BONDS SURGE AS GLOBAL STOCKS FALL... A plunge in Chinese stocks started the sharpest global stock downturn in four years. Emerging markets lost 8% on the week while foreign stocks in general fell 5.6%. By contrast, the U.S. lost a little over 4%. The hardest hit market sector... READ MORE
YEN RALLIES AGAINST ALL MAJOR CURRENCIES ... In the middle of Tuesday's global selloff, I showed bond prices rising as stocks were selling off. I mentioned that falling U.S. yields were hurting the U.S. Dollar, especially against the Japanese yen which had rallied to a new six-week... READ MORE
STOCKS FIRM AFTER BIG DECLINE... Today's Market Message was written by Arthur Hill. John Murphy will be back tomorrow. - Editor A day after the biggest decline in years, the S&P 500 ETF (SPY), Nasdaq 100 ETF (QQQQ) and Russell 2000 ETF (IWM) firmed on Wednesday.... READ MORE
VOLATILITY INDEX SURGES ON PUT BUYING ... When investors get nervous about the stock market, they buy puts. That negative sentiment is reflected in rising volatility indexes. And the two most closely watched volatility indexes soared today as the market fell heavily. Chart 1 shows the CBOE Volatility (VIX) Index soaring... READ MORE
CHINA PLUNGE PUNISHES EMERGING MARKETS ... A 9% plunge in the Chinese stock market has caused a global stock selloff and a continuing shift to the safety of Treasury bonds. Chart 1 shows Chinese iShares (FXI) gapping down below its 50-day moving average on very heavy volume. The day's... READ MORE
MORGAN STANLEY IS LATEST CASUALTY ... On Friday I wrote about selling in brokerage stocks and showed chart breakdowns in Lehman Brothers and Merrill Lynch. The brokerage group was today's weakest industry, and the biggest percentage loser in the group was Morgan Stanley. The daily bars in Chart 1... READ MORE
MORTGAGE CONCERNS WEAKEN HOUSING SECTOR ... On February 12, I showed a chart of Countrywide Financial starting to break down on rising volume. It's fallen even further since then and is now threatening its 200 day moving average (Chart 1). I took its earlier weakness as a sign that... READ MORE
SILVER EXCEEDED SPRING PEAK MONTHS AGO ... Precious metals surged to new nine-month highs on Wednesday on heavy volume. Although a lot has been made about the fact that gold was testing its spring high (which it broke yesterday), the fact is that silver exceeded that chart barrier in late November.... READ MORE
TECHS AND SMALL-CAPS HOLD UP... Today's Market Message was written by Arthur Hill. John Murphy will be back tomorrow. - Editor The market ended mixed on Wednesday. The S&P 500 and Dow edged lower, but the Nasdaq and Russell 2000 closed slightly higher. Techs and small-caps... READ MORE
IT STARTS WITH FALLING BOND YIELDS... The main feature of the week was a falling dollar, which was the result of falling bond yields. Chart 1 shows the 10-year T-note yield trading at the lowest level in a month. Falling U.S. rates weaken the dollar. Chart 2 shows the... READ MORE
WEEKLY WRAPUP ... The market shrugged off some bad news on Friday from Microsoft and the housing sector to end either flat or modestly higher. That's actually a pretty good performance. Bond yields and the dollar continued to weaken which boosted commodities (especially gold and oil) and foreign ETFs.... READ MORE
BUDWEISER TESTS RECORD HIGHS ... Brewers have become consumer staple leaders. Last Friday I showed Molson Coors (TAP) breaking out to a new high (Chart 1). The beer stock is up 5% today and is the strongest stock in the Consumer Staples SPDR (XLP). Right behind it is Anheuser Busch (BUD)... READ MORE
GENTLE BEN SPARKS THE DOW... Today's Market Message was written by Arthur Hill. John Murphy will be back tomorrow. - Editor Comments from Fed Chairman Ben Bernanke sparked a rally on Wall Street and the Dow surged to another record high on Wednesday. The Fed Chairman indicated that... READ MORE
