When price is very near a moving average, a crossover is more likely with only a small price movement.
Agriculture, PowerShares DB Agriculture Fund ETF (DBA) price turned systematically bearish (from neutral) again on 5/8/13 when price whipsawed back down below the 50-day SMA
Technology (XLK) stock sector Relative Strength Ratio (XLK/SPY) turned systematically neutral (from bearish) again on 5/8/13, when it whipsawed up above the 50-day SMA.
U.S. stocks opened slightly lower but quickly turned higher, rallying to new highs by 12:07 p.m. Prices dipped, then turned upward again after 2:47 p.m., closing at their highest levels of the day.
The S&P 500 Composite Index (SPX: 1,632.69) finished up 0.41% at a new high close, the Nasdaq Composite Index rose 0.49% to a 12-year high, the Dow Jones Industrial Average advanced by 0.32% to a new high, and the Dow Jones Transportation Average rose 0.22% to a new high.
NYSE total volume rose 7% to a level 6% above its 200-day SMA. Rising volume on a price rise confirms that price rise, while falling volume on a price rise may indicate diminishing buying power behind that advance.
Breadth was positive, with 2,729 Advances and 1,247 Declines. In addition, Advancing/Declining Volume was positive, with 2.6 billion Advancing Stock Volume versus 1.2 billion Declining Stock Volume.
My interpretation of the technical indicators has been that the medium-term stock market uptrend evident since November may have been overdone, and the stock market seemed overdue for a significant downside correction. Based on normal market behavior observed over many years past, that interpretation still seems reasonable. With the Fed providing massive artificial stimulus by buying securities at an unprecedented pace of $85 billion of a month, however, there may be reason to question whether past normal standards apply.
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Stock Market Indicators
The Dow Theory confirmed a Primary Tide Bull Market on 5/6/13, when the Dow-Jones Transportation Average followed the lead of the Dow-Jones Industrial Average by finally closing at a new price high.
NASDAQ 100/S&P 500 Relative Strength Ratio (QQQ/SPY) rose above its 50-day SMA on 4/30/13, thereby turning systematically neutral (from bearish).
iShares MSCI BRIC Fund (BKF) Relative Strength Ratio (BKF/SPY) fell below the lows of the previous 4 years on 4/17/13, reconfirming its major downtrend. BKF/SPY turned systematically bearish on 3/27/13, when the 50-day SMA crossed below the 200-day SMA. BKF/SPY fell below its 50-day SMA on 2/4/13 and fell below its 200-day SMA on 2/19/13. Price peaked at 42.29 on 2/1/13 and fell to a 5-month low on 4/17/13.
Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) fell below the lows of the previous 4 years on 4/15/13, reconfirming its major downtrend. EEM/SPY turned systematically bearish on 3/20/13, when the 50-day SMA fell below the 200-day SMA. Price peaked at 45.34 on 1/2/13 and fell to a 5-month low on 4/17/13.
Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) rose above its 50-day SMA on 4/23/13, thereby turning systematically bullish again. EFA price confirmed the uptrend by rising above the highs of the previous 21 months on 5/8/13.
The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEF/SPY) turned systematically bearish again (from neutral) on 4/24/13, when it whipsawed back down below its 50-day SMA. Large Caps tend to outperform in bearish general market trends as investors seek the perceived relative stability and safety of large size. On the other hand, Large Caps tend to underperform Mid Caps and Small Caps in bullish general market trends as investors seek greater potential returns in more volatile, smaller stocks.
The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) fell below the lows of the previous 5 months on 5/1/13. IWM/SPY turned systematically neutral on 4/1/13 when it fell below the 50-day SMA. Absolute price rose to a new high on 5/8/13.
The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) turned systematically bullish (from neutral) on 5/7/13 when it rose above the 50-day SMA. Absolute price rose to a new high on 5/8/13.
Daily price momentum oscillators have been diverging bearishly for many weeks and months while most of the stock price indexes rose to higher highs. Daily price momentum oscillators have remained below their highs of January, 2013, as well as below their 2011-2012 highs. For example, RSI(14) based on the S&P 500 Index peaked at 74.46 on 1/29/13 but was only able to rise to 68.58 on 5/8/13 when the S&P 500 closed at a higher high. And MACD(12,26,9) peaked at 17.88 on 1/29/13 but was lower at 16.96 on 5/8/13. In addition, the percentage of stocks in the S&P 500 trading above their 50-day SMAs failed to rise to higher highs for the year, 2013. Momentum is a leading indicator of price.
