Members Only

MEMBERS ONLY

MARKET IS IN DANGER OF GIVING FIRST MAJOR SELL SIGNAL IN THREE YEARS -- HOMEBUILDERS PLUNGE TO LOWEST LEVEL IN TWO YEARS AS CONSUMER DISCRETONARY STOCKS LEAD MARKET LOWER

by John Murphy,

Chief Technical Analyst, StockCharts.com

HOMEBUILDERS CONTINUE TO CRUMBLE... Yesterday I wrote about how relative weakness in retail stocks over the last year was an early sign that higher energy prices and rising interest rates were starting to hurt the economy and the stock market. It was reported this morning that June's retail...   READ MORE 

MEMBERS ONLY

OIL HITS RECORD HIGH AND STOCK SELLING INTENSIFIES -- CYCLICALS, RETAILERS, AND TRANSPORTS LEAD DECLINE -- NASDAQ 100 BREAKS MAJOR SUPPORT LINES

by John Murphy,

Chief Technical Analyst, StockCharts.com

CRUDE EXCEEDS $76... Crude oil surged $1.70 today to reach a new all-time high. A lot of that had to do with mideast tensions. It also had a lot to do with the big drop in oil inventories reported on Wednesday. And the fact that oil, like most commodities,...   READ MORE 

MEMBERS ONLY

REVIEW OF MOVING AVERAGE SIGNALS -- INTERMEDIATE SELL SIGNAL IS STILL INTACT -- BUT NO MAJOR SELL SIGNAL YET -- DOWNSIDE TARGET IF ONE DOES OCCUR

by John Murphy,

Chief Technical Analyst, StockCharts.com

S&P RETESTS 200-DAY AVERAGE ... This is as good a time as any to take another look at a variety of moving average lines and signals. I'm going to show three different ways to do that. The first is the usual 50- and 200-day moving averages. The...   READ MORE 

MEMBERS ONLY

SIX-YEAR SMALL CAP DOMINANCE MAY BE ENDING -- REITS AND TELECOM ARE DOING BETTER -- SO IS DJ DIVIDEND ETF

by John Murphy,

Chief Technical Analyst, StockCharts.com

DIVIDEND ETF IS OUTPERFORMING ... Last Friday I showed a few defensive groups that were showing upside leadership including consumer staples, pharmaceuticals, and utilities. Here's another one. Chart 1 is a daily bar chart of the DJ Dividend Index iShares (DVY) through the first six months of 2006. The...   READ MORE 

MEMBERS ONLY

FEWER JOBS AND HIGHER WAGES HURT STOCKS -- DOW FALLS BELOW 50-DAY AVERAGE -- DEFENSIVE STOCKS RALLY -- NASDAQ 100 CONTINUES TO DRAG MARKET LOWER

by John Murphy,

Chief Technical Analyst, StockCharts.com

A RECIPE FOR STAGFLATION ... The June employment report gave a double dose of bad news to the stock market today. First of all, June job growth was very weak. That hinted at economic slowing. At the same time, June wages jumped at the fastest rate in five years. That'...   READ MORE 

MEMBERS ONLY

NORTH KOREAN MISSILES AND RISING BOND YIELDS RATTLE GLOBAL STOCKS -- GOLD AND OIL RISE -- CRB INDEX TOPS 50-DAY AVERAGE

by John Murphy,

Chief Technical Analyst, StockCharts.com

CRB INDEX CLEARS 50-DAY LINE ... Commodity markets continue the new rally that began with the recent bounce off their 200-day moving average. Today's gain has pushed the Reuters/Jefferies CRB Index back above its 50-day moving average. Fourteen of the nineteen commodities are in the black with some...   READ MORE 

MEMBERS ONLY

STOCKS REACT FAVORABLY TO FED MOVE -- SO DO COMMODITIES AS DOLLAR SLIPS -- GASOLINE BREAKS OUT TO TEN-MONTH HIGH

by John Murphy,

Chief Technical Analyst, StockCharts.com

GASOLINE LEADS COMMODITY MARKETS HIGHER ... Commodity markets rose again today. The most bullish action occurred in the gasoline pits. Chart 1 shows the continuous futures contract for unleaded gasoline breaking out to a new ten-month high. Crude oil rose another $1.35 to close at 73.50. That's...   READ MORE 

MEMBERS ONLY

GASOLINE CHALLENGES 2006 HIGHS AS ENERGY SHARES RECOVER -- CRB INDEX, GOLD AND SILVER ARE TESTING 200-DAY AVERAGES -- THE DOLLAR IS BOUNCING OFF CHART SUPPORT

by John Murphy,

Chief Technical Analyst, StockCharts.com

GASOLINE TESTS YEARLY HIGH ... One of the things the Fed will most likely be looking at today and tomorrow is the price of oil, gasoline, and most other commodities. They'll do that to get some clue as the future direction of inflation (and the economy). They won'...   READ MORE 

