NASDAQ 100/S&P 500 Relative Strength Ratio held above its 50-day SMA on 6/8/10 and remains bullish. The Relative Strength Ratio rose above 9-year highs on 6/4/10, giving a major bullish signal.

S&P 500 Composite (SPX) tested year-to-date extreme intraday lows and held them again. SPX remains in a deeply oversold position and at previous support, suggesting that bargain-hunting demand could appear again roughly where it has before, technically speaking.

Various price momentum oscillators have been demonstrating bullish divergence by holding above May lows while S&P 500 closing price made lower lows. These include RSI, MACD, MACDH, Directional Movement, CCI, etc.

The VIX Fear Index recently has been stuck in the 30s after rising to a 14-month high of 48.20 on 5/21/10. This might suggest some kind of divergence compared to price indexes, which are nearer their extreme lows of the year.

Clearly, excessive bullish sentiment has been wrung out of the stock market. This is a major change from last month. On 4/26/10, I wrote: “Investors Intelligence survey of stock market newsletter advisors, Call/Put Volume Ratios, and implied option volatility have shown bullish complacency in recent weeks. Excessive bullish sentiment sometimes precedes a shakeout to the downside.” We got that shakeout, and now it appears to be over.

Gold nearest futures contract price rose above its all-time high at 1249.7 set on 6/8/10. The main trend remains bullish.
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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
1.43% , BDH , Broadband H, BDH
4.29% , IDX , Indonesia MV, IDX
1.57% , FEZ , Euro STOXX 50, FEZ
1.33% , PFM , Dividend Achievers PS, PFM
5.24% , PTV , PACTIV
6.56% , GLW , CORNING
3.88% , ABK , AMBAC FINL GRP
1.49% , EWQ , France Index, EWQ
5.77% , HOT , STARWOOD HOTELS
2.76% , FLEX , Flextronics International Ltd
3.76% , HSY , HERSHEY FOODS
1.15% , ELV , Value Large Cap DJ, ELV
2.51% , KR , KROGER
0.35% , IGN , Networking, IGN
3.18% , SRE , SEMPRA ENERGY
2.30% , FMCN , Focus Media, FMCN
5.00% , AVP , AVON
4.18% , EWA , Australia Index, EWA
4.84% , ZION , ZIONS
1.84% , RKH , Bank Regional H, RKH
1.69% , EWC , Canada Index, EWC
3.27% , XOM , EXXON MOBIL
1.24% , ECH , Chile MSCI iS, ECH
2.74% , DUK , DUKE ENERGY
1.95% , SCZ , Small Cap EAFE MSCI iS, SCZ
2.40% , IYM , Basic Materials DJ US, IYM
1.20% , EIS , Israel MSCI iS, EIS
3.24% , RDC , ROWAN COMPANIES
4.03% , RSH , RADIOSHACK
2.75% , RF , REGIONS FINAN
1.07% , VIG , Dividend Appreciation Vipers, VIG
1.95% , ERIC.O , LM Ericsson Telephone Company
1.78% , IGE , Natural Resource iS GS, IGE
2.16% , FXI , China 25 iS, FXI
4.11% , DD , DU PONT
2.27% , XLB , Materials SPDR, XLB
0.36% , KCE , Capital Markets KWB ST, KCE
2.17% , VWO , Emerging VIPERs, VWO
0.98% , PBJ , Food & Beverage, PBJ
0.69% , PEJ , Leisure & Entertainment, PEJ

Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-3.87% , BHH , Internet B2B H, BHH
-4.07% , PWO , OTC Dynamic PS, PWO
-5.78% , RIG , TRANSOCEAN
-4.71% , MRVL , MARVELL TECHNOLOGY
-2.67% , HANS , Hansen Natural, HANS
-0.57% , PTE , Telecommunications & Wireless, PTE
-4.51% , APC , ANADARKO PETRO
-1.14% , HHH , Internet H, HHH
-0.80% , PWT , Growth SmallCap Dynamic PS, PWT
-3.11% , NIHD , NII Holdings, Inc.
-1.62% , CTXS , CITRIX SYSTEMS
-2.85% , HOLX , Hologic, Inc., HOLX
-2.85% , GILD , Gilead Sciences Inc
-2.19% , LNCR , Lincare Holdings Inc
-2.60% , AMZN , Amazoncom Inc
-2.80% , NVDA , NVIDIA
-1.15% , LLTC , LINEAR TECH
-0.26% , PXN , Nanotech Lux, PXN
-0.58% , PXQ , Networking, PXQ
-1.93% , DELL , DELL
-1.77% , JCI , JOHNSON CONTROLS
-2.55% , MOLX , MOLEX
-1.43% , MAS , MASCO
-1.41% , NE , NOBLE
-1.28% , SWY , SAFEWAY
-3.66% , CAR , Avis Budget Group, Inc. (CAR)
-1.42% , WPI , WATSON PHARM
-1.07% , MZZ , Short 200% MidCap 400 PS, MZZ
-0.94% , BCR , C R BARD
-0.52% , PBE , Biotech & Genome, PBE
-1.16% , BRCM , BROADCOM STK A
-1.60% , SIRI , Sirius Satellite
-2.39% , DXD , Short 200% Dow 30 PS, DXD
-1.35% , HES , AMERADA HESS
-1.85% , MBI , MBIA
-0.82% , BK , BANK OF NEW YORK
-1.26% , DOG , Short 100% Dow 30, DOG
-0.81% , HAS , HASBRO
-1.00% , YHOO , YAHOO
-1.00% , UIS , UNISYS

9 major U.S. stock sectors ranked in order of long-term relative strength:

Consumer Discretionary (XLY) Bullish, Overweight. The Relative Strength Ratio (XLY/SPY) rose above 12-year highs on 5/27/10 and remains bullish. Absolute price of XLY remains above its 200-day SMA and May low and remains neutral. Support 30.34. Resistance 34.39, 36.13, 38.25 and 39.09.

Consumer Staples (XLP) Neutral, Market Weight. The Relative Strength Ratio (XLP/SPY) has performed about in-line with the broader market for the past 8-months and remains neutral. Absolute price of XLP held above its May low and remains neutral. Support 25.78 and 24.95. Resistance 27.83, 27.95, 28.20, 28.75, 29.29 and 30.29.

Technology (XLK) Neutral, Market Weight. The Relative Strength Ratio (XLK/SPY) rose further above 4-month highs on 6/4/10 but still remains neutral. Absolute price of XLK held above its May low and remains neutral. Support 20.64. Resistance 23.27, 24.16, 24.68, and 25.69.

Industrial (XLI) Neutral, Market Weight. The Relative Strength Ratio (XLI/SPY) fell below its 50-day SMA on 6/1/10 and remains neutral, according to the 50/200 trend-following moving average system. Absolute price of XLI fell below its May low on 6/7/10 and remains neutral. Support 27.40. Resistance 32.41, 33.46, 34.24, 34.50, and 35.00.

Utilities (XLU) Neutral, Market Weight. The Relative Strength Ratio (XLU/SPY) moved above 4-month highs on 6/8/10 and remains neutral. Absolute price of XLU remains bearish, with price below SMAs and the 50 below the 200 SMA. Support 27.44, 25.76. Resistance 30.02, 30.59, 30.91, 31.64 and 32.08.

Health Care (XLV) Neutral, Market Weight. The Relative Strength Ratio (XLV/SPY) moved above 2-month highs on 6/7/10 and is neutral. Absolute price of XLV fell below 6-month lows on 5/25/10 and remains neutral. Support 27.96. Resistance 30.83, 32.05, 32.18, 32.42, 32.69, 33.16, 33.37 and 33.74.

Financial (XLF) Neutral, Market Weight. The Relative Strength Ratio (XLF/SPY) fell below 3-month lows on 6/7/10 and remains neutral. Absolute price of XLF also remains neutral. Support 13.70 and 13.51. Resistance 15.67, 16.13, 16.90, 17.12, 17.16, and 17.87.

Materials (XLB) Neutral, Market Weight. The Relative Strength Ratio (XLB/SPY) fell below 14-month lows on 6/7/10 and remains bearish. Absolute price of XLB fell below 9-month lows on 6/7/10 and remains neutral. Support 28.55. Resistance 33.06, 35.47, and 37.56.

Energy (XLE) Neutral, Market Weight. The Relative Strength Ratio (XLE/SPY) fell below 2-year lows on 6/1/10 and remains bearish. Absolute price of XLE fell below its 8-month lows on 5/25/10 and remains neutral. Support 50.15 Resistance 58.11, 59.84, 62.30, 62.73, 69.95, and 78.10.
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Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) fell to a 12-month low on 5/20/10. EEM/SPY trend turned bearish on 4/16/10, according to strict moving average analysis. Absolute price of EEM fell to an 8-month low on 5/25/10.

Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) fell below 5-year lows on 5/26/10 and remains bearish. Absolute price of EFA fell below 10-month lows on 5/25/10 and remains bearish.

NASDAQ 100/S&P 500 Relative Strength Ratio held above its 50-day SMA on 6/8/10 and remains bullish. The RS Ratio rose above 9-year highs on 6/4/10, giving a major bullish signal.

NASDAQ Composite/S&P 500 Relative Strength Ratio fell below its 50-day SMA on 6/8/10, turning neutral. Absolute price of the NASDAQ bounced near its May low and remains neutral.

Russell 1000 Value ETF Relative Strength Ratio (IWD/SPY) remains neutral. Absolute price of IWD tested and held above its February low and remains neutral.

Growth Stock/Value Stock Relative Strength Ratio (IWF/IWD) rose above 3-month highs on 6/7/10 and remains neutral. Absolute price of IWF held above its May low and remains neutral.

The S&P 500 Equally Weighted ETF Relative Strength Ratio (RSP/SPY) fell below its 50-day SMA on 6/7/10 and so turned neutral. Absolute price of RSP closed above its intraday May low and remains neutral.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) fell below the lows of the previous 22 months on 5/27/10 and remains bearish. Absolute price of OEX remains neutral.

The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) fell further below its 50-day SMA on 6/7/10 and remains neutral. Absolute price of IWM closed above its intraday May low and remains neutral.

The S&P MidCap 400/Large Cap Relative Strength Ratio (MDY/SPY) fell below its 50-day SMA on 6/7/10 and so turned neutral. Absolute price of MDY closed above its intraday May low and remains neutral.

Crude Oil nearest futures contract price broke 10-month lows and uptrend lines in May. Technical trends appear uncertain, at best. Support 67.15, 65.05, and 64.24. Resistance 75.72, 77.74, 78.81, 81.29, 87.15, 90.51, 98.65, and 102.84.

Gold nearest futures contract price rose above its all-time high at 1249.7 set on 6/8/10. The main trend remains bullish. Support 1196.9, 1168.0, 1156.2, 1124.3, 1084.8, 1045.2, 1026.9 and 989.3. Resistance: none.

Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) fell steeply on 6/4/10 and is neutral.

Silver/Gold Ratio turned bearish on 5/17/10 when it crossed below both 50- and 200-day SMAs, with the 50-day SMA below the 200-day SMA.

Copper nearest futures price broke down to another new 7-month low on 6/7/10. Copper’s downtrend reflects current uncertainties about the global economic prospects. Strength in Copper suggests renewed hope about prospects for the world economy, while weakness suggests doubts. Support 2.9005 and 2.811. Resistance 3.187, 3.2675, 3.3225, 3.795 and 4.27.

U.S. Treasury Bond nearest futures contract price rose above 5-day highs on 6/4/10, reflecting a flight to safety. Support 121.06, 119.26, 118.24, 118.12, 115.15, 114.06. 113.04, and 112.15. Resistance 126.15 and 130.31.

Junk/Investment-Grade Corporate Bonds Relative Strength Ratio (JNK/LQD) has been moving with the stock market and remains neutral.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) fell below 6-month lows on 5/20/10 but still remains neutral for the intermediate-term trend. This implies that investors are choosing somewhat less inflation protection. Absolute price of TIP remains bullish.

The U.S. dollar nearest futures contract price broke out to another new 14-month high on 6/7/10. USD main trend remains bullish. Support 85.325, 83.07, 81.74, 80.14, 79.73, 79.61, 78.83, 78.20, 76.74 and 75.90. Resistance 89.71 and 92.53.

The Art of Contrary Thinking: The various surveys of investor sentiment are best considered as background factors. The majority of investors can be right for a long time before a major trend finally changes course. The Art of Contrary Thinking is best used together with more precise market timing tools.

Advisory Service Sentiment: There were 39.8% Bulls versus 28.4% Bears as of 6/2/10, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear ratio fell to 1.40, up from 1.35 the previous week. The current Bull/Bear ratio has fallen substantially from its peak at 3.36 set on 1/13/10, which was the highest bullish sentiment in 6 years. The 20-year range is 0.41 to 3.74, the median is 1.51, and the mean is 1.57.

VIX Fear Index recently has been stuck in the 30s after rising to a 14-month high of 48.20 on 5/21/10. This might suggest some kind of divergence compared to price indexes, which are nearer their extreme lows of the year. A high and rising VIX suggests increasing bearish sentiment. 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.

