The risk-on trade remains in force, but the bullish case has been weakening since last week. Even though the Euro remains in clear uptrend, supporting the risk-on trade, the 10-year Treasury Yield ($TNX) remains in a downtrend and fell further on Monday. In addition, the Finance SPDR (XLF) was hit... READ MORE
Once again, stocks dipped on Monday and early Tuesday, but quickly recovered with a sharp rally that held up into the close. The medium-term and short-term trends are clearly up, but the intermarket picture remains mixed. Strength in the Euro is positive for stocks, but strength in bonds and weakness... READ MORE
FINANCIALS LEAD LATE SELL-OFF IN STOCKS... Link for todays video. After bouncing around most of the day Monday, stocks were hit with selling pressure in the final hour and the S&P 500 closed near its lows for the day. Chart 1 shows the S&P 500 edging... READ MORE
The S&P Sector PerfChart shows the percentage change for the nine sectors and the S&P 500. Those up more than the S&P 500 are leading. Those up less are lagging. In a surprising twist, both the technology and healthcare sectors are leading the S&... READ MORE
After a relatively short pullback the prior three days, stocks rebounded with a strong move on Friday. The major indices were all up 2% or more with the Russell 2000 leading the charge (+3.42%). Relative strength in small-caps is a big positive for the market. We are also seeing... READ MORE
CRB INDEX HITS EIGHT-MONTH HIGH... I wrote on Thursday that a falling US Dollar Index was bullish for commodities (and stocks tied to commodities). Chart 1 shows the USD hitting another eight-month low on Friday. Right on cue, the CRB Commodity Index broke out to a new eight-month high on... READ MORE
NASDAQ HOLDS BREAKOUT AS RESISTANCE TURNS SUPPORT... Link for todays video. The Nasdaq broke above its July-August highs with the September surge and broken resistance turned into support this week. After breaking resistance around 2300, chart 1 shows the index pulling back mid week and then surging on Friday. Broken... READ MORE
After consolidating for a few days, the Nasdaq 100 ETF (QQQQ) broke resistance with a surge on Friday. In fact, the 30-minute PnF chart shows an ascending triangle taking shape this week. These are bullish continuation patterns. Click this image for a live chart... READ MORE
Thursday's action was not encouraging. Stocks started weak as the major index ETFs gapped down on the open. However, the bulls came in almost immediately and pushed stocks into positive territory just after 11AM. Techs led the rebound. This looked encouraging, but selling pressure took hold in the... READ MORE
Despite a few discrepancies, the indicator summary remains in the bullish camp. The Russell 2000 ETF (IWM) has yet to break its summer highs, but QQQQ, SPY and DIA have broken through. The NYSE AD Line hit another new high, but the Nasdaq AD Line has yet to take out... READ MORE
With a sharp decline the last three days, the Finance SPDR (XLF) failed at resistance for the fifth time since late May. In addition, the chart below shows the ETF breaking short-term support with a gap down. Deja vu? The price relative moved to a new low as finance continues... READ MORE
DOW TRANSPORTS HAVEN'T BROKEN... A lot has been written about the recent upside breakout in several market indexes. Unfortunately, the upside breakout took place on relatively light volume and hasn't shown much follow-through. I suspect that part of the reason for the lack of bullish follow-through... READ MORE
On the daily chart, SPY formed red indecisive candlesticks with a stall around 114 the last two days. These spinning tops can sometimes foreshadow reversals. Judging from the candlesticks, a decline below 112 would erase Monday's gain and call for a short-term trend reversal. Also notice that SPY... READ MORE
The Consumer Discretionary SPDR (XLY) is one of the leaders in September, but the ETF is now stalling near the upper trendline of a rising price channel. The lower trendline was drawn first and the upper trendline is parallel from the late July high. This trendline extension coincides with the... READ MORE
SEMIS CONTINUE TO LAG BROADER MARKET... Link for todays video. The Semiconductor HOLDRS (SMH) stands out as a clear laggard over the last few months. Most broad market indices moved above their summer highs, but SMH did not even come close. In addition, note that the Networking iShares (IGN), the... READ MORE
With a high volume surge the last three days, Google (GOOG) broke above Volume by Price resistance around 500. The stock also broke above its summer highs and has shown relative strength in September. Click this image for a live chart... READ MORE
via stockcharts.com Airline stocks have been in the new recently and here's why. They are very close to punching through the recent resistance zone around 42. The expanding Bollinger Bands reflect the recent volatility in the sector, but a close above 42 would go a long way... READ MORE
SPY broke above its summer highs and closed at its highest level since the second week of May. Perhaps the advance is accelerating higher with this breakout. At this point, the bulls are in clear control and I am focused on what it would take to turn this chart bearish.... READ MORE
For stocks, there was good news and bad news on Tuesday. It is positive to see the Euro surging, but negative to see interest rates falling. Throughout 2010, stocks have been positively correlated with interest rates and negatively correlated with the Euro. Which relationship are we to follow here? I... READ MORE
SPY BREAKS ABOVE NECKLINE RESISTANCE... Link for todays video. There are some classic chart patterns at work in the major index ETFs. First, the S&P 500 ETF (SPY) has an inverse head-and-shoulders pattern that is being confirmed with todays advance. This pattern is also present in the Nasdaq... READ MORE
