap Growth S&P 400 iS, IJK
-0.24% Growth MidCap Russell, IWP
-0.25% REIT Wilshire, RWR
-0.26% Australia Index, EWA
-0.27% Networking, IGN
-0.27% Dividend International, PID
-0.27% Foreign LargeCap EAFE MSCI iS, EFA
-0.28% Industrial SPDR, XLI
-0.29% Silver Trust iS, SLV
-0.29% Dividend Appreciation Vipers, VIG
-0.29% Global ex U.S. LargeCap Blend, ACWX
-0.32% Energy & Nat Res iS GS, IGE
-0.33% Pacific ex-Japan, EPP
-0.34% Homebuilders SPDR, XHB
-0.34% Energy DJ, IYE
-0.36% Utilities VIPERs, VPU
-0.38% SmallCap Blend EAFE MSCI iS, SCZ
-0.38% Energy SPDR, XLE
-0.39% Value EAFE MSCI, EFV
-0.40% Russia MV, RSX
-0.42% India PS, PIN
-0.42% Utilities SPDR, XLU
-0.43% Biotech SPDR, XBI
-0.47% Bond, 20+ Years Treasury, TLT
-0.49% WilderHill Clean Energy PS, PBW
-0.49% Sweden Index, EWD
-0.49% Commodity Tracking, DBC
-0.52% Emerging Markets MSCI iS, EEM
-0.53% Emerging VIPERs, VWO
-0.54% Hong Kong Index, EWH
-0.54% Semiconductor iS IGW, SOXX
-0.56% Agriculture DB PS, DBA
-0.58% Water Resources, PHO
-0.60% Spain Index, EWP
-0.66% China LargeCap Growth G D H USX PS, PGJ
-0.67% Pacific VIPERs, VPL
-0.68% Malaysia Index, EWM
-0.73% Energy Global, IXC
-0.76% Italy Index, EWI
-0.83% Taiwan Index, EWT
-0.87% Semiconductor SPDR, XSD
-0.89% China 25 iS, FXI
-0.91% India Earnings WTree, EPI
-1.04% Transportation Av DJ, IYT
-1.13% South Africa Index, EZA