COMMODITY CORRECTION CONTINUES ... The combination of a rising stock market and a bouncing dollar is continuing the recent rotation out of an overbought commodity group. The streetTracks Gold Trust (GLD) hit a four-month low and appears headed toward its 200-day moving averagae (Chart 1). Most other commodities sold off as... READ MORE
FED CUTS RATES ... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor The Fed cut the federal funds rate and the discount rate by 0.25% each. This is the seventh cut in the federal funds rate since September. At 2%, this... READ MORE
MOST COMMODITIES ARE IN CORRECTIONS... Last Thursday I showed most of the charts shown below to make the point that, outside of energy, most other commodity markets have entered downside corrections. I attributed the reasons for that to be rising U.S. rates, a bouncing dollar, and economic slowing. Here&... READ MORE
WHERE IS 80-WEEK AVERAGE ... One of our readers asked where the 80-week moving average was located on the major market indexes. Charts 1 through 4 show where its daily version (400-day average) is located. The Dow and the NYSE Composite Indexes are right up against that major resistance line. The... READ MORE
DOLLAR STARTS TO BOUNCE ... On Tuesday, I showed that the pullback in gold started in mid-March just as bond yields (and the stock market) were starting to bounce. There are three reasons why gold is pulling back at this point. One is that money has been flowing back into stocks.... READ MORE
LONG-TERM OUTLOOK FOR THE S&P 500 ... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor In yesterday's commentary, John Murphy showed how the difference between two long-term moving averages can help determine the long-term trend. I would like... READ MORE
STILL A BEAR MARKET BOUNCE... I've been surprised at the number of questions asking whether the recent stock rebound is the start of a new bull market or just a bear market rebound. In my view, this is still a bear market rebound. The only question in my... READ MORE
RUSSELL 2000 SHOWS RELATIVE WEAKNESS... One of the factors aiding the recent market rebound was a simultaneous rebound in small cap stocks. That small cap support appears to be diminishing. Chart 1 shows the Russell 2000 Small Cap Index (RUT) backing off from the top of its three-month trading range... READ MORE
DOW TRANSPORTS HIT EIGHT-MONTH HIGH ... We've pointed several times the relatively strong performance in transportation stocks. Today's 2% gain pushed the Dow Transports to the highest level since last August (Chart 1). The relative strength ratio (below chart) has been rising strongly since January. That may... READ MORE
GOOGLE SPARKS INTERNET BREAKOUT... The major market indexes are testing the top of their three-month trading range (Chart 1). Today's stock gains are being led by financial and technology stocks. A 17% jump in Google is pushing the Interactive Internet Index to a three-month high (Chart 2). Financials... READ MORE
RISING YIELDS MAY DRIVE SOME MONEY BACK TO STOCKS ... On Tuesday, I wrote about bond yields being in oversold territory and near chart support at their 2003 lows. I also showed that the 10-Year T-Note price was overbought and up against resistance at its 2003 peak. I suggested that rising... READ MORE
BROAD RALLY LIFTS WALL STREET ... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor Spurred by positive news from Intel (INTC), JP Morgan (JPM) and Wells Fargo (WFC), stocks surged on Wednesday. The NY Composite and the Nasdaq were both up over... READ MORE
YES, FOOD AND ENERGY COUNT ... I think it's time that the Fed (and the economic community) stopped the charade of not counting food and energy in their inflation calculations. That's where most of the inflation is located. This morning's PPI inflation report was a... READ MORE
GENERAL ELECTRIC TUMBLES 12% ... By now you probably know that General Electric tumbled 12% on Friday on massive volume. The fact that GE is the second biggest stock in the market (and the fact that many consider it a bellwether of the U.S. economy) depressed the rest of the... READ MORE
COPPER NEARS NEW RECORD ... One of our readers asked for an update on copper. The question comes at a good time. Chart 1 shows copper on the verge of reaching a record high over $400. Copper has been trading sideways since the spring of 2006 between $400 and $250. The... READ MORE
OIL SURGES TO NEW HIGHS... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor The government reported a decline in crude inventories and this news sent the United States Oil Fund ETF (USO) to new highs. This report may have sparked today&... READ MORE
LONG-TERM AVERAGES ... One of our readers asked about the 40- and 80-week moving averages, and correctly points out that the shorter average is moving down toward the longer. I prefer to convert the weekly averages to dailies which become a 200-day and 400-day combination as shown in Chart 1. I... READ MORE
CHINA AND INDIA FALL TO BOTTOM OF 2008 RANKINGS... A year ago it was believed that the raging bull markets in China and India would go on forever. Three months ago while in Europe, I read that those huge emerging markets would be the safest bets in a global downturn.... READ MORE
VIX THREATENS ITS 200-DAY MOVING AVERAGE... I've gotten a lot of requests to take a look at the CBOE Volatility (VIX) Index. This is a good time to do so because the VIX is at a critical juncture. Just to review, the VIX generally trends in the opposite... READ MORE
S&P 500 AND NASDAQ NEAR RESISTANCE ZONES... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor With the advance over the last few weeks, both the S&P 500 and the Nasdaq are closing in on important resistance zones.... READ MORE
