INDIVIDUAL REITS ARE FALLING ON VOLUME... Earlier today, I showed the Morgan Stanley REIT Index (RMS) and a leading REIT ETF breaking their 50-day day moving averages on rising volume. Here's a closer look at where most of the selling is coming from. The first three charts show... READ MORE
DELTA SLASHES FARES... Delta's announcement of a 50% rate cut in domestic airline fares is killing the airlines today. The Airline Index (XAL) is tumbling 7% today as the entire group is being sold heavily. Chart 1 shows the Airline Index crashing through its 50-day moving average and... READ MORE
VIX REACHES TWO-MONTH HIGH... It's been a long time since I've written about the CBOE Volatility (VIX) Index. A lot of people have dismissed it as no longer having any forecasting value. That may explain why we haven't heard much about its recent rise.... READ MORE
SEMICONDUCTORS BREAK DOWN ... Semiconductor stocks are having a very bad chart day. Chart 1 shows the Semiconductor (SOX) Index shattering its 50-day moving average and a rising support line drawn under its September/October lows. The recent failed attempt by the SOX to stay over its 200-day moving average also... READ MORE
MORE DOLLAR BUYING ... As the dollar continues the new year rally, foreign currencies continue to weaken. The Euro is moving down for a test of its December low and its 50-day average. Its daily MACD lines have issued a short-term sell signal (Chart 1). The Japanese yen is already threatening... READ MORE
WORLD INDEX IS OVERBOUGHT ... The Dow Jones World Index is now in overbought territory. Chart 1 compares the 14-week RSI oscillator to the Index since 1998. An overbought reading occurs when the RSI is over 70. A oversold reading occurs when it's under 30. The weekly RSI line... READ MORE
DOLLAR RALLIES... The first day of trading in the new year is witnessing a bounce in the dollar and selling in foreign currencies. The Euro has been the only major foreign currency to reach a new high during December. But that move to a new high hasn't been... READ MORE
AN ALTERNATE VIEW ... I've written many times over the last few months about my view that the cyclical bull market in stocks has entered a fifth (and final) upleg. That's based on the Elliott Wave approach that holds that bull markets take place in five waves... READ MORE
REVUE OF NOVEMBER 24 MESSAGE... A number of readers have asked about the recent action in gold and the dollar -- especially after yesterday's $8.00 drop in bullion. Some wondered if the pullback in gold was warning of a bounce in the dollar. The answer is probably... READ MORE
LOCKHEED MARTIN LEADS DEFENSE STOCKS LOWER... Aerospace/defense stocks ave been among the year's top performers. Not anymore. The group has been losing ground lately, but is being hit especially hard today. The biggest loser is Lockheed Martin. Chart 1 shows the stock gapping down to a two-month... READ MORE
FEAR OF JAPANESE SELLING ... The Japanese yen is falling today. Rumors that the Japanese central bank may use the thinly-traded week to do some yearend intervening has caused nervous selling by currency traders. The yen has fallen to the lowest level in a year against the Euro. Chart 1 shows... READ MORE
AMAZON BREAKS OUT ON GOOD VOLUME... Amazon.com is today's standout stock performer on the Nasdaq market. News of a strong holiday season is pushing the stock through two important resistance barriers -- its September peak and its 200-day moving average. The two big volume bars reflect heavy... READ MORE
BIOTECH INDEX COMPLETES BULLISH TRIANGLE... The last time I looked at the Biotech Index, I described it as a potential "ascending triangle" as shown in Chart 1. That pattern is identified by two converging trendlines with the upper line flat and the lower line rising -- and is... READ MORE
DOW STARTING TO OUTPERFORM NASDAQ ... I mentioned yesterday that the Dow Industrials were starting to catch up with the rest of the market after reaching a three-year high on Tuesday. Actually there's more to it than that. If the Dow is starting to do better than the rest... READ MORE
DRUGS ARE LEADING MARKET HIGHER... In a continuation of yesterday's rebound in the big drug stocks, the Pharm Holders are the day's top sector ETF. Chart 1 shows them rebounding smartly off their 50-day moving average. Pfizer continues to lead the rebound with others that I&... READ MORE
ABBOTT LABS IS SHORT-TERM OVERBOUGHT ... During my TV appearance on the Nightly Business Report last Friday evening, I gave five stock recommendations. All five were in the consumer staple and drug groups and had been shown here over the previous week. As I was mentioning the stocks, NBR showed the... READ MORE
LAST FIVE DAYS OF THE YEAR... The traditional Santa Claus rally may be starting. According to the Stock Traders Almanac, the Santa Claus rally is a "short, sweet, respectable rally within the last five (trading) days of the year and the first two in January". The Almanac points... READ MORE
TV INTERVIEW TONIGHT ON CHANNEL 13 ... I'll be doing an interview with Paul Kangas on the Nightly Business Report this evening. The shows airs on Channel 13 and runs from 6:30 to 7:00 pm (NYT). The guest is usually interviewed in the second half of the... READ MORE
RATES SHOULD BE MOVING HIGHER... This time last year I wrote about my expectation for long-term interest rates to start moving higher during 2004. I got it only half right. They moved higher during the first half, but then fell back during the second half. It looks like bond yields... READ MORE
PFIZER PLUNGES 14%... Today's news that Pfizer's drug Celebrex may increase the risk of heart attacks took the stock -- and the drug group -- completely by surprise this morning. Chart 1 shows today's plunge to a new low by Pfizer. Several other drug... READ MORE
