Small- and mid-cap stock price indexes continued to demonstrate relative weakness.
Crude Oil, United States Oil ETF (USO) fell below the lows of the previous 4 trading days and closed below its 20-, 50-, and 200-day simple moving averages.
Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) crossed below its 20- and 50-day simple moving averages and remains below its 200-day SMA. JNK/LQD broke down below 9-month lows on 6/16/11, thereby confirming a major downtrend.
Advisory Service Sentiment: There were 49.5% Bulls versus 21.5% Bears as of 7/27/11, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear Ratio rose to 2.30, which suggests 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 jumped to 23.20 intraday on 7/27/11, up from a low of 15.12 on 7/1/11. This is the highest level of fear in 8 weeks, but it is still well below the 31.28 peak in March.
The S&P 500 Composite (SPX, 1,304.89 ) fell 27.05 points or 2.03% on Wednesday, July 27, 2011. Trading was active, confirming the price downtrend, with NYSE volume 14% above its 200-day simple moving average. SPX broke down below the lows of the previous 6 trading days and fell below its 20- and 50-day simple moving averages. Sensitive momentum indicators fell steeply after previously rolling over and showing bearish divergences, as noted here in recent days.
Both Dow-Jones Industrial and Transportation Averages closed below 4-week closing price lows, confirming short-term downtrends.
As of the close on July 21, 2011, the Dow Theory suggested a divergence and non-confirmation as the Dow-Jones Industrial Average closed above its closing prices of the previous 2 months but the Dow-Jones Transportation Average failed to confirm a similar breakout above its recent trading range.
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.”
There is a strategy that gained over the past 3 months, while most other strategies lost; see:
The Colby Global Markets Report (click here).
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
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
16.31% , JNY , JONES APPAREL
4.83% , WMB , WILLIAMS
2.49% , PSQ , Short 100% QQQ, PSQ
2.76% , MYY , Short 100% MidCap 400, MYY
3.79% , ACE , ACE
5.02% , QID , Short 200% QQQ PS, QID
2.03% , SH , Short 100% S&P 500, SH
4.08% , SDS , Short 200% S&P 500 PS, SDS
5.54% , MZZ , Short 200% MidCap 400 PS, MZZ
3.92% , IGT , INTL GAME TECH
1.64% , WYN , Wyndham Worldwide
1.55% , DOG , Short 100% Dow 30, DOG
1.24% , RFMD , RF Micro Devices Inc
0.58% , HSP , HOSPIRA
1.92% , GILD , Gilead Sciences Inc
3.89% , AMZN , Amazoncom Inc
3.22% , DXD , Short 200% Dow 30 PS, DXD
0.75% , NSC , NORFOLK SOUTHERN
0.58% , EP , EL PASO
0.29% , EWW , Mexico Index, EWW
0.24% , PST , 200% Short Bond 7-10 Yr T, PST
0.40% , R , RYDER SYSTEM
0.67% , BA , BOEING
0.81% , EXC , EXELON CORP
0.61% , CEG , CONSTELL ENERGY
0.45% , CLX , CLOROX
0.46% , PPL , PPL
0.20% , KR , KROGER
0.64% , PWER , POWER ONE
0.19% , TIP , Bond, TIPS, TIP
0.07% , T , AT&T Corp., T
0.03% , IDX , Indonesia MV, IDX
0.03% , DISCA , Discovery Communications
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-2.32% , IWZ , Growth LargeCap Russell 3000, IWZ
-3.02% , PEJ , Leisure & Entertainment, PEJ
-2.62% , FDV , Value 40 Large Low P/E FT DB, FDV
-12.87% , TUP , TUPPERWARE
-2.53% , ONEQ , Growth LargeCap NASDAQ Fidelity, ONEQ
-2.84% , PPA , Aerospace & Defense, PPA
-3.72% , XSD , Semiconductor SPDR, XSD
-2.20% , RPV , Value S&P 500, RPV
-2.65% , VO , MidCap VIPERs, VO
-3.90% , BDH , Broadband H, BDH
-7.94% , CHRW.O , CH Robinson Worldwide Inc, CHRWD
-3.48% , PSJ , Software, PSJ
-10.75% , CIEN.O , CIENA
-6.61% , WLP , WELLPOINT HEALTH
