The S&P 500 Composite (SPX: 1,277.30) rose 0.02% on Wednesday. Volume on the NYSE fell 10%, confirming an indecisive trading mood.

SPX remains above its widely-followed 50-day and 200-day SMAs, but the 50-day SMA has remained bearishly below the 200-day SMA every day since 8/12/11, suggesting a persistent Bear trend for the longer term.

Short-term Price Momentum Oscillators based on SPX are overbought and are losing upside momentum.

I doubt that SPX will be able to break through the upper end of its 6-month range at this time. The 6-month range high was 1292.66 set on 10/27/11.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) rose above the highs of the previous 7 months. Longer term, the 50-day SMA has remained bullishly above the 200-day SMA every day since 8/25/11. Large Caps tend to outperform in bearish general market trends as investors seek the perceived relative safety of large size.

The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) fell below is 50-day SMA.

Crude Oil, United States Oil ETF (USO) broke out above the highs of the previous 7 months on 1/4/12, thereby signaling a major uptrend.

Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) crossed back below its 50-day SMA and remains below its 200-day SMA.

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Hedge Funds End 2011 on a Very Bad Note
2011 was the second-worst year on record for hedge funds, according to an index maintained by Eurekahedge, an independent research firm that specializes in hedge fund data. Some of the world’s largest and best-known hedge-funds suffered double-digit losses.

But not all money managers were down in 2011; 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 8/2/11, when both Dow-Jones Industrial and Transportation Averages closed below their closing price lows of the previous 11 months. On 1/4/12, both Averages reconfirmed a Secondary Reaction upside bounce by closing above their closing price highs of the previous 5 months. This appears to be one of those junctures when interpretation of the Dow Theory could be open to debate. Significantly, in my opinion, the higher highs on 1/4/12 were NOT confirmed by the broad-based, capitalization-weighted price indexes. I want to see broader upside confirmation before changing my bearish interpretation of the major trend.

NASDAQ Composite/S&P 500 Relative Strength Ratio broke down below the lows of the previous 6-months on 12/23/11. The Ratio has been trending lower since peaking on 9/23/11. Absolute price of the NASDAQ Composite remains below its 200-day SMA, and the 50-day SMA has been bearishly below the 200-day SMA every day since 8/12/11.

iShares MSCI BRIC Fund (BKF) Relative Strength Ratio (BKF/SPY) fell below the lows of the previous 2 years on 12/29/11. BKF/SPY remains below its falling 50-day and 200-day SMAs. Longer term, the 50-day SMA has remained bearishly below the 200-day SMA every day since 1/13/11.

Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) fell below the lows of the previous 2 years on 12/28/11. EEM/SPY remains below its falling 50-day and 200-day SMAs. Longer term, the 50-day SMA has remained bearishly below the 200-day SMA every day since 2/3/11.

Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) fell below the lows of the previous 6 years on 12/28/11. EFA/SPY remains below its falling 50-day and 200-day SMAs. Longer term, the 50-day SMA has remained bearishly below the 200-day SMA every day since 1/14/11.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) rose above the highs of the previous 7 months on 1/4/12 and has been in a rising trend since 11/4/11. Longer term, the 50-day SMA has remained bullishly above the 200-day SMA every day since 8/25/11. Large Caps tend to outperform in bearish general market trends as investors seek the perceived relative safety of large size. 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) fell below is 50-day SMA on 1/4/12. IWM/SPY has remained below its 200-day SMA consistently every day since 7/6/11. Longer term, the 50-day SMA has remained bearishly below the 200-day SMA consistently every day since 8/11/11.

The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) fell below is 50-day SMA on 12/12/11. MDY/SPY has remained below its 200-day SMA consistently every day since 8/1/11. Longer term, the 50-day SMA has remained bearishly below the 200-day SMA consistently every day since 8/24/11.

Advisory Service Sentiment: There were 69.5% Bulls plus Neutrals versus 30.5% Bears as of 12/28/11, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The 20-year median of Bulls plus Neutrals is 69.40 and the mean is 68.32.

