U.S. dollar ETF (UUP) turned systematically neutral again on 1/8/13 when whipsawed back above its 50-day SMA and a 6-months long downtrend line.
VIX Fear Index collapsed to 13.62 on 1/8/13 from 23.23 on 12/28/12. This indicates a rapid shift to bullish complacency from worried concern.
The S&P 500 (SPX: 1,457.15 ) fell 4.74 points or 0.32% on Tuesday in 9% more active trading. SPX fell below its lows of the previous 3 trading days. The bullish majority is left to reflect on the meaning of indecisive Spinning Top Candlesticks and the disappointment of lack of upside follow through after Friday’s unconfirmed closing high for SPX.
The Art of Contrary Thinking calls for questioning popular optimism. Investor sentiment data indicated alarming degrees of optimism and bullish complacency in recent weeks, matching extremes in September, 2012, when many stock price indexes hit peaks and reversed to the downside. Elevated levels of optimism are bearish because when the majority is extremely bullish, investors are already fully invested in the market. Once everyone who is going to buy has already bought, stocks are vulnerable to a downside shakeout. The pendulum of emotion tends to swing too far in one direction, but the market mood always reverts to the mean.
Our clients’ separately managed accounts made gains in 6 of the past 7 consecutive quarters; see:
Robert W. Colby Asset Management, Inc. (click here).
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Fixed-Income Investments
Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) fell below its 50-day SMA on 12/12/12, thereby turning systematically neutral again. TLT whipsawed back down below its 200-day SMA again on 1/2/13. Longer term, TLT’s 50-day SMA has remained above the 200-day SMA every day since 6/24/11. Support 117.36, 115.69, 114.82, 109.69, 106.08, 103.20, 102.27, 96.31, 94.83, 93.14, 89.65, and 88.14. Resistance: 123.71, 126.08, 127.19, 127.72, 130.69, and 132.22.
Bond, iShares Barclays 7-10 Year U.S. Treasury ETF (IEF) fell below its 50-day SMA on 12/12/12, thereby turning systematically neutral again. IEF whipsawed back down below its 200-day SMA again on 1/2/13. IEF’s 50-day SMA has remained above the 200-day SMA every day since 6/21/11. Support 106.21, 105.84, 105.22, 104.77, 103.90, 102.51, 101.77, 101.36, 101.11, 99.79, and 97.66. Resistance: 108.07, 108.15, 109.20, 109.32, and 109.89.
Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) remains systematically neutral. JNK/LQD 50-day SMA has remained consistently below the 200-day SMA every day since 6/1/12.
U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) turned systematically bullish again on 1/7/13 when it whipsawed back above its 50-day SMA. TIP/IEF rose above its 200-day SMA on 9/27/12, and the 50-day SMA rose above the 200-day SMA on 10/10/12.
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Tangible Assets, Commodities
U.S. dollar ETF (UUP) turned systematically neutral again on 1/8/13 when whipsawed back above its 50-day SMA and a 6-months long downtrend line. UUP fell below its 200-day SMA on 8/31/12, and the 50-day SMA fell below the 200-day SMA on 10/2/12. Support 21.57, 21.07, and 20.84. Resistance 22.05, 22.30, 22.45, 23.14, 23.52, 25.84, 27.19, 28.97.
Agriculture, PowerShares DB Agriculture Fund ETF (DBA) price fell below its lows of the previous 6 months on 1/4/13. DBA turned systematically neutral on 11/30/12 when price crossed back down below its 50-day SMA. The 50-day SMA remains above the 200-day SMA, although the 50-200 spread has been narrowing, and the two SMAs could cross in weeks ahead.