VXN Fear Index recently has been stuck in the 30s after rising to a 14-month high of 48.89 on 5/21/10. This might suggest some kind of divergence compared to price indexes, which are nearer their extreme lows of the year. A high and rising VIX suggests increasing bearish sentiment. VXN measures NASDAQ Volatility using a method comparable to that used for VIX.

ISEE Call/Put Ratio fell to .059 on 5/7/10, a low level that indicates bearish sentiment. Its 2-year mean is 1.20, and its typical range is 0.69 to 1.71, which represents two standard deviations from the mean.

CBOE Put/Call Ratio rose to 0.96 on 5/20/10, its highest level of the year. A high level indicates bearish sentiment. The 2-year mean is 0.70, and the typical range is 0.44 to 0.96, which represents two standard deviations from the mean.

The Dow Theory again confirmed a Bullish Major Trend on 4/26/10, when both the Dow-Jones Industrial Average and the Dow-Jones Transportation Average closed above their closing price highs of the previous 18 months. The Dow Theory signaled the current 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. That 7/23/09 bullish signal reversed the previous bearish signal: the two Averages signaled a Primary Tide Bear Market on 11/21/07, when both Averages closed below their closing price lows of August 2007.

S&P 500 Composite (SPX) tested year-to-date extreme intraday lows and held them again. SPX remains in a deeply oversold position and at previous support, suggesting that bargain-hunting demand could appear again roughly where it has before, technically speaking. Support 1040.78, 1029.38, 1019.95, 1012.42, and 1008.55. Resistance 1109.17, 1130.29, 1151.41, 1173.57, 1181.49, 1219.80, 1220.03, and 1228.74.

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
1366.59, high of 6/17/2008
1335.63, high of 6/25/2008
1313.15, high of 8/11/2008
1274.42, high of 9/8/2008
1255.09, high of 9/12/2008
1238.81, Fibonacci 78.6% of 1,576.09 high
1228.74, Fibonacci 61.8% of 2007-2009 range
1220.03, high of 9/25/2008
1219.80, high of 4/26/2010
1181.49, Fibonacci 78.6% of 2010 range
1173.57, high of 5/13/2010
1151.41, Fibonacci 61.8% of 2010 range
1130.29, Gann 50.0% of 2010 range
1109.17, Fibonacci 38.2% of 2010 range

S&P 500 Cash Index Potential Support
1040.78, low of 5/25/2010
1029.38, low of 11/2/2009
1019.95, low of 10/2/2009
1012.42, Gann 37.5% of 2009-2010 range
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