CANADIAN DOLLAR AND JAPANESE YEN ARE BOUNCING ... Two of the weaker foreign currencies of late have been the Canadian Dollar and the Japanese yen. [Both are included in the Dollar Index basket]. Today's announcement of a record U.S. trade deficit for 2006 (which was even higher than... READ MORE
ENERGY ETFS ARE AVERAGING DOWN... On Friday, crude oil breached the important $60 resistance barrier intra-day, but couldn't hold the gain. In today's trading, crude is down more than $2. Energy ETFs are struggling with some resistance barriers of their own. Chart 1 shows the Energy... READ MORE
COMMODITIES CONTINUE TO RALLY ... Commodity markets continue the rally that started a month ago. Thirteen of the nineteen commodities in the Reuters/Jefferies CRB Index are in the black. Among the day's CRB leaders are copper, wheat, sugar, gold, aluminum, crude oil and silver. Crude exceeded $60 for... READ MORE
WHY YEN AND USD SOMETIMES DROP TOGETHER ... Normally when I discuss the direction of the U.S. Dollar, I use the U.S. Dollar Index (USD). The USD measures the dollar against six foreign currecies. In my view, it gives a truer picture of dollar trends. Following my dollar article... READ MORE
NASDAQ 100 MAKES A MOVE... Today's Market Message was written by Arthur Hill. John Murphy will be back tomorrow. - Editor The Nasdaq 100 took the lead on Wednesday with a surge above 1800. This move reinforces support at 1750 and keeps the medium-term uptrend alive. Support around... READ MORE
FALLING DOLLAR FAVORS FOREIGN STOCKS ... One of our readers asked why I haven't mentioned the impact of the dollar on foreign stocks. Actually, I've done so several times. Since the dollar is at a crucial juncture, however, this is as good a time as any to... READ MORE
WRONG AVERAGE... Some of you with really sharp eyes may have noticed a mistake in the monthly S&P 500 chart that I posted on Friday. The chart was intended to show how the 13- and 34- month exponential moving averages (EMAs) had worked on the S&P... READ MORE
WEEKLY EMAS STILL WORK... Last July, I reviewed a moving average technique that used weekly exponential moving averages. [I first described this system in October 2005]. I'm revisiting it today because it continues to do remarkably well. And I'd like to suggest expanding its usefulness. The... READ MORE
FED STATEMENT WEAKENS THE DOLLAR ... Yesterday's Fed wording about moderating inflation pressures weakened the U.S. dollar (because it virtually ruled out any Fed tightening in the near future). This comes at an important time for the dollar. Chart 1 shows the U.S. Dollar Index (plotted through... READ MORE
RUSSELL 2000 CHALLENGES DECEMBER HIGH... Today's Market Message was written by Arthur Hill. John Murphy will be back tomorrow. - Editor The Russell 2000 is making a breakout bid that would bode well for the overall market. While the Dow and the S&P 500 moved higher... READ MORE
TELECOM LEADERSHIP CONTINUES... I wrote a positive article on the telecom group on June 19 of last year with headlines like "AT&T Leads Telecom Group Higher" and "Telecom Holders Are Having a Good Year". Chart 1 is an updated version of a chart I... READ MORE
OVERLAYING RSI ON PRICE BARS ... Most chartists place indicators like RSI either above or below corresponding price bars. I like to overlay the indicator right on the price. To me, that makes for easier comparison between the two lines. Take Chart 1 for example. It overlays the 14-week RSI line... READ MORE
BOND YIELDS REACH FIVE-MONTH HIGH ... The upturn in bond yields that started during December is starting to look more serious. Chart 1 shows the 10-year T-note yield trading over its late October peak (4.85%) and its 200-day moving average for the first time since August. A decisive close over... READ MORE
NYSE COMPOSITE AND NASDAQ CONTINUE THEIR BATTLE... Today's Market Message was written by Arthur Hill. John Murphy will be back tomorrow. - Editor Two weeks ago I wrote that the Nasdaq was holding up well and outperforming the NYSE Composite. The Nasdaq held firm the first five trading... READ MORE