Crude Oil, United States Oil ETF (USO) price rose above its highs of the previous 2 months on 1/2/13. USO turned systematically neutral on 12/26/12, when price rose back above its 50-day SMA. USO price fell below its 200-day SMA on 9/17/12, and the 50-day SMA has remained below its 200-day SMA consistently every day since 6/7/12. Support 31.00, 29.02, 26.28, and 22.74. Resistance 34.70, 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 4 months on 12/20/12. GLD turned systematically neutral on 11/27/12, when price fell below its 50-day SMA. Support: 158.39, 157.40, 154.83, 148.27, 147.19, 143.97, 143.42, and 142.55. Resistance: 164.14, 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 on 12/27/12 when the 50-day SMA crossed below the 200-day SMA.
Silver, iShares Silver Trust ETF (SLV) price turned systematically neutral on 12/13/12 when it fell below its 50-day SMA. Support 28.61, 27.97, 26.87, 26.13, 25.34, 25.00, 24.44, 22.52, 20.73, and 19.44. Resistance: 30.04, 30.47, 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 4 months on 12/20/12. SLV/GLD turned systematically neutral on 12/14/12 when it fell below its 50-day SMA.
Copper, iPath DJ-UBS Copper TR Sub-Index ETN (JJC) turned systematically neutral on 12/26/12, when it rose above its 50-day SMA. Long term, JJC has been consolidating losses in Triangle chart pattern trading range between 38.99 and 51.41 for more than a year since October 2011. “Dr. Copper” is widely accepted as one of the better indicators of investor confidence (or lack thereof) in the global industrial economy.
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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
4.95% , OMX , OFFICEMAX INC., OMX
2.67% , MON , MONSANTO
2.32% , SNI , Scripps Networks Interactive
2.30% , OXY , OCCIDENTAL
1.11% , HOLX , Hologic, Inc., HOLX
1.95% , CTB , COOPER TIRE
2.93% , DISCA , Discovery Communications
2.46% , TIF , TIFFANY
2.10% , TWX , TIME WARNER INC
2.60% , GPS , GAP
1.45% , HPQ , HEWLETT PACKARD
1.69% , DV , DeVry, Inc.
1.42% , PPG , PPG INDUSTRIES
1.56% , SHW , SHERWIN WILLIAMS
1.94% , SIRI , Sirius Satellite
0.68% , WY , WEYERHAEUSER
1.91% , BF.B , BROWN FORMAN STK B
1.27% , BCR , C R BARD
1.10% , LUV , SOUTHWEST AIRLS
0.69% , CMCSA , COMCAST HOLDINGS STK A
1.26% , BEN , FRANKLIN RSC
3.15% , LPX , LOUISIANA PAC
0.27% , DBO , Oil Fund PowerShares, DBO
0.68% , GILD , Gilead Sciences Inc
1.06% , NEE , NextEra Energy Resources LLC
0.89% , BDX , BECTON DICKINSON
0.39% , OMC , OMNICOM
1.22% , NEM , NEWMONT MINING
3.06% , COH , COACH
0.41% , FDX , FEDEX
0.17% , S , SPRINT NEXTEL
1.17% , KWT , Solar Energy MV, KWT
0.55% , WLP , WELLPOINT HEALTH
Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-6.43% , SHLD , SEARS HOLDINGS
