Agriculture, PowerShares DB Agriculture Fund ETF (DBA) fell below the lows of the previous 5 weeks on 11/11/11–this following a break below the lows of the previous 10 months on 10/3/11. DBA remains below 20-day, 50-day, and 200-day SMAs. DBA remains bearish in all time frames.
Crude Oil, United States Oil ETF (USO) rose above 3-month highs and further above 50-day and 200-day SMAs on 11/11/11. The 50-day SMA remains far below the 200-day SMA, however, implying a neutral medium-term trend. Longer term, USO broke down below 2-year lows on 10/4/11 to confirm a major bear market.
Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) price fell below the lows of the previous 13 trading days on 11/10/11 and remains bearishly below falling 50-day and 200-day SMAs. Major trend weakness in Copper suggests serious concerns about the economic outlook.
The stock market appears to be correcting and consolidating after its May-October downtrend. That is normal, since markets don’t move in straight lines. There is a better than even chance that the downtrend may resume soon.
AAII Sentiment, now in excess of 75% Bulls plus Neutrals, indicates Bullish Complacency and suggests that the U.S. stock market may be vulnerable to a downside price adjustment. Note that this AAII Sentiment is at the same level as in May, 2008, following a similar Bear Market Secondary Reaction to the upside.
The S&P 500 Composite (SPX: 1,263.85) had an “Inside” week, that is, the range was contained within the previous week’s range, with a lower high and higher low. This is a neutral sign of consolidation.
Over the past 3 weeks, SPX appears to have played with and stalled out near (that is, modestly above and below, not to be interpreted as a precise point) its widely-followed, 200-day Simple Moving Average (SMA), which is now at 1272.27. This appears to be Resistance.
Trading volume on the NYSE on Friday fell 18% below Thursday’s slow pace, thereby confirming the relative insignificance of the relatively moderate upside price move on Thursday and Friday. Some traders took a day off for Veterans’ Day.
When light volume on rising price days is much less than heavy volume on falling price days, as in recent months, there is serious selling pressure and the market is vulnerable to price decline.
The popular MACD (12/26/9) fell below its Signal Line on Wednesday 11/9/11 and remains below.
The high price volatility of recent months is typical of bear markets. In contrast, bull markets are much less volatile.
Longer-term indicators still are far from confirming any change in the Bearish Primary Tide Trend. For example, 50-day SMAs are well below 200-day SMAs for most stocks and indexes.
Ripples and Secondary Reactions opposite to the Dow Theory Primary Tide Trend lure short-term traders into trying to trade a bounce. Price corrections against the larger trends are normal and expected, of course, but playing counter-trend bounces is risky. The mood can switch from “risk on” to “risk off” overnight, leaving the too-clever trader suddenly holding the bag.
The Dow Theory signaled a Primary Tide Bear Market on 8/2/11, when both Dow-Jones Averages, Industrial and Transportation, closed below their closing price lows of the previous 11 months. This Bear Market was confirmed on 10/3/11 by lower closing price lows for both Averages. Both Averages would have to close above their closing price highs for the year to indicate a “Turn in the Tide”.
A Dow Theory Primary Tide Bear Market is a powerful beast that must not be underestimated. The median Dow Theory Primary Tide Bear Market in history lasts 16 months and takes stock prices down 34%. In a Dow Theory Primary Tide Bear Market, the big surprises usually come to the downside. Typically, there is no safe place to hide in a Dow Theory Primary Tide Bear Market. Even those stocks that have held up relatively well through most of the Bear Market eventually succumb to the relentless tide of selling.
