Stocks are caught between a rock (medium-term downtrend) and a hard place (short-term uptrend). After a good bounce the last few days, stocks took a breather with some weakness on Tuesday. Actually, stocks have been trading flat since Monday's gap up. This sideways action could be just a... READ MORE
The Correlation Coefficient is used to measure the degree of correlation between two assets. Positive correlation means they move in the same direction. Negative correlation means they move in opposite directions. The 12-Month US Oil Fund (USL) and S&P 500 ETF (SPY) are positively correlated. The 20-day Correlation... READ MORE
Charts of Interest: ABX, ANF, BBBY, NEM, RAX This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think for ourselves when it comes to trading our own... READ MORE
Stocks extended their gains on Monday with strong breadth. All sectors were up 1.4% or more. The Energy, Finance and Utilities SPDRs surged over 3%. NYSE Net Advances Percent hit 81% and Nasdaq Net Advances Percent finished at 61%. The NYSE number was especially strong. We can attribute this... READ MORE
Rates plunged along with stocks over the last several weeks. This makes sense because rates move lower when bonds move high. This chart shows the 10-year Treasury Yield ($TNX) breaking triangle support with a move below 24 (2.4%). Rates remain in a long-term downtrend and Treasury bonds are in... READ MORE
The major index ETFs are now in short-term uptrends as they bounce from oversold levels. SPY tested 112 on Monday and Wednesday with an intraday dip to 110.5 in between (Tuesday). An inverse Head-and-Shoulders formed these three days and the ETF broke above the Tuesday-Wednesday highs with Thursday'... READ MORE
StockCharts.com recently added Bullish Percent Indices for some key European indices. In particular, the Euronext 100 ($BPENXT) broke support in June and continued below its 2010 low in July. There is a status bar at the top of each P&F Bullish Percent Index chart. Euronext BPI status... READ MORE
The indicator summary remains unchanged after a topsy-turvy week. Nine of the ten indicators are clearly in bear mode. The Nasdaq/NY Composite ratio is the only indicator considered positive because the Nasdaq is outperforming the NY Composite. Relative strength in techs is heavily outweighed by the bearish indications. Most... READ MORE
Stocks moved sharply higher for the second time in two days, but remain mixed, at best, over the last five days. The chart below comes from the Sector Carpet. The red squares show losers, while the green squares show gainers. Notice the numbers at the top of each sector box.... READ MORE
The stock market staged another big advance in the face of adversity. This is the second such advance in the last three days. All the same, the major index ETFs remain below their closing levels from last Friday. In other words, stocks are still down for the week. Small and... READ MORE
The stock market staged another big advance in the face of adversity. This is the second such advance in the last three days. All the same, the major index ETFs remain below their closing levels from last Friday. In other words, stocks are still down for the week. Small and... READ MORE
Among other items, Wednesday's sharp decline in stocks was blamed on solvency issues surrounding Societe Generale (GLE.EU), a large French bank. It is, however, worth noting that SocGen, as it is called, was already in a downtrend. Moreover, the stock broke supports in early July and again... READ MORE
Stocks continued their wild ride with a decline that gave back Tuesday's gains. Even so, the major index ETFs remained above Tuesday's lows. In other words, Wednesday's decline is perhaps a test of the lows. Current volatility reminds me of May-July 2010, which was... READ MORE
With a big recovery on Tuesday, a number of stocks formed hammers on the price charts. Express Scripts (EXRX) formed a hammer, but has yet to follow through and fill Monday's gap. In other words, the stock is still down for the week. Follow through above the gap... READ MORE
In the FOMC policy statement, Bernanke signaled that the Fed is prepared to leave interest rates near zero until at least mid 2013. Say what? Bernanke must have one heck of a crystal ball to forecast interest rates so far in advance. The prospect of low rates just reinforces the... READ MORE
Stocks opened weak, remained weak and closed weak. The short-term and medium-term trends are clearly down at this point, but the current trends are way oversold after the sharp decline of the last two weeks. Going long at this point is a bottom picking exercise akin to catching a falling... READ MORE
Needless to say, there has been a clear shift in investor sentiment over the last few weeks. In short, money is re-pricing risk. Stocks and commodities, which are viewed as riskier assets, declined over the last two weeks. Bonds and gold, which are viewed as safe-havens, advanced as alternatives. The... READ MORE
As of this writing, the markets are in panic after Standard and Poor's downgraded US debt late Friday. Stocks, bonds and oil are down sharply overnight. Dow futures were down around 274 points at 2AM ET. The Dollar is also down, but the losses are relatively modest. Gold... READ MORE
Based on the writings of Charles Dow, Dow Theory utilizes the Dow Industrials and Dow Transports to generate buy and sell signals for the broader market. The market trend is up when both forge higher highs. The market trend is down when both forge lower lows. A non-confirmation is present... READ MORE