-7.56% , RSH , RADIOSHACK
-4.20% , YUM , YUM BRANDS
-7.42% , MTG , MGIC INVESTMENT
-4.67% , ERIC.O , LM Ericsson Telephone Company
-2.63% , BA , BOEING
-3.68% , CIEN.O , CIENA
-2.60% , APOL , APOLLO GROUP
-2.22% , AZO , AUTOZONE
-3.48% , GNW , GENWORTH FINANCIAL
-3.86% , AET , AETNA
-4.75% , HMA , HEALTH MGMT STK A
-3.25% , ZEUS , Olympic Steel, ZEUS
-4.25% , SNV , SYNOVUS
-1.38% , IGN , Networking, IGN
-2.32% , ROK , ROCKWELL AUTOMAT
-2.04% , XLNX , XILINX
-5.77% , MBI , MBIA
-1.45% , CB , CHUBB
-2.88% , ATI , ALLEGHENY TECH
-1.42% , PETM , PETsMART Inc
-1.26% , LM , LEGG MASON
-2.35% , NE , NOBLE
-1.41% , SRE , SEMPRA ENERGY
-2.04% , CSC , COMPUTER SCIENCE
-1.48% , BLL , BALL
-2.00% , ZION , ZIONS
-1.07% , ADRE , Emerging 50 BLDRS, ADRE
-3.16% , GNTX , Gentex Corporation
-1.00% , CTL , CENTURYTEL
-1.64% , ACE , ACE
-2.09% , KR , KROGER
-0.76% , RPV , Value S&P 500, RPV
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
0.86% Biotech SPDR, XBI
0.71% Gold Shares S.T., GLD
0.69% Silver Trust iS, SLV
0.66% Bond, 20+ Years Treasury, TLT
0.49% India PS, PIN
0.43% Water Resources, PHO
0.33% Homebuilders SPDR, XHB
0.27% Bear, Short S&P 500, SH
0.27% Financial Preferred, PGF
0.27% Oil Fund PowerShares, DBO
0.25% Commodity Tracking, DBC
0.24% Bond, 10 Year Treasury, IEF
0.23% WilderHill Clean Energy PS, PBW
0.23% Frontier Markets Guggenheim , FRN
0.22% Italy Index, EWI
0.20% Microcap Russell, IWC
0.18% Bond, Muni S&P ATM-Free iS, MUB
0.16% Materials SPDR, XLB
0.14% Bond, TIPS U.S. Treasury iS, TIP
0.13% Bond Ex-US Treas, BWX
0.13% Spain Index, EWP
0.12% Oil, Crude, U.S. Oil Fund, USO
0.09% Bond, Long-Term Corp iBoxx iS, LQD
0.09% Bond, Intermediate US Aggregate iS, AGG
0.08% Preferred Stock iS, PFF
0.02% Health Care SPDR, XLV
0.01% Bond, 1-3 Year Treasury, SHY
0.00% India Earnings WTree, EPI
0.00% Bond Treasury Short-Term iS, SHV
-0.02% SmallCap Growth Russell 2000 iS, IWO
-0.02% Bond, High-Yield Junk, JNK
-0.04% Thailand MSCI iS, THD
-0.04% Switzerland Index, EWL
-0.06% SmallCap Growth S&P 600 iS, IJT
-0.07% Canada Index, EWC
-0.07% SmallCap Blend Russell 2000 iS, IWM
-0.07% Bond, High Yield Corp iBoxx iS, HYG
-0.08% MidCap Growth S&P 400 iS, IJK
-0.08% SmallCap Value Russell 2000 iS, IWN
-0.11% Financial DJ US, IYF
-0.11% Dividend Appreciation Vipers, VIG
-0.13% France Index, EWQ
-0.15% LargeCap Growth S&P 500 iS, IVW
-0.16% Utilities VIPERs, VPU
-0.17% Energy DJ, IYE
-0.19% Realty Cohen & Steers, ICF
-0.19% Small Cap VIPERs, VB
-0.19% REIT VIPERs, VNQ
-0.20% QQQ Nasdaq 100 Trust, QQQ
-0.20% Real Estate US DJ iS, IYR
-0.20% Energy VIPERs, VDE
-0.20% Dividend SPDR, SDY
-0.20% Europe 350 S&P Index, IEV
-0.21% Turkey MSCI iS, TUR
-0.21% Growth VIPERs, VUG
-0.21% Dividend High Yield Equity PS, PEY