VIX Fear Index broke down below the lows of the previous 5-months on 12/22/11, hitting 20.34 intraday. That is down from recent peaks of 30.91 on 12/8/11, 37.83 on 11/1/11, 46.88 on 10/4/11, and 48.00 on 8/8/11. This drop indicates a shift away from fear and toward confidence, which, according to Humphrey Bancroft Neill’s Art of Contrary Thinking, may be bearish. 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 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
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
1284.62, high of 1/3/2012
1277.55, high of 11/8/2011

The S&P 500 Composite Potential Support
1269.37, high of 12/27/2011
1262.30, low of 12/27/2011
1258.71, 200-day SMA
1257.46, low of 12/30/11
1257.58, Fibonacci 61.8% of 2011 range
1255.22, high of 12/22/2011
1248.64, low of 12/29/2011
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 11/3/11
1231.04, high of 12/16/11
1226.64, low of 11/9/2011
1222.68, Fibonacci 50% of 2011 range
1224.57, high of 12/19/11
1215.20, low of 12/16/11
1209.47, low of 12/14/2011
1209.43, low of 11/17/2011
1204.49, Fibonacci 23.6% of 2009-11 range
1202.37, low of 12/19/11
1187.77, Fibonacci 38.2% of 2011 range
1158.66, low of 11/25/2011
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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Tangible Assets, Commodities

U.S. dollar ETF (UUP) rebounded on 1/4/12 to recover a normal fraction of its losses over the previous 3 trading days. UUP remains in bullish position. UUP rose above its 50-day SMA on 11/14/11 and rose above its 200-day SMA on 11/9/11. The 50-day SMA has remained bullishly above the 200-day SMA every day since 10/26/11. Support 22.31, 21.97, 21.92, 21.58, 21.07, and 20.84. Resistance 22.24, 22.60, 22.70, 23.52, 25.84, 27.19, 28.97.

Agriculture, PowerShares DB Agriculture Fund ETF (DBA) appears to be encountering significant resistance near its falling 50-day SMA. DBA appears to be in a vulnerable, overbought position. Price fell below the lows of the previous 14 months on 12/16/11, again confirming a bearish major downtrend.

Crude Oil, United States Oil ETF (USO) broke out above the highs of the previous 7 months on 1/4/12, thereby signaling a major uptrend. Support 35.73, 34.54, 32.52, 29.10, 26.28, and 22.74. Resistance 40.74 and 45.60.

Gold, SPDR Gold Shares ETF (GLD) rebounded to test its recent high near 157.53 set on 12/21/11. GLD fell below the lows of the previous 5 months on 12/29/11, confirming a bearish trend. On 12/12/11, I warned that a break below the low at 165.53 set on 12/6/11 would be bearish. GLD remains below its 50-day and 200-day SMAs. Support: 148.27, 147.19, 143.97, 143.42, and 142.55. Resistance: 157.53, 162.07, 165.53, 170.80, 175.46, 177.40, and 185.85.

Gold Mining Stocks ETF/Gold Shares ETF Relative Strength Ratio (GDX/GLD) remains bearishly below its 50-day and 200-day SMAs. Longer term, the 50-day SMA has remained bearishly below the 200-day SMA every day since 2/22/11. GDX/GLD fell below 3-year lows on 12/19/11, reconfirming a bearish major trend for the long term.

Silver, iShares Silver Trust ETF (SLV) fell below the lows of the previous 11 months on 12/29/11. SLV remains bearishly below its falling 50-day and 200-day SMAs. SLV crossed below its 50-day SMA on 12/8/11 and crossed below its 200-day SMA on 9/22/11. Longer term, the 50-day SMA has remained bearishly below the 200-day SMA every day since 10/27/11. Support 25.65 and 24.44. Resistance: 28.99, 32.53, 34.44, 34.51, 40.23, 41.49, 42.30, 42.78, 44.71 and 48.35.

Silver/Gold ETFs Ratio (SLV/GLD) fell below the lows of the previous 14 months on 12/28/11, confirming a bearish trend. SLV/GLD remains bearishly below 50-day and 200-day SMAs. Longer term, the 50-day SMA has remained bearishly below the 200-day SMA every day since 8/30/11. This SLV/GLD downtrend means investors prefer Gold over Silver.

Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) crossed back below its 50-day SMA on 1/4/12. JJC remains below its 200-day SMA, and the 50-day SMA has remained bearishly below the 200-day SMA every day since 8/8/11. Major trend weakness in Copper suggests serious concerns about the 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 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
11.36% , NFLX , Netflix, NFLX
9.29% , LIZ , LIZ CLAIRBORNE
3.31% , CTAS , CINTAS
2.52% , ADRU , Europe 100 BLDRS, ADRU
3.21% , STLD , Steel Dynamics, STLD
5.85% , PSTL , Steel Global PS ETF, PSTL
4.40% , VFC , VF
0.35% , ONEQ , Growth LargeCap NASDAQ Fidelity, ONEQ
2.24% , AZO , AUTOZONE
4.20% , RL , Polo Ralph Lauren
3.72% , LOW , LOWES
1.53% , F , FORD MOTOR
1.57% , MAR , MARRIOTT INTL STK A
1.81% , HUM , HUMANA
0.15% , IVE , Value S&P 500 B, IVE
1.65% , SPLS , STAPLES
1.78% , GPS , GAP
1.91% , MAS , MASCO
1.82% , BBBY , BED BATH BEYOND
2.66% , WFM.O , Whole Foods Market Inc
2.84% , FII , FED INVESTORS STK B
1.89% , AET , AETNA
1.01% , QCOM , QUALCOMM
2.37% , MSFT , MICROSOFT
1.93% , CSCO , CISCO SYSTEMS
1.44% , CLF , CLIFFS NATURAL RESOURCES, CLF
1.46% , DE , DEERE & CO
3.24% , RYAAY , Ryanair Holdings plc
1.42% , HD , HOME DEPOT
1.64% , SUN , SUNOCO
1.21% , ASH , ASHLAND
1.94% , PETM , PETsMART Inc
3.13% , TER , TERADYNE

Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-28.19% , EK , EASTMAN KODAK
-0.94% , PBJ , Food & Beverage, PBJ
-6.83% , AN , AUTONATION
-3.77% , EBAY , EBAY
-0.52% , DGT , Global Titans, DGT
-5.15% , TLAB , TELLABS
-1.13% , FEU , Value LargeCap Euro STOXX 50 DJ, FEU
-3.10% , YHOO , YAHOO
-1.00% , PPH , Pharmaceutical H, PPH
-3.09% , NTAP , NETWK APPLIANCE
-0.46% , FDL , Dividend Leaders, FDL
-0.29% , RKH , Bank Regional H, RKH
-2.82% , NIHD , NII Holdings, Inc.
-2.19% , TGT , TARGET
-1.03% , IEV , Europe 350 S&P Index, IEV
-0.84% , IGV , Software, IGV
-0.37% , EIS , Israel MSCI iS, EIS
-1.16% , EWO , Austria Index, EWO
-2.61% , LLY , ELI LILLY
-2.53% , JNY , JONES APPAREL
-0.97% , RZV , Value SmallCap S&P 600, RZV
-0.50% , EWD , Sweden Index, EWD
-5.44% , THC , TENET HEALTHCARE
-1.62% , RFMD , RF Micro Devices Inc
-1.29% , MDP , MEREDITH
-1.61% , SIRI , Sirius Satellite
-2.30% , NE , NOBLE
-1.90% , BBY , BEST BUY
-0.68% , PUI , Utilities, PUI
-2.71% , ATI , ALLEGHENY TECH
-1.56% , DOV , DOVER
-1.79% , HMA , HEALTH MGMT STK A
-3.63% , PWER , POWER ONE
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
1.49% Chile MSCI iS, ECH
1.21% Homebuilders SPDR, XHB
1.18% Australia Index, EWA
1.10% Financial Preferred, PGF
1.09% Frontier Markets Guggenheim , FRN
0.89% Preferred Stock iS, PFF
0.84% Materials SPDR, XLB
0.79% Consumer Discretionary SPDR, XLY
0.76% Commodity Tracking, DBC
0.69% Basic Materials DJ US, IYM
0.60% Pacific ex-Japan, EPP
0.53% Pacific VIPERs, VPL
0.52% Water Resources, PHO
0.52% Indonesia MV, IDX
0.51% Gold Shares S.T., GLD
0.47% Oil Fund PowerShares, DBO
0.46% Industrial SPDR, XLI
0.43% Energy & Nat Res iS GS, IGE
0.42% QQQ Nasdaq 100 Trust, QQQ
0.39% Latin Am 40, ILF
0.39% Technology DJ US, IYW
0.37% Brazil Index, EWZ
0.33% Transportation Av DJ, IYT
0.30% Energy VIPERs, VDE
0.28% Bond EmrgMkt JPM iS, EMB
0.28% DIAMONDS (DJIA), DIA
0.27% Technology SPDR, XLK
0.25% Metals & Mining SPDR, XME
0.24% Energy DJ, IYE
0.21% Energy SPDR, XLE
0.20% Oil, Crude, U.S. Oil Fund, USO
0.18% Russia MV, RSX
0.18% Energy Global, IXC
0.18% Bond Muni ATM-Free S&P iS, MUB
0.17% LargeCap Blend S&P 100, OEF
0.16% S&P 500 SPDRs LargeCap Blend, SPY
0.16% Growth VIPERs, VUG
0.15% Growth 1000 Russell, IWF
0.15% Value S&P 500 B, IVE
0.13% Growth S&P 500/BARRA, IVW
0.12% LargeCap VIPERs, VV
0.10% Info Tech VIPERs, VGT
0.09% Bond, TIPS, TIP
0.09% Singapore Index, EWS
0.09% S&P 500 iS LargeCap Blend, IVV
0.08% Bond, Corp, LQD
0.05% Dividend Appreciation Vipers, VIG
0.05% LargeCap Blend Russell 3000, IWV
0.05% Blend Total Market VIPERs, VTI
0.03% LargeCap 1000 R, IWB
0.01% Bond, 1-3 Year Treasury, SHY
0.00% Semiconductor iS IGW, SOXX
0.00% Bond Treasury Short-Term iS, SHV
-0.02% Value VIPERs, VTV
-0.03% Value 1000 Russell, IWD
-0.05% Bond, High-Yield Junk, JNK
-0.09% LargeCap Blend S&P=Weight R, RSP
-0.09% Mexico Index, EWW
-0.11% Japan Index, EWJ
-0.11% Growth MidCap Russell, IWP
-0.13% Bear, Short S&P 500, SH
-0.13% Financial Services DJ, IYG
-0.14% Bond, Aggregate, AGG
-0.14% Value MidCap S&P 400 B, IJJ
-0.15% Value LargeCap Dynamic PS, PWV
-0.17% Dividend SPDR, SDY
-0.17% Bond, High-Yield Corporate, HYG
-0.18% United Kingdom Index, EWU
-0.18% Canada Index, EWC
-0.22% Consumer Staples SPDR, XLP
-0.24% Global 100, IOO
-0.25% MidCap Russell, IWR
-0.26% Growth MidCap 400 B, IJK
-0.27% MidCap S&P 400 SPDRs, MDY
-0.27% Value MidCap Russell, IWS
-0.28% Emerging VIPERs, VWO
-0.28% MidCap S&P 400 iS, IJH
-0.30% Financial SPDR, XLF
-0.31% Bond, 10 Year Treasury, IEF
-0.32% Dividend DJ Select, DVY
-0.32% Dividend High Yield Equity PS, PEY
-0.33% Emerging 50 BLDRS, ADRE
-0.34% Dividend International, PID
-0.34% Agriculture DB PS, DBA
-0.35% Financials VIPERs, VFH
-0.36% Value SmallCap VIPERS, VBR
-0.36% Biotech SPDR, XBI
-0.37% Malaysia Index, EWM
-0.38% Capital Markets KWB ST, KCE
-0.42% Taiwan Index, EWT
-0.46% Financial DJ US, IYF
-0.46% South Korea Index, EWY
-0.46% Value SmallCap Russell 2000, IWN
-0.48% Small Cap VIPERs, VB
-0.48% Health Care SPDR, XLV
-0.50% Sweden Index, EWD
-0.53% Small Cap EAFE MSCI iS, SCZ
-0.55% SmallCap Russell 2000, IWM
-0.56% Emerging Markets, EEM
-0.56% Switzerland Index, EWL
-0.57% Utilities SPDR, XLU
-0.57% WilderHill Clean Energy PS, PBW
-0.58% SmallCap S&P 600, IJR
-0.58% Growth SmallCap VIPERs, VBK
-0.58% Global ex US ACWI iS, ACWX
-0.60% Growth SmallCap R 2000, IWO
-0.60% EAFE Index, EFA
-0.61% Utilities VIPERs, VPU
-0.63% Hong Kong Index, EWH
-0.64% Microcap Russell, IWC
-0.64% Value SmallCap S&P 600 B, IJS
-0.71% Value EAFE MSCI, EFV
-0.71% Growth EAFE MSCI, EFG
-0.73% India Earnings WTree, EPI
-0.75% Growth BARRA Small Cap 600, IJT
-0.79% Bond Ex-US Treas, BWX
-0.87% Semiconductor SPDR, XSD
-0.95% Germany Index, EWG
-1.03% Europe 350 S&P Index, IEV
-1.04% South Africa Index, EZA
-1.12% Real Estate US DJ, IYR
-1.16% Austria Index, EWO
-1.19% Bond, 20+ Years Treasury, TLT
-1.21% European VIPERs, VGK
-1.22% Telecom DJ US, IYZ
-1.22% Networking, IGN
-1.29% Belgium Index, EWK
-1.29% India PS, PIN
-1.47% China 25 iS, FXI
-1.52% Thailand MSCI iS, THD
-1.53% Silver Trust iS, SLV
-1.57% China LargeCap Growth G D H USX PS, PGJ
-1.65% Netherlands Index, EWN
-1.66% EMU Europe Index, EZU
-1.71% REIT VIPERs, VNQ
-1.74% France Index, EWQ
-1.74% REIT Wilshire, RWR
-1.94% Realty Cohen & Steers, ICF
-2.16% Italy Index, EWI
-2.23% Spain Index, EWP
-2.84% Turkey MSCI iS, TUR