One of the nagging concerns about the current market rally is the lack of participation by small cap stocks. This week's action was another example of that troubling trend. The Russell 2000 Small Cap Index lost -0.72% this week (versus a +0.54 gain by the S&... READ MORE
U.S. STOCK INDEXES END WEEK HIGHER... A strong rebound on Friday helped U.S. large cap stock indexes end the week higher. That kept their uptrends intact. The week's strongest gainers were the Dow Industrials (+0.92%). Chart 1 shows the Dow Industrials ending the week above... READ MORE
The Regional Bank SPDR (KRE) failed to hold its flag breakout and then broke support with a sharp decline this week. It would now appear that KRE formed a rising wedge that peaked below the January high. This week's wedge break signals a continuation of the prior decline... READ MORE
KEY BREADTH INDICATOR STILL BULLISH ... Link for today's video. While there are certainly a few negatives regarding the stock market, the bulk of the evidence remains bullish. Among the negatives, the Russell 2000 iShares is down around 7% from its early July high and shows relative weakness since... READ MORE
As markets make new highs, investors often befriend a dangerous new companion. He’s the greedy little devil that sits on your shoulder and whispers in your ear – assuring you that this market will make you wealthy as he coaxes you to buy more and ignore the naysayers. As I... READ MORE
Stocks came under selling pressure over the past week with small-caps bearing the brunt. The PerfChart below shows the performance for eight major index ETFs over the past week. Seven are down and only one is up. The Dow Diamonds (DIA) has the only gain. The Russell 2000 iShares (IWM)... READ MORE
Stocks opened slightly lower and then slid as news reports suggested that the Malaysian airliner was shot down. There was a small bounce around midday and stocks again came under selling pressure in the afternoon. Small-caps led the way lower as IWM fell around 1.5%. All sectors were lower... READ MORE
Periodically I like to run a scan that gathers stocks and ETFs that have a PMO that has been rising for three days and has the 50-EMA above the 200-EMA. Here's what I like about this scan. First, if the 50-EMA is above 200-EMA that implies that the... READ MORE
DOW JONES INDUSTRIAL AVERAGE MAKES NEW HIGH... The Dow Jones Industrial Average ($INDU) broke out to new highs on Thursday morning in Chart 1. At the close on Wednesday, the Dow had pushed and closed above 17100. This morning, we made an intraday high of 17151 before selling off to... READ MORE
* Less than 50% of NASDAQ stocks are above their 200-day MA’s. * Bond market confidence ratio on the verge of a major breakdown. * US Dollar Index could be about to break to the upside. Click here for video version US Equities The Dow touched an all-time high this week but... READ MORE
There are only three setups today because the pickings are slim during earnings season. Risk is always above average when a company reports earnings and I try to insure that the earnings report is at least a week away. Today, we have a semiconductor stock with a bull flag. Second,... READ MORE
Stocks opened strong and then stalled. SPY and QQQ managed to hold their gains and close slightly higher. IWM did not and closed fractionally lower. Seven of the nine sector SDPRs were higher with technology, energy and materials leading the way. The Technology SPDR gained almost 1% with help from... READ MORE
COMMODITIES TAKE A SLIDE... Commodities were the strongest asset class during the first half of the year. That's no longer the case. Chart 1 shows the DB Commodities Tracking ETF (DBC) tumbling since mid-June to the lowest level in five months. It has also fallen below its 200-day... READ MORE
Stocks, gold, the Dollar and bonds got whipped around during congressional testimony from Fed Chair Janet Yellen. Stocks opened strong, took a deep dip and the recovered some of that dip with an afternoon advance. It is hard to read into price action driven by Fed comments and the overall... READ MORE
TIMBER ETF FORMS CLASSIC CORRECTIVE PATTERN ... Link for today's video. Chart 1 shows the Timber ETF (CUT) with a corrective wedge taking shape over the last few weeks. Overall, the ETF hit a new high in early March and then fell sharply into mid April. With the rebound... READ MORE
The S&P 500 is up over 6% since mid April, but this advance has been about as boring as they get. Note that this key benchmark has not moved more than 1% since April 16th (hat tip crossingwallstreet.com). The old Wall Street adage, "never short a... READ MORE
There are five setups today. First, we have an education provider with a break down. Second, there is a tech stock breaking out of a bullish continuation pattern. Third, we feature a mining equipment play with a bullish wedge taking shape. Fourth, there is another tech stock with an ascending... READ MORE
Stocks started the day strong and then stalled as buying and selling pressure equalized. The major index ETFs finished with modest gains. Seven of the nine sectors were higher with technology, energy and finance leading. The utilities sector moved sharply lower with a 1+ percent loss. The chart below shows... READ MORE
After a wedge breakout in late May, the Solar Energy ETF (TAN) is testing this breakout and two key moving averages in July. Notice how the 50-day and 200-day moving averages converge in the 40-41 area. TAN is currently above both and the 50-day is above the 200-day. The bias... READ MORE
SELLING PRESSURE IS STILL QUITE LIMITED... Link for today's video. Last week was rough for small-caps and micro-caps as they bore the brunt of selling pressure. There are concerns with relative weakness in small-caps and July-August seasonal patterns, but recent selling pressure was lopsided and confined to a... READ MORE