GOLD CORRECTION MAY HAVE MORE TO GO ... A number of readers have asked for a potential downside target for gold. Chart 1 shows the streetTracks Gold Trust (GLD) falling well below its 50-day moving average. In addition, its recent fall has taken place on heavy volume. That shows some pretty... READ MORE
NYSE TRADES OVER 50-DAY LINE ... The market is starting the second quarter with a big bang. Led by financial shares, all of the market indexes are trading sharply higher. Perhaps the most significant event is the fact that the NYSE Composite Index is trading over its 50-day average for the... READ MORE
BEAR MARKET RALLIES... A couple of weeks ago I suggested that the market had completed a five-wave decline which would suggest the likelihood for an intermediate rally. On Tuesday, I explained that an "intermediate" rally can last anywhere from three weeks to three months and can retrace 38%... READ MORE
200-DAY AVERAGE DETERMINES MAJOR TREND... One of our readers asked if the 200-day moving average is more important than the 50-day moving average. Yes, certainly. That's because they measure two different trends. The 50-day (or 10-week) average measures the "intermediate" market trend, while the 200-day (or... READ MORE
S&P 500 AND NASDAQ POINT & FIGURE CHARTS... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor The S&P 500 and the Nasdaq achieved double top breakouts on their Point & Figure charts, but resistance zones are not... READ MORE
WHAT DOES THAT MEAN?... Last week I suggested that the stock market was most likely putting in a bottom of intermediate proportions. One of our readers asked me to define what constitutes an "intermediate" rally. I referred to my book "Technical Analysis of the Financial Markets"... READ MORE
DOW TRANSPORTS CLEARS 200-DAY LINE... I've been including the Dow Transports in those market groups that have been showing good relative strength of late. Today is no exception. With the market getting off to a strong start this week, the Dow Transports are one of the day'... READ MORE
MORTGAGE LENDERS LEAD MARKET RALLY ... On Tuesday I wrote about signs of improvement in the stock market and the likelihood for a rally of intermediate proportions. One of the reasons was new signs of relative strength in housing-related areas like homebuilders, retailers, and financial stocks. Here's some more... READ MORE
XLE AND XLB GET SLAMMED... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor The Energy SPDR (XLE) and the Materials SPDR (XLB) led the market lower on Wednesday. This is no doubt due to sharp declines in oil, copper, gold, silver... READ MORE
LINE CHART SHOWS FIFTH DOWNWAVE... Earlier today I wrote a Market Message supporting the idea that the stock market appears to be putting in a bottom of at least intermediate proportions. I also showed a number of short-term positive divergences suggesting that the market is due for a rally. I... READ MORE
FORMER LAGGARDS CONTINUE TO LEAD ... Last Thurday I showed that several 2007 market groups that helped pull the market lower last year were showing much better relative strength in 2008. The groups I showed included transports, retailers, homebuilders, small and midcap stocks. I suggested that their improved relative performance was... READ MORE
YEN HITS THIRTEEN YEAR HIGH ... Last week I showed the Japanese Yen testing major chart resistance its 2000/2004 peaks. Today's 2% gain against the dollar put the yen over 100 for the first time in thirteen years (1995). While that's good for the yen, it&... READ MORE
SMALLER STOCKS ARE STARTING TO ACT BETTER... One of our readers asked for an update on the performance of small cap stocks. Interestingly, they're starting to act better than large caps for the first time in several months. The same is true for midcaps. Charts 1 and 2... READ MORE
IN THE EYES OF THE BEHOLDER... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor Technical analysis is a little art and a little science, which makes it subjective and open to interpretation. It is kind of like, gasp, economics. With a... READ MORE
RATIO-ADJUSTED VERSION CHANGES NUMBERS... I recently showed a chart of the NYSE McClellan Summation Index (NYSI). One of our readers asked for an explanation of the McClellan Oscillator which is actually the basis for the NYSI. In essense, the McClellan Oscillator is the difference between the 39- and 19-day exponential... READ MORE
YEN IS AT CRITICAL CHART POINT... Last Friday I wrote a bullish story on the Japanese yen, which has gone from the world's weakest currency to the strongest since last July. I explained that the yen was benefiting from the unwinding of the "carry trade" in... READ MORE
SHORT-TERM VIEWS ... They say a picture is worth a thousand words. At the moment, I've run out of words (meaning that I don't want to keep repeating the same ones). But I never run out of pictures (thanks to Stockcharts.com). As far as I can... READ MORE
NOT THE BEARS ... I've tried to avoid commenting on how the financial media (and their steady stream of Wall Street suits) have reported on the market's problems. I heard one radio guest today, however, that caught my attention because he typified the problem with Wall Street... READ MORE
DOW AND S&P 500 TESTS SUPPORT... Today's Market Message was written by Arthur Hill. John Murphy will return tomorrow. - Editor After sharp declines late last week, the Dow and S&P 500 are finding some support from their February lows. Both broke key support... READ MORE
JAPAN ECONOMY IS EXPORT-ORIENTED ... I received a number of responses to my February 29 article on the rising Japanese yen and why that was bad for global stocks. Some of the questioners seemed to have missed the point of the article or either misunderstood what I was trying to say.... READ MORE