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Fixed-Income Investments
Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) price rose above its 50-day SMA on 3/22/13, thereby turning systematically neutral (from bearish). Support 119.88, 117.49, 114.62, 109.69, 106.08, 103.20, 102.27, 96.31, 94.83, 93.14, 89.65, and 88.14. Resistance: 124.26, 126.08, 127.19, 127.72, 130.69, and 132.22.
Bond, iShares Barclays 7-10 Year U.S. Treasury ETF (IEF) price rose above its 50-day SMA on 3/18/13, thereby turning systematically neutral (from bearish). Support 108.39, 107.71, 107.22, 106.56, 105.56, 105.22, 104.77, 103.90, 102.51, 101.77, 101.36, 101.11, 99.79, and 97.66. Resistance: 109.17, 109.20, 109.32, and 109.89.
Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) whipsawed back above its 50-day SMA on 5/3/13, thereby turning systematically bullish (from neutral). JNK/LQD has been neutral for most of the past 3 years.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) turned systematically bearish (from neutral) on 5/6/13, when the 50-day SMA crossed below the 200-day SMA. Absolute price of TIP peaked at 123.44 on 12/6/12 and turned systematically bearish on 5/3/13.
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Tangible Assets, Commodities
U.S. dollar ETF (UUP) price turned systematically neutral (from bullish) on 4/26/13, when it whipsawed back down below the 50-day SMA. Longer term, UUP has been consolidating secular trend losses since bottoming at 20.84 on 5/4/11. Support 22.12, 21.53, 21.07, and 20.84. Resistance 22.69, 22.78, 22.96, 23.14, 23.52, 25.84, 27.19, and 28.97.
Agriculture, PowerShares DB Agriculture Fund ETF (DBA) price turned systematically bearish (from neutral) again on 5/8/13 when price whipsawed back down below the 50-day SMA.
Crude Oil, United States Oil ETF (USO) price turned systematically neutral (from bearish) on 5/2/13 when price rose above the 50-day SMA. Longer term, however, USO had been mostly bearish since peaking at 119.17 on 7/11/08. Support 32.12, 30.79, 29.02, 26.28, and 22.74. Resistance 34.86, 35.53, 37.17, 38.31, 40.29, 41.38, 42.30, and 45.60.
Gold, SPDR Gold Shares ETF (GLD) price fell below its lows of the previous 2 years on 4/15/13, thereby reconfirming its preexisting major bearish trend. Price turned systematically bearish on 2/22/13, when the 50-day SMA fell below the 200-day SMA. Longer term, GLD has been mostly bearish since peaking at 185.85 on 9/6/11. Support: 139.78 135.85, and 130.51. 142.55. Resistance: 143.43, 149.44, 153.85, 156.80, 164.40, 166.94, 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 bearish again on 12/27/12, when the 50-day SMA crossed below the 200-day SMA. Longer term, GDX/GLD has remained mostly bearish for more than 6 years, since 9/5/06.
Silver, iShares Silver Trust ETF (SLV) price fell below its lows of the previous 2 years on 4/15/13, thereby reconfirming its preexisting major bearish trend. Price turned systematically bearish on 3/1/13, when the 50-day SMA fell below the 200-day SMA. Longer term, SLV has been mostly bearish since peaking at 48.35 on 4/28/11. Support 21.96, 20.73, and 19.44. Resistance: 23.70, 27.14, 27.35, 28.50, 28.61, 29.73, 31.41, 32.72, 33.31, 34.08, 36.44, 40.23, 41.49, 42.30, 42.78, 44.71, and 48.35.
Silver/Gold ETFs Ratio (SLV/GLD) fell below its lows of the previous 2 years on 4/24/13, confirming a major downtrend. SLV/GLD remains systematically bearish.
Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) price fell below its lows of the previous 2 years on 5/1/13, thereby reconfirming its preexisting bearish major trend. JJC has been mostly bearish since peaking at 61.69 on 2/14/11. “Dr. Copper” is widely accepted as one of the better indicators of investor confidence (or lack thereof) in the global industrial economy, so price weakness in Copper implies a weak economic outlook.