-4.56% , PXN , Nanotech Lux, PXN
-2.63% , IEV , Europe 350 S&P Index, IEV
-3.87% , KWT , Solar Energy MV, KWT
-2.53% , EWK , Belgium Index, EWK
-6.70% , EMR , EMERSON ELECTRIC
-1.85% , IVE , Value S&P 500 B, IVE
-1.83% , IWW , Value LargeCap Russell 3000, IWW
-3.31% , FEZ , Euro STOXX 50, FEZ
-2.88% , IJR , SmallCap S&P 600, IJR
-3.09% , PHO , Water Resources, PHO
-3.77% , SIL , Silver Miners Global X, SIL
-5.06% , JBL , JABIL CIRCUIT
-5.00% , BHH , Internet B2B H, BHH
-3.67% , GCI , GANNETT
-3.85% , ASH , ASHLAND
-1.41% , IXP , Telecommunications Global, IXP
-5.47% , HUM , HUMANA
-3.64% , XLNX , XILINX
-2.75% , IJH , MidCap S&P 400 iS, IJH
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
9 Major U.S. Stock Sectors
ranked in order of long-term relative strength
Major trend rankings are available by subscription–
NOW WITH A NO-RISK FREE TRIAL.
The Colby Global Markets Report
(click here for a no-risk free trial)
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .
Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) fell 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, 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 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 appears to be stalling out below its high set on 1/18/11. Long term, the trend remains bullish. Absolute price peaked on 5/2/11 at 2,887.75 (intraday) and appears to be turning down again below that high.
The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) rose above the highs of the previous 4 months on 7/25/11, suggesting a medium-term 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) fell below 6-week lows on 7/27/11. IWM/SPY appears bearish for the short term.
The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) fell sharply below 4-month lows on 7/27/11. MDY/SPY appears bearish for the medium term.
Agriculture, PowerShares DB Agriculture Fund ETF (DBA) fell below the lows of the previous 2 weeks on 7/25/11, suggesting a short-term price pullback. DBA may be forming a bearish Descending Triangle Top Reversal Pattern since its high at 35.58 set 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) fell below the lows of the previous 4 trading days and closed below its 20-, 50-, and 200-day simple moving averages. Support 36.93 and 35.14. Resistance 39.25, 40.74, and 45.60.
Gold, SPDR Gold Shares ETF (GLD) rose above previous all-time price highs intraday on 7/27/11 but reversed to close lower for the day on 7/27/11. Minor profit taking is normal in a major 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: 154.10, 153.61, 147.19, 143.97, 143.42, and 142.55. Resistance: none.
Gold Mining Stocks ETF (GDX) Relative (to the Gold bullion ETF) Strength Ratio (GDX/GLD) turned back down again on 7/25/11 and crossed under its 50-day SMA on 7/27/11. GDX fell below 27-month lows on 6/17/11, which was a bearish indication for the long term. The Ratio is down substantially since its peak on 4/8/11, and the main trend remains bearish.
Silver, iShares Silver Trust ETF (SLV) rose above the highs of the previous 11 weeks but reversed to close lower for the day on 7/27/11. Silver appears to have emerged on the bullish side of a 2-month Triangle Consolidation. Support 37.23, 34.02, and 31.97. Resistance: 44.71 and 48.35.
Silver/Gold ETFs Ratio (SLV/GLD) rose above the highs of the previous 11 weeks on 7/26/11, thereby confirming a short-term minor uptrend. The SLV/GLD Ratio is in a bullish position relative to 50- and 200-day SMAs.
Copper, iPath DJ-UBS Copper TR Sub-Idx ETN (JJC ) consolidated gains after rising 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: 59.06, 60.04, and 61.69.
Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) fell below the lows of the previous 2 weeks on 7/25/11, confirming a short-term price pullback. The U.S. debt ceiling blame game in Washington may offer an unquantifiable risk for the financial markets. Technically, larger trends still appear bullish since TLT bottomed at 88.14 on 2/9/11. Support 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) crossed below its 20- and 50-day simple moving averages on 7/27/11 and remains below its 200-day SMA. JNK/LQD broke down below 9-month lows on 6/16/11, thereby confirming a major downtrend.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) rose above the highs of the previous 9 weeks on 7/25/11, suggesting a medium-term uptrend. The TIP/IEF Ratio has been weak since 2005, however, and remains in a long-term downtrend. That means fixed-income investors have preferred 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 11 weeks on 7/26/11, again confirming a significant downtrend. In addition, on 7/21/11, UUP fell below the lower boundary line of a Symmetrical Triangle Consolidation Pattern from the low at 20.84 on 5/4/11. Support 21.01 and 20.84. Resistance 21.74, 21.86, and 22.21.
Advisory Service Sentiment: There were 49.5% Bulls versus 21.5% Bears as of 7/27/11, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear Ratio rose to 2.30, which suggests 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 jumped to 23.20 intraday on 7/27/11, up from a low of 15.12 on 7/1/11. This is the highest level of fear in 8 weeks, but it is still well below the 31.28 peak in March. 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.
As of the close on July 21, 2011, the Dow Theory suggested a divergence and non-confirmation as the Dow-Jones Industrial Average closed above its closing prices of the previous 2 months but the Dow-Jones Transportation Average failed to confirm a similar breakout above its recent trading range.
The S&P 500 Composite (SPX, 1,304.89) fell 27.05 points or 2.03% on Wednesday, July 27, 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
1347.00, high of 7/21/11
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
0.29% Mexico Index, EWW
0.19% Bond, TIPS, TIP
0.03% Indonesia MV, IDX
0.02% Bond Treasury Short-Term iS, SHV
0.01% Bond, 20+ Years Treasury, TLT
-0.02% Bond Ex-US Treas, BWX
-0.05% Bond EmrgMkt JPM iS, EMB
-0.06% Bond, 1-3 Year Treasury, SHY
-0.16% Bond, 10 Year Treasury, IEF
-0.17% Bond, Aggregate, AGG
-0.18% Agriculture DB PS, DBA
-0.30% Utilities SPDR, XLU
-0.30% Bond, Corp, LQD
-0.33% Bond Muni ATM-Free S&P iS, MUB
-0.37% Gold Shares S.T., GLD
-0.44% Utilities VIPERs, VPU
-0.51% Financial Preferred, PGF
-0.56% Singapore Index, EWS
-0.59% Preferred Stock iS, PFF
-0.64% Hong Kong Index, EWH
-0.66% Malaysia Index, EWM
-0.68% Commodity Tracking, DBC
-0.72% Bond, High-Yield Junk, JNK
-0.74% Turkey MSCI iS, TUR
-0.78% Taiwan Index, EWT
-0.79% Bond, High-Yield Corporate, HYG
-0.91% Thailand MSCI iS, THD
-1.08% Consumer Staples SPDR, XLP
-1.15% Dividend High Yield Equity PS, PEY
-1.15% Australia Index, EWA
-1.25% South Korea Index, EWY
-1.32% Pacific ex-Japan, EPP
-1.34% India PS, PIN
-1.40% Pacific VIPERs, VPL
-1.41% China 25 iS, FXI
-1.45% Telecom DJ US, IYZ
