DELL BOUNCES OFF SUPPORT ON VOLUME... Some good news out of Dell Computer is prompting some heavy buying today. Chart 1 shows the stock gapping higher on rising volume (DELL is the most actively-traded Nasdaq stock today). The 14-day RSI oscillator appears to have bottomed near 30. In addition, the... READ MORE
CUTTING PAPER PROFITS... The Paper and Forest Product Index is falling to a three-month low today. It's green relative strength line has been holding up pretty well since the October bottom. But it may start rolling over. The daily MACD lines turned negative a month ago -- giving... READ MORE
NASDAQ 100 LEADS MARKET BOUNCE... The Nasdaq 100 -- inspired by a bounce in the big tech stocks -- gained over 3% today and was the day's strongest stock index. It's usually a good sign for the market when the big techs are showing better relative... READ MORE
DOW HITS ANOTHER FOUR-MONTH LOW... The major averages fell to another four-month low today. The S&P 500 ended down 10 points near 818 and is bearing down on its October lows. That will be an important test for the market. As we've said before, we wouldn&... READ MORE
CRB INDEX NEARING RESISTANCE... The bull market in commodity prices is reflected in the CRB Index rising to the highest level in five and half years. However, the CRB is approaching a potential resistance zone, which may stall its advance -- or at least cause some profit-taking. The two levels... READ MORE
TREND IS STILL DOWN TO FLAT... After a weak start, the Dow (and the other major stock indexes) closed higher today. The Dow gained 55 points. Breadth was positive, but volume was light. On a short-term basis, the Dow has also reached an oversold condition. The 9-day RSI oscillator along... READ MORE
CONSUMER INDEX THREATENING OCTOBER LOW... The Morgan Stanley Consumer Index is designed to measure the performance of consumer-oriented, stable growth industries. The major industries are beverage, food, drug, tobacco, and personal product sectors. Normally, this is thought of as a defensive group. At the moment, however, the CMR is threatening... READ MORE
S&P 500 IN A SECULAR BEAR... Along with other technical analysts, we've made the point several times over the past year that the market is now in a "secular" bear trend. Let's make it clear what that means. Chart 1 shows the... READ MORE
MARKET AVERAGES CONTINUE TO ERODE... The Dow and the other major stock averages slipped beneath minor chart support along the lows of the last eight trading days to keep their short-term downtrend intact. Although there were a lot more losers than winners, there were some winners -- mainly in the... READ MORE
DOW RUNS INTO CHART RESISTANCE... The Dow rallied into midday following Mr. Powell's UN testimony before fading. The Dow ended with a 28 point loss. Chart 1 is a 30-minute bar chart of the Dow covering the last seven trading days. It clearly shows a minor trading range... READ MORE
AIG PULLS ENTIRE INSURANCE GROUP DOWN... American International has tumbled below its October low on heavy volume. That puts the big insurer at the lowest level in seven months. That's weighing heavily on all insurance stocks, which are the day's weakest group. Chartwise, it's... READ MORE
INSURERS FALL HARD... Earlier today we showed the collapse in American International Group to a new seven-month low on very heavy volume (AIG was the most actively-traded NYSE stock). Other insurance stocks were caught in the AIG downdraft. Chubb fell under recent support to a new 52-week low on increasing... READ MORE
AMAT FALLS... Applied Materials has tumbled to the lowest level since last October. That makes it the biggest percentage loser in the Nasdaq market -- and is weighing on the Semiconductor(SOX) Index as well. As a result, technology is the weakest market sector in morning trading. Chart 1 OTHER... READ MORE
JANUARY BAROMETER... The fact that the market ended down for the January is a negative omen for the year -- or so goes the January Barometer. That barometer is based on the idea that "as January goes, so goes the year." We can think whatever we wish about... READ MORE
CANADIAN DOLLAR... Following our positive comments on the Canadian market last evening, we were asked several questions on the Canadian market today. Let's take a more extensive look at that market -- starting with its currency. Chart 1 shows the Canadian Dollar starting to bottom about two years... READ MORE
REITS PEAKED LAST JULY... One of our members asked today about the technical situation on the REITs -- and their role in the intermarket picture. Chart 1 is a daily chart of Morgan Stanley REIT Index for the past year. The chart shows a "double top" forming during... READ MORE
DAX TESTING OCTOBER LOW-- FTSE AT 7-YEAR LOW... We thought it a good time to see how foreign stock markets are faring relative to our own. Europe has been having a tough time. The two biggest European markets are shown below. The German DAX Index has fallen all the way... READ MORE
LAST MAJOR INDEX TO FALL... A lot is being made in the media about the Dow falling back under 8,000 today. Since the Dow had already broken down last week (along with most of the NYSE averages), we think the bigger news involves the Nasdaq market. The Nasdaq Composite... READ MORE
CHART BREAKDOWN... It looks like the market is going to end the week on a downer. Near midday the Dow is down over 200 points and, more importantly, has fallen under its late-December low at 8250. If those lower prices hold through today's close, that will represent a... READ MORE
SELLING PRESSURE INTENSIFIES... Last Friday we used the ADX line (and its two accompanying lines) to show the absence of a trend in the market during its recent advance. That led us to conclude that, absent a trend, the market would probably start to weaken from the top of its... READ MORE
AT&T GAPS BELOW KEY SUPPORT... AT&T (T) is gapping down today below its 200-day moving average and bottom of the neutral range that its been trading in since early November (see shaded rectangle). The stock is down close to 20% on massive volume and is currently... READ MORE