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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
17.11% , EA.O , ELECTRONIC ARTS
1.81% , EWP , Spain Index, EWP
7.38% , JCP , JC PENNEY
6.89% , MCK , MCKESSON CORP
8.53% , CLF , CLIFFS NATURAL RESOURCES, CLF
10.12% , WFM.O , Whole Foods Market Inc
5.91% , CECO , CAREER EDUCATION CORP
5.65% , X , US STEEL CORP
8.19% , AMD , ADV MICRO DEV
3.36% , LVLT.K , LEVEL 3 COMMUNICATIONS
3.11% , XME , Metals & Mining SPDR, XME
1.26% , IEV , Europe 350 S&P Index, IEV
1.21% , EFG , Growth EAFE MSCI, EFG
3.32% , UNH , UNITEDHEALTH GRP
5.07% , ATI , ALLEGHENY TECH
5.11% , LOW , LOWES
1.82% , PGJ , China LargeCap Growth G D H USX PS, PGJ
1.38% , EWG , Germany Index, EWG
0.78% , EWO , Austria Index, EWO
2.66% , AA , ALCOA
5.04% , CTSH , Cognizant Technology Solutions
1.85% , STI , SUNTRUST BANKS
1.26% , EWD , Sweden Index, EWD
0.65% , IYF , Financial DJ US, IYF
4.50% , LPX , LOUISIANA PAC
3.39% , APOL , APOLLO GROUP
1.37% , FEU , Value LargeCap Euro STOXX 50 DJ, FEU
1.45% , EWQ , France Index, EWQ
1.42% , FEZ , Euro STOXX 50, FEZ
1.38% , EWC , Canada Index, EWC
2.66% , MU.O , MICRON TECH
1.37% , PCAR , PACCAR
1.87% , XRAY , DENTSPLY International Inc
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Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-3.73% , WMB , WILLIAMS
-6.99% , CHRW.O , CH Robinson Worldwide Inc, CHRWD
-2.19% , KBH , KB HOME
-1.26% , LAMR , Lamar Advertising Company
-2.43% , SYMC , SYMANTEC
-1.93% , GNW , GENWORTH FINANCIAL
-1.03% , NWSA , News Corporation, NWSA
-0.74% , IDU , Utilities DJ, IDU
-0.82% , VPU , Utilities VIPERs, VPU
-1.38% , KSS , KOHLS
-1.52% , EIX , EDISON INTL
-0.47% , RTN , RAYTHEON
-1.05% , LMT , LOCKHEED MARTIN
-0.51% , HES , AMERADA HESS
-0.95% , NEE , NextEra Energy Resources LLC
-1.31% , MCD , MCDONALDS
-0.47% , AMP , Ameriprise Financial Inc.
-0.72% , BIG , BIG LOTS
-0.32% , SNDK , SanDisk Corporation
-0.44% , MCO , MOODYS CORP
-0.26% , ODP , OFFICE DEPOT
-0.74% , WMT , WAL MART STORES
-0.62% , MRK , MERCK & CO
-0.17% , CAH , CARDINAL HEALTH
-1.07% , DUK , DUKE ENERGY
-0.32% , MNST , Monster Beverage, MNST
-0.18% , ETFC , E*TRADE FINANCIAL
-0.50% , FPX , IPOs, First Tr IPOX-100, FPX
-0.56% , XL , XL CAPITAL STK A
-0.31% , TE , TECO ENERGY
-0.09% , SEE , SEALED AIR
-0.16% , PLL , PALL
-0.05% , PGF , Financial Preferred, PGF
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
3.11% , Metals & Mining SPDR, XME
2.10% , Thailand MSCI iS, THD
1.98% , Taiwan Index, EWT
1.84% , South Africa Index, EZA
1.82% , China LargeCap Growth G D H USX PS, PGJ
1.81% , Spain Index, EWP
1.76% , Switzerland Index, EWL
1.66% , Italy Index, EWI
1.48% , Gold Shares S.T., GLD
1.47% , Turkey MSCI iS, TUR
1.45% , France Index, EWQ
1.43% , Semiconductor SPDR, XSD
1.38% , Germany Index, EWG
1.38% , Canada Index, EWC
1.29% , European VIPERs, VGK
