Stocks: falling volume indicates weak demand.

The S&P 500 Composite (SPX, 1,325.84) fell 0.89 points or 0.07% on Wednesday, July 20, 2011. SPX opened above the highs of the previous 4 trading days but reversed to close lower on the day.

Previously, SPX had 47.78 points or 3.53% from its 1,353.22 closing price high on 7/7/11 to Monday’s close at 1,305.44. Already, SPX has had a normal 50% retracement of that loss.

Trading volume on the NYSE fell 12% below the previous day’s pace. Volume was 17% below its trailing 200-day SMA. Rising volume confirms the price direction, while low and falling volume indicate relatively poor demand for stocks and raises doubts about the significance of any rally attempt.

As I have been saying, “For the medium term, a complex Dow Theory Secondary Reaction probably is still unfolding during the historically weak, ‘Sell in May, and go away’ season.”

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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
1.72% , FEU , Value LargeCap Euro STOXX 50 DJ, FEU
9.82% , CTAS , CINTAS
13.67% , ETFC , E*TRADE FINANCIAL
10.44% , TXT , TEXTRON
0.67% , UTH , Utilities H, UTH
3.59% , EWP , Spain Index, EWP
4.67% , NYT , NY TIMES STK A
2.44% , CLX , CLOROX
2.11% , STJ , ST JUDE MEDICAL
2.34% , RDC , ROWAN COMPANIES
0.78% , ADRA , Asia 50 BLDRS, ADRA
1.90% , ASH , ASHLAND
1.30% , KSU , Kansas City Southern, KSU
1.05% , PSTL , Steel Global PS ETF, PSTL
2.42% , ADM , ARCHER DANIELS
2.08% , CNP , CENTERPNT ENERGY
1.09% , XL , XL CAPITAL STK A
1.63% , EWQ , France Index, EWQ
1.29% , ITF , Japan LargeCap Blend TOPIX 150, ITF
1.66% , IXG , Financials Global LargeCap Value, IXG
1.20% , AMP , Ameriprise Financial Inc.
1.84% , MON , MONSANTO
1.75% , RKH , Bank Regional H, RKH
1.52% , BIG , BIG LOTS
1.03% , COL , ROCKWELL COLLINS
1.29% , FDO , FAMILY DLR STRS
2.79% , CBS , CBS CORP.
1.00% , CECO , CAREER EDUCATION CORP
1.35% , IYG , Financial Services DJ, IYG
1.09% , EWO , Austria Index, EWO
0.78% , NE , NOBLE
0.97% , BDH , Broadband H, BDH
0.25% , 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
-7.37% , ECL , ECOLAB
-0.77% , SWH , Software H, SWH
-3.38% , PXQ , Networking, PXQ
-7.61% , YHOO , YAHOO
-1.54% , HHH , Internet H, HHH
-3.80% , SYK , STRYKER
-4.38% , JCI , JOHNSON CONTROLS
-6.54% , ALTR , ALTERA
-2.69% , GNTX , Gentex Corporation
-2.63% , DGX , QUEST DIAG
-2.04% , HGSI , Human Genome Sciences Inc
-1.86% , DISCA , Discovery Communications
-2.41% , MO , ALTRIA, MO
-3.96% , BHH , Internet B2B H, BHH
-0.63% , IGM , Technology GS, IGM
-1.69% , CSX , CSX
-0.91% , IIH , Internet Infrastructure H, IIH
-1.35% , HSP , HOSPIRA
-2.07% , WY , WEYERHAEUSER
-0.68% , JKH , MidCap Growth iS M, JKH
-0.64% , PEJ , Leisure & Entertainment, PEJ
-2.76% , CTXS , CITRIX SYSTEMS
-1.40% , PSJ , Software, PSJ
-0.34% , JKK , Growth SmallCap iS M, JKK
-1.61% , PMTC.O , PARAMETRIC
-1.51% , XLNX , XILINX
-0.35% , PJP , Pharmaceuticals, PJP
-0.54% , IJK , Growth MidCap 400 B, IJK
-0.20% , VO , MidCap VIPERs, VO
-0.06% , PUI , Utilities, PUI
-1.92% , IGN , Networking, IGN
-0.36% , RTH , Retail H, RTH
-0.93% , ABT , ABBOTT LABS
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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) fell further below 7-week lows on 7/12/11 after trading with a bearish bias since peaking on 10/14/10. The Ratio remains below the 200-day SMA, below the 50-day SMA, and the 50-day SMA remains below the 200-day SMA. Absolute price broke down below 14-week lows on 6/23/11.

Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) fell further below 4-month lows on 7/19/11. The Ratio has been trading with a bearish bias since peaking on 11/27/07, so this is a major long-term bearish trend. The Ratio remains below the 200-day SMA, below the 50-day SMA, and the 50-day SMA remains below the 200-day SMA. Absolute price broke down below 14-week lows on 6/23/11.

NASDAQ Composite/S&P 500 Relative Strength Ratio staged a prolonged correction from 1/18/11 to 6/20/11. The Ratio has picked up some bullish short-term momentum since 6/20/11 but has yet to break out to a new high. Long term, the trend remains bullish. Absolute price peaked on 5/2/11.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) rose above the highs of the previous 10 weeks on 7/14/11, suggesting a minor recovery. But OEX/SPX fell below 28-year lows on 5/26/11, confirming its preexisting bearish long-term major trend.

The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) suddenly reversed to the downside on 7/14/11–this just after IWM/SPY rose above the highs of the previous 3 months on 7/13/11. Although IWM/SPY appears uncertain about the short term, longer term the trend remains bullish.

The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) has been fluctuating neutral/sideways since peaking on 4/5/11. Long term, the trend remains bullish.

Agriculture, PowerShares DB Agriculture Fund ETF (DBA) rose above the highs of the previous 2 trading days on 7/19/11, possibly suggesting a minor short-term bounce. Longer term, DBA has been stuck in a downside correction since peaking at 35.58 on 3/4/11. Support 32.35, 32.23, 31.65, 31.46. Resistance 33.42, 34.83, and 35.58.

Crude Oil, United States Oil ETF (USO) rose above the highs of the previous 2 trading days on 7/19/11, possibly suggesting a minor short-term bounce. Still, USO has been trading trendless, choppy/sideways for most of the past 2 months. Many day-to-day reversals make Oil a risky market to trade at this time. Long term, as long as USO holds above its low at 35.14 on 6/27/11, the major trend might turn back up. Support 36.93 and 35.14. Resistance 38.98, 40.74, and 46.60.

Gold, SPDR Gold Shares ETF (GLD) fell below the lows of the previous 2 trading days on 7/19/11, possibly suggesting a minor short-term price pullback. GLD rose above previous all-time price highs on 7/18/11, reconfirming a major long-term uptrend. In a world of too much debt and weak currencies, investors around the globe seek the safety of gold as the only true-forever money. Support: 153.61, 147.19, 143.97, 143.42, and 142.55. Resistance: 156.58.

Gold Mining Stocks ETF (GDX) Relative (to the Gold bullion ETF) Strength Ratio (GDX/GLD) rose above the highs of the previous 6 weeks on 7/18/11, confirming a short-term bounce. GDX fell below 27-month lows on 6/17/11, which was a bearish indication for the long term. The Ratio is still down substantially since its peak on 4/8/11, and the main trend remains bearish.

Silver, iShares Silver Trust ETF (SLV) fell below the lows of the previous trading day on 7/19/11, possibly suggesting a minor short-term price pullback. SLV rose above the highs of the previous 10 weeks on 7/18/11, confirming a medium-term uptrend. Silver also appears to have emerged on the bullish side of a 2-month Triangle Consolidation. Support 34.02 and 31.97. Resistance: 44.71 and 48.35.

Silver/Gold ETFs Ratio (SLV/GLD) rose above the highs of the previous 9 weeks on 7/18/11, confirming a short-term minor uptrend. The Ratio entered a steep downtrend since the peak on 4/28/11 and fell below the lows of the previous 4 months in 6/27/11, reconfirming a more significant downtrend for the medium term.

Copper, iPath DJ-UBS Copper TR Sub-Idx ETN (JJC ) rose above the highs of the previous 3 months on 7/19/11, confirming a preexisting medium-term uptrend. JJC has been in a bullish trend since bottoming at 51.13 on 5/11/11. Strength in Copper suggests confidence in the economic outlook, while Weakness suggests doubts about the future. Support 56.92, 55.50, 52.93, 52.12, 51.13. Resistance: 60.04 and 61.69.

Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) rose above the highs of the previous 2 trading days on 7/19/11, possibly suggesting a minor short-term bounce. TLT had been consolidating with a small Flag pattern since peaking at 97.90 on 7/14/11. Technically, larger trends still appear bullish since TLT bottomed at 88.14 on 2/9/11. A slowing economic growth rate is bullish for bond prices. Support 95.24, 93.14, 89.65, and 88.14. Resistance 97.90, 102.27, 106.10, 107.05, and 109.32.

Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) fell below the lows of the previous 2 weeks on 7/12/11, confirming a minor downtrend. JNK/LQD broke down below 9-month lows on 6/16/11, confirming a major downtrend.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) have consolidated losses since falling below the lows of the previous 6 months on 6/20/11. This downtrend means that fixed-income investors prefer the unprotected 7-10 Year U.S. Treasury Note ETF (IEF) over the inflation-protected TIPs.

U.S. dollar ETF (UUP) fell below the lows of the previous 2 trading days on 7/19/11, possibly suggesting a minor short-term price pullback. Still, UUP may be forming a Triangle Bottom pattern since making a low at 20.84 on 5/4/11. Support 21.34, 21.01, and 20.84. Resistance 21.74, 21.86, and 22.21

Advisory Service Sentiment: There were 46.2% Bulls versus 21.5% Bears as of 7/20/11, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear Ratio rose to 2.15, which suggests moderate bullish complacency when compared to 20-year range of 0.41 to 3.74, a median of 1.56, and a mean of 1.64.

VIX Fear Index collapsed below the lows of the previous 8-weeks, plunging to 15.12 intraday on 7/1/11, in a surprisingly rapid swing to bullish complacency. 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.

As of the close on July 1, 2011, the Dow Theory suggested a divergence and non-confirmation as the Dow-Jones Transportation Average closed above all previous closing price highs but the Dow-Jones Industrial Average failed to confirm.

The S&P 500 Composite (SPX, 1,325.84) fell 0.89 points or 0.07% on Wednesday, July 20, 2011.

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
1356.48, high of 7/7/11
1330.43, high of 7/20/11