* Fading Sectors/Industries: Financial, Homebuilders, Consumer, Biotech, Small Cap, Industrial * Emerging Sectors/Industries: Energy, Mines, Basic Materials, Gold Miners Sector rotation is a continual process, but recently several old favorites have started to lose favor, and several previously discarded ones are coming to the fore. I am going to run... READ MORE
It was a rough week for stocks. Small-caps led the major index ETFs lower as IWM lost around 4%. The finance sector was relatively weak as XLF declined around 1.5% on the week. The Home Construction iShares and the Retail SPDR were two of the weakest industry group ETFs.... READ MORE
Sentiment has traditionally been measured by taking polls of selected groups of investors, advisors, investing professionals, etc. There have been and still are problems associated with this methodology: (1) The polls are normally taken over a period of several days, during which time market movement and investor outlook can change... READ MORE
HOME CONSTRUCTION ISHARES TESTS KEY SUPPORT... Link for today's video. Chart 1 shows the Home Construction iShares (ITB) breaking out with a move in late May and early June, but then falling back to support this week. The sharpness of this week's decline is a concern... READ MORE
As Oscar Wilde aptly said, “Memory is the diary that we all carry with us.” It’s July 4th, and I’m coaching kids about timing and firecrackers. Not too different from coaching investors about timing and selling equities. Most grownups have learned from experience -- perhaps some more than... READ MORE
The intermarket PerfChart below shows July getting off to a rather strange start. SPY and QQQ are up slightly this month, but IWM is down sharply with a 2+ percent loss. Relative weakness in small-caps suggests that the equity market may be entering into a corrective period. Small-caps and momentum... READ MORE
MARKETS OPEN DOWN 1% THEN RALLY OFF SUPPORT.... The S&P500 ($SPX) opened 1% lower in the first few minutes this morning and rallied throughout the day. It bounced off the support provided by the June 9 high and the June 26th low. From Chart 1 we can see... READ MORE
Alaska Air (ALK) fell sharply in early June, established support just above 46 and bounced off this support zone the last few days. This is impressive considering the selling pressure that hit the market this week. Notice the hollow, or white, candles. These form when the close is well above... READ MORE
Stocks firmed after a sharp two day decline in small-caps and momentum names. Firmness could be fleeting because stock futures are down after hours. If the second shoe drops here, I would expect the momentum names and small-caps to lead the way lower again. While I do not think this... READ MORE
There are five setups today. First, we have a tech stock with a pennant break down. Second, we have a teen apparel retailer with a falling wedge. Third, there is a medical device company trading within an extended correction. Fourth, we feature a gold stock poised to challenge range resistance.... READ MORE
* Brokers are leading the market lower * NASDAQ Composite leaves a lot to be desired * The balance of evidence suggests lower near-term bond prices * Commodities complete a short-term top US Equities The correction we have been talking about in the last couple of Market Roundups is likely to continue. As Art... READ MORE
BRAZIL IS GAINING ON GERMANY ... No, that's not a comment on a soccer game. It's a comment on the fact that Brazil stocks are doing better than Germany's this year (unlike their soccer team). That's a reversal of trends seen since 2011.... READ MORE
The high-beta names (i.e. momentum stocks) got hammered again on Tuesday. The Russell 2000 iShares fell over 1%, the Internet ETF fell 3%, the Solar Energy ETF declined over 3.5% and the Biotech SPDR lost 3.77%. It is beginning to look a lot like March. Note that... READ MORE
The Russell 2000 is not the only index struggling right now. If you look at the Nasdaq Composite, Dow Utilities, S&P 400 and S&P 600, you'll see similar breakdowns. The Russell 2000 has been traveling upward in a bearish ascending wedge. The expectation was... READ MORE
There are seasonal tendencies and then there are STRONG seasonal tendencies. Over the last 20 years, the S&P 500 Volatility Index ($VIX) has moved higher 80% of the time in the month of July. This follows the weakest month, June, which shows a rising VIX just 25% of... READ MORE
RUSSELL 2000 PLUNGES FROM RANGE RESISTANCE... Link for today's video. Small-caps are leading the market lower with sharp declines the last two days. Chart 1 shows the Russell 2000 surging to its March high last week, stalling for a couple days and felling over 3% the last few... READ MORE
After hitting new highs last week, stocks started this week with some selling pressure. Large-caps held up relatively well as SPY fell .76%. Small-caps and micro-caps bore the brunt of selling pressure as the Russell 2000 iShares and Russell MicroCap iShares fell more than 1.5% on the day. Six... READ MORE
There are five setups today. First, we start with a Chinese aluminum stock that is surging off a key retracement. Second, we have a restaurateur stalling at a key retracement. Third, there is an equipment manufacturer with a triangle consolidation. Fourth, we feature an inflight internet provider with a breakdown... READ MORE
Hello Fellow ChartWatchers! 2014 has already been full of surprises both in the markets and here at StockCharts.com. From a market perspective it has been yet another great year to be a technician assuming that you trusted the charts and not the talking heads and experts. "The market... READ MORE