NASDAQ Composite/S&P 500 Relative Strength Ratio fell below the lows of the previous 3 weeks.

NASDAQ Composite price closed below the closing prices of the previous 4 trading days with a 0.43% loss.

The number of 52-week new lows swamped the number of new highs.

The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) fell below the lows of the previous 7-weeks.

The S&P 500 Composite (SPX, 1,160.40) rose 9.34 points or 0.81% on Thursday, September 29, 2011.

SPX opened on an upside gap (again) but fell to a loss by 3:05 p.m. A late bounce allowed the SPX to close on the plus side, moderately above the midpoint of the day’s high-low price range but well below the open.

Minor upside reversals against the dominant bear trend lure short-term traders into trying to trade a bounce. Minor price corrections against the trend are normal and expected, of course, but playing counter-trend bounces is risky. The mood can switch from “risk on” to “risk off” overnight, leaving the too-clever trader suddenly holding the bag, as we have seen repeatedly over the past 7 weeks.

In a Dow Theory Primary Tide Bear Market, the big surprises come to the downside. The Bear is a powerful beast that must not be underestimated.
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Stock Market Indicators

NASDAQ Composite/S&P 500 Relative Strength Ratio fell below the lows of the previous 3 weeks on 9/29/11, suggesting a minor downside correction. The Ratio rose above previous 10-year highs on 9/23/11 reconfirming a long-term uptrend. A long NASDAQ Composite and short S&P 500 hedge was a winning trade from 10/8/2002 to 9/23/11, and that major trend probably will resume. NASDAQ absolute price turned bearish, falling below 50-day and 200-day SMAs, on 9/20/11.

iShares MSCI BRIC Fund (BKF) Relative Strength Ratio (BKF /SPY) fell below 29-month lows on 9/22/11, reconfirming a major long-term downtrend. This basket of the stocks of Brazil, Russia, India and China is in a relatively bearish major trend.

Emerging Markets Stocks ETF (EEM) Relative Strength Ratio (EEM/SPY) broke down below 29-month lows on 9/22/11, reconfirming its preexisting bearish major trend. Absolute price broke down below 14-month lows on 9/22/11and remains bearishly below falling 50- and 200-day SMAs.

Foreign Stocks ETF (EFA) Relative Strength Ratio (EFA/SPY) broke down below 7-year lows on 9/19/11, reconfirming its preexisting bearish major trend. Absolute price broke down below 14-month lows on 9/22/11 and remains bearishly below falling 50- and 200-day SMAs.

The Largest Cap S&P 100/S&P 500 Relative Strength Ratio (OEX/SPX) shot up above the highs of the previous 5-weeks on 9/29/11. OEX/SPX rose above 50-day and 200-day SMAs on 9/21/11, which was a RELATIVELY bullish sign for the short term trend of the Ratio. Longer term, however, OEX/SPX fell below 28-year lows on 5/26/11, reconfirming its preexisting bearish major trend. So, trends conflict in different time frames.

The Small Cap Russell 2000 Index/Large Cap Relative Strength Ratio (IWM/SPY) fell below 13-month lows on 9/28/11, reconfirming a major downtrend. Absolute price has been weak since 5/2/11, broke down below 12-month lows on 9/22/11, and remains below falling 50- and 200-day SMAs.

The S&P Mid Cap 400/Large Cap Relative Strength Ratio (MDY/SPY) fell below the lows of the previous 7-weeks on 9/29/11, confirming a bearish minor trend. MDY/SPY fell below the lows of the previous 10-months on 8/8/11, confirming a bearish major trend.

Advisory Service Sentiment: There were 37.6% Bulls versus 40.9% Bears as of 9/28/11, according to the weekly Investors Intelligence survey of stock market newsletter advisors. The Bull/Bear Ratio was 0.92, up from 0.87 two weeks ago That 0.87 ratio was the lowest level since August, 2010 and was more than 1 standard deviation below the 20-year average. The 20-year median is 1.56 and the mean is 1.64.

VIX Fear Index remains stuck in its 7-week, relatively high level trading range, from a low of 30.16 to a high of 48.00. 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 Bear Market on 8/2/11, when both the Dow-Jones Industrial Average and the Dow-Jones Transportation Average closed below their closing price lows of June, 2011.

The S&P 500 Composite (SPX, 1,160.40) rose 9.34 points or 0.81% on Thursday, September 29, 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
1370.58, 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
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
1234.56, low of 8/3/11
1232.85, low of 12/16/10
1228.74, Fibonacci 61.8% of 2007-2009 range
1230.71, high of 8/31/11

S&P 500 Cash Index Potential Support
1101.54, low of 8/9/2010
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
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Fixed-Income Investments

Bond, iShares Barclays 20+ Year U.S. Treasury ETF (TLT) consolidated gains this week. TLT rose above all-time highs on 9/22/11, reconfirming a major uptrend. Support 115.76, 114.05, 111.25, 106.08, 103.20, 102.27, 96.31, 94.83, 93.14, 89.65, and 88.14. Resistance 123.87.

