S&P 500 Composite (SPX, 1,279.56) fell 5.38 points or 0.42% on Wednesday to its lowest closing price in 11 weeks, again confirming its preexisting significant downside correction. Other major indexes also confirmed.

Price momentum oscillators, such as MACD, Stochastic, and RSI, broke down below all pervious 2011 lows.

NYSE volume rose 22% to confirm an increase on Selling Pressure.

The Cumulative Daily Advance-Decline Line finally broke down below 7-week lows to confirm the downtrends in the price indexes.

Financial SPDR stock sector ETF (XLF) absolute price broke down further below 6-month lows and remains bearish.

Technology SPDR stock sector ETF (XLK) absolute price broke down below 11-week lows and remains bearish.

Materials SPDR stock sector ETF (XLB) absolute price broke down below 11-week lows.

Industrial SPDR stock sector ETF (XLI) absolute price broke down below 11-week lows.

Consumer Discretionary SPDR stock sector ETF (XLY) absolute price broke down below 11-week lows.

Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) broke down below 27-month lows. The Ratio has been falling steeply since 4/8/11 and remains bearish.

Junk/Investment-Grade Corporate Bonds Relative Strength Ratio (JNK/LQD) broke down below 6-month lows. Absolute price of JNK broke down below 11-week lows, after topping out at 41.32 on 11/4/10. Both confirm a bearish trend for JNK.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) fell below the lows of the previous 6 months, again reconfirming a medium-term downtrend. TIP/IEF entered a downtrend after peaking on 4/8/11. This downtrend means that fixed-income investors prefer the unprotected 7-10 Year U.S. Treasury Note ETF (IEF) over the inflation-protected TIPs. Inflation expectations are still waning.

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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
1.38% , FRN , Frontier Markets Guggenheim , FRN
2.16% , EBAY , EBAY
0.90% , MYY , Short 100% MidCap 400, MYY
2.05% , USO , Oil, Crude, U.S. Oil Fund, USO
2.73% , DYN , DYNEGY
0.30% , FDL , Dividend Leaders, FDL
1.04% , SWY , SAFEWAY
1.47% , VZ , VERIZON COMMS
1.31% , DBO , Oil Fund PowerShares, DBO
1.54% , QID , Short 200% QQQ PS, QID
1.42% , AZO , AUTOZONE
1.49% , HANS , Hansen Natural, HANS
0.95% , XOM , EXXON MOBIL
0.50% , PKI , PERKINELMER
1.37% , KR , KROGER
0.94% , WPI , WATSON PHARM
0.54% , HUM , HUMANA
0.70% , AIV , APT INV MNGMT
1.14% , DBA , Agriculture DB PS, DBA
0.87% , SDS , Short 200% S&P 500 PS, SDS
1.03% , SLB , SCHLUMBERGER
0.69% , BF.B , BROWN FORMAN STK B
0.70% , TAP , ADOLPH COORS STK B, TAP
0.48% , UNH , UNITEDHEALTH GRP
0.99% , RF , REGIONS FINAN
0.14% , CLF , CLIFFS NATURAL RESOURCES, CLF
0.61% , SO , SOUTHERN
0.75% , PSQ , Short 100% QQQ, PSQ
0.43% , IYE , Energy DJ, IYE
0.78% , TLT , Bond, 20+ Years Treasury, TLT
0.29% , LM , LEGG MASON
1.02% , OXY , OCCIDENTAL
0.62% , MRK , MERCK & CO

Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-20.22% , MTG , MGIC INVESTMENT
-16.19% , CIEN.O , CIENA
-1.56% , JKJ , SmallCap Core iS M, JKJ
-3.52% , BHH , Internet B2B H, BHH
-1.51% , KLD , LargeCap Blend Socially Responsible iS, KLD
-1.60% , PWY , Value SmallCap Dynamic PS, PWY
-1.27% , SWH , Software H, SWH
-4.44% , KWT , Solar Energy MV, KWT
-4.70% , CMI , CUMMINS
-1.79% , PXQ , Networking, PXQ
-5.58% , SIRI , Sirius Satellite
-2.99% , THD , Thailand MSCI iS, THD
-3.06% , DHI , D.R. HORTON, DHI
-1.24% , IJT , Growth BARRA Small Cap 600, IJT
-2.80% , KBH , KB HOME
-1.91% , JKK , Growth SmallCap iS M, JKK
-2.74% , KMX , CarMax
-2.99% , WYN , Wyndham Worldwide
-2.94% , JCP , JC PENNEY
-4.23% , LIZ , LIZ CLAIRBORNE
-0.72% , RPV , Value S&P 500, RPV
-4.14% , MBI , MBIA
-2.70% , URBN , Urban Outfitters Inc.
-1.34% , PSTL , Steel Global PS ETF, PSTL
-1.22% , IWC , Microcap Russell, IWC
-0.90% , IJS , Value SmallCap S&P 600 B, IJS
-3.06% , ATI , ALLEGHENY TECH
-3.26% , SIL , Silver Miners Global X, SIL
-3.84% , ALTR , ALTERA
-1.87% , PMCS , PMC SIERRA
-2.36% , TROW , T ROWE PRICE GP
-1.29% , FDV , Value 40 Large Low P/E FT DB, FDV
-2.17% , XME , Metals & Mining SPDR, XME

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

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Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) has been trading with a bearish bias since peaking on 10/14/10. The Ratio remains below the 200-day SMA, and the 50-day SMA remains below the 200-day SMA.

Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) remains neutral, with the 50-day SMA below the 200-day SMA.

NASDAQ Composite/S&P 500 Relative Strength Ratio entered a downside correction since peaking on 1/18/11 and remains neutral. Absolute price entered a downside correction since peaking on 5/2/11.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) fell further below 28-year lows on 5/26/11, again reconfirming its preexisting bearish major trend.

The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) broke down below 2-month lows on 5/24/11 and has been in a downside correction since 4/5/11.

The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) has been correcting and consolidating major gains since 4/5/11 and remains neutral. The Ratio set an all-time high on 4/5/11.

Crude Oil nearest futures contract price rose above the highs of the previous 4 trading days on 6/8/11 following surprising news that OPEC ministers kept production quotas unchanged. Oil fell below the lows of the previous 2-weeks on 6/7/11, confirming a short-term minor downtrend. Intermediate-term, Oil has been consolidating losses in a downtrend, turning choppy/sideways following the low of 94.63 on 5/6/11. The latest data from the Commodity Futures Trading Commission shows hedge-fund and other money managers increased net long positions in Oil–which could prove to be bearish when this hot money rushes for the exits. On 5/3/11, when Crude Oil was 111.56, I wrote, “Crude Oil nearest futures contract price fell below the lows of the previous 7 trading days on 5/3/11, suggesting a short-term price pullback.” Support 94.63, 87.09, 83.85, 83.55, 80.28, 80.06, 79.84, 79.25, 78.86, 73.52, 72.63, 70.76, 70.35, 69.51, 68.59, 67.15, 65.05, and 64.24. Resistance 103.39, 104.60, 105.16, 114.83, 115.27, 120.42, 130.0, and 147.27.

Gold nearest futures contract price fell below the lows of the previous 2 trading days on 6/8/11, possibly indicating a trend change to the downside. Upside momentum had slowed, so I suspected that the recent countertrend bounce might be weakening. Reward/Risk does not appear attractive. It seems possible that Gold has topped out. Support: 1520.04, 1462.5, 1445.0, 1411.5, 1380.7, 1419.5, 1351.4, 1309.1, 1307.7, 1297.0, 1274.8, 1270.5, 1232.4, 1210.9, 1191.5, and 1155.6. Resistance: 1577.4.

Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) broke down below 27-month lows on 6/8/11. The Ratio has been falling steeply since 4/8/11 and remains bearish.

Silver nearest futures contract price fell below the lows of the previous 2 trading days on 6/8/11, possibly indicating a trend change to the downside. Silver fell from 49.82 on 4/25/11 to 32.3 on 5/12/11, breaking down below 10-week lows. Since 5/12/11, Silver may have experienced nothing more than a temporary countertrend bounce and normal partial retracement of losses in a larger downside correction. On 5/2/11, when Silver was 46.084, I wrote, “Silver nearest futures contract price broke sharply below the lows of the previous 2 weeks. The short-term price trend has turned down. If this downtrend continues, it could have implications for inflation expectations.” Support 36.265, 32.3, 31.695, 31.61, 30.265, 29.635, 26.30, 24.98, and 22.84. Resistance: 38.845, 39.38, 39.47, 49.82, 49.845 and 50.35.