-1.54% Dividend DJ Select, DVY
-1.55% India Earnings WTree, EPI
-1.58% Emerging VIPERs, VWO
-1.59% DIAMONDS (DJIA), DIA
-1.62% South Africa Index, EZA
-1.66% Japan Index, EWJ
-1.67% Dividend International, PID
-1.68% Emerging 50 BLDRS, ADRE
-1.68% Frontier Markets Guggenheim , FRN
-1.69% Latin Am 40, ILF
-1.69% Dividend SPDR, SDY
-1.73% Health Care SPDR, XLV
-1.74% Consumer Discretionary SPDR, XLY
-1.75% Russia MV, RSX
-1.75% China LargeCap Growth G D H USX PS, PGJ
-1.75% Oil Fund PowerShares, DBO
-1.75% Value LargeCap Dynamic PS, PWV
-1.76% Emerging Markets, EEM
-1.81% Silver Trust iS, SLV
-1.81% LargeCap Blend S&P 100, OEF
-1.85% Value S&P 500 B, IVE
-1.86% Value VIPERs, VTV
-1.88% Dividend Appreciation Vipers, VIG
-1.89% Energy SPDR, XLE
-1.91% Value 1000 Russell, IWD
-1.92% Small Cap EAFE MSCI iS, SCZ
-1.93% Chile MSCI iS, ECH
-1.95% Energy DJ, IYE
-2.01% Switzerland Index, EWL
-2.03% S&P 500 iS LargeCap Blend, IVV
-2.04% Growth EAFE MSCI, EFG
-2.04% Energy VIPERs, VDE
-2.05% S&P 500 SPDRs LargeCap Blend, SPY
-2.06% Energy Global, IXC
-2.09% Global ex US ACWI iS, ACWX
-2.11% LargeCap VIPERs, VV
-2.12% Growth S&P 500/BARRA, IVW
-2.15% LargeCap 1000 R, IWB
-2.16% Value MidCap Russell, IWS
-2.16% Oil, Crude, U.S. Oil Fund, USO
-2.19% Brazil Index, EWZ
-2.20% Blend Total Market VIPERs, VTI
-2.22% LargeCap Blend Russell 3000, IWV
-2.24% Growth 1000 Russell, IWF
-2.27% Global 100, IOO
-2.28% Materials SPDR, XLB
-2.30% Growth VIPERs, VUG
-2.31% United Kingdom Index, EWU
-2.35% Energy & Nat Res iS GS, IGE
-2.35% Value EAFE MSCI, EFV
-2.36% Financial DJ US, IYF
-2.37% Financial SPDR, XLF
-2.38% LargeCap Blend S&P=Weight R, RSP
-2.40% Homebuilders SPDR, XHB
-2.43% EAFE Index, EFA
-2.46% Basic Materials DJ US, IYM
-2.51% Transportation Av DJ, IYT
-2.51% MidCap Russell, IWR
-2.53% Value SmallCap VIPERS, VBR
-2.53% Belgium Index, EWK
-2.55% Austria Index, EWO
-2.55% Financial Services DJ, IYG
-2.57% Value MidCap S&P 400 B, IJJ
-2.57% Financials VIPERs, VFH
-2.57% QQQ Nasdaq 100 Trust, QQQ
-2.62% Value SmallCap Russell 2000, IWN
-2.63% Europe 350 S&P Index, IEV
-2.64% Value SmallCap S&P 600 B, IJS
-2.65% Technology SPDR, XLK
-2.69% Real Estate US DJ, IYR
-2.70% Realty Cohen & Steers, ICF
-2.71% Industrial SPDR, XLI
-2.74% MidCap S&P 400 SPDRs, MDY
-2.75% MidCap S&P 400 iS, IJH
-2.76% Canada Index, EWC
-2.77% REIT Wilshire, RWR
-2.78% Microcap Russell, IWC
-2.79% Sweden Index, EWD
-2.80% Netherlands Index, EWN
-2.81% REIT VIPERs, VNQ
-2.84% Growth MidCap Russell, IWP
-2.88% SmallCap S&P 600, IJR
-2.89% Small Cap VIPERs, VB
-2.93% France Index, EWQ
-2.96% European VIPERs, VGK
-2.96% Growth MidCap 400 B, IJK
-2.97% EMU Europe Index, EZU
-2.97% Biotech SPDR, XBI
-2.98% SmallCap Russell 2000, IWM
-2.99% Germany Index, EWG
-3.02% Technology DJ US, IYW
-3.03% Growth BARRA Small Cap 600, IJT
-3.04% Info Tech VIPERs, VGT
-3.09% Water Resources, PHO
-3.15% Growth SmallCap VIPERs, VBK
-3.18% Growth SmallCap R 2000, IWO
-3.38% Metals & Mining SPDR, XME
-3.40% Capital Markets KWB ST, KCE
-3.48% WilderHill Clean Energy PS, PBW
-3.56% Semiconductor iS IGW, SOXX
-3.72% Semiconductor SPDR, XSD
-3.77% Silver Miners Global X, SIL
-3.94% Spain Index, EWP
-4.46% Italy Index, EWI
-6.07% Networking, IGN