Bond, iShares Barclays 7-10 Year U.S. Treasury ETF (IEF) price consolidated gains this week. IEF rose above all-time highs on 9/22/11, reconfirming its preexisting major uptrend. Support 103.80, 103.55, 102.50, and 102.38. Resistance 106.66.

Junk/Investment-Grade Corporate Bond ETFs Relative Strength Ratio (JNK/LQD) remains bearish according to my objective 50/200 SMA system. JNK/LQD fell below 6-week lows on 9/22/11, confirming a bearish trend for the short term. JNK/LQD fell below 2-year lows on 8/10/11, confirming a bearish trend for the long term.

U.S. Treasury Inflation Protected / U.S. Treasury 7-10 Year ETFs Relative Strength Ratio (TIP/IEF) remains bearish according to my objective 50/200 SMA system. TIP/IEF has been weak since peaking on 4/8/11 and fell below 13-month lows on 9/22/11. This bearish trend means that fixed-income investors have been choosing the unprotected 7-10 Year U.S. Treasury Note ETF (IEF) over the inflation-protected TIPs. So, fixed-income investors may be more worried about deflation than inflation.
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Tangible Assets, Commodities

U.S. dollar ETF (UUP) price consolidated gains this week. UUP rose above the highs of the previous 7 months on 9/22/11, reconfirming a major price uptrend. After the collapse of gold and the Swiss Franc, the U.S. dollar is the last refuge for risk-averse investors. Support 21.94, 21.75, 21.56, 21.42, and 20.84. Resistance 22.32 and 22.63.

Agriculture, PowerShares DB Agriculture Fund ETF (DBA) price fell below the lows of the previous 10 months on 9/28/11, reconfirming a major long-term downtrend.

Crude Oil, United States Oil ETF (USO) price broke down from a Bearish Rising Wedge pattern on 9/19/11, thereby signaling renewed bearish momentum. USO fell below the lows of the previous 2-years intraday on 9/26/11 before reversing to close higher on the day. Still, a new low confirms a long-term major downtrend. Support 30.23, 26.28, 22.74. Resistance 32.83, 32.91, 35.08, 35.14, 39.25, 40.74, and 45.60.

Gold, SPDR Gold Shares ETF (GLD) price broke down below 9-week lows on 9/26/11,confirming a downtrend, for the short term at least. Gold rose above all-time highs on 9/6/11, reconfirming its preexisting major uptrend. Support: 154.19, 153.61, 147.19, 143.97, 143.42, and 142.55. Resistance: 170.32, 177.40, and 185.85.

Gold Mining Stocks ETF/ Gold Shares ETF Relative Strength Ratio (GDX/GLD) whipsawed back below its falling 50-day SMA on 9/22/11 and remains below its falling 200-day SMA. GDX/GLD fell below 29-month lows on 8/8/11, confirming a bearish major trend for the long term. Investors still prefer Gold bullion over Gold Miners.

Silver, iShares Silver Trust ETF (SLV) price broke down below the lows of the previous 7 months on 9/26/11, confirming a bearish major trend for the long term. SLV fell back below its 50-day SMA on 9/19/11 and fell below its 200-day SMA on 9/22/11. Support 27.41, 26.03, and 24.44. Resistance: 32.62, 34.51, 40.23, 41.49, 42.30, 42.78, 44.71 and 48.35.

Silver/Gold ETFs Ratio (SLV/GLD) broke down below the lows of the previous 10 months on 9/28/11, reconfirming a bearish major trend for the long term.. SLV/GLD has been mostly weak since peaking on 4/28/11. This means investors prefer Gold over Silver.

Copper, iPath DJ-UBS Copper TR Sub-Idx ETN (JJC ) fell below the lows of the previous 14 months on 9/28/11, reconfirming a major price downtrend. Such weakness in Copper suggests serious concerns about the 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 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
1.60% , ITF , Japan LargeCap Blend TOPIX 150, ITF
4.19% , MDP , MEREDITH
5.03% , GT , GOODYEAR TIRE
2.23% , IJS , Value SmallCap S&P 600 B, IJS
1.45% , IDU , Utilities DJ, IDU
4.39% , CNP , CENTERPNT ENERGY
0.74% , IYK , Consumer Non-Cyclical, IYK
7.60% , KEY , KEYCORP
8.85% , NYT , NY TIMES STK A
4.59% , SNV , SYNOVUS
6.57% , MS , MORGAN STANLEY
6.91% , LEN , Lennar Corp. (LEN)
4.24% , PEY , Dividend High Yield Equity PS, PEY
5.02% , HMA , HEALTH MGMT STK A
2.52% , IYG , Financial Services DJ, IYG
5.59% , AON , AON
4.52% , DPS , Dr Pepper Snapple Group
4.02% , PHM , PULTE HOMES
5.79% , CMA , COMERICA
0.90% , VOX , Telecom Services VIPERs, VOX
2.67% , DDM , Ultra Dow30 Double, DDM
3.24% , MAR , MARRIOTT INTL STK A
3.67% , FITB , FIFTH THIRD BANC
3.73% , SVU , SUPERVALU
3.68% , USB , US BANCORP
2.76% , WPO , Washington Post
3.44% , CINF , CINCINNATI FIN
1.53% , EFG , Growth EAFE MSCI, EFG
1.60% , JKF , Value LargeCap iS M, JKF
3.69% , EWI , Italy Index, EWI
3.74% , DHI , D.R. HORTON, DHI
1.33% , PFM , Dividend Achievers PS, PFM
2.64% , VGK , European VIPERs, VGK