Silver/Gold Ratio entered a steep downtrend since the peak on 4/28/11. Although the Ratio has stabilized somewhat since making a low on 5/16/11, it probably remains bearish.

Copper nearest futures contract price fell below the lows of the previous 2 trading days on 6/8/11, possibly indicating a trend change to the downside. Copper broke down below previous 5-month lows on 5/12/11, confirming an intermediate-term correction, if not a bear market. Weakness in Copper suggests doubts about the economic outlook. Support 3.9505, 3.8535, 3.846, 3.6065, 3.3930, 3.1775, 2.9285, 2.8555, 2.8445, and 2.72. Resistance: 4.2125, 4.402, 4.533, 4.554, 4.6495, 4.6535, and 4.6575.

U.S. Treasury Bond nearest futures contract price rose above the highs of the previous 4 trading days on 6/8/11 as investors reacted to Federal Reserve Chairman Ben Bernanke’s downbeat outlook for the economy. The short-term trend is up and, intermediate-term, the Bond rose above the highs of the previous 6 months on 6/1/11, reconfirming a significant uptrend. In its favor, nearly everyone has been talking bearish on Bonds this year, so the Bond is rising up off an extreme oversold condition. Support 124.01, 123.18, 120.20, 119.15, 117.28, 117.04, 116.26, 115.15, 114.06, 113.04, and 112.15. Resistance 126.10, 128.00 129.14, 129.27, 132.26, 133.00, 135.12, 135.19, 136.31, 137.31, and 142.31.

Junk/Investment-Grade Corporate Bonds Relative Strength Ratio (JNK/LQD) broke down below 6-month lows on 6/8/11. Absolute price of JNK broke down below 11-week lows on 6/8/11, after topping out at 41.32 on 11/4/10. Both confirm a bearish trend for JNK.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) fell below the lows of the previous 6 months on 6/8/11, again reconfirming a medium-term downtrend. TIP/IEF entered a downtrend after peaking on 4/8/11. This downtrend means that fixed-income investors prefer the unprotected 7-10 Year U.S. Treasury Note ETF (IEF) over the inflation-protected TIPs. Inflation expectations are still waning.

The U.S. dollar nearest futures contract price fell below the lows of the previous 4-weeks early on 6/7/11, confirming a short-term minor downtrend. Support 72.86, and 70.80. Resistance 74.955, 76.54, 76.87, 77.675, 78.98, 79.34, 81.635, 81.935, 82.02, 83.64, 84.73, 85.36, 86.71, 88.80, 89.22, 89.71, and 92.53.

Advisory Service Sentiment: There were 40.9% Bulls versus 22.6% Bears as of 6/8/11, according to the weekly Investors Intelligence survey of stock market newsletter advisors. This is near normal, since the Ratio’s 20-year range is 0.41 to 3.74, the median is 1.56, and the mean is 1.64. Note that Advisory Service Sentiment as of 4/6/11 rose to 3.65, its highest level in the 8 years since the 20-year high of 3.74 set on 6/18/03. The market has been working off that excess by correcting to the downside.

VIX Fear Index fell below its 3-year range on 4/20/11, hitting 14.30 intraday, and again confirming a preexisting trend toward bullish complacency. This follows a brief spike up to an intraday peak of 31.28 on 3/16/11. Fear was short-lived. 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 Dow Theory signaled a 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.

As of the close on June 6, 2011, the Dow Theory confirmed a Secondary Reaction (a significant downside correction) for the general stock market, as the Dow Industrials and Transports both closed below 10-week lows. Previously, as of June 1, 2011, the Dow Theory gave a warning of a significant downside correction for the general stock market, as the Dow Industrials and Transports both closed below 5-week lows.

On 5/2/11, when the S&P 500 Composite (SPX) was 1,358.59, I warned, “The majority of major stock price indexes opened higher on gaps but reversed to close with losses on the day. This may signal exhaustion of the short-term uptrend. Sentiment indicators have been suggesting that the stock market may be over loved and overbought. And in view of the sharp reversals in the metal commodities, the so-called “inflation trade”, when speculators buy stocks and sell fixed-income instruments based on expectations of rising price levels for goods and services, may be on thin ice.”