4.29% Indonesia MV, IDX
4.18% Australia Index, EWA
3.07% Pacific ex-Japan, EPP
2.87% Turkey MSCI iS, TUR
2.52% Brazil Index, EWZ
2.40% Basic Materials DJ US, IYM
2.37% Thailand MSCI iS, THD
2.33% Latin Am 40, ILF
2.29% Emerging Markets, EEM
2.28% Metals & Mining SPDR, XME
2.27% Materials SPDR, XLB
2.17% Emerging VIPERs, VWO
2.16% China 25 iS, FXI
2.12% Switzerland Index, EWL
2.11% Mexico Index, EWW
2.09% Financial SPDR, XLF
2.08% Emerging 50 BLDRS, ADRE
2.01% South Korea Index, EWY
1.96% Sweden Index, EWD
1.95% Small Cap EAFE MSCI iS, SCZ
1.88% Pacific VIPERs, VPL
1.87% Realty Cohen & Steers, ICF
1.84% Oil, Crude, U.S. Oil Fund, USO
1.83% Global ex US ACWI iS, ACWX
1.81% South Africa Index, EZA
1.80% Hong Kong Index, EWH
1.79% REIT VIPERs, VNQ
1.78% Natural Resource iS GS, IGE
1.75% Real Estate US DJ, IYR
1.75% India PS, PIN
1.75% Energy VIPERs, VDE
1.72% Growth EAFE MSCI, EFG
1.70% Italy Index, EWI
1.70% Financial DJ US, IYF
1.69% REIT Wilshire, RWR
1.69% Canada Index, EWC
1.66% Energy SPDR, XLE
1.66% Netherlands Index, EWN
1.65% Financials VIPERs, VFH
1.63% Financial Services DJ, IYG
1.62% Consumer Staples SPDR, XLP
1.60% EAFE Index, EFA
1.53% European VIPERs, VGK
1.52% Energy DJ, IYE
1.49% France Index, EWQ
1.43% Value VIPERs, VTV
1.41% India Earnings WTree, EPI
1.37% Malaysia Index, EWM
1.34% Energy Global, IXC
1.31% Utilities SPDR, XLU
1.26% Value EAFE MSCI, EFV
1.26% Value 1000 Russell, IWD
1.25% Utilities VIPERs, VPU
1.24% Belgium Index, EWK
1.24% Chile MSCI iS, ECH
1.24% Global 100, IOO
1.24% Value S&P 500 B, IVE
1.23% Spain Index, EWP
1.22% China LargeCap Growth G D H USX PS, PGJ
1.20% Austria Index, EWO
1.19% DIAMONDS (DJIA), DIA
1.18% Dividend SPDR, SDY
1.14% EMU Europe Index, EZU
1.13% Transportation Av DJ, IYT
1.12% Europe 350 S&P Index, IEV
1.11% Dividend International, PID
1.09% Agriculture DB PS, DBA
1.07% Dividend Appreciation Vipers, VIG
1.07% S&P 500 SPDRs LargeCap Blend, SPY
1.07% Russia MV, RSX
1.06% LargeCap Blend S&P 100, OEF
1.05% Dividend DJ Select, DVY
1.05% Industrial SPDR, XLI
1.02% Value LargeCap Dynamic PS, PWV
0.98% Japan Index, EWJ
0.98% Value MidCap Russell, IWS
0.95% S&P 500 iS LargeCap Blend, IVV
0.94% LargeCap 1000 R, IWB
0.93% LargeCap Blend S&P=Weight R, RSP
0.93% Singapore Index, EWS
0.92% Taiwan Index, EWT
0.92% MidCap Russell, IWR
0.92% LargeCap VIPERs, VV
0.88% LargeCap Blend Russell 3000, IWV
0.86% Blend Total Market VIPERs, VTI
0.85% Growth S&P 500/BARRA, IVW
0.84% Consumer Discretionary SPDR, XLY
0.82% Germany Index, EWG
0.80% Commodity Tracking, DBC
0.78% Dividend High Yield Equity PS, PEY
0.77% Value MidCap S&P 400 B, IJJ
0.68% Growth 1000 Russell, IWF
0.66% United Kingdom Index, EWU
0.62% Growth VIPERs, VUG
0.58% Growth MidCap Russell, IWP
0.58% Telecom DJ US, IYZ
0.53% Water Resources, PHO
0.48% MidCap S&P 400 iS, IJH
0.45% Growth MidCap 400 B, IJK
0.45% Silver Trust iS, SLV
0.45% Bond Ex-US Treas, BWX
0.43% Value SmallCap VIPERS, VBR
0.43% MidCap S&P 400 SPDRs, MDY
0.36% Capital Markets KWB ST, KCE
0.35% Networking, IGN
0.25% Health Care SPDR, XLV
0.19% Technology SPDR, XLK
0.16% Bond, High-Yield Corporate, HYG
0.12% Bond Muni ATM-Free S&P iS, MUB
0.06% Info Tech VIPERs, VGT
0.02% Technology DJ US, IYW
0.02% Value SmallCap Russell 2000, IWN
0.00% Bond, Corp, LQD
-0.01% Bond, 1-3 Year Treasury, SHY
-0.02% Growth BARRA Small Cap 600, IJT
-0.02% Semiconductor iS GS, IGW
-0.04% Small Cap VIPERs, VB
-0.05% SmallCap Russell 2000, IWM
-0.11% Growth SmallCap VIPERs, VBK
-0.11% Preferred Stock iS, PFF
-0.11% Bond, Aggregate, AGG
-0.18% Growth LargeCap NASDAQ 100, QQQQ
-0.21% Semiconductor SPDR, XSD
-0.22% Value SmallCap S&P 600 B, IJS
-0.22% Growth SmallCap R 2000, IWO
-0.24% SmallCap S&P 600, IJR
-0.25% Bond EmrgMkt JPM iS, EMB
-0.25% Financial Preferred, PGF
-0.25% Bond, TIPS, TIP
-0.31% Bond, 10 Year Treasury, IEF
-0.32% Homebuilders SPDR, XHB
-0.40% Gold Shares S.T., GLD
-0.50% Bond, 20+ Years Treasury, TLT
-0.58% Microcap Russell, IWC
-0.61% WilderHill Clean Energy PS, PBW
-1.44% Biotech SPDR, XBI
-2.52% Value SmallCap S&P 600, RZV