Stocks bounced on Tuesday, but I was not impressed with the finish or with breadth. First, let's look at breadth. The charts below show the AD Volume Line and Net Advancing Volume for the NYSE and Nasdaq. NYSE Net Advancing Volume reached the +1000 level four times during... READ MORE
The Shanghai Composite ($SSEC) and the Materials SPDR (XLB) have been moving together in 2010. The moves in XLB are a little more exaggerated, but the positive correlation is clear. Most recently, both bottomed in early July and moved higher the last six weeks. Click this image for a live... READ MORE
Trend following and mean reversion are two types of trading strategies. Trend followers wait for a reversal and confirmation with a support break or resistance breakout. Mean reversion traders look for overbought or oversold conditions to pick tops or bottoms. The two styles are diametrically opposed, but both systems have... READ MORE
Outside of gold, August has been a tough month for commodities. The PerfChart below shows performance for six commodity related ETFs. Only one is up. Metals, Oil and Natural Gas are down rather sharply. Gold, in contrast is up over 2%. In an interesting twist, notice that gold is up... READ MORE
Selling pressure was intense enough to produce a short-term breadth breakdown. The charts below show the 10-day SMA for Net Advancing Volume for the Nasdaq and NYSE. Net Advancing Volume is simply the volume of advancing stocks less the volume of declining stocks. A move above +100 shows a significant... READ MORE
Bonds have been on a tear since April with the 10-Year US Treasury Note ($UST) advancing some 8% in three months. The DJ Corporate Bond Index ($DJCBP) is not far behind with a 4.4% gain since early June. The advances over the last two months are exceptional sharp and... READ MORE
Even though the indicator summary flipped to positive last week, I noted that a sharp decline from current levels could easily flip a few indicators back to the bears. That is indeed what happened. With sharp declines this week, SPY, IWM and QQQQ failed at important resistance zones. The discrepancy... READ MORE
The S&P 500 ETF (SPY) gapped down again on the open, but managed to bounce and close well above its open to form a hollow candlestick. Even so, the ETF closed below its prior close to color the candlestick red. Nevertheless, SPY remains below its support break at... READ MORE
Stocks were down sharply with a broad based decline on Wednesday, but there were a few stocks swimming against the tide. The S&P Sector Market Carpet provides an easy means to visual scan for green stocks in a sea of red. Carefusion (CFN), Macy's (M), Western... READ MORE
With a gap up, tight consolidation and gap down, the S&P 500 ETF (SPY) formed an island reversal over the last two weeks. It all started with the gap and close above 112 on August 2nd. The ETF traded between 111 and 113 the next six days and... READ MORE
With a gap up eight days ago and a gap down on Wednesday, the Industrials SPDR (XLI) formed an island reversal. Notice how the ETF gapped above 30.5 and largely held above this level for seven days. That ended with a large gap down that signals a reversal. MACD... READ MORE
Even though stocks bounced after the Fed announcement, S&P futures are down sharply in pre-market trading today. European and Asian stocks are also lower this morning. The Euro is getting slammed (130.5) and this may signal a return to the risk-off trade. Earning season is passing, the... READ MORE
Apple (AAPL) continues to consolidation within a relatively narrow range. The stock has traded between 266 and 254.90 for the last 13 days. Falling volatility is confirmed with the Bollinger BandWidth indicator, which shows the bands at their tightest in over five months. The direction of the consolidation break... READ MORE
Don't fight the Fed. This Wall Street motto is as old as the Fed. Even if you doubt the Fed's ability to influence the long-term outcome, the Fed can still affect the short-term expectations. Quantitative easing (QE) is back on the table and this may keep... READ MORE
A classic tenet of technical analysis is that broken resistance turns into support (and visa versa). The Russell 2000 ETF (IWM) broke the April trendline and resistance from its mid July high with a surge above 64.5 in late July. This broken resistance zone (63.8-64.5) now turns... READ MORE
Despite a worse-than-expected jobs number, stocks managed to limit early losses and surge in the final hour of trading. Conspiracy theorists are calling this manipulation. Maybe. Maybe not. To be honest, nobody really knows. The best we can do is watch the price action and trade accordingly. Even if the... READ MORE
The intermarket picture shows a preference for the risk-on trade over the last five weeks. The next two PerfCharts show five intermarket ETFs over two distinct timeframes. The first extends from late April until late June, which is when stocks declined sharply. The second extends from early July to early... READ MORE
The intermarket relationships over the last five weeks show stocks and oil rising together. On the other side, bonds, the Dollar and gold are down since early July. This looks like the classic "risk-on" trade. Strength in stocks and oil reflects an increased appetite for risk. Click this... READ MORE
The overall picture is still mixed, but bullish assessments of the volatility indices and Net New Highs pushed the indicator summary into positive territory for the first time since mid June. The S&P 500 Volatility Index ($VIX) and Nasdaq 100 Volatility Index ($VXN) continue to move lower and... READ MORE
Despite a jump in initial jobless claims, the market managed to mute its losses and trade in a narrow range. The consensus was for 455,000 initial jobless claims and the actual number was 479,000. This is considerably higher, but the market took it in stride. The market held... READ MORE
