The Dow-Jones Industrial Average fell further below its February lows, but the Dow-Jones Transportation Average continued to hold above its February lows. Therefore, the Transports have been failing to fully confirm weakness in the Industrials.

The Dow-Jones Utility Average continued to hold above its June lows. The Utilities Stock Sector Relative Strength Ratio (XLU/SPY) rose above 5-month highs on 7/2/10.

The NYSE Cumulative Daily Advance-Decline Line fell below its June low but remains well above its February lows.

NYSE Bullish Percent Index is holding above early June lows.

S&P 500 Composite (SPX) fell another 0.47% and gave a bearish signal on 7/2/10 when the 50-day simple moving average (SMA) crossed below the 200-day simple moving average. Still, price momentum oscillators, such as RSI (14), MACD, Directional Movement, and McClellan Oscillator, are more deeply oversold–but not quite as oversold as they were a few weeks ago, thereby showing bullish divergence. A critical number to watch for the SPX is1008.55, which is the Fibonacci 38.2% retracement of 2009-2010 range.

Sentiment remains very bearish. The news is emphasizing only pessimistic points of view, and it is difficult to find any bulls at all. This is bullish, of course, according to the Art of Contrary Thinking.

Financial Stock Sector Relative Strength Ratio (XLF/SPY) fell sharply over the past 5 trading days and remains bearish (below both SMAs and with the 50 below the 200 SMA).

Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) fell sharply since 6/28/10. The Ratio is technically bearish, below both SMAs and with the 50-day SMA below the 200-day SMA.

Crude Oil fell further below 7-week lows on 7/2/10, again confirming the preexisting bearish trend for the short term.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) fell below 9-month lows on 7/2/10 and remains RELATIVELY bearish. This implies that investors are choosing less inflation protection. Absolute price of TIP turned from bullish to neutral as of 7/2/10.

The U.S. dollar price fell further below 7-week lows on 7/2/10. The USD chart appears still bearish for the short term.
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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
7.21% , AGN , ALLERGAN
5.76% , BIIB , BIOGEN IDEC
0.39% , TTH , Telecom H, TTH
3.48% , RSH , RADIOSHACK
5.90% , GENZ , GENZYME
1.36% , PJP , Pharmaceuticals, PJP
0.53% , FDL , Dividend Leaders, FDL
0.29% , ADRD , Developed 100 BLDRS, ADRD
0.48% , PXN , Nanotech Lux, PXN
1.11% , HSY , HERSHEY FOODS
0.26% , IXJ , Healthcare Global, IXJ
2.13% , RYAAY , Ryanair Holdings plc
1.72% , DLTR , Dollar Tree Stores Inc
0.59% , ROK , ROCKWELL AUTOMAT
0.98% , AMP , Ameriprise Financial Inc.
0.52% , FO , FORTUNE BRANDS
2.83% , AM , AMER GREETINGS STK A
0.61% , ADRE , Emerging 50 BLDRS, ADRE
1.01% , MCO , MOODYS CORP
2.23% , NI , NISOURCE
0.64% , EPU , Peru MSCI iS, EPU
0.34% , ADRU , Europe 100 BLDRS, ADRU
0.11% , EMB , Bond EmrgMkt JPM iS, EMB

Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-8.94% , LNCR , Lincare Holdings Inc
-0.80% , PXE , Energy Exploration & Prod, PXE
-3.61% , SNV , SYNOVUS
-0.24% , FPX , IPOs, First Tr IPOX-100, FPX
-0.74% , PSI , Semiconductors, PSI
-0.68% , IJK , Growth MidCap 400 B, IJK
-0.30% , TMW , Wilshire 5000 ST TM, TMW
-1.78% , GRMN , GARMIN LTD
-2.35% , EQR , EQUITY RESIDENT BEN INT
-2.91% , CSX , CSX
-0.83% , VXF , Extended Mkt VIPERs, VXF
-1.63% , NTRS , NORTHERN TRUST
-0.77% , BLL , BALL
-1.01% , ADM , ARCHER DANIELS
-1.08% , PEJ , Leisure & Entertainment, PEJ
-0.91% , PCAR , PACCAR
-5.20% , PLD , PROLOGIS TRUST
-0.16% , PIC , Insurance, PIC
-3.40% , NSC , NORFOLK SOUTHERN
-1.86% , LAMR , Lamar Advertising Company
-0.32% , VDE , Energy VIPERs, VDE
-0.99% , FEZ , Euro STOXX 50, FEZ
-0.81% , EWK , Belgium Index, EWK
-0.69% , ETR , ENTERGY
-0.57% , PWY , Value SmallCap Dynamic PS, PWY
-0.11% , LLTC , LINEAR TECH
-0.01% , SWH , Software H, SWH
-0.56% , PFG , PRINCIPAL FINL
-0.19% , DBC , Commodity Tracking, DBC
-0.28% , ACWX , Global ex US ACWI iS, ACWX