MEMBERS ONLY

LACK OF UPSIDE VOLUME SHOWS LITTLE BUYING ENTHUSIASM -- SOX INDEX PULLS MARKET LOWER -- NASDAQ 100 IS TESTING LAST OCTOBER'S LOW

by John Murphy,

Chief Technical Analyst, StockCharts.com

MARKET ON FED WATCH ... Very little has changed over the last few trading days. The market has been attempting a modest price bounce to work off a short-term oversold condition. Major market averages (with the exception of the Dow) have been unable to regain their 200-day moving averages. The fact...   READ MORE 

MEMBERS ONLY

MARKET ENDS WEEK ON A FIRM NOTE -- BUT LONG-TERM TREND STILL IN DOUBT -- JUNE SPEECH IS AVAILABLE FOR VIEWING

by John Murphy,

Chief Technical Analyst, StockCharts.com

SHORT-TERM TREND STRENGTHENS ... The market is ending the week on a firm note. That's largely due to a short-term oversold condition and improvement in short-term market indicators. Chart 1 shows the daily MACD lines turning positive on the S&P 500 for the first time in a...   READ MORE 

MEMBERS ONLY

YIELD ON 10-YEAR NOTE HITS NEW FOUR-YEAR HIGH -- THAT'S BAD FOR HOMEBUILDERS AND RETAILERS -- ESPECIALLY THOSE TIED TO HOME IMPROVEMENT AND FURNISHING

by John Murphy,

Chief Technical Analyst, StockCharts.com

NEW HIGH FOR YIELDS ... The yield on the 10-year Treasury Note touched a new four-year high today. The weekly bars in Chart 1 show that the uptrend in long-term interest rates began exactly a year ago. The fact that bond yields were headed higher was confirmed in the spring of...   READ MORE 

MEMBERS ONLY

MORGAN STANLEY AND FEDEX LIFT OVERSOLD MARKET AS MAJOR MARKET INDEXES TRY TO RECLAIM 200-DAY AVERAGES

by John Murphy,

Chief Technical Analyst, StockCharts.com

MORGAN STANLEY LEADS BROKERS HIGHER ... Strong second quarter earnings by Morgan Stanley has pushed the brokerage stock up nearly 5% today and is leading a rally in that group and the market in general. Chart 1 shows the stock gapping back over its 200-day moving average on rising volume. Chart...   READ MORE 

MEMBERS ONLY

KROGER LEADS CONSUMER STAPLES HIGHER -- VERIZON HELPS THE DOW -- ROTATION OUT OF ENERGY INTO CONSUMER STAPLES ISN'T A GOOD SIGN -- NEITHER IS DOW STRENGTH AND SMALL CAP WEAKNESS

by John Murphy,

Chief Technical Analyst, StockCharts.com

CONSUMER STAPLES ARE DAY'S TOP SECTOR... With today's stock market rally fading again, investors continued to favor the defensive qualities of consumer staples. That made consumer staples the day's top sector. That's nothing new. Chart 1 shows the Consumer Staples Sector SPDR...   READ MORE 

MEMBERS ONLY

AT&T LEADS TELECOM GROUP HIGHER- RISING RATE FUNDS FOLLOW BOND YIELDS HIGHER -- SMALL CAPS ARE GETTING SMALLER -- NO SAR BUY SIGNAL IN GOLD YET

by John Murphy,

Chief Technical Analyst, StockCharts.com

TELECOM HOLDERS ARE HAVING A GOOD YEAR ... With the market selloff that started in May, a lot of defensive groups have attracted new money -- including consumer staples and utilities. The telecommunications group belongs on that list. Chart 1 shows why. Telecom Holders (TTH) have been one of the top...   READ MORE 

MEMBERS ONLY

MARKET CONTINUES REBOUND FROM OVERSOLD CONDITION -- NYSE REGAINS 200-LINE PACED BY MATERIALS AND ENERGY -- NYSE BULLISH PERCENT INDEX, HOWEVER, SUGGESTS THIS IS A BEAR MARKET BOUNCE

by John Murphy,

Chief Technical Analyst, StockCharts.com

BULLISH PERCENT INDEX SUGGESTS A BEAR ... The most difficult thing to determine in market analysis is the difference between a market correction and the start of a bear market. They look pretty much the same. Prices fall to an area of chart support (usually around the 200-day moving average), get...   READ MORE 