BIGGEST TECHNOLOGY LEADERS... PeopleSoft (PSFT) and Texas Instruments (TXN) were up significantly today which sparked a rally in technology stocks. PSFT (chart #1) surged over +11% and closed back above its 50-day moving average, which is bullish. The daily Stochastic (below chart) is oversold and turning up which suggests PSFT&... READ MORE
GENERAL DYNAMICS HURTS DEFENSE STOCKS... This morning's high-volume plunge in General Dynamics is taking a toll on defense stocks. That explains today's relative weakness in the likes of Boeing and Northrop Grumman, which have both fallen beneath their 50-day averages. Chart 1 Chart 2 Chart 3... READ MORE
BROKERS BREAK DECEMBER LOW... Brokerage stocks continue to lead the market lower. The Broker/Dealer Index closed beneath its late-December low, and has turned its short-term trend decidedly lower. Last night, we showed Charles Schwab leading the brokerage fall. Merrill Lynch was one of today's biggest lossers. That... READ MORE
MAJOR AVERAGES SHORT TERM OUTLOOK CONTINUES TO WEAKEN... Last week (see Market Messages dated Jan. 17th and 16th), we mentioned the possibility of further market weakness due to the major averages reaching trading range extremes and the failed attempts to penetrate 200-day resistance levels. Today's market weakness provides... READ MORE
BROKERS/DEALER INDEX (XBD) BREAKS KEY SUPPORT... Financial stocks appear to be following in the foot steps of the major averages (see earlier update), which warrants near term caution. Chart #1 shows the Broker/Dealer index (XBD) breaking its 50 & 200-day moving averages on a closing basis, which doesn&... READ MORE
FOUR BIGGEST LOSERS... Four prominent technology stocks are falling heavily this morning. That's weighing on the technology sector and the market in general. All four are gapping lower on relatively heavy trading (and are on the most-active list). The charts pretty much speak for themselves -- and don&... READ MORE
STOCK AND BOND TRADING RANGES... It now appears that bonds and stocks have reached the extremes of their respective trading ranges -- stocks on the upside and bonds on the downside. On a short-term basis, that suggests that stocks should start to weaken while bond prices gain. Chart 1 shows... READ MORE
BTK INDEX TRADES ABOVE 200-DAY INTRA-DAY... Several biotech stocks: DNA, IDPH, MLNM, and MEDI, to name a few, are supporting a rally in the Biotechnology Index (BTK) which is currently trading above its 200-day Moving average intra-day. A close above this resistance level would be positive for the BTK and... READ MORE
J.B. HUNT LEADS TRUCKING RALLY... Dispite the weakness in the major market averages, trucking stocks: J.B. Hunt (JBHT), Yellow (YELL), Roadway (ROAD), and CNF Transport (CNF) are rolling ahead. J.B. Hunt (see chart #1) is currently breaking out of the top of a neutral trading range (see... READ MORE
BIG VOLUME LOSERS... The first three charts show some high-volume losers today. On the Nasdaq, QLogic broke moving average support -- on the highest volume in two months. Among retailers, Federated tumbled on very heavy volume -- after failing a retest of its 50-day average. McDonalds also met new selling... READ MORE
SOX LEADS NASDAQ LOWER... In early morning trading, the Nasdaq 100 is the biggest loser among the major market averages. That's being caused mainly by a 2.50% drop in the Semiconductor (SOX) Index. Intel is down today and is meeting resistance at its 50-day moving average. News... READ MORE
CHIP MAKERS FALL ON HEAVY VOLUME... Intel's news that it would cut back on capital spending took a heavy toll on chip equipment makers. Applied Materials was one of the hardest hit. Chart 1 shows AMAT falling under its 50-day averege on heavy volume. Teradyne also fell hard... READ MORE
ALCATEL SPARKS TELECOM RALLY... Telecom stocks: ALA, LU, and NT are dominating today's N.Y.S.E. most actives list. Alcatel (ALA) is leading the group higher with double-digit intra-day gains. ALA gapped above its December peak resistance this morning and is currently trading above its 200-day moving... READ MORE
BKX POISED FOR UPSIDE BREAKOUT?... The Bank Index (BKX) is currently testing a key resistance barrier near the 800 level . Prior attempts to surpass this area have failed. However, in the three prior attempts the BKX was trading under its 200-day moving average. This time the picture looks somewhat brighter.... READ MORE
TECHNOLOGY BREAKS 200-DAY LINE... The Nasdaq 100 achieved its first Friday close above its 200-day average since last March. That's a good sign both for technology and the rest of the market. That's because the market is usually in better shape when technology is showing superior... READ MORE
RETAIL BUYING... Retail stocks are experienceing strong buying today across the board. Abercrombie & Fitch (ANF), one of todays NYSE most actives, is gapping up above its 200-day moving average. The stock appears poised to challenge its December high. Best Buy (BBY) is gapping up. The next level of resistance... READ MORE
NASDAQ RALLIES ON INCREASED VOLUME - 40 WEEK MOVING AVERAGE CHALLENGE... The Nasdaq Composite rallied 2.67% to close above its 40-week (200-Day) moving average. However, a Friday close over the moving average is necessary to validate an upside penetration on the weekly chart. Heavier volume is also encouraging since... READ MORE
KEY TEST OF OVERHEAD RESISTANCE... The Nasdaq market is testing a key resistance barrier at its 200-day moving average. The test is important because the 200-day line is one of the key indicators in determining whether a market is in a bull or bear market. The first chart shows the... READ MORE
ALCOA IS BIGGEST DOW LOSER... Alcoa fell over 10% today -- on very heavy volume. Chart 1 also shows the big aluminum producer falling under previous chart support at its December lows. That breakdown helped set a gloomy tone for the Dow and the rest of the market. If that... READ MORE