Bearish Stocks: Falling Price and Rising Volume
Ranked by Price Change * Volume Change
% Price Change, Symbol, Name
-1.18% , PEJ , Leisure & Entertainment, PEJ
-6.22% , PXN , Nanotech Lux, PXN
-18.17% , FMCN , Focus Media, FMCN
-9.97% , SIRI , Sirius Satellite
-13.66% , AMD , ADV MICRO DEV
-7.34% , WYNN , Wynn Resorts L
-6.89% , TIF , TIFFANY
-6.09% , COH , COACH
-5.76% , YUM , YUM BRANDS
-1.47% , TMW , Wilshire 5000 ST TM, TMW
-3.06% , HHH , Internet H, HHH
-1.19% , JKI , Value MidCap iS M, JKI
-5.43% , YHOO , YAHOO
-0.87% , IAH , Internet Architecture H, IAH
-1.03% , KLD , LargeCap Blend Socially Responsible iS, KLD
-3.20% , SBUX , STARBUCKS
-2.36% , APOL , APOLLO GROUP
-3.32% , DDS , DILLARD STK A
-1.72% , PWO , OTC Dynamic PS, PWO
-2.08% , AN , AUTONATION
-2.59% , DXD , Short 200% Dow 30 PS, DXD
-4.01% , MU.O , MICRON TECH
-3.27% , TJX , TJX
-1.75% , PSI , Semiconductors, PSI
-3.25% , ALTR , ALTERA
-2.28% , ABC , AMERISOURCEBERGN
-1.76% , RIG , TRANSOCEAN
-0.75% , ONEQ , Growth LargeCap NASDAQ Fidelity, ONEQ
-0.85% , MYY , Short 100% MidCap 400, MYY
-1.13% , LMT , LOCKHEED MARTIN
-1.27% , CBS , CBS CORP.
-3.07% , EBAY , EBAY
-2.31% , QLD , Ultra QQQ Double, QLD
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One-Day Ranking of Major ETFs, Ranked from Strongest to Weakest of the Day:
% Price Change, ETF Name, Symbol
4.29% Sweden Index, EWD
4.24% Dividend High Yield Equity PS, PEY
3.78% Silver Trust iS, SLV
3.77% Netherlands Index, EWN
3.69% Italy Index, EWI
3.56% Russia MV, RSX
3.45% Spain Index, EWP
3.21% Germany Index, EWG
3.18% EMU Europe Index, EZU
2.95% France Index, EWQ
2.83% Austria Index, EWO
2.81% Financial SPDR, XLF
2.81% Capital Markets KWB ST, KCE
2.72% Financials VIPERs, VFH
2.72% Turkey MSCI iS, TUR
2.64% European VIPERs, VGK
2.52% Financial Services DJ, IYG
2.43% Switzerland Index, EWL
2.43% South Korea Index, EWY
2.41% Value EAFE MSCI, EFV
2.37% Value SmallCap Russell 2000, IWN
2.36% Financial DJ US, IYF
2.30% Oil, Crude, U.S. Oil Fund, USO
2.26% Agriculture DB PS, DBA
2.23% Value SmallCap S&P 600 B, IJS
2.23% Europe 350 S&P Index, IEV
2.10% Value SmallCap VIPERS, VBR
2.03% Transportation Av DJ, IYT
1.98% Belgium Index, EWK
1.96% EAFE Index, EFA
1.94% SmallCap S&P 600, IJR
1.90% Indonesia MV, IDX
1.88% Small Cap EAFE MSCI iS, SCZ
1.88% Homebuilders SPDR, XHB
1.83% Dividend SPDR, SDY
1.82% REIT Wilshire, RWR
1.82% Realty Cohen & Steers, ICF
1.78% Japan Index, EWJ
1.74% Chile MSCI iS, ECH
1.74% Microcap Russell, IWC
1.73% SmallCap Russell 2000, IWM
1.72% Global 100, IOO
1.72% Value MidCap S&P 400 B, IJJ
1.72% Oil Fund PowerShares, DBO
1.72% India PS, PIN
1.72% Malaysia Index, EWM
1.65% Value S&P 500 B, IVE
1.62% Energy Global, IXC
1.61% Utilities SPDR, XLU
1.55% REIT VIPERs, VNQ
1.54% Value VIPERs, VTV