Based on the daily SPX, momentum indicators gave bearish divergence warnings in April; that is, they never made it back to their February peaks when the price indexes rose to higher highs. These bearish divergence warnings are still in effect.

S&P 500 Composite (SPX, 1,279.56) fell 5.38 points or 0.42% on Wednesday to its lowest closing price in 11 weeks, again confirming its preexisting significant downside correction.

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
1370.50, high of 5/2/11
1359.44, high of 5/10/11
1346.82, high of 5/19/11

S&P 500 Cash Index Potential Support
1249.05, low of 3/16/11
1246.73, high of 12/13/10
1238.81, Fibonacci 78.6% of 1,576.09 high
1235.05, high of 12/7/10
1232.85, low of 12/16/10
1228.74, Fibonacci 61.8% of 2007-2009 range
1227.08, high of 11/5/10
1173.00, low of 11/16/10
1171.70, low of 10/27/10
1166.74, low of 10/20/10
1159.71, low of 10/19/10
1,151.41, low of 10/7/10
1,131.87, low of 10/4/10
1122.79, low of 9/23/2010
1114.63, low of 9/15/2010
1110.88, low of 9/10/2010
1091.15, low of 9/7/2010
1039.70, low of 8/27/10
1039.31, Fibonacci 23.6% of June-Aug. 2010 range
1010.91, low of 7/1/2010
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

