INDUSTRIALS CONFIRM TRANSPORT BREAKOUT... Earlier today I showed the Dow Transports breaking through their June high. The Dow Industrials completed a bullish breakout of their own by day's end. That puts both Dow Averages in intermediate uptrends. The stock that contributed the most to the Dow's... READ MORE
DOW TRANSPORTS HIT FOUR-MONTH HIGH ... The Dow Transports have finally broken through chart resistance at their early June high. Chart 2 shows the Dow Industrials trading just above their June high and on the verge of a similar breakout. As I suggested last week, a decisive close through that barrier... READ MORE
NASDAQ HITS NEW RECOVERY HIGH ... The Nasdaq market hit a new recovery high today and had the biggest percentage gain of the major market indexes. Chart 1 shows the Nasdaq Composite closing at 2173 which puts it within 20 points of its early 2005 high at 2191. That will be... READ MORE
MARKET BOTTOMS EVERY FOUR YEARS ... I made brief mention of the four-year presidential cycle last week. Since it plays a important part of my overall stock market view, I thought it needed a more thorough explanation. The presidential cycle is the four-year cycle that repeats itself over and over again... READ MORE
BIG DROP IN CRUDE CAUSES SELLING IN OIL PATCH ... A $2.00 drop in crude oil to below $58 caused some heavy profit-taking in energy shares which were the day's weakest sector. Charts 1 and 2 show the Energy Sector SPDR (XLE) and the Oil Service Holders (OIH)... READ MORE
MARKET IS STILL IN A TRADING RANGE ... In a number of this year's market messages I've described the stock market as being in a trading range. [A "trading range" is a sideways market]. I have allowed for the possibility of "marginal" new... READ MORE
GROUP LEADERS FOR THE LAST MONTH ... The performance bars in Chart 1 show the group leaders over the last month. While some of them are old leaders from the first half of 2005 (energy, housing & real estate, and utilities), there are some new leaders emerging. Among them are brokers,... READ MORE
OVERSOLD EURO BOUNCES OFF CHART SUPPORT... Last week I showed the U.S. Dollar Index having reached an overhead resistance zone along the 2004 highs (90-92) while in an overbought condition. The Euro is a mirror image of the Dollar Index. The weekly bars in Chart 1 show the Euro... READ MORE
SOX IS CHALLENGING PREVIOUS PEAKS ... Last Friday the Nasdaq Composite Index broke through 2100 for the first time this year and started to show better relative strength. Technology leadership is normally good for the rest of the market. That's why today's strong action by the semiconductors... READ MORE
DOW AND S&P TURN UP... After describing yesterday's upside reversal day last evening, I wrote that we needed to see some upside follow-through. We certainly got that today. All market sectors closed in the black with the exception of energy. Crude oil fell over a dollar... READ MORE
BRITAIN REGAINS LOST GROUND ... The purpose of this article is twofold. The first is to show that the British stock market (and Europe in general) has recovered from yesterday's early selloff. Chart 1 shows the London Financial Times Index (FTSE) through this morning. Yesterday's bomb attacks... READ MORE
BIOTECHS LEAD MARKET RALLY ... Biotechs are making a strong bid for market leadership. Thanks to a 52-week high by Amgen, biotechs were the day's top market group. Yesterday I showed the Biotech iShares (IBB) closing over their 200-day average for the first time since February. After retesting that... READ MORE
DON'T OVERREACT... This morning's news of bombings in London caused some initial panic selling in global markets. However, markets appear to be returning to more normal activity. In reality, there haven't been any serious market changes. Naturally, most of the overseas selling took place... READ MORE
ENERGY MARKETS HIT RECORD HIGHS... Crude oil closed above $61 today for the first time in history. Heating oil and gasoline futures prices also reached new records. While some of today's energy strength is due to hurricane activity, it demonstrates how little margin for error there is in... READ MORE
BIOTECH INDEX EXCEEDS 2004 HIGH... Chart 1 is an updated version of a similar chart that I showed on May 9 (May 09, 2005) which described the Biotechnology Index (BTK) as being in the latter stages of a bullish "symmetrical triangle". [A symmetrical triangle is identified by the... READ MORE
FIRST HALF RESULTS... The bars in the following chart show the best and worst group performers for the first half of the year. To no one's surprise, energy was the top sector -- while the fuel-sensitive transports were the weakest. Utilities took second place thanks to falling bond... READ MORE
OIL ETFS STAY OVER BREAKOUT POINTS ... Despite the recent dip in oil prices, energy ETFs have held up relatively well. They're rising today on the back of a jump in the price of crude. Chart 1 shows the Energy Sector SPDR (XLE) staying over its March high near... READ MORE
THE FED DOES IT AGAIN ... The Fed raised the Fed funds rate another quarter point today. Although its wording showed little change from last month, it appears that the stock market was hoping for a sign that the Fed tightening cycle is nearing an end. When it didn't... READ MORE
TRANSPORTS GET LEFT FROM OIL DROP... With crude oil dropping more than $2 today, transportation stocks are getting a much needed lift. And it's coming at a good time. Chart 1 shows the Dow Transports flirting with the late-April/early May lows ranging from 3350 to 3400. This... READ MORE
RISING OIL IS HURTING TRANSPORTS THE MOST ... It's normal to expect that record high oil prices are hitting the fuel-sensitive transportation stocks the hardest. Last week I showed the Dow Transports falling to a new monthly low after breaking their moving average lines. With crude now trading over... READ MORE