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

Consumer Discretionary (XLY) Neutral, Market Weight. The Relative Strength Ratio (XLY/SPY) fell below its 50-day SMA on 6/17/10, thereby turning neutral. XLY/SPY remains above its 200-day SMA. Absolute price of XLY fell below 4-month lows intraday on 7/1/10. Support 28.21 and 26.62. Resistance 33.12, 34.39, 36.13, 38.25 and 39.09.

Consumer Staples (XLP) Neutral, Market Weight. The Relative Strength Ratio (XLP/SPY) has performed about in-line with the broader market for the past 11-months and remains neutral. Absolute price of XLP fell below 8-month lows intraday on 7/1/10. Support 24.95. Resistance 26.97, 27.83, 27.95, 28.20, 28.75, 29.29 and 30.29.

Industrial (XLI) Neutral, Market Weight. The Relative Strength Ratio (XLI/SPY) is stuck between 50- and 200-day SMAs and remains neutral. Absolute price of XLI fell below 4-month lows intraday on 7/1/10. Support 26.85 and 26.66. Resistance 30.60, 33.12, 33.46, 34.24, 34.50, and 35.00.

Utilities (XLU) Neutral, Market Weight. The Relative Strength Ratio (XLU/SPY) rose above 5-month highs on 7/2/10. The XLU/SPY Ratio’s 50-day SMA is still below the 200-day SMA, however, so the XLU/SPY remains neutral. Absolute price of XLU fell below 5-week lows intraday on 7/1/10. Support 27.44, 25.76. Resistance 30.39, 30.59, 30.91, 31.64 and 32.08.

Technology (XLK) Neutral, Market Weight. The Relative Strength Ratio (XLK/SPY) has been consolidating gains since peaking on 12/31/09 and remains neutral. Absolute price fell below 8-month lows intraday on 7/1/10. Support 20.01and 19.51. Resistance 22.62, 23.27, 24.16, 24.68, and 25.69.

Health Care (XLV) Neutral, Market Weight. The Relative Strength Ratio (XLV/SPY) has been consolidating losses since making a low on 4/26/10. The XLV/SPY Ratio’s 50-day SMA is still below the 200-day SMA, so the XLV/SPY remains neutral. Absolute price of XLV fell below 11-month lows intraday on 7/1/10 and remains bearish because price is below both SMAs and the 50 is below the 200 SMA. Support 27.49. Resistance 29.93, 30.83, 32.05, 32.18, 32.42, 32.69, 33.16, 33.37 and 33.74.

Financial (XLF) Neutral, Market Weight. The Relative Strength Ratio (XLF/SPY) fell sharply over the past 5 trading days and remains bearish (below both SMAs and with the 50 below the 200 SMA). Absolute price of XLF fell below 11-month lows intraday on 7/1/10 and remains neutral. Support 13.34 and 13.08. Resistance 15.05, 15.67, 16.13, 16.90, 17.12, 17.16, and 17.87.

Materials (XLB) Bearish, Under Weight. The Relative Strength Ratio (XLB/SPY) fell below 14-month lows on 6/7/10 and remains bearish. Absolute price of XLB fell below 11-month lows intraday on 7/1/10 and remains bearish with the 50-day SMA below the 200-day SMA of price since 6/18/10. Support 28.53 and 27.78. Resistance 31.80, 33.06, 35.47, and 37.56.

Energy (XLE) Bearish, Under Weight. The Relative Strength Ratio (XLE/SPY) fell further below its 50-day SMA on 6/29/10 and remains bearish. Absolute price of XLE fell below 10-month lows intraday on 7/1/10 and remains bearish with the 50-day SMA below the 200-day SMA. Support 46.16 and 43.66. Resistance 56.70, 58.11, 59.84, 62.30, 62.73, 69.95, and 78.10.
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Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) has been rising since its low on 5/20/10 but remains neutral, with the 50-day below the 200-day SMA. Absolute price of EEM has stabilized since its low on 5/25/10 but remains bearish due to negative SMA relationships.

Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) has been rising since its low on 5/26/10 but remains neutral, with the 50-day below the 200-day SMA. Absolute price of EFA has stabilized since its low on 5/25/10 but remains bearish due to negative SMA relationships.

NASDAQ Composite/S&P 500 Relative Strength Ratio is neutral between 50- and 200-day SMAs. Absolute price fell below 7-month lows on 7/1/10.

Russell 1000 Value ETF Relative Strength Ratio (IWD/SPY) has turned neutral since making a high on 5/3/10.

Growth Stock/Value Stock Relative Strength Ratio (IWF/IWD) has turned neutral since making a low on 4/14/10.

The S&P 500 Equally Weighted ETF Relative Strength Ratio (RSP/SPY) turned neural when it fell below its 50-day SMA on 6/29/10.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) fell below the lows of the previous 30 years on 6/15/10 and remains bearish. Big caps have been out of favor for more than 10 years, since 3/29/2000.

The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) has turned neutral since making a high on 5/17/10.

The S&P MidCap 400/Large Cap Relative Strength Ratio (MDY/SPY) remains neutral but is very close to a bullish signal. Absolute price of MDY crossed below its 200 SMA on 6/29/10 and remains neutral.

Crude Oil nearest futures contract fell further below 7-week lows on 7/2/10, again confirming the preexisting bearish trend for the short term. Support 70.93, 69.51, 68.59, 67.15, 65.05, and 64.24. Resistance 79.38, 79.94, 81.29, 87.15, 90.51, 98.65, and 102.84.

Gold nearest futures contract broke down below 5-week lows on 7/1/10, thereby signaling a bearish trend for the short term. Support 1196.9, 1168.0, 1156.2, 1124.3, 1084.8, 1045.2, 1026.9 and 989.3. Resistance: 1264.8, 1263.7, and 1266.5.

Gold Mining Stocks ETF (GDX) Relative Strength Ratio (relative to the Gold bullion ETF, GDX/GLD) fell sharply since 6/28/10. The Ratio is technically bearish, below both SMAs and with the 50-day SMA below the 200-day SMA.

Silver/Gold Ratio turned bearish on 5/17/10 when it crossed below both 50- and 200-day SMAs, and with the 50-day SMA already below the 200-day SMA.

Copper nearest futures price broke below 8-day lows on 7/1/10, confirming a price pullback for the short-tem. Weakness in Copper suggests doubts about prospects for the world economy. Support 2.8445 and 2.72. Resistance 3.106, 3.187, 3.2675, 3.3225, 3.795 and 4.27.

U.S. Treasury Bond nearest futures contract price rose further above 14-month highs on 7/1/10, again confirming a major uptrend. Support 124.19, 123.03, 121.28, 119.26, 118.24, 118.12, 115.15, 114.06. 113.04, and 112.15. Resistance 130.31, 133.20, 137.31, and 142.31.

Junk/Investment-Grade Corporate Bonds Relative Strength Ratio (JNK/LQD) declined since 6/21/10 and remains bearish.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year Relative Strength Ratio (TIP/IEF) fell below 9-month lows on 7/2/10 and remains RELATIVELY bearish. This implies that investors are choosing less inflation protection. Absolute price of TIP turned from bullish to neutral as of 7/2/10.

The U.S. dollar nearest futures contract price fell further below 7-week lows on 7/2/10. The USD chart appears still bearish for the short term. Support 83.07, 81.74, 80.14, 79.73, 79.61, 78.83, 78.20, 76.74 and 75.90. Resistance 86.71, 89.22, 89.71, and 92.53.

The Art of Contrary Thinking: The various surveys of investor sentiment are best considered as background factors. The majority of investors can be right for a long time before a major trend finally changes course. The Art of Contrary Thinking is best used together with more precise market timing tools.

Advisory Service Sentiment: There were 41.1% Bulls versus 33.3% Bears as of 6/30/10, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear ratio fell to1.23, down from 1.32 the previous week. The current Bull/Bear ratio has fallen substantially from its peak at 3.36 set on 1/13/10, which was the highest bullish sentiment in 6 years. The 20-year range is 0.41 to 3.74, the median is 1.51, and the mean is 1.57.

VIX Fear Index jumped up to 37.58 on 7/1/10, up from 22.87 on 6/21/10. A high and strongly rising VIX suggests increasing bearish sentiment. 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.