2.05% Oil, Crude, U.S. Oil Fund, USO
1.38% Frontier Markets Guggenheim , FRN
1.31% Oil Fund PowerShares, DBO
1.14% Agriculture DB PS, DBA
0.83% Commodity Tracking, DBC
0.78% Bond, 20+ Years Treasury, TLT
0.43% Energy DJ, IYE
0.32% Energy VIPERs, VDE
0.30% Energy SPDR, XLE
0.25% Utilities VIPERs, VPU
0.24% Utilities SPDR, XLU
0.22% Bond, 10 Year Treasury, IEF
0.16% Bond EmrgMkt JPM iS, EMB
0.14% Bond Muni ATM-Free S&P iS, MUB
0.11% Health Care SPDR, XLV
0.08% Bond, Aggregate, AGG
0.06% Consumer Staples SPDR, XLP
0.06% Bond, Corp, LQD
0.05% Energy Global, IXC
0.01% Biotech SPDR, XBI
0.01% Bond, 1-3 Year Treasury, SHY
-0.01% Bond, TIPS, TIP
-0.01% Bond Treasury Short-Term iS, SHV
-0.10% Japan Index, EWJ
-0.12% Dividend High Yield Equity PS, PEY
-0.15% Dividend SPDR, SDY
-0.16% DIAMONDS (DJIA), DIA
-0.17% Dividend DJ Select, DVY
-0.18% Russia MV, RSX
-0.21% South Africa Index, EZA
-0.21% Energy & Nat Res iS GS, IGE
-0.22% Dividend Appreciation Vipers, VIG
-0.23% LargeCap Blend S&P 100, OEF
-0.25% Silver Trust iS, SLV
-0.26% Value LargeCap Dynamic PS, PWV
-0.27% Realty Cohen & Steers, ICF
-0.28% REIT VIPERs, VNQ
-0.30% Value S&P 500 B, IVE
-0.30% REIT Wilshire, RWR
-0.30% Preferred Stock iS, PFF
-0.31% Value VIPERs, VTV
-0.34% India Earnings WTree, EPI
-0.34% Chile MSCI iS, ECH
-0.35% Bond, High-Yield Junk, JNK
-0.39% Value 1000 Russell, IWD
-0.41% Gold Shares S.T., GLD
-0.41% Brazil Index, EWZ
-0.41% S&P 500 iS LargeCap Blend, IVV
-0.42% S&P 500 SPDRs LargeCap Blend, SPY
-0.43% Turkey MSCI iS, TUR
-0.44% Financial Preferred, PGF
-0.45% Bond Ex-US Treas, BWX
-0.46% Growth S&P 500/BARRA, IVW
-0.47% LargeCap 1000 R, IWB
-0.47% Bond, High-Yield Corporate, HYG
-0.48% Real Estate US DJ, IYR
-0.49% LargeCap VIPERs, VV
-0.49% LargeCap Blend Russell 3000, IWV
-0.52% Blend Total Market VIPERs, VTI
-0.53% China 25 iS, FXI
-0.53% Telecom DJ US, IYZ
-0.54% Emerging 50 BLDRS, ADRE
-0.57% Growth 1000 Russell, IWF
-0.59% Growth VIPERs, VUG
-0.62% Value MidCap Russell, IWS
-0.63% Latin Am 40, ILF
-0.64% Emerging VIPERs, VWO
-0.66% Global 100, IOO
-0.67% Malaysia Index, EWM
-0.67% Technology SPDR, XLK
-0.70% Taiwan Index, EWT
-0.70% India PS, PIN
-0.72% Emerging Markets, EEM
-0.72% QQQ Nasdaq 100 Trust, QQQ
-0.73% LargeCap Blend S&P=Weight R, RSP
-0.74% Dividend International, PID
-0.75% Water Resources, PHO
-0.75% Pacific VIPERs, VPL
-0.76% Value MidCap S&P 400 B, IJJ
-0.77% Value SmallCap VIPERS, VBR
-0.77% Mexico Index, EWW
-0.78% Consumer Discretionary SPDR, XLY
-0.79% Singapore Index, EWS
-0.79% Hong Kong Index, EWH
-0.85% MidCap Russell, IWR
-0.86% Financials VIPERs, VFH
-0.87% Industrial SPDR, XLI
-0.88% MidCap S&P 400 SPDRs, MDY
-0.89% Canada Index, EWC
-0.90% Value SmallCap S&P 600 B, IJS
-0.91% Financial SPDR, XLF
-0.91% Financial DJ US, IYF
-0.91% Value SmallCap Russell 2000, IWN
-0.91% MidCap S&P 400 iS, IJH
-0.95% Info Tech VIPERs, VGT
-0.95% Technology DJ US, IYW
-1.01% SmallCap S&P 600, IJR
-1.01% Growth MidCap 400 B, IJK
-1.02% Indonesia MV, IDX
-1.03% Materials SPDR, XLB
-1.04% Small Cap VIPERs, VB
-1.06% Value EAFE MSCI, EFV
-1.08% Switzerland Index, EWL
-1.10% United Kingdom Index, EWU
-1.10% Financial Services DJ, IYG
-1.12% SmallCap Russell 2000, IWM
-1.12% Germany Index, EWG
-1.13% Growth MidCap Russell, IWP
-1.17% Basic Materials DJ US, IYM
-1.17% Transportation Av DJ, IYT
-1.17% Global ex US ACWI iS, ACWX
-1.22% Microcap Russell, IWC
-1.24% Growth BARRA Small Cap 600, IJT
-1.29% EAFE Index, EFA
-1.30% Capital Markets KWB ST, KCE
-1.32% Small Cap EAFE MSCI iS, SCZ
-1.32% Growth EAFE MSCI, EFG
-1.35% South Korea Index, EWY
-1.36% Growth SmallCap VIPERs, VBK
-1.39% Growth SmallCap R 2000, IWO
-1.51% Pacific ex-Japan, EPP
-1.55% Belgium Index, EWK
-1.55% Homebuilders SPDR, XHB
-1.56% France Index, EWQ
-1.69% Italy Index, EWI
-1.70% Europe 350 S&P Index, IEV
-1.74% European VIPERs, VGK
-1.79% EMU Europe Index, EZU
-1.80% Spain Index, EWP
-1.81% Australia Index, EWA
-1.93% China LargeCap Growth G D H USX PS, PGJ
-1.95% Semiconductor iS IGW, SOXX
-1.95% Austria Index, EWO
-1.97% Netherlands Index, EWN
-2.06% Semiconductor SPDR, XSD
-2.17% Metals & Mining SPDR, XME
-2.56% WilderHill Clean Energy PS, PBW
-2.70% Networking, IGN
-2.99% Thailand MSCI iS, THD
-3.13% Sweden Index, EWD
-3.26% Silver Miners Global X, SIL