The Retail SPDR (XRT) reversed near resistance with a gap up, stall and gap down. This sequence is also known as an island reversal. In addition to the reversal at resistance, notice that XRT shows relative weakness as the price relative moved below its mid December low. Click this image... READ MORE
SETTING MOMENTUM SUPPORT FOR SPY AND QQQ... Link for todays video. Chart 1 shows the S&P 500 ETF (SPY) with the True Strength Index generating four oscillator signals over the past year. The True Strength Index is a momentum oscillator that measures the momentum of double-smoothed price changes.... READ MORE
Programming note: I will be taking off December 27th and 31st. Art's charts and the Market Message will be updated on Wednesday and Friday this week, and Wednesday (Jan-2) next week. Happy Holidays! Stocks edged lower on Christmas Eve with relatively mild selling pressure during a shortened session.... READ MORE
One of the most consistent intermarket principles is that gold (and most commodities) usually trend in the opposite direction of the U.S. Dollar. That inverse relationship has broken down of late. Chart 1 compares the Gold Trust (GLD) to the Dollar Index (UUP) over the last year. Both markets... READ MORE
To historians, this doesn't come as a surprise. Since 1987, the Russell 2000 has produced annualized returns during the month of December of 43.38%. April is the next best month for small caps with its annualized return of 21.84%, a very distant second. Over the past... READ MORE
In the past several weeks, the FOMC has voted to "expand" its balance sheet until which time economic growth is strong and getting stronger ($45 billion long-term treasuries/$45 MBS). One would have reasonably thought that Gold prices ($GOLD) would have rallied rather sharply - we certainly were... READ MORE
About a month ago I wrote an article stating that I thought that gold was resuming its long-term up trend, but that belief was conditioned upon price moving above the October top. That did not happen. Instead, after putting in a lower top in November, price has dropped below the... READ MORE
2012 is ending with a bang for banking stocks as sentiment towards this sector improved significantly in December. Perhaps the big banks are looking forward to open-ended quantitative easing in 2013. The chart below shows the Finance SPDR (XLF) breaking above its autumn highs to record a 52-week high. In... READ MORE
The Sector Market Carpet is full of red today as selling pressure hit an overbought stock market. All sectors are down, but there are a few isolated green boxes. Nike (NKE) is the top performer with a 4.8% surge. Red Hat (RHT) is up within the technology sector and... READ MORE
FISCAL CLIFF FEARS HIT OVERBOUGHT STOCK MARKET... Link for todays video. Fiscal cliff fears hit the markets on Friday as money moved from risky assets to relative safe-havens. Also note that stocks and the Euro were quite overbought, while Treasuries and the Dollar were oversold. Perhaps the fiscal cliff was... READ MORE
I’ll confess that my students have referred to me as tough, irreverent and leathery – and those are the kind comments said to my face. Guilty as charged, with the caveat that perhaps some of these comments are by students with objectives that are not on the same page as... READ MORE
Things were looking up until the fiscal cliff hit a roadblock. Stock futures are pointing to a sharply lower open and it could be a bumpy ride until yearend. The indicator summary remains bullish overall with new highs in the NYSE AD Line and AD Volume Line leading the charge.... READ MORE
Programming note: I will be taking off December 24, 27 and 31. Art's charts and the Market Message will be updated on Wednesday and Friday next week. Merry Christmas and Happy Holidays! Forget about the fiscal cliff and markets for a while and take time for things that... READ MORE
Electronic Arts (EA) came under strong selling pressure the last three days with consecutive long black candlesticks. As this chart now stands (11:48 ET), a bearish three black crows pattern is taking shape. The stock is short-term oversold already, but the trend line and support break are medium-term bearish.... READ MORE
GOLD AND THE DOLLAR ARE FALLING TOGETHER... One of the most consistent intermarket principles is that gold (and most commodities) usually trend in the opposite direction of the U.S. Dollar. That inverse relationship has broken down of late. Chart 1 compares the Gold Trust (GLD) to the Dollar Index... READ MORE
AAP Consolidates after Gap Down. HAS Falls Five Straight Days. Plus AZO, BCR, CB, LUB, ROL, XOM This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think... READ MORE
Stocks edged lower during the day and then took a hit in the final hour. The S&P 500 ETF (SPY) fell .74% and the Nasdaq 100 ETF (QQQ) declined .43% on the day. The losses were modest and the market was ripe for some profit taking. Keep in... READ MORE
NASDAQ 100 EQUAL-WEIGHT ETF BREAKS BIG TRIANGLE... Link for todays video. The Nasdaq 100 ETF (QQQ) has been under pressure because its biggest component (Apple) fell over 20% from its late September high. Apple accounted for over 20% of the ETF in September, but now accounts for a mere 16.... READ MORE
The market brushed off the fiscal cliff BS as the Santa bulls got into high gear on Tuesday. All of the major index ETFs advanced over 1% with the Nasdaq 100 Equal-Weight ETF (QQEW) leading the way (+1.52%). Small-caps were also strong with the Russell 2000 ETF (IWM) up... READ MORE
The Nasdaq 100 Equal-Weight ETF (QQEW) continues to lead the Nasdaq 100 ETF (QQQ) with a break above its autumn highs. After forming a doji and a hammer, QQEW broke channel resistance in late November and never looked back. The indicator window shows the price relative breaking out in early... READ MORE