VXN Fear Index jumped up to 38.29 on 7/1/10, up from 23.12 on 6/18/10. A high and strongly rising VXN suggests increasing bearish sentiment. VXN measures NASDAQ Volatility using a method comparable to that used for VIX.

ISEE Call/Put Ratio fell to .059 on 5/7/10, a low level that indicates bearish sentiment. Its 2-year mean is 1.20, and its typical range is 0.69 to 1.71, which represents two standard deviations from the mean.

CBOE Put/Call Ratio rose to 0.96 on 5/20/10, its highest level of the year. A high level indicates bearish sentiment. The 2-year mean is 0.70, and the typical range is 0.44 to 0.96, which represents two standard deviations from the mean.

The Dow Theory again confirmed a Bullish Major Trend on 4/26/10, when both the Dow-Jones Industrial Average and the Dow-Jones Transportation Average closed above their closing price highs of the previous 18 months. The Dow Theory signaled the current 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. That 7/23/09 bullish signal reversed the previous bearish signal: the two Averages signaled a Primary Tide Bear Market on 11/21/07, when both Averages closed below their closing price lows of August 2007.

S&P 500 Composite (SPX) fell another 0.47% and gave a bearish signal on 7/2/10 when the 50-day simple moving average (SMA) crossed below the 200-day simple moving average. Still, price momentum oscillators, such as RSI (14), MACD, Directional Movement, and McClellan Oscillator, are more deeply oversold–but not quite as oversold as they were a few weeks ago, thereby showing bullish divergence. Sentiment is very bearish. Therefore, there is still a chance for an oversold bounce. A critical number to watch for the SPX is1008.55, which is the Fibonacci 38.2% retracement of 2009-2010 range. Support 1008.55, 991.97, 978.51, 956.23, and 943.29. Resistance 1040.78, 1131.23, 1173.57, and 1219.80.

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
1366.59, high of 6/17/2008
1335.63, high of 6/25/2008
1313.15, high of 8/11/2008
1274.42, high of 9/8/2008
1255.09, high of 9/12/2008
1238.81, Fibonacci 78.6% of 1,576.09 high
1228.74, Fibonacci 61.8% of 2007-2009 range
1220.03, high of 9/25/2008
1219.80, high of 4/26/2010
1173.57, high of 5/13/2010
1131.23, high of 6/21/2010
1040.78, low of 5/25/2010

S&P 500 Cash Index Potential Support
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

2.04% Turkey MSCI iS, TUR
1.74% Russia MV, RSX
1.43% Brazil Index, EWZ
1.24% Singapore Index, EWS
1.24% Gold Shares S.T., GLD
1.18% Chile MSCI iS, ECH
1.15% Thailand MSCI iS, THD
1.10% South Africa Index, EZA
0.98% Taiwan Index, EWT
0.93% Latin Am 40, ILF
0.70% Biotech SPDR, XBI
0.61% Emerging 50 BLDRS, ADRE
0.54% Hong Kong Index, EWH
0.44% United Kingdom Index, EWU
0.43% Japan Index, EWJ
0.43% Emerging Markets, EEM
0.41% Bond Ex-US Treas, BWX
0.36% WilderHill Clean Energy PS, PBW
0.27% Small Cap EAFE MSCI iS, SCZ
0.27% Preferred Stock iS, PFF
0.25% Pacific VIPERs, VPL
0.25% Health Care SPDR, XLV
0.21% Emerging VIPERs, VWO
0.18% Financial Preferred, PGF
0.17% Malaysia Index, EWM
0.14% Pacific ex-Japan, EPP
0.12% Utilities VIPERs, VPU
0.11% Silver Trust iS, SLV
0.11% Utilities SPDR, XLU
0.11% Bond EmrgMkt JPM iS, EMB
0.11% Bond Muni ATM-Free S&P iS, MUB
0.09% Spain Index, EWP
0.02% Bond, High-Yield Corporate, HYG
0.00% Italy Index, EWI
0.00% Growth EAFE MSCI, EFG
0.00% Canada Index, EWC
0.00% Bond, 1-3 Year Treasury, SHY
-0.04% Networking, IGN
-0.05% Australia Index, EWA
-0.13% Value LargeCap Dynamic PS, PWV
-0.13% Austria Index, EWO
-0.14% Bond, Aggregate, AGG
-0.15% Technology SPDR, XLK
-0.17% Energy Global, IXC
-0.18% Bond, 10 Year Treasury, IEF
-0.19% Commodity Tracking, DBC
-0.19% Bond, TIPS, TIP
-0.21% EAFE Index, EFA
-0.21% Technology DJ US, IYW
-0.21% Value EAFE MSCI, EFV
-0.22% European VIPERs, VGK
-0.22% Info Tech VIPERs, VGT
-0.24% Energy SPDR, XLE
-0.24% Dividend SPDR, SDY
-0.28% Energy DJ, IYE
-0.28% Global ex US ACWI iS, ACWX
-0.28% Growth LargeCap NASDAQ 100, QQQQ
-0.29% Bond, Corp, LQD
-0.32% Energy VIPERs, VDE
-0.33% Dividend International, PID
-0.33% Agriculture DB PS, DBA
-0.35% France Index, EWQ
-0.36% Mexico Index, EWW
-0.36% Natural Resource iS GS, IGE
-0.37% Growth VIPERs, VUG
-0.37% Global 100, IOO
-0.39% Consumer Staples SPDR, XLP
-0.41% Dividend Appreciation Vipers, VIG
-0.42% Growth S&P 500/BARRA, IVW
-0.45% LargeCap VIPERs, VV
-0.47% Europe 350 S&P Index, IEV
-0.48% Blend Total Market VIPERs, VTI
-0.48% EMU Europe Index, EZU
-0.48% DIAMONDS (DJIA), DIA
-0.50% Dividend DJ Select, DVY
-0.52% Dividend High Yield Equity PS, PEY
-0.53% Semiconductor iS GS, IGW
-0.54% LargeCap Blend S&P 100, OEF
-0.54% Value VIPERs, VTV
-0.55% S&P 500 SPDRs LargeCap Blend, SPY
-0.56% Sweden Index, EWD
-0.57% Materials SPDR, XLB
-0.57% Netherlands Index, EWN
-0.59% S&P 500 iS LargeCap Blend, IVV
-0.60% Water Resources, PHO
-0.61% LargeCap Blend S&P=Weight R, RSP
-0.63% China LargeCap Growth G D H USX PS, PGJ
-0.66% India Earnings WTree, EPI
-0.66% Basic Materials DJ US, IYM
-0.67% MidCap S&P 400 iS, IJH
-0.68% Growth MidCap 400 B, IJK
-0.71% Growth BARRA Small Cap 600, IJT
-0.71% Value S&P 500 B, IVE
-0.71% Capital Markets KWB ST, KCE
-0.74% MidCap S&P 400 SPDRs, MDY
-0.75% Telecom DJ US, IYZ
-0.79% Semiconductor SPDR, XSD
-0.79% Germany Index, EWG
-0.80% Bond, 20+ Years Treasury, TLT
-0.80% Value MidCap S&P 400 B, IJJ
-0.81% India PS, PIN
-0.81% Belgium Index, EWK
-0.82% Indonesia MV, IDX
-0.82% Oil, Crude, U.S. Oil Fund, USO
-0.91% China 25 iS, FXI
-0.92% Growth MidCap Russell, IWP
-0.94% Growth 1000 Russell, IWF
-0.95% LargeCap Blend Russell 3000, IWV
-0.98% Value SmallCap VIPERS, VBR
-0.99% SmallCap S&P 600, IJR
-0.99% Growth SmallCap VIPERs, VBK
-1.02% Financial DJ US, IYF
-1.02% Metals & Mining SPDR, XME
-1.03% Financial Services DJ, IYG
-1.04% Switzerland Index, EWL
-1.07% Small Cap VIPERs, VB
-1.08% Financials VIPERs, VFH
-1.11% Microcap Russell, IWC
-1.12% MidCap Russell, IWR
-1.12% Consumer Discretionary SPDR, XLY
-1.13% Value SmallCap S&P 600 B, IJS
-1.16% Value MidCap Russell, IWS
-1.17% Financial SPDR, XLF
-1.19% LargeCap 1000 R, IWB
-1.20% Homebuilders SPDR, XHB
-1.22% Value 1000 Russell, IWD
-1.24% Growth SmallCap R 2000, IWO
-1.24% Industrial SPDR, XLI
-1.42% SmallCap Russell 2000, IWM
-1.46% Value SmallCap S&P 600, RZV
-1.47% South Korea Index, EWY
-1.68% Value SmallCap Russell 2000, IWN
-1.91% Real Estate US DJ, IYR
-1.92% REIT VIPERs, VNQ
-2.14% REIT Wilshire, RWR
-2.24% Realty Cohen & Steers, ICF
-2.30% Transportation Av DJ, IYT