1.54% Global ex US ACWI iS, ACWX
1.53% Growth EAFE MSCI, EFG
1.49% Real Estate US DJ, IYR
1.47% Value 1000 Russell, IWD
1.46% Value MidCap Russell, IWS
1.45% Dividend DJ Select, DVY
1.44% Industrial SPDR, XLI
1.42% Utilities VIPERs, VPU
1.41% DIAMONDS (DJIA), DIA
1.40% Small Cap VIPERs, VB
1.38% Pacific VIPERs, VPL
1.38% Dividend International, PID
1.37% Emerging Markets, EEM
1.29% China 25 iS, FXI
1.29% Metals & Mining SPDR, XME
1.23% Water Resources, PHO
1.20% Taiwan Index, EWT
1.19% United Kingdom Index, EWU
1.19% Energy DJ, IYE
1.18% Emerging VIPERs, VWO
1.18% Commodity Tracking, DBC
1.17% Growth BARRA Small Cap 600, IJT
1.16% Value LargeCap Dynamic PS, PWV
1.14% Hong Kong Index, EWH
1.06% Dividend Appreciation Vipers, VIG
1.03% Energy VIPERs, VDE
1.02% India Earnings WTree, EPI
0.98% Consumer Staples SPDR, XLP
0.96% LargeCap Blend S&P 100, OEF
0.95% Energy SPDR, XLE
0.95% Gold Shares S.T., GLD
0.92% MidCap S&P 400 iS, IJH
0.88% LargeCap 1000 R, IWB
0.87% S&P 500 iS LargeCap Blend, IVV
0.87% Pacific ex-Japan, EPP
0.84% Singapore Index, EWS
0.83% LargeCap Blend S&P=Weight R, RSP
0.79% S&P 500 SPDRs LargeCap Blend, SPY
0.76% Energy & Nat Res iS GS, IGE
0.76% MidCap S&P 400 SPDRs, MDY
0.74% LargeCap VIPERs, VV
0.74% Bond EmrgMkt JPM iS, EMB
0.73% Blend Total Market VIPERs, VTI
0.71% LargeCap Blend Russell 3000, IWV
0.71% Growth SmallCap R 2000, IWO
0.69% Bond, 20+ Years Treasury, TLT
0.68% Emerging 50 BLDRS, ADRE
0.66% Health Care SPDR, XLV
0.66% Growth SmallCap VIPERs, VBK
0.62% Canada Index, EWC
0.62% MidCap Russell, IWR
0.59% Preferred Stock iS, PFF
0.53% Telecom DJ US, IYZ
0.50% Financial Preferred, PGF
0.48% Mexico Index, EWW
0.45% Latin Am 40, ILF
0.39% Australia Index, EWA
0.35% Thailand MSCI iS, THD
0.32% Frontier Markets Guggenheim , FRN
0.28% Bond Ex-US Treas, BWX
0.24% Growth MidCap 400 B, IJK
0.10% Materials SPDR, XLB
0.09% Bond Muni ATM-Free S&P iS, MUB
0.08% Bond, High-Yield Junk, JNK
0.07% Growth 1000 Russell, IWF
0.06% Growth S&P 500/BARRA, IVW
0.05% Biotech SPDR, XBI
0.02% Bond, 1-3 Year Treasury, SHY
0.00% Bond, 10 Year Treasury, IEF
-0.01% Bond Treasury Short-Term iS, SHV
-0.04% Bond, Aggregate, AGG
-0.09% Growth VIPERs, VUG
-0.11% Bond, Corp, LQD
-0.19% Bond, High-Yield Corporate, HYG
-0.21% Technology SPDR, XLK
-0.26% Basic Materials DJ US, IYM
-0.26% Brazil Index, EWZ
-0.29% Info Tech VIPERs, VGT
-0.31% Bond, TIPS, TIP
-0.35% Growth MidCap Russell, IWP
-0.39% Technology DJ US, IYW
-0.61% Networking, IGN
-0.83% Consumer Discretionary SPDR, XLY
-0.84% Silver Miners Global X, SIL
-1.05% WilderHill Clean Energy PS, PBW
-1.13% Semiconductor SPDR, XSD
-1.19% QQQ Nasdaq 100 Trust, QQQ
-1.29% Semiconductor iS IGW, SOXX
-1.45% South Africa Index, EZA
-1.72% China LargeCap Growth G D H USX PS, PGJ