-0.21% Indonesia MV, IDX
-0.21% SmallCap Blend S&P 600 iS, IJR
-0.23% Financials VIPERs, VFH
-0.23% Growth MidCap Russell, IWP
-0.24% REIT Wilshire, RWR
-0.25% LargeCap Blend Russell 3000 iS, IWV
-0.25% LargeCap VIPERs, VV
-0.26% Info Tech VIPERs, VGT
-0.27% Blend Total Market VIPERs, VTI
-0.27% MidCap S&P 400 SPDRs, MDY
-0.27% LargeCap Growth Russell 1000 iS, IWF
-0.27% LargeCap Blend S&P 500 iS, IVV
-0.27% Financial Services DJ, IYG
-0.28% Value SmallCap VIPERS, VBR
-0.28% Consumer Staples SPDR, XLP
-0.28% Energy & Nat Res iS GS, IGE
-0.29% MidCap Blend S&P 400 iS, IJH
-0.29% LargeCap Blend S&P 100, OEF
-0.29% S&P 500 SPDRs LargeCap Blend, SPY
-0.29% Consumer Discretionary SPDR, XLY
-0.29% Mexico Index, EWW
-0.29% Financial SPDR, XLF
-0.29% Growth SmallCap VIPERs, VBK
-0.30% EMU Europe Index, EZU
-0.31% LargeCap Value Russell 1000 iS, IWD
-0.31% Dividend International, PID
-0.31% Utilities SPDR, XLU
-0.33% European VIPERs, VGK
-0.33% Energy SPDR, XLE
-0.33% LargeCap Blend Russell 1000 iS, IWB
-0.33% Technology DJ US, IYW
-0.34% DIAMONDS (DJIA), DIA
-0.35% Transportation Av DJ, IYT
-0.35% Value VIPERs, VTV
-0.37% Value EAFE MSCI, EFV
-0.37% MidCap Russell, IWR
-0.38% Technology SPDR, XLK
-0.38% SmallCap Value S&P 600 iS, IJS
-0.39% SmallCap Blend EAFE MSCI iS, SCZ
-0.39% Dividend U.S. DJ iS, DVY
-0.40% MidCap Value S&P 400 iS, IJJ
-0.42% LargeCap Blend S&P=Weight R, RSP
-0.43% LargeCap Value S&P 500 iS, IVE
-0.44% United Kingdom Index, EWU
-0.45% Bond, Emerg Mkt JPM iS, EMB
-0.48% Basic Materials DJ US, IYM
-0.48% Global 100, IOO
-0.49% Global LargeCap Blend MSCI iS, ACWI
-0.50% Pacific ex-Japan, EPP
-0.52% Value MidCap Russell, IWS
-0.54% Value LargeCap Dynamic PS, PWV
-0.56% Hong Kong Index, EWH
-0.56% Foreign LargeCap EAFE MSCI iS, EFA
-0.58% Austria Index, EWO
-0.59% Singapore Index, EWS
-0.62% Latin Am 40, ILF
-0.63% Capital Markets KWB ST, KCE
-0.63% Netherlands Index, EWN
-0.65% Dividend ex-U.S. DJ iS, IDV
-0.65% South Korea Index, EWY
-0.66% Chile MSCI iS, ECH
-0.66% Global ex U.S. LargeCap Blend, ACWX
-0.67% Energy Global, IXC
-0.67% Australia Index, EWA
-0.68% Agriculture DB PS, DBA
-0.70% Growth EAFE MSCI, EFG
-0.70% Belgium Index, EWK
-0.73% Germany Index, EWG
-0.77% Industrial SPDR, XLI
-0.79% Malaysia Index, EWM
-0.82% Emerging VIPERs, VWO
-0.88% Taiwan Index, EWT
-0.90% Emerging Markets MSCI iS, EEM
-0.92% South Africa Index, EZA
-0.96% Russia MV, RSX
-1.07% Emerging 50 BLDRS, ADRE
-1.10% Pacific VIPERs, VPL
-1.12% China LargeCap Growth G D H USX PS, PGJ
-1.15% Semiconductor iS IGW, SOXX
-1.18% Sweden Index, EWD
-1.33% Brazil Index, EWZ
-1.33% Japan Index, EWJ
-1.38% Networking, IGN
-1.52% Telecom DJ US, IYZ
-1.57% Semiconductor SPDR, XSD
-1.63% Metals & Mining SPDR, XME
-1.77% China 25 iS, FXI