1.26% , Belgium Index, EWK
1.26% , Sweden Index, EWD
1.26% , Europe 350 S&P Index, IEV
1.21% , Growth EAFE MSCI, EFG
1.19% , EMU Europe Index, EZU
1.17% , Oil Fund PowerShares, DBO
1.16% , Telecom DJ US, IYZ
1.15% , Oil, Crude, U.S. Oil Fund, USO
1.10% , Singapore Index, EWS
1.07% , Semiconductor iS IGW, SOXX
1.05% , Foreign LargeCap EAFE MSCI iS, EFA
1.04% , Basic Materials DJ US, IYM
1.02% , Netherlands Index, EWN
1.00% , Networking, IGN
0.98% , Emerging 50 BLDRS, ADRE
0.98% , Global ex U.S. LargeCap Blend, ACWX
0.98% , Water Resources, PHO
0.95% , SmallCap Blend EAFE MSCI iS, SCZ
0.93% , Capital Markets KWB ST, KCE
0.92% , Dividend ex-U.S. DJ iS, IDV
0.90% , Value EAFE MSCI, EFV
0.89% , United Kingdom Index, EWU
0.89% , Emerging VIPERs, VWO
0.87% , Materials SPDR, XLB
0.85% , Japan Index, EWJ
0.85% , Global LargeCap Blend MSCI iS, ACWI
0.84% , Australia Index, EWA
0.83% , Technology DJ US, IYW
0.81% , China 25 iS, FXI
0.81% , Financial SPDR, XLF
0.80% , Technology SPDR, XLK
0.78% , Austria Index, EWO
0.77% , Emerging Markets MSCI iS, EEM
0.77% , Energy & Nat Res iS GS, IGE
0.77% , Financial Services DJ, IYG
0.76% , Info Tech VIPERs, VGT
0.73% , Pacific ex-Japan, EPP
0.72% , Pacific VIPERs, VPL
0.70% , Dividend International, PID
0.68% , Financials VIPERs, VFH
0.68% , Global 100, IOO
0.66% , MidCap S&P 400 SPDRs, MDY
0.65% , Financial DJ US, IYF
0.64% , Bond Ex-US Treas, BWX
0.63% , Industrial SPDR, XLI
0.62% , Russia MV, RSX
0.58% , India Earnings WTree, EPI
0.54% , Energy Global, IXC
0.53% , Growth VIPERs, VUG
0.52% , Growth MidCap Russell, IWP
0.52% , Growth SmallCap VIPERs, VBK
0.51% , LargeCap VIPERs, VV
0.51% , MidCap Growth S&P 400 iS, IJK
0.49% , Value MidCap Russell, IWS
0.49% , LargeCap Value Russell 1000 iS, IWD
0.49% , Value VIPERs, VTV
0.48% , LargeCap Blend S&P=Weight R, RSP
0.48% , QQQ Nasdaq 100 Trust, QQQ
0.48% , LargeCap Blend Russell 1000 iS, IWB
0.48% , India PS, PIN
0.47% , LargeCap Value S&P 500 iS, IVE
0.47% , LargeCap Blend S&P 500 iS, IVV
0.47% , Blend Total Market VIPERs, VTI
0.46% , MidCap Russell, IWR
0.46% , LargeCap Growth Russell 1000 iS, IWF
0.46% , MidCap Blend S&P 400 iS, IJH
0.46% , SmallCap Value S&P 600 iS, IJS
0.46% , Commodity Tracking, DBC
0.46% , S&P 500 SPDRs LargeCap Blend, SPY
0.45% , DIAMONDS (DJIA), DIA
0.45% , LargeCap Blend S&P 100, OEF
0.44% , MidCap Value S&P 400 iS, IJJ
0.43% , LargeCap Growth S&P 500 iS, IVW
0.42% , WilderHill Clean Energy PS, PBW
0.41% , LargeCap Blend Russell 3000 iS, IWV
0.40% , SmallCap Blend S&P 600 iS, IJR
0.40% , Small Cap VIPERs, VB
0.38% , Homebuilders SPDR, XHB
0.37% , Dividend Appreciation Vipers, VIG
0.37% , Indonesia MV, IDX
0.37% , SmallCap Growth S&P 600 iS, IJT
0.36% , Bond, High-Yield Junk, JNK
0.35% , Bond, High Yield Corp iBoxx iS, HYG
0.29% , Health Care SPDR, XLV
0.29% , SmallCap Blend Russell 2000 iS, IWM