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The S&P 500 Composite (SPX: 1,263.85) 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
1370.58, high of 5/2/11
1359.44, high of 5/10/11
1356.48, high of 7/7/11
1347.00, high of 7/21/11
1307.28, Fibonacci 78.6% of 2011 range
1292.66, high of 10/27/11
1277.55, high of 11/8/2011
1272.27, 200-day SMA
S&P 500 Composite (SPX: 1,263.85) Potential Support
1263.21, high of 11/3/2011
1258.07, low of 6/16/11
1257.58, Fibonacci 61.8% of 2011 range
1256.55, high of 10/24/11
1249.05, low of 3/16/11
1246.73, high of 12/13/10
1238.81, Fibonacci 78.6% of 1,576.09 high
1234.81, low of 11/3/11
1222.68, Fibonacci 50% of 2011 range
1221.06, low of 10/26/2011
1215.42, low of 11/1/2011
1204.49, Fibonacci 23.6% of 2009-11 range
1190.58, low of 10/13/2011
1187.77, Fibonacci 38.2% of 2011 range
1144.38, Fibonacci 23.6% of 2011 range
1101.73, Fibonacci 38.2% of 2009-11 range
1074.77, low of 10/4/2011
1039.70, low of 8/27/10
1039.31, Fibonacci 23.6% of June-Aug. 2010 range
1010.91, low of 7/1/2010
1018.69, Fibonacci 50% of 2009-11 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
935.64, Fibonacci 61.8% of 2009-11 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
817.40, Fibonacci 78.6% of 2009-11 range
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
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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
2.31% , SWH , Software H, SWH
3.30% , HHH , Internet H, HHH
2.23% , RTH , Retail H, RTH
1.33% , PIC , Insurance, PIC
2.19% , PBJ , Food & Beverage, PBJ
2.05% , IYY , LargeCap Blend Total Market DJ, IYY
2.46% , BDH , Broadband H, BDH
3.00% , PXJ , Oil & Gas, PXJ
5.95% , DIS , WALT DISNEY
2.70% , PKB , Building & Construction, PKB
4.55% , BHH , Internet B2B H, BHH
1.73% , PPH , Pharmaceutical H, PPH
2.47% , ILF , Latin Am 40, ILF
2.05% , IGV , Software, IGV
2.06% , JKH , MidCap Growth iS M, JKH
0.92% , BBH , Biotech H, BBH
6.02% , LRCX , LAM RESEARCH CORP
1.91% , IVW , Growth S&P 500/BARRA, IVW
4.96% , LBTYA , Liberty Global Inc. (LBTYA)
3.10% , JCP , JC PENNEY
0.98% , TTH , Telecom H, TTH
3.52% , NVDA , NVIDIA
4.91% , ATI , ALLEGHENY TECH
2.07% , IDX , Indonesia MV, IDX
4.26% , GLW , CORNING
2.28% , JKL , Value SmallCap iS M, JKL
2.54% , VB , Small Cap VIPERs, VB
1.84% , UIS , UNISYS
3.06% , XHB , Homebuilders SPDR, XHB
2.42% , PXN , Nanotech Lux, PXN
3.96% , CAH , CARDINAL HEALTH
1.62% , EIS , Israel MSCI iS, EIS
2.00% , FDV , Value 40 Large Low P/E FT DB, FDV
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-12.63% , DDS , DILLARD STK A
-2.25% , MYY , Short 100% MidCap 400, MYY
-4.11% , ETFC , E*TRADE FINANCIAL
-2.23% , DOG , Short 100% Dow 30, DOG
-2.21% , CAG , CONAGRA FOODS
-3.28% , VLO , VALERO ENERGY
-2.26% , FMCN , Focus Media, FMCN
-1.72% , DHI , D.R. HORTON, DHI
-1.14% , TLAB , TELLABS
-0.28% , JWN , NORDSTROM
-0.34% , DYN , DYNEGY
-0.12% , AGG , Bond, Aggregate, AGG
-0.08% , SJM , J. M. Smucker
-0.17% , TEVA , Teva Pharmaceutical Industries Limited
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
4.27% Sweden Index, EWD
4.17% Italy Index, EWI
4.08% Germany Index, EWG
3.78% France Index, EWQ
3.72% EMU Europe Index, EZU
3.68% Belgium Index, EWK
3.51% Semiconductor iS IGW, SOXX
3.50% Spain Index, EWP
3.45% Austria Index, EWO
3.36% Semiconductor SPDR, XSD
3.21% Silver Miners Global X, SIL
3.17% Netherlands Index, EWN
3.06% Europe 350 S&P Index, IEV
3.06% Homebuilders SPDR, XHB
3.01% South Korea Index, EWY
2.92% European VIPERs, VGK
2.90% Australia Index, EWA
2.78% Mexico Index, EWW
2.77% Value SmallCap S&P 600 B, IJS
2.77% SmallCap S&P 600, IJR