DB COMMODITY ETF IS RALLYING ... Last Friday I suggested that an overbought US Dollar Index was starting to back off potential resistance at its 200-day average. The dollar is dropping today against the Euro and is giving a boost to oversold commodity markets. I also suggested on Friday that commodity... READ MORE
NYSE BULLISH PERCENT HISTORY ... I've received a few requests to update my December 8 article on the NYSE Bullish Percent Index. There are two ways of looking at it. One is a line chart as shown in Chart 1. The second, and more common way, is with a... READ MORE
HEALTHCARE RS LINE MAY BE BOTTOMING ... On January 4, I wrote a message entitled: "Heathcare is Starting to Look Better". I showed the Healthcare SPDR (XLV) hitting a new record high. [It's doing so again today]. I pointed out, however, that its relative strength line was... READ MORE
NASDAQ PAUSES AFTER BREAKOUT ... Today's Market Message was written by Arthur Hill. John Murphy will be back tomorrow. - Editor After breaking consolidation resistance last week, the Nasdaq took a breather and fell back below 2500 over the last two days. The pullback is relatively mild thus far... READ MORE
DOW TRANSPORTS CONTINUE TO RALLY ON FALLING OIL ... With oil falling sharply today, transportation stocks are continuing their recent surge. Chart 1 shows the Dow Transports gaining 2% and trading at the highest level in nearly two months. The TRAN crossed over its 50-day moving average on Friday. Its relative... READ MORE
EXTREME SIMPLICITY ... One of our readers asked that I review some current point & figure charts. The beauty of p&f charts is the precision of buy and sell signals and their extreme simplicity. [P&F is also the oldest form of charting in the U.S.]. I... READ MORE
COMMODITY TRACKING FUND BOUNCES OFF CHART SUPPORT ... Commodities have been the weakest asset class over the last half year. Since last May, the Reuters/Jefferies CRB Index has lost 20%. Most of those losses, however, have come from the energy sector (with crude oil losing 30%). Smaller losses of 10%... READ MORE
NEW NASDAQ LEADERSHIP ... The first part of the headline posted above is the same one I used last Thursday. At the time the Nasdaq Composite Index had bounced impressively off its 50-day moving average. And its relative strength line (versus the S&P 500) had turned up for the... READ MORE
NASDAQ LEADS THE WAY... It has been a tale of two markets in 2007. The Nasdaq has been working its way higher this year, but the NYSE Composite has been working its way lower. Even though we are only talking six trading days, something is happening here and we should... READ MORE
VIX IS TESTING OVERHEAD RESISTANCE ... One of the hallmarks of last year's strong stock market was unusually low market volatility. Some market strategists expect volatility to pick up this year. If it does, it could make for a more difficult year for stocks. That's because rising... READ MORE
RISING RATES POSE A THREAT TO STOCKS ... On December 28, Arthur Hill showed an earlier version of Chart 1 which demonstrated that the stock market advance since mid-year had coincided with a drop in bond yields. As Mr. Hill pointed out, however, the TNX had already broken its six-month down... READ MORE
JUMP IN JOBS AND WAGES BOOST INTEREST RATES ... Today's report of an unexpected jump in new jobs during the month of December -- combined with a 0.5% jump in wages (for an annual rate of 4.2%)-- raised inflation concerns and is causing a jump in... READ MORE
NASDAQ LEADS MARKET HIGHER... Two good things happened today regarding the Nasdaq market. One is that it gained over a percentage point and bounced sharply off its 50-day moving average as shown in Chart 1. [The Nasdaq 100 did even better]. That kept the Nasdaq uptrend intact. The second good... READ MORE