MORE DRUG LEADERS ... In my earlier market message, I showed today's explosive upmove in the pharmaceutical group -- spearheaded by Johnson & Johnson. I mentioned, however, these next two stocks who also qualify as drug leaders. The weekly bars in Chart 1 show Abbott Labs trading over 45... READ MORE
HEALTHCARE IS TOP SECTOR... I've been writing recently about the revival in the Healthcare sector. Today it looks like the healthiest part of the market. On Tuesday I showed the Health Care Select Sector SPDR (XLV) closing over its 200-day average for the first time since June, and... READ MORE
FOREIGN PURCHASES OF US ASSETS ARE SLOWING... The recent bounce in the dollar -- and the pullback in foreign currencies -- didn't last long. The dollar is falling sharply again today and foreign currencies are jumping. Chart 1 shows the Euro having bounced off initial support at its... READ MORE
ENERGY AND THEN STAPLES... Market sectors have a tendency to show market leadership in a certain order. They don't always follow the order exactly, but there is a strong tendency not to get too far out of line. Chart 1 shows the "ideal" order during an... READ MORE
CRUDE OIL TESTING $40 SUPPORT... Last week's price drop has pushed crude oil within a dollar of potential long-term support around $40. I've written a few times about my belief that $40 would be the new floor under the oil market. That belief is being tested.... READ MORE
CAMPBELL SOUP IS HEATING UP ... I wrote yesterday about new buying in the consumer staple group and showed a handful of recent stock leaders. With all the recent attention being given to basic material, gold, oil, and technology stocks, it's possible that a lot of investors may be... READ MORE
WHAT ABOUT THE 50-DAY AVERAGE?... I received several questions about my piece on the short-term breakdown in the Semiconductor (SOX) Index yesterday. One asked if it wasn't too soon to abandon semiconductors since the SOX was still over its 50-day average. I totally agree. And I wasn'... READ MORE
NEW SIGNS OF STRENGTH ... Yesterday I wrote about how the healthcare sector was starting to move up in the relative strength rankings. I mentioned that over the previous week, HC had moved into third place behind technology and consumer staples. One of our readers asked if new buying in HC... READ MORE
ALTERA AND XILINX FALL HARD ... Both chip stocks cut earnings forecasts and are falling heavily today on rising volume. Charts 1 and 2 show the chart damage being done. Both stocks have gapped beneath moving average lines and previous breakout points along thier September/October highs. With the trading day... READ MORE
BIOTECHS ARE DAY'S STRONGEST GROUP ... Biotech stocks are not only helping the healthcare sector today; they're also the day's strongest industry group. And their charts are starting to look more promising. Chart 1 shows the Biotechnology Index in an apparent "ascending triangle"... READ MORE
FOREIGN CURRENCIES ARE FALLING ... A sharp rebound in an oversold dollar is causing heavy selling on foreign currencies. Chart 1 shows the Euro gapping down to 132 today and nearing a test of its 20-day moving average. The Japanese yen has already broken that initial support line and is headed... READ MORE
COMMODITY STOCKS ARE FALLING ... Almost anything related to commodities fell hard today. Gold stocks have been falling for a week. And so have oil stocks. Another big drop in crude today pushed the Energy Select Sector SPDR ( XLE) under its 50-day moving average for the first time in three months... READ MORE
REVISITING NETWORKERS... Back in mid-November, I wrote about the Network iShares (IGN) breaking through their 200-day moving average (see red circle) and starting to move from technology laggards to leaders November 15, 2004. That leadership is continuing today. In fact, the IGN is the day's strongest sector ETF.... READ MORE
INTEL TRYING TO HOLD GAP AREA... I'm going to take a close look at Intel because of its importance in the Semiconductor (SOX) Index and the Nasdaq market (not to mention the Dow and the S&P 500). A bullish report last Thursday caused Intel to gap... READ MORE
P&F CHART OF NASDAQ 100 ... The main benefit of point & figure charts is that they give precise buy and sell signals. A buy signal occurs when a column of x's exceeds a previous x column. A sell doesn't occur until a column of... READ MORE
OCTOBER TOP IS NORMAL... Since the direction of crude oil is so important to the stock market, and because I've received so many questions on the energy sector this week, I'd like to spend more time on the subject. Before doing so, however, I'd... READ MORE
LONG-TERM CHART OF OIH ... Once again, I need to clarify the difference between short and long-term market action. A reader recently asked where the next upside target for the OIH was. I showed the following chart with an upside target near 98. That was a long-term projection. Obviously, this week&... READ MORE
ENERGY CONTINUES TO CORRECT ... With crude oil falling another dollar today, energy stocks remain on the defensive. The weakest part of the energy sector -- oil service -- is falling the hardest. Chart 1 shows the Oil Service Holders (OIH) breaking their 50-day average. A further drop to the early... READ MORE
CRUDE DROPS $3.64 ON THE DAY ... Crude oil plunged over $3 today (-7.4%) and is on the verge of undercutting its mid-November low. That took place after crude had recovered half of its recent price drop from $55 to $45, and suggests the likelihood that it will now... READ MORE
DROP IN OIL HURTS OSX -- SOX IS RETESTING 200-DAY LINE ... The market is reacting very positively to today's big drop in the price of crude. As a result, Energy is one of the few sectors in the red today (along with Utilities. More on the utility selling... READ MORE