BHI HAS JUST HIT ALL-TIME HIGH... During my Friday evening interview on the Nightly Business Report, I recommended the Oil Service Holders (OIH) and Baker Hughes. I pointed out that BHI was the biggest holding in the OIH which had just exceeded its 2000 peak. They showed a 52-week chart... READ MORE
THE MARKET ISN'T READY FOR $60 OIL... On Wednesday I suggested a more cautious view of the market due to the fact that several stock market indexes were up against resistance at their 2005 highs and in short-term overbought conditions. That's why Thursday's high-volume... READ MORE
DOW THEORISTS WON'T LIKE DROP IN TRANSPORTS ... Not too long ago I showed the Dow Transports dropping under their 200-day moving average and suggested that was a negative sign for Dow Theorists. Today's drop in the transports makes that situation even worse. Chart 1 shows the... READ MORE
GOLD JUMPS $4... The rally in gold continues. In today's trading, bullion has risen $4.00 and is trading at a new three-month high. Chart 1 shows the Gold ETF (GLD) having broken its eight-month down trendline and moving to up to test its March high. I think... READ MORE
A KEY TEST IS GOING ON IN A LOT OF INDEXES... While most market observers are watching the Dow and the S&P 500, it's important to recognize that several market indexes have already reached their 2005 highs and are undergoing an important test of that resistance... READ MORE
VALUE IS STILL IN THE LEAD ... One of the battles going on in the market is the one between large cap value versus growth. Charts 1 and 2 show a six-month comparison of two ETFs that reflect those two market segments. Chart 1 shows the S&P 500 Value... READ MORE
DOLLAR IS STILL IN RALLY PHASE OFF 1995 LOW... Near the start of 2005, I showed a monthly chart of the Dollar Index similar to the one shown in Chart 1. The point of the earlier chart was to warn dollar bears that the USD was nearing a major support... READ MORE
BIOTECH INDEX TESTS EARLY 2004 HIGH ... On Friday I showed the Biotechnology Index breaking out to new 52-week high. It's hitting another new high today and very close to challenging its early 2004 high. There are several ways to participate in the biotech rally. One is buy some... READ MORE
HEALTHCARE ETF HITS 52-WEEK HIGH ... While a lot of attention has been paid to rising energy and basic material stocks this week, not much has been written about healthcare. It's time to correct that. Chart 1 shows the Health Care Sector SPDR (XLV) closing the week at a... READ MORE
NASDAQ 100 CORRECTION MAY BE ENDING ... I wrote earlier in the week that the market would have a hard time resuming its uptrend unless the Nasdaq started to move higher as well. That may very well be happening. One of the things I was looking for was a test of... READ MORE
MONEY IS FLOWING BACK INTO COMMODITY STOCKS... With commodity prices climbing again, it was just a matter of time until basic material stocks started to climb as well. Thanks to jumps in the price of copper and gold, the Materials Select SPDR (XLB) is the day's strongest sector.... READ MORE
MIDCAP INDEX REACHES NEW HIGH ... I recently showed the S&P 400 Mid Cap Index testing its early March high and suggested that what it did at that resistance barrier held an important clue to market direction. Chart 1 shows that the Mid Cap Index breaking through its 2005... READ MORE
NASDAQ 100 HOLDING THE MARKET BACK ... Ever since the Nasdaq market backed off from its spring high a couple of weeks ago, the rest of the market rally has stalled. That's because the market needs Nasdaq leadership to continue its summer rally. Last week I showed the Nasdaq... READ MORE
RETAIL HOLDERS NEAR 2005 HIGH... Retail stocks are the day's strongest group. Chart 1 shows the Retail Holders (RTH) very close to reaching a new 2005 high. The better performance by the retail group has actually been going on since early May when its relative strength line bottomed... READ MORE
WHY EUROPE ISHARES HAVE BEEN FALLING ... While the major European stock indexes are at or close to new 52-week highs, it may seem puzzling to see European stock ETFs falling since March. Chart 1 shows the Europe 350 iShares (IEV) peaking in March and declining toward its 200-day moving average.... READ MORE
NYSE AND DOW ARE STUCK BELOW RESISTANCE ... So far this week I've shown three market leaders -- the Nasdaq Composite, the S&P 400 Midcap, and the Semiconductor (SOX) Index -- all backing off from chart resistance near their spring highs. That loss of leadership has prevented... READ MORE
SELLING INTEL ON THE NEWS ... Yesterday I showed the S&P 400 Mid Cap Index testing its 2005 high, and suggested that it held an important key to short-term market direction. The same is true for the semiconductor group. A positive mid-quarter report from Intel last evening was greeted... READ MORE
CRUDE OIL HITS NEW RECOVERY HIGH... Earlier today I wrote about the bullish breakout in the energy sector. That strong action in energy stocks was confirmed by equally bullish action in the commodity. Crude oil surged over 5% today to reach the highest level in nearly two months. Crude appears... READ MORE
MIDCAPS HAVE BEEN THE STRONGEST ... Earlier in the week I showed the S&P 400 Mid Cap Index (MID) having already reached its March high. It's the first index to reach that important chart point. The MID/SPX ratio has been rising since the start of the... READ MORE
ENERGY ETFs ARE BREAKING OUT ... Yesterday I showed the two Energy ETFs that I track closely challenging their late April highs. A late drop in the price of oil yesterday prevented an upside breakout. With oil trading a dollar higher this afternoon, it looks like the bullish breakouts are taking... READ MORE