THREE SECTOR BREAKOUTS ... Sector performance over the last month has turned more positive for the stock market. The fact that stock sectors sensitive to the economy are leading it higher is a sign of more confidence. In fact, the top three sectors are hitting new 52-week highs today and achieving... READ MORE
The Santa Claus rally continued on Monday with the major index ETFs scoring nice gains. The Nasdaq 100 ETF (QQQ) led the way with a 1.33% rise. All sectors were up with the consumer discretionary, technology, finance and utilities sectors leading the way. In fact, five of the nine... READ MORE
BP Forms Triangle Consolidation, CHS Bounces off Support. Plus CQP, COH, FITB, USB This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think for ourselves when it... READ MORE
The Consumer Discretionary SPDR (XLY) is showing strength with a channel breakout in November and a pennant consolidation in December. XLY surged over 1.4% on Monday to form the second low for the pennant. A breakout would signal a continuation higher. Click this image for a live chart... READ MORE
HAMMERS, HANGING MEN, SHOOTING STARS AND INVERTED HAMMERS... Link for todays video. The S&P 500 ETF (SPY) got a big bounce in the second half of November and then stalled with opposing candlesticks the first two weeks of December. Before looking at the SPY chart, lets review a... READ MORE
Trading could get real tricky (volatile) has we head into the fiscal-cliff endgame and holiday season. First, the markets will become extra sensitive to the news flow out of Washington over the next two weeks. Second, trading volume will thin, which means any uptick in volume could cause an outsized... READ MORE
S&P 1500 AD LINE BREAKS OCTOBER HIGHS... Link for todays video. StockCharts Pro gives chartists the ability to upload their own data series and chart them as ordinary symbols. I have taken advantage of this feature to create some custom breadth charts. In particular, I uploaded Net Advances,... READ MORE
Whether it’s golf or trading, it’s all about stress control. If you were sitting across the table from me and I booked a $10,000 loss, and then in the next hour I closed out a trade for a $10,000 profit, I would wager you even money... READ MORE
Intraday P&F charts are good for capturing short-term and medium-term price movements. The chart below is a 60-minute P&F chart for KB Home (KBH). Notice how the stock broke the Bearish Resistance Line and forged a breakout at 15 this week. Click this image for a... READ MORE
Stocks extended their uptrends on Monday-Tuesday, but fell back after the Fed meeting and declined on Thursday. Even though a post-Fed decline may seem negative, it could be just a little buy-the-rumor and sell-the-news at work. In addition, the fiscal cliff circus continues to dominate the news. With stocks holding... READ MORE
Stocks retreated after the Fed announcement. Of course, the fiscal cliff deadlock got the blame. Never mind that the S&P 500 was up some 6% from its mid November lows and ripe for a pullback or consolidation. Thursday's decline was not enough to reverse the short-term... READ MORE
FALLING YEN BOOSTS JAPANESE STOCKS ... Foreign markets generally do better when their currencies are rising. That's been the case with Europe over the past few months. It's also been true in emerging markets which have been rising along with their currencies. One major exception to that... READ MORE
With the consumer staples sector showing some relative strength on Thursday, I went to the sector summary to find the strong industry groups within this sector. The image below shows the 10 industry groups with the DJ US Drug Retailers Index ($DJUSRD) leading the way. Users can click on the... READ MORE
Stocks were all over the place on Wednesday. The major index ETFs opened strong, pulled back in the late morning, surged after the Fed announcement and pulled back again in the final hour. The end result was mixed as the S&P 500 ETF (SPY) and Nasdaq 100 Equal-Weight... READ MORE
AMT Breaks out to a 52-week High. CCL Forms Ascending Triangle within Uptrend. Plus DHI, M, STLD This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all need to think... READ MORE
S&P 500 CHALLENGES EARLY NOVEMBER HIGHS... Link for todays video. The Fed left rates unchanged, but announced intentions to expand quantitative easing in January. In particular, the Fed will start buying $45 billion worth of Treasury securities per month. In its policy statement, the Fed also noted that... READ MORE
The NYSE AD Line ($NYAD) reflects broad market strength with a move above the September-October highs this week. In fact, the indicator is trading at a 52-week high. There are no signs of weakness here. Click this image for a live chart.... READ MORE
The bulls kept up the pressure on Tuesday with the technology sector leading the charge. The Semiconductor SPDR (XSD) led tech stocks with a 2.71% surge. There was also strength in the Airline ETF (FAA), which advanced 2% and hit a new 52-week high (intraday). Elsewhere, the Steel ETF... READ MORE
NASDAQ 100 CLEARS MOVING AVERAGE LINES... Stocks are having another strong day. Chart 1 and 2 show the Dow and S&P 500 SPDRs moving above their early November highs. Both indexes cleared their 50-day lines last Friday. Chart 3 shows the Power Shares QQQ Trust moving above its... READ MORE
The technology sector is showing upside leadership with the average stock gaining 1.3% on Tuesday. The red ovals highlight the top five stocks in the S&P 500 today. Three of the top five are in the consumer discretionary sector, one comes from the sector and one from... READ MORE