Even though it is just midday, some stocks are showing signs of firmness. Amgen (AMGN) is firming with a Harami taking shape. After a sharp decline on Thursday, the stock opened up and is trading within Thursday's range. A break above Thursday's high would confirm the... READ MORE
Unsurprisingly, there were several downgrades this week as sharp declines did lots of technical damage. Last week I noted that many indicators were on the verge of turning bearish. Some turned bearish after the close on Friday and the rest followed on Tuesday. The AD Volume Lines both broke below... READ MORE
With another big move in stocks and bonds, the underlying trends have accelerated even further to become more extended. The only thing we can do at this point is respect the trend. The downtrend is too strong to justify longs and too oversold to justify new shorts. The ability to... READ MORE
After becoming oversold on Tuesday, the major index ETFs formed high-volume hammers on Wednesday. Today's report will feature daily charts to get some perspective. SPY dipped below 124 and below its March low, but recovered to close above 126. Volume was the highest since the March low. The... READ MORE
EBAY Firms in Gap Zone. LSI Breaks Pennant Resistance. ORCL Tests Support with Inverted Hammer. Plus SIR, T and VZ. This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all... READ MORE
10-day RSI for SPY moved below 30 for the fourth time in 2011. I lowered the look-back period from 14 to 10 to increase sensitivity. RSI became oversold in March, June and now August. Oversold does not guarantee a bounce, but it does increase the odds of at least a... READ MORE
Stocks are now very oversold with some long-term support levels coming into play. Over the last seven trading days, IWM is down 8.69%, SPY is down 6.75% and QQQ is down 5.59%. 10-day RSI moved below 30 for SPY and IWM, but remains above 30 for QQQ.... READ MORE
The Sector Market Carpet provides a color-coded display of the last seven trading days for the S&P 500 sectors. It is mostlly red as all sectors are down. Stocks holding up the best are shown with green or white-ish squares. Three of the five gainers come from the... READ MORE
Trading turned quite volatile on Monday as stocks opened sharply higher, moved sharply lower and then recovered somewhat. Despite all this pushing and shoving, the major index ETFs closed slightly lower and all sector SPDRs were down for the day. Stocks did not follow through on the strong open and... READ MORE
ADM Forms Inverted Hammer within Steep Flag. DOW Bucks the Trend with Small Gain. FITB Forms Bull Flag. Plus ALK, AMX, BK.... READ MORE
With a decline the last five months, the Agriculture ETF (DBA) formed a falling wedge that extends back to March. The May-July highs mark key resistance just above 33.25. After a surge in late June and early July, a smaller falling wedge took shape the last three weeks. Look... READ MORE
Unsurprisingly, Congress and the White House struck an 11th hour deal on the debt ceiling. Stock futures are trading higher with the Dow poised to open some 100 points up. Oil is also higher, but bonds, gold and the Dollar are lower (±5AM ET). Technically, stocks were oversold after a... READ MORE
With another bout of selling pressure this week, the Nasdaq McClellan Summation Index reversed at the zero line and moved back below -100. Notice that this breadth indicator has been largely negative since mid March. You can read more on the McClellan Oscillator and Summation index in our ChartSchool. Click... READ MORE
With a slew of downgrades this week, the Indicator Summary now stands at zero, which is a neutral reading. There are several neutral scores this week because many indicator groups are split or on the verge of turning bearish. For example, the Trend and Structure for the Price Charts is... READ MORE
Stocks remained under pressure as early strength gave way to afternoon weakness. QQQ finished with a small gain, but the other major index ETFs finished with small losses. With little real movement on Thursday, nothing has changed on the 60-minute chart. IWM was the first to break support and turn... READ MORE
General Dynamics (GD) broke below its June low with a sharp decline the last two days. Also notice that the Price Relative (GD:SPY Ratio) broke support. GD is showing both absolute and relative weakness. Click this image for a live chart... READ MORE
Stocks moved sharply lower with a broad sell off that rocked all boats. All nine sectors were down. Small-caps and mid-caps led the way lower with declines in excess of 2%. Breadth plunged with the NYSE Net Advances Ratio reaching -.81 and the Nasdaq Net Advancing Volume Ratio hitting... READ MORE
ANF Fails at Resistance with Long Black Candle. DIS Hits Resistance at Broken Support. PLCE Retraces 50% with Rising Wedge. Plus AVP, BBBY and WMT. This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock... READ MORE
Expedia has been on a tear the last few months with 50+ percent advance since February. The stock has yet to correct, but a bearish engulfing pattern hints at a possible short-term reversal. More candlestick patterns can be found on the pre-defined scans page. Click this image for a live... READ MORE
Relative weakness in small-caps remains a concern for the stock market. While the Nasdaq 100 ETF (QQQ) is holding up fine, the Russell 2000 ETF (IWM) is already in its support zone with declines over the last two days. The first chart shows IWM gapping down on Monday. This gap... READ MORE
While the Nasdaq 100 continues to move higher and the S&P 500 shows gains the last 10 days, the PerfChart below shows that small and mid caps are starting to suffer. The S&P 500 is up just over 1% snce July 13th, but the S&... READ MORE