S&P 500 Cash Index Potential Support
1295.92, low of 7/18/11
1258.07, low of 6/16/11
1249.05, low of 3/16/11
1246.73, high of 12/13/10
1238.81, Fibonacci 78.6% of 1,576.09 high
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
3.59% Spain Index, EWP
2.92% Silver Trust iS, SLV
2.75% Italy Index, EWI
1.92% Sweden Index, EWD
1.81% Netherlands Index, EWN
1.75% Taiwan Index, EWT
1.73% Silver Miners Global X, SIL
1.68% EMU Europe Index, EZU
1.68% Belgium Index, EWK
1.63% France Index, EWQ
1.45% Capital Markets KWB ST, KCE
1.44% Switzerland Index, EWL
1.38% Value EAFE MSCI, EFV
1.36% European VIPERs, VGK
1.36% Europe 350 S&P Index, IEV
1.35% Financial Services DJ, IYG
1.19% EAFE Index, EFA
1.15% Australia Index, EWA
1.14% Financial SPDR, XLF
1.09% Austria Index, EWO
1.09% United Kingdom Index, EWU
1.06% Pacific ex-Japan, EPP
1.03% Japan Index, EWJ
1.02% Financials VIPERs, VFH
0.98% Financial DJ US, IYF
0.96% REIT Wilshire, RWR
0.94% Small Cap EAFE MSCI iS, SCZ
0.93% Water Resources, PHO
0.92% Realty Cohen & Steers, ICF
0.90% Pacific VIPERs, VPL
0.88% Gold Shares S.T., GLD
0.87% Bond Ex-US Treas, BWX
0.83% Growth EAFE MSCI, EFG
0.82% South Korea Index, EWY
0.78% Global ex US ACWI iS, ACWX
0.75% Real Estate US DJ, IYR
0.73% REIT VIPERs, VNQ
0.72% Global 100, IOO
0.70% WilderHill Clean Energy PS, PBW
0.65% Singapore Index, EWS
0.61% Utilities VIPERs, VPU
0.60% Utilities SPDR, XLU
0.55% Germany Index, EWG
0.44% Hong Kong Index, EWH
0.44% Canada Index, EWC
0.41% Bond EmrgMkt JPM iS, EMB
0.41% China 25 iS, FXI
0.40% Value MidCap Russell, IWS
0.39% Oil, Crude, U.S. Oil Fund, USO
0.38% Dividend International, PID
0.35% Bond Muni ATM-Free S&P iS, MUB
0.33% Commodity Tracking, DBC
0.31% Oil Fund PowerShares, DBO
0.30% Emerging Markets, EEM
0.26% China LargeCap Growth G D H USX PS, PGJ
0.25% Value MidCap S&P 400 B, IJJ
0.24% Value 1000 Russell, IWD
0.23% Value S&P 500 B, IVE
0.22% Value VIPERs, VTV
0.21% Emerging VIPERs, VWO
0.20% Malaysia Index, EWM
0.19% Industrial SPDR, XLI
0.19% South Africa Index, EZA
0.18% Preferred Stock iS, PFF
0.18% Emerging 50 BLDRS, ADRE
0.17% Dividend DJ Select, DVY
0.16% Brazil Index, EWZ
0.14% Value SmallCap VIPERS, VBR
0.12% Indonesia MV, IDX
0.11% Dividend High Yield Equity PS, PEY
0.11% Financial Preferred, PGF
0.11% Energy & Nat Res iS GS, IGE
0.10% Bond, High-Yield Junk, JNK
0.09% Dividend SPDR, SDY
0.09% Bond, High-Yield Corporate, HYG
0.08% LargeCap Blend S&P 100, OEF
0.05% Value LargeCap Dynamic PS, PWV
0.04% Value SmallCap Russell 2000, IWN
0.02% Energy Global, IXC
-0.02% LargeCap VIPERs, VV
-0.02% Bond Treasury Short-Term iS, SHV
-0.04% Bond, 1-3 Year Treasury, SHY
-0.04% LargeCap Blend S&P=Weight R, RSP
-0.04% LargeCap 1000 R, IWB
-0.05% S&P 500 iS LargeCap Blend, IVV
-0.06% Blend Total Market VIPERs, VTI
-0.06% S&P 500 SPDRs LargeCap Blend, SPY
-0.08% Materials SPDR, XLB
-0.10% LargeCap Blend Russell 3000, IWV
-0.10% MidCap Russell, IWR
-0.10% Small Cap VIPERs, VB
-0.11% Basic Materials DJ US, IYM
-0.12% Thailand MSCI iS, THD
-0.12% Value SmallCap S&P 600 B, IJS
-0.13% Energy VIPERs, VDE
-0.14% DIAMONDS (DJIA), DIA
-0.15% Microcap Russell, IWC
-0.16% Bond, Aggregate, AGG
-0.16% Consumer Staples SPDR, XLP
-0.16% MidCap S&P 400 SPDRs, MDY
-0.17% SmallCap Russell 2000, IWM
-0.17% Homebuilders SPDR, XHB
-0.18% Transportation Av DJ, IYT
-0.18% Energy DJ, IYE
-0.19% MidCap S&P 400 iS, IJH
-0.21% Metals & Mining SPDR, XME
-0.23% Bond, Corp, LQD
-0.24% SmallCap S&P 600, IJR
-0.25% Energy SPDR, XLE
-0.26% Growth VIPERs, VUG
-0.30% Semiconductor SPDR, XSD
-0.30% Technology SPDR, XLK
-0.30% Agriculture DB PS, DBA
-0.31% Growth S&P 500/BARRA, IVW
-0.33% Telecom DJ US, IYZ
-0.34% Health Care SPDR, XLV
-0.35% Growth SmallCap VIPERs, VBK
-0.35% Dividend Appreciation Vipers, VIG
-0.39% Growth 1000 Russell, IWF
-0.39% Semiconductor iS IGW, SOXX
-0.42% Growth SmallCap R 2000, IWO
-0.42% QQQ Nasdaq 100 Trust, QQQ
-0.45% Technology DJ US, IYW
-0.45% Growth BARRA Small Cap 600, IJT
-0.46% Info Tech VIPERs, VGT
-0.49% Russia MV, RSX
-0.49% Bond, 10 Year Treasury, IEF
-0.50% Latin Am 40, ILF
-0.52% Consumer Discretionary SPDR, XLY
-0.54% Growth MidCap 400 B, IJK
-0.57% Bond, TIPS, TIP
-0.60% Growth MidCap Russell, IWP
-0.69% Turkey MSCI iS, TUR
-0.75% Frontier Markets Guggenheim , FRN
-1.13% India Earnings WTree, EPI
-1.18% Bond, 20+ Years Treasury, TLT
-1.27% Mexico Index, EWW
-1.53% Biotech SPDR, XBI
-1.74% Chile MSCI iS, ECH
-1.75% India PS, PIN
-1.92% Networking, IGN