0.29% , Transportation Av DJ, IYT
0.26% , Value SmallCap VIPERS, VBR
0.26% , SmallCap Value Russell 2000 iS, IWN
0.24% , Preferred Stock iS, PFF
0.24% , Real Estate US DJ iS, IYR
0.24% , Chile MSCI iS, ECH
0.23% , Energy VIPERs, VDE
0.22% , South Korea Index, EWY
0.18% , Brazil Index, EWZ
0.18% , Dividend SPDR, SDY
0.17% , Energy DJ, IYE
0.17% , SmallCap Growth Russell 2000 iS, IWO
0.16% , Frontier Markets Guggenheim , FRN
0.16% , Energy SPDR, XLE
0.16% , Bond, 20+ Years Treasury, TLT
0.12% , Consumer Staples SPDR, XLP
0.12% , Bond, 10 Year Treasury, IEF
0.12% , Value LargeCap Dynamic PS, PWV
0.11% , Latin Am 40, ILF
0.10% , Hong Kong Index, EWH
0.10% , Biotech SPDR, XBI
0.09% , Bond, Long-Term Corp iBoxx iS, LQD
0.09% , Bond, Intermediate US Aggregate iS, AGG
0.09% , Silver Trust iS, SLV
0.07% , Consumer Discretionary SPDR, XLY
0.07% , Bond, Emerging Mkt JPM iS, EMB
0.06% , Malaysia Index, EWM
0.05% , REIT VIPERs, VNQ
0.05% , Dividend High Yield Equity PS, PEY
0.01% , Bond, 1-3 Year Treasury, SHY
0.00% , Bond, Muni S&P ATM-Free iS, MUB
0.00% , Bond Treasury Short-Term iS, SHV
-0.02% , REIT Wilshire, RWR
-0.05% , Financial Preferred, PGF
-0.09% , Dividend U.S. DJ iS, DVY
-0.15% , Microcap Russell, IWC
-0.22% , Bond, TIPS U.S. Treasury iS, TIP
-0.22% , Realty Cohen & Steers, ICF
-0.35% , Agriculture DB PS, DBA
-0.37% , Mexico Index, EWW
-0.51% , Bear, Short S&P 500, SH
-0.82% , Utilities VIPERs, VPU
-0.88% , Utilities SPDR, XLU
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The S&P 500 Composite Potential Resistance
1632.78, intraday high of 5/7/2013
The S&P 500 Composite Potential Support
1565.47, 50-day SMA
1536.03, low of 4/18/2013
1485.01, low of 2/26/2013
1474.51, high of 9/14/2012
1467.97, 200-day SMA
1463.76, low of 1/15/2013
1451.64, low on 1/8/13
1448.00, high of 12/19/2012
1440.24, high of 5/19/2008
1439.15, high of 9/12/2012
1438.59, high of 12/12/2012
1434.27, high of 11/2/2012
1432.82, low of 12/20/2012
1430.53, low of 9/26/2012
1426.76, low of 12/12/2012
1425.53, low of 10/12/2012
1423.73, high of 12/3/2012
1422.58, low of 12/21/2012
1422.38, high of 4/2/2012
1422.06, low of 10/22/2012
1421.12, high of 10/25/2012
1420.34, high of 12/7/2012
1419.70, high of 11/29/2012
1418.71, high of 8/17/2012
1415.32, high of 5/1/2012
1409.16, high of 11/23/2012
1403.28, low of 10/26/12
1401.58, low of 12/28/12
1398.11, low of 12/31/2012
1397.68, low of 11/26/2012
1396.56, low of 9/4/2012
1391.04, low of 8/6/2012
1388.71, low of 5/3/2012
1385.43, low of 11/28/2012
1381.50, Fibonacci 78.6% of 2007-2009 range
1380.39, high of 7/19/2012
1374.81, high of 7/3/2012
1370.58, high of 5/2/2011
1363.49, high of 6/19/2012
1357.38, low of 4/10/2012
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
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
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