MEMBERS ONLY

HIGH CORE INFLATION NUMBERS PUNISH BONDS -- NEGATIVE YIELD CURVE MAY BE HURTING BANKS WHICH FALL SHARPLY -- WORLD STOCK INDEX STILL LOOKS WEAK

by John Murphy,

Chief Technical Analyst, StockCharts.com

BOND PRICES ARE FALLING AGAIN ... For the second day in a row, core inflation numbers came in higher than economists were expecting. Yesterday it was the PPI. Today's core CPI reading for May rose to 0.3%. [The actual CPI rose .4% during May]. Core inflation (excluding food...   READ MORE 

MEMBERS ONLY

LEHMAN LEADS BROKERS LOWER -- MARKET STAYS ON THE DEFENSIVE -- JUST AS BOND TOPS LEAD TO STOCK TOPS, STOCK TOPS LEAD TO COMMODITY TOPS

by John Murphy,

Chief Technical Analyst, StockCharts.com

LEHMAN BREAKS 200-DAY AVERAGE ... We've been showing a lot of markets threatening or breaking their 200-day moving averages lately. Here's another one. Despite a 47% jump in second quarter earnings, Lehman Brothers has fallen 4% and, in so doing, has broken its 200-day moving average. That&...   READ MORE 

MEMBERS ONLY

NO FRIDAY FOLLOW-THROUGH AS TESTING PROCESS CONTINUES -- BUT LONG-TERM INDICATORS STILL LOOK TOPPY

by John Murphy,

Chief Technical Analyst, StockCharts.com

NYSE STILL SITTING ON 200-DAY LINE ... Friday's market action didn't tell us much about the staying power of Thursday's afternoon bounce. Market averages closed modestly lower in lighter trading volume. The good news is that the NYSE Composite Index remains on top of its...   READ MORE 

MEMBERS ONLY

MARKET STAGES LATE COMEBACK -- SEVERAL INDEXES END ON TOP OF 200-DAY AVERAGES

by John Murphy,

Chief Technical Analyst, StockCharts.com

DOW AND NYSE INDEXES CLOSE ABOVE 200-DAY LINES ... An afternoon comeback avoided a serious market breakdown. Chart 1 shows the Dow Industrials closing 8 points higher after heavy losses this morning. More importantly, the Dow closed on top of its 200-day moving average. Chart 2 shows the NYSE Composite Index...   READ MORE 

MEMBERS ONLY

HIKES IN GLOBAL RATES PUSH WORLD STOCKS LOWER -- 200-DAY AVERAGES BROKEN AROUND THE WORLD

by John Murphy,

Chief Technical Analyst, StockCharts.com

GLOBAL BREAKDOWN... Rate hikes by central bankers in Europe and Asia (and more hawkish comments from Fed officials) have pushed most global stocks below their 200-day moving averages. Among the hardest hit are emerging markets like Latin America which are tied to commodity prices which are also falling. Chart 1...   READ MORE 

MEMBERS ONLY

BEAR FUNDS CONTINUE TO BENEFIT FROM MARKET DROP -- NASDAQ 100 CONTINUES TO FALL -- S&P 500 RETESTS 200-DAY LINE

by John Murphy,

Chief Technical Analyst, StockCharts.com

BEAR FUNDS ARE STILL RISING... A number of readers have asked for an update on a couple of bear funds that I recommended in mid-May. As you might expect, they've been rising as the market has been falling. Chart 1 shows the ProFunds Short OTC Fund (plotted through...   READ MORE 

MEMBERS ONLY

RISING RATES AND FALLING STOCKS AREN'T GOOD FOR COMMODITIES -- NEITHER ARE FALLING BASIC MATERIAL STOCKS

by John Murphy,

Chief Technical Analyst, StockCharts.com

FIRMER DOLLAR PUSHES COMMODITIES LOWER... Although commodities have been the strongest asset class since 2002, and while they remain in a major uptrend, they're not immune to a downside correction. We may be seeing the start of one right now. One hint at that is the recent heavy...   READ MORE 

MEMBERS ONLY

HOMEBUILDERS CONTINUE TO CRUMBLE -- RECENT MARKET ROTATIONS SHOW INCREASINGLY DEFENSIVE MARKET

by John Murphy,

Chief Technical Analyst, StockCharts.com

HOUSING INDEX HITS NEW 52-WEEK LOW ... More bad news on the housing front pushed the PHLX Housing Index to the lowest level in eighteen months. The weekly bars in Chart 1 leave little doubt that housing stocks have peaked. The recent breaking of the late 2005 lows has left a...   READ MORE 

MEMBERS ONLY

COMMODITIES FINISH STRONG -- DOLLAR ENDS WEEK AT CRUCIAL CHART JUNTURE -- UTILITIES SURGE ON FALLING BOