Materials stock sector Relative Strength Ratio (XLB/SPY) turned bearish again on 12/3/12 when it fell below its 50-day SMA. XLB absolute price also fell below its 50-day SMA to confirm.
The S&P 500 (SPX: 1,409.46) fell 6.72 points or 0.47% on Monday, thereby erasing 94% of last week’s gain.
Stimulated by foreign stock markets, SPX gapped higher on the open, but it immediately reversed to the downside. Prices fell most of the day and ended near the lows.
NYSE trading volume fell 20% to a level that was 15% below its 200-day SMA. Low volume indicates tepid demand for stocks.
SPX price briefly exceeded but failed to close above resistance at its falling 50-day SMA, now at 1420.57, which also happens to be just below the Fibonacci 61.8% retracement of the SPX September-November price range at 1,424.41. Thus, the SPX tested and failed at a significant zone of technical resistance, as anticipated. As I wrote over the weekend, “Another failed short-term rally attempt may be at hand.”
There were advance warnings. During the regular day session on Thursday, the S&P 500 ETF (SPY) closed near its opening price, forming Spinning Top Candlestick, which indicated indecision. Another Spinning Top Candlestick on Friday confirmed Thursday’s stalemate in the battle of bullish and bearish forces. On Monday, SPY formed a Bearish Engulfing Candlestick, suggesting that bearish forces have asserted control over the short-term, day-to-day trend.
The rising Minor Ripple trend (which longer-term investors view as insignificant noise) lasted 2 weeks, which is quite typical of Minor Ripples. Assuming that minor bounce is over, the September-November downtrend may be ready to resume.
The technical condition of the stock market has not supported the excessive optimism that the bullish majority of stock investors and traders clearly exhibited over the past several months. Long-term momentum has been showing bearish divergence and has weakened considerably since the SPX price peak on 9/14/12. Choosing safety over risk still appears to be the most reasonable approach for conservative traders and investors.
Our clients’ separately managed accounts preserved capital over the past 9 weeks while the S&P 500 fell 8.9%, based on intraday highs and lows from 9/14/12 to 11/16/12. In addition, our clients’ accounts made gains every quarter for the past 6 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
1523.57, high of 12/11/2007
1498.85, high of 12/26/2007
1474.51, high of 9/14/2012
1464.02, high of 10/18/2012
1440.24, high of 5/19/2008
1439.15, high of 9/12/2012
1434.27, high of 11/2/2012
1430.53, low of 9/26/2012
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
1420.57, 50-day SMA
1422.38, high of 4/2/2012
1422.06, low of 10/22/2012
1421.12, high of 10/25/2012
1419.70, high of 11/29/2012
1418.71, high of 8/17/2012
1415.32, high of 5/1/2012
The S&P 500 Composite Potential Support
1409.16, high of 11/23/2012
1403.28, low of 10/26/12
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
1385.07, 200-day SMA
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) turned systematically bullish on 11/7/12 when price rose above its 50-day SMA. TLT remains above its 200-day SMA, and TLT’s 50-day SMA has remained above the 200-day SMA every day since 6/24/11. Support 123.43, 121.78, 119.87, 118.05, 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: 127.19, 127.72, 130.69, and 132.22.
Bond, iShares Barclays 7-10 Year U.S. Treasury ETF (IEF) turned systematically bullish on 11/7/12 when price rose above its 50-day SMA. IEF remains above its 200-day SMA, and IEF’s 50-day SMA has remained above the 200-day SMA every day since 6/21/11. Support 107.99, 107.25, 106.59, 106.42, 105.84, 105.22, 104.77, 103.90, 102.51, 101.77, 101.36, 101.11, 99.79, and 97.66. Resistance: 109.20, 109.32, and 109.89.
Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) rose above its 50-day SMA on 11/28/12, thereby turning systematically neutral again. JNK/LQD fell below its 200-day SMA on 9/20/12. JNK/LQD 50-day SMA has remained consistently below the 200-day SMA every day since 6/1/12.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) turned systematically neutral on 11/13/12 when it fell below its 50-day SMA. TIP/IEF rose above its 200-day SMA on 9/27/12, and the 50-day SMA rose above the 200-day SMA on 10/10/12.
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Tangible Assets, Commodities
U.S. dollar ETF (UUP) turned systematically bearish again on 11/30/12 when price fell below its 50-day SMA. UUP fell below its 200-day SMA on 8/31/12, and the 50-day SMA fell below the 200-day SMA on 10/2/12. Support 21.89, 21.86, 21.57, 21.07, and 20.84. Resistance 22.05, 22.30, 22.45, 23.14, 23.52, 25.84, 27.19, 28.97.
Agriculture, PowerShares DB Agriculture Fund ETF (DBA) turned systematically neutral again on 11/30/12 when price crossed back down below its 50-day SMA. The 50-day SMA remains above the 200-day SMA, although the 50-200 spread has been narrowing gradually.
Crude Oil, United States Oil ETF (USO) turned systematically bearish on 9/19/12, when price fell below its 50-day SMA. USO price fell below its 200-day SMA on 9/17/12, and the 50-day SMA has remained below its 200-day SMA consistently every day since 6/7/12. Support 31.00, 29.02, 26.28, and 22.74. Resistance 32.93, 34.70, 37.17, 38.31, 40.29, 41.38, 42.30, and 45.60.
Gold, SPDR Gold Shares ETF (GLD) turned systematically neutral on 11/27/12, when price fell below its 50-day SMA. GLD price rose above its 200-day SMA on 8/22/12. GLD 50-day SMA rose above the 200-day SMA on 9/20/12. Support: 165.18, 162.30, 159.56, 154.83, 148.27, 147.19, 143.97, 143.42, and 142.55. Resistance: 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 neutral on 11/5/12 when it fell below its 50-day SMA. The 50-day SMA has been above the 200-day SMA since 10/19/12, but a bearish crossover seems possible in weeks ahead.
Silver, iShares Silver Trust ETF (SLV) rose above its 50-day SMA on 11/21/12, thereby turning systematically bullish. The 50-day SMA crossed above the 200-day SMA on 10/1/12. Support 31.91, 29.84, 29.28, 26.87, 26.13, 25.34, 25.00, 24.44, 22.52, 20.73, and 19.44. Resistance: 34.08, 36.44, 40.23, 41.49, 42.30, 42.78, 44.71, and 48.35.
Silver/Gold ETFs Ratio (SLV/GLD) rose above its 50-day SMA on 11/20/12, thereby turning systematically bullish. Longer term, SLV/GLD 50-day SMA crossed above the 200-day SMA on 10/9/12.
Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) rose above both its 50-day SMA and 200-day SMA on 11/30/12. Long term, JJC has been consolidating losses in Triangle chart pattern trading range between 38.99 and 51.41 for more than a year since October 2011. “Dr. Copper” is widely accepted as one of the better indicators of investor confidence (or lack thereof) in the global industrial economy.
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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
0.59% , EWO , Austria Index, EWO
4.18% , EFX , EQUIFAX
7.43% , MTG , MGIC INVESTMENT
4.36% , DELL , DELL
4.02% , PBI , PITNEY BOWES
1.65% , EL , Estee Lauder
0.38% , VGK , European VIPERs, VGK
3.18% , CSC , COMPUTER SCIENCE
0.38% , EWK , Belgium Index, EWK
3.24% , IGT , INTL GAME TECH
2.55% , GRMN , GARMIN LTD
7.27% , AMD , ADV MICRO DEV
0.46% , EWN , Netherlands Index, EWN
0.70% , R , RYDER SYSTEM
0.72% , MOLX , MOLEX
0.37% , ICF , Realty Cohen & Steers, ICF
0.62% , MHP , MCGRAW HILL
0.61% , STT , STATE STREET
0.52% , SYK , STRYKER
0.23% , EWU , United Kingdom Index, EWU
0.80% , IDX , Indonesia MV, IDX
0.35% , SRE , SEMPRA ENERGY
0.20% , PSQ , Short 100% QQQ, PSQ
0.09% , EFG , Growth EAFE MSCI, EFG
0.31% , SJM , J. M. Smucker
0.38% , EWL , Switzerland Index, EWL
0.40% , EWQ , France Index, EWQ
0.42% , SNV , SYNOVUS
0.24% , SHLD , SEARS HOLDINGS
0.07% , IWN , Value SmallCap Russell 2000, IWN
0.74% , PFG , PRINCIPAL FINL
0.40% , VNQ , REIT VIPERs, VNQ
0.07% , EWA , Australia Index, EWA
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-0.92% , IYJ , Industrial LargeCap Blend DJ US, IYJ
-7.70% , QLGC , QLOGIC
-6.99% , NFLX , Netflix, NFLX
-5.66% , HMA , HEALTH MGMT STK A
-0.47% , PWB , Lg Cap Growth PSD, PWB
-1.85% , XLB , Materials SPDR, XLB
-0.52% , EWP , Spain Index, EWP
-2.95% , DOW , DOW CHEMICAL
-1.61% , IYM , Basic Materials DJ US, IYM
-3.24% , UIS , UNISYS
-2.80% , DV , DeVry, Inc.
-0.27% , IJJ , Value MidCap S&P 400 B, IJJ
-0.65% , IYC , Consumer Cyclical DJ, IYC
-3.01% , EXC , EXELON CORP
-0.33% , IJK , Growth MidCap 400 B, IJK
-0.55% , VO , MidCap VIPERs, VO
-1.34% , XME , Metals & Mining SPDR, XME
-0.92% , IGE , Energy & Nat Res iS GS, IGE
-1.57% , FITB , FIFTH THIRD BANC
-0.55% , IYE , Energy DJ, IYE
-4.02% , JNS , JANUS CAPITAL
-0.27% , FDL , Dividend Leaders, FDL
-1.92% , STI , SUNTRUST BANKS
-0.39% , MVV , Ultra MidCap400 Double, MVV
-0.28% , EFV , Value EAFE MSCI, EFV
-2.19% , NUE , NUCOR
-0.95% , VIS , Industrials VIPERs, VIS
-0.50% , IXG , Financials Global LargeCap Value, IXG
-0.20% , IYH , Healthcare DJ, IYH
-0.35% , PHO , Water Resources, PHO
-2.36% , MON , MONSANTO
-0.24% , IYF , Financial DJ US, IYF
-0.55% , PFM , Dividend Achievers PS, PFM
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
1.41% Turkey MSCI iS, TUR
0.80% Indonesia MV, IDX
0.72% Thailand MSCI iS, THD
0.59% Austria Index, EWO
0.49% Silver Trust iS, SLV
0.46% Netherlands Index, EWN
0.45% REIT Wilshire, RWR
0.42% Sweden Index, EWD
0.41% Bear, Short S&P 500, SH
0.40% REIT VIPERs, VNQ
0.40% France Index, EWQ
0.38% Germany Index, EWG
0.38% Belgium Index, EWK
0.38% Switzerland Index, EWL
0.38% European VIPERs, VGK
0.37% Europe 350 S&P Index, IEV
0.37% Realty Cohen & Steers, ICF
0.34% Mexico Index, EWW
0.31% EMU Europe Index, EZU
0.31% Italy Index, EWI
0.28% Real Estate US DJ iS, IYR
0.25% Commodity Tracking, DBC
0.24% Agriculture DB PS, DBA
0.24% Oil Fund PowerShares, DBO
0.23% United Kingdom Index, EWU
0.21% Capital Markets KWB ST, KCE
0.17% Latin Am 40, ILF
0.13% Foreign LargeCap EAFE MSCI iS, EFA
0.12% Oil, Crude, U.S. Oil Fund, USO
0.09% Growth EAFE MSCI, EFG
0.07% Australia Index, EWA
0.07% SmallCap Value Russell 2000 iS, IWN
0.05% China LargeCap Growth G D H USX PS, PGJ
0.05% Gold Shares S.T., GLD
0.03% Emerging VIPERs, VWO
0.01% South Korea Index, EWY
0.00% Russia MV, RSX
0.00% India Earnings WTree, EPI
0.00% Dividend High Yield Equity PS, PEY
-0.01% Bond Treasury Short-Term iS, SHV
-0.01% Bond, 1-3 Year Treasury, SHY
-0.02% Bond, High Yield Corp iBoxx iS, HYG
-0.02% Global ex U.S. LargeCap Blend, ACWX
-0.04% Emerging Markets MSCI iS, EEM
-0.04% SmallCap Value S&P 600 iS, IJS
-0.04% Telecom DJ US, IYZ
-0.07% SmallCap Growth S&P 600 iS, IJT
-0.08% South Africa Index, EZA
-0.08% Global 100, IOO
-0.08% Chile MSCI iS, ECH
-0.09% SmallCap Blend S&P 600 iS, IJR
-0.10% Bond, TIPS U.S. Treasury iS, TIP
-0.10% Technology DJ US, IYW
-0.10% Bond, 20+ Years Treasury, TLT
-0.11% Pacific ex-Japan, EPP
-0.11% SmallCap Blend Russell 2000 iS, IWM
-0.13% SmallCap Blend EAFE MSCI iS, SCZ
-0.13% Dividend International, PID
-0.13% Brazil Index, EWZ
-0.14% Technology SPDR, XLK
-0.15% Global LargeCap Blend MSCI iS, ACWI
-0.15% Value SmallCap VIPERS, VBR
-0.17% Bond, 10 Year Treasury, IEF
-0.17% MidCap Blend S&P 400 iS, IJH
-0.17% Bond, High-Yield Junk, JNK
-0.18% MidCap S&P 400 SPDRs, MDY
-0.18% Financials VIPERs, VFH
-0.20% Bond, Long-Term Corp iBoxx iS, LQD
-0.20% QQQ Nasdaq 100 Trust, QQQ
-0.21% Canada Index, EWC
-0.22% Financial Preferred, PGF
-0.22% Health Care SPDR, XLV
-0.24% Small Cap VIPERs, VB
-0.24% Financial DJ US, IYF
-0.24% Info Tech VIPERs, VGT
-0.25% Pacific VIPERs, VPL
-0.26% Frontier Markets Guggenheim , FRN
-0.26% Value MidCap Russell, IWS
-0.27% MidCap Value S&P 400 iS, IJJ
-0.28% Value EAFE MSCI, EFV
-0.29% Bond, Emerg Mkt JPM iS, EMB
-0.31% Dividend ex-U.S. DJ iS, IDV
-0.31% Bond Ex-US Treas, BWX
-0.31% Microcap Russell, IWC
-0.32% SmallCap Growth Russell 2000 iS, IWO
-0.33% MidCap Growth S&P 400 iS, IJK
-0.33% Value VIPERs, VTV
-0.33% LargeCap Blend Russell 3000 iS, IWV
-0.34% Growth SmallCap VIPERs, VBK
-0.35% Water Resources, PHO
-0.35% Bond, Muni S&P ATM-Free iS, MUB
-0.35% LargeCap Blend S&P 100, OEF
-0.38% Japan Index, EWJ
-0.38% LargeCap Value Russell 1000 iS, IWD
-0.38% Dividend SPDR, SDY
-0.38% Financial SPDR, XLF
-0.39% Consumer Staples SPDR, XLP
-0.40% Growth MidCap Russell, IWP
-0.41% MidCap Russell, IWR
-0.42% Dividend U.S. DJ iS, DVY
-0.42% Homebuilders SPDR, XHB
-0.42% LargeCap Blend S&P=Weight R, RSP
-0.42% DIAMONDS (DJIA), DIA
-0.42% Value LargeCap Dynamic PS, PWV
-0.43% LargeCap VIPERs, VV
-0.43% Networking, IGN
-0.43% Growth VIPERs, VUG
-0.44% Blend Total Market VIPERs, VTI
-0.44% Taiwan Index, EWT
-0.44% LargeCap Value S&P 500 iS, IVE
-0.44% LargeCap Blend Russell 1000 iS, IWB
-0.46% LargeCap Growth Russell 1000 iS, IWF
-0.46% LargeCap Growth S&P 500 iS, IVW
-0.47% LargeCap Blend S&P 500 iS, IVV
-0.47% Semiconductor iS IGW, SOXX
-0.48% Semiconductor SPDR, XSD
-0.50% S&P 500 SPDRs LargeCap Blend, SPY
-0.51% Financial Services DJ, IYG
-0.51% Utilities VIPERs, VPU
-0.52% Spain Index, EWP
-0.52% Energy Global, IXC
-0.53% Consumer Discretionary SPDR, XLY
-0.54% Singapore Index, EWS
-0.55% Energy SPDR, XLE
-0.55% Energy DJ, IYE
-0.58% Bond, Intermediate US Aggregate iS, AGG
-0.58% Energy VIPERs, VDE
-0.61% Malaysia Index, EWM
-0.62% Utilities SPDR, XLU
-0.63% Emerging 50 BLDRS, ADRE
-0.64% Dividend Appreciation Vipers, VIG
-0.65% India PS, PIN
-0.68% Hong Kong Index, EWH
-0.78% Preferred Stock iS, PFF
-0.78% WilderHill Clean Energy PS, PBW
-0.83% Biotech SPDR, XBI
-0.92% Energy & Nat Res iS GS, IGE
-0.94% China 25 iS, FXI
-1.03% Transportation Av DJ, IYT
-1.08% Industrial SPDR, XLI
-1.34% Metals & Mining SPDR, XME
-1.61% Basic Materials DJ US, IYM
-1.85% Materials SPDR, XLB