In addition to the S&P 500 ($SPX), the S&P MidCap 400 ($MID) formed an inverse head-and-shoulders pattern over the last four months and broke neckline resistance with a surge on Monday. MACD also remains in bull mode as it remains in positive territory and above its... READ MORE
There is not much change on the daily chart as we head towards the Fed policy statement on Tuesday. Even though no major policy changes are expected, we cannot not rule volatility on Tuesday afternoon. After churning around 112 the prior four days, SPY opened above 113 with a gap... READ MORE
FACEBOOK? TWITTER? YOU TUBE? LINKED-IN? - In case you missed it, StockCharts has recently expanded into several different social media networks. So, what do you need to do about it? Do you have to join these things too? If so, which ones? What's different about the information there... READ MORE
I wrote on Tuesday that strength in foreign currencies (especially commodity currencies like the Aussie and Canadian Dollars) was negative for the U.S. Dollar but positive for most commodities. One reason for that view is that stronger foreign currencies suggest growing confidence in the global economy. Another sign of... READ MORE
The S&P 500 is square within the September/October "historically weak" time frame, but it has been nothing short of astounding to be sure...to the upside. We've seen a rally in 10 of the past 13 days, with prices now squarely upon major... READ MORE
Let's do a case study. Wouldn't it be great to find the next Google (GOOG) or Apple (AAPL) in the early stages, before the meteoric rise? It's definitely possible, but it takes homework and TONS of patience. Every great long-term performer goes through similar... READ MORE
Today another long-term buy signal was generated when the S&P 500 Index 50-EMA crossed up through the 200-EMA. Normally, we have high confidence in these signals, but, unfortunately, the long-term model has generated four, count 'em, four "long-term" signals in less than three months. On... READ MORE
Hello Fellow ChartWatchers! Today we're taking the wraps off of our upcoming major upgrade to our ChartNotes annotation tool. We've been working on this for a while now and we are getting close to releasing it out to everyone. Even though it will probably be a... READ MORE
Leadership from three of the four key offensive sectors makes the September surge all the more impressive. I consider the consumer discretionary, finance, technology and industrials sectors as the offensive sectors that are key to the stock market and the economy. Leadership from at least 2 of the 4 is... READ MORE
OFFENSIVE SECTORS LEAD SEPTEMBER SURGE... Link for todays video. Leadership from the four key offensive sectors makes the September surge all the more impressive. Consumer discretionary, finance, technology and industrials are considered the offensive sectors. Leadership from at least 2 of the 4 is needed for a rally to have... READ MORE
The Nasdaq 100 ($NDX) represents large-cap tech stocks and the S&P 100 ($OEX) represents large-cap everything. We can compare these two with the price relative or $NDX:$OEX ratio. With this ratio plot breaking to new highs, it is clear that $NDX is leaving $OEX in the dust.... READ MORE
With a couple more indicator turns, the indicator summary is now within a point of its maximum reading, which is +10. This often happens after an extended advance and the S&P 500 ($SPX) is up significantly in September. Lagging Nasdaq breadth has been countered by relative strength in... READ MORE
Trading is getting a bit strange, but the bulls clearly have the edge in the stock market right now. Techs have started to lead on the upside, but small-caps were relatively weak as IWM closed down on Thursday. Even though stocks continue to move higher, oil took a rather hard... READ MORE
BASIC MATERIALS LEAD MARKET RALLY... I wrote on Tuesday that strength in foreign currencies (especially commodity currencies like the Aussie and Canadian Dollars) was negative for the U.S. Dollar but positive for most commodities. One reason for that view is that stronger foreign currencies suggest growing confidence in the... READ MORE
After a weak open, buyers came into the market and pushed stocks higher with a little pop coming in the final hour. There seems to be some performance anxiety creeping into the market as the major indices trade well above their August lows. There is not much change in the... READ MORE
After a high volume surge at the start of September, Charles Schwab (SCHW) moved into a trading range the last two weeks. The pattern this month looks like a flat flag with resistance at the May trendline. A move above 14.10 would break flag resistance and expanding volume would... READ MORE
SMALL-CAPS AND TECHS LEAD MARKET HIGHER... Link for todays video. Buying pressure continued on Wednesday with the Russell 2000 ETF (IWM) and the Nasdaq 100 ETF (QQQQ) leading the major indices higher. John Murphy wrote about the S&P 500 testing neckline resistance yesterday. Today, the Nasdaq 100 ETF... READ MORE
There were a couple of bullish developments in the intermarket area over the last few weeks. First, bonds have been moving down and interest rates higher since late August. Bonds have been negatively correlated with stocks in 2010. Interest rates have been positively correlated. Despite an overall uptrend in rates,... READ MORE
FOREIGN STOCKS LEAD US HIGHER... One of the reasons I've turned more bullish on the U.S. stock market is the relatively strong performance in foreign shares. Look at Chart 1 which compares EAFE Index iShares (red line) to the S&P 500 (green line) over the... READ MORE
PRECIOUS METAL BREAKOUTS ... I've devoted the last two Tuesday's to bullish articles on precious metals. This Tuesday is no exception. That's because precious metal assets are surging through important resistance barriers today to achieve bullish breakouts. Chart 1 shows the Gold Trust Shares (GLD)... READ MORE