There is no change in the medium-term or short-term trends, which are both up. Even though SPY is trading in a resistance zone marked by the June high and 50-62% retracement zone, the trend is up and we have yet to see a failure or reversal at resistance. The break... READ MORE
The 20+ Year T-Bond ETF (TLT) is at a make-or-break level with two key employment related releases over the next two days. An improving employment picture would likely lead to a support break, but further weakness in the employment numbers could keep bonds buoyant. Click this image for details... READ MORE
The NYSE and NY Composite have been driving the current rally. NYSE breadth has been stronger than Nasdaq breadth and the NY Composite has far outperformed the Nasdaq over the last five weeks. The leader will offer the first clues of a potential reversal. The chart below shows the 10-day... READ MORE
Ratio charts allow chartists to compare the performance of one security against another. The chart below plots the ratio of the Nasdaq and the NY Composite. The Nasdaq is underperforming because this ratio ($COMPQ:$NYA) has been falling since June. Click this image for details... READ MORE
The bulls came out charging on Monday. Strength in European banks and equities triggered yesterday's strong open. More importantly, stocks remained strong throughout the day and the major index ETFs closed near their highs for the session. NYSE breadth was strong, but Net Advances, Net Advancing Volume and... READ MORE
While the S&P 500 moved above its mid July high, the Nikkei 225 ($NIKK) remains short of a breakout and within a downtrend still. $NIKK surged to resistance last week, but fell just short of 9800 and pullback on Friday. A break above this resistance level is needed... READ MORE
After a big surge in July, the S&P 500 ETF (SPY) hit resistance around 112 and pulled back last week. Overall, SPY broke above the wedge trendline and exceeded its mid July high. These are bullish developments, but overbought conditions, key retracements and resistance kept stocks under pressure... READ MORE
Whirlpool (WHR) came across the triple bottom break scan. The stock is in a clear downtrend with lower lows and lower highs since May. WHR broke triple bottom support twice in the next few days and the downside price objective is 74. This objected is based on traditional P&... READ MORE
It all depends on where we set key resistance. If the mid July highs marked key resistance, then this indicator summary would be in bull mode. If the mid June highs mark key resistance, then a number of indicators and ETFs remain short of trend changing breakouts. Because this is... READ MORE
Even though the July surge had impressive breadth and upside momentum, the S&P 500 ETF (SPY) is clearly running into resistance around 112. Resistance from prior highs and key retracements is not surprising. In addition, the ETF became overbought early this week after a 10% advance in 17... READ MORE
For the second time in two months, Akamai (AKAM) gapped down from resistance at 46. The stock first hit resistance here in mid June and gapped down in late June. AKAM moved back to resistance in July, but failed again with another gap and high-volume decline. Click this image for... READ MORE
There is no change on the daily chart as SPY stalls in its resistance zone. Even though the strong July surge and wedge breakout are medium-term bullish, SPY is still on the overbought side and battling resistance. First, the ETF advanced around 10% from its July low (~102 to ~112)... READ MORE
Flowserve (FLS) came across the bullish triangle alert page from the P&F pattern scans. On the P&F chart, notice how the stock broke above the bearish resistance line with a surge above 98. As far as Point & Figure is concerned, this chart remains bullish as... READ MORE
After strong buying pressure four of the last five days, stocks took a breather on Tuesday as the S&P 500 ETF (SPY) forged a small red candlestick. SPY opened above 112 and closed below 112. After a strong open, SPY moved lower and this indicates selling pressure. The... READ MORE
While the market continued higher the last three days, Apple (AAPL) stalled with three inside days. This stall comes after last week's wedge breakout, which is still holding. A move below last week's gap (252) would negate the breakout. Click this image for details... READ MORE
Even though volume has been light in July, breadth has been strong, especially on the NYSE. Breadth is picking up steam on the Nasdaq as Net New Highs hit +91 and Net Advances exceeded +1000 for the third day in a row. Summer volume is supposed to be light so... READ MORE
The US Dollar Index ($USD) became oversold as RSI moved below 30 last week. In addition, notice that the index has retraced just over 62% of the March-June advance. A channel has taken shape since early June and traders should watch for a channel breakout to reverse this downtrend. Click... READ MORE
The medium-term picture is perking up as stocks finished strong last week. SPY started the week with an indecisive candlestick last Monday. After a weak open below 106 on Tuesday, SPY finished strong with a close above 108 that very same day. There was a sharp pullback on Wednesday, but... READ MORE
On the monthly chart, the S&P 500 broke below its 12-month moving average for the first time since July 2009. Even though moving average crossovers do not pick exact bottoms or tops, this moving average cross captured the major moves over the last eight years. As with all... READ MORE
Despite all the troubles in Europe, the German DAX ($DAX) remains in a uptrend since March 2009 and has yet to roll over. The index is above its 12-month moving average and MACD(5,35,5) is positive. However, notice that index retraced 50-62% of its prior decline and is... READ MORE