2.75% Growth SmallCap R 2000, IWO
2.74% Transportation Av DJ, IYT
2.74% Realty Cohen & Steers, ICF
2.69% Water Resources, PHO
2.69% REIT VIPERs, VNQ
2.68% REIT Wilshire, RWR
2.65% Growth BARRA Small Cap 600, IJT
2.64% SmallCap Russell 2000, IWM
2.63% Networking, IGN
2.59% Real Estate US DJ, IYR
2.54% Small Cap VIPERs, VB
2.52% Chile MSCI iS, ECH
2.52% Consumer Discretionary SPDR, XLY
2.49% EAFE Index, EFA
2.49% Metals & Mining SPDR, XME
2.47% Latin Am 40, ILF
2.45% Value SmallCap Russell 2000, IWN
2.44% Value EAFE MSCI, EFV
2.44% Global ex US ACWI iS, ACWX
2.44% Value SmallCap VIPERS, VBR
2.43% Growth MidCap 400 B, IJK
2.42% Growth SmallCap VIPERs, VBK
2.40% Emerging Markets, EEM
2.39% Capital Markets KWB ST, KCE
2.38% Industrial SPDR, XLI
2.37% Microcap Russell, IWC
2.36% Financial SPDR, XLF
2.35% MidCap S&P 400 iS, IJH
2.35% Pacific ex-Japan, EPP
2.33% Materials SPDR, XLB
2.32% India PS, PIN
2.32% Financial Services DJ, IYG
2.32% Basic Materials DJ US, IYM
2.29% Emerging VIPERs, VWO
2.28% MidCap S&P 400 SPDRs, MDY
2.27% Global 100, IOO
2.26% Emerging 50 BLDRS, ADRE
2.26% Growth MidCap Russell, IWP
2.25% Brazil Index, EWZ
2.25% Energy Global, IXC
2.24% Russia MV, RSX
2.22% DIAMONDS (DJIA), DIA
2.21% LargeCap Blend S&P=Weight R, RSP
2.20% Value MidCap S&P 400 B, IJJ
2.20% Financials VIPERs, VFH
2.19% United Kingdom Index, EWU
2.19% China 25 iS, FXI
2.19% Financial DJ US, IYF
2.19% Energy & Nat Res iS GS, IGE
2.18% Biotech SPDR, XBI
2.17% MidCap Russell, IWR
2.15% Info Tech VIPERs, VGT
2.13% Value MidCap Russell, IWS
2.12% WilderHill Clean Energy PS, PBW
2.09% Canada Index, EWC
2.08% Switzerland Index, EWL
2.07% Indonesia MV, IDX
2.06% Small Cap EAFE MSCI iS, SCZ
2.05% Energy SPDR, XLE
2.02% Growth EAFE MSCI, EFG
1.99% Growth VIPERs, VUG
1.99% LargeCap Blend Russell 3000, IWV
1.99% Dividend Appreciation Vipers, VIG
1.99% Taiwan Index, EWT
1.98% Blend Total Market VIPERs, VTI
1.96% Turkey MSCI iS, TUR
1.94% Growth 1000 Russell, IWF
1.92% LargeCap VIPERs, VV
1.92% Technology DJ US, IYW
1.91% India Earnings WTree, EPI
1.91% Value 1000 Russell, IWD
1.91% Growth S&P 500/BARRA, IVW
1.91% Technology SPDR, XLK
1.88% QQQ Nasdaq 100 Trust, QQQ
1.88% Energy DJ, IYE
1.88% S&P 500 SPDRs LargeCap Blend, SPY
1.88% LargeCap 1000 R, IWB
1.87% S&P 500 iS LargeCap Blend, IVV
1.85% Energy VIPERs, VDE
1.85% Value VIPERs, VTV
1.85% Value S&P 500 B, IVE
1.84% LargeCap Blend S&P 100, OEF
1.82% Dividend International, PID
1.81% Dividend SPDR, SDY
1.81% Silver Trust iS, SLV
1.81% Thailand MSCI iS, THD
1.76% Health Care SPDR, XLV
1.72% Dividend DJ Select, DVY
1.70% China LargeCap Growth G D H USX PS, PGJ
1.65% Gold Shares S.T., GLD
1.62% Singapore Index, EWS
1.62% Telecom DJ US, IYZ
1.62% South Africa Index, EZA
1.54% Value LargeCap Dynamic PS, PWV
1.50% Pacific VIPERs, VPL
1.43% Utilities SPDR, XLU
1.43% Utilities VIPERs, VPU
1.32% Bond, High-Yield Corporate, HYG
1.30% Oil, Crude, U.S. Oil Fund, USO
1.26% Bond, High-Yield Junk, JNK
1.16% Consumer Staples SPDR, XLP
1.13% Dividend High Yield Equity PS, PEY
1.12% Oil Fund PowerShares, DBO
1.08% Japan Index, EWJ
1.02% Financial Preferred, PGF
1.00% Frontier Markets Guggenheim , FRN
0.97% Commodity Tracking, DBC
0.85% Bond Ex-US Treas, BWX
0.79% Preferred Stock iS, PFF
0.59% Malaysia Index, EWM
0.44% Hong Kong Index, EWH
0.43% Agriculture DB PS, DBA
0.40% Bond EmrgMkt JPM iS, EMB
0.02% Bond Muni ATM-Free S&P iS, MUB
0.02% Bond Treasury Short-Term iS, SHV
-0.05% Bond, 1-3 Year Treasury, SHY
-0.12% Bond, Aggregate, AGG
-0.18% Bond, Corp, LQD
-0.31% Bond, TIPS, TIP
-0.46% Bond, 10 Year Treasury, IEF
-0.61% Bond, 20+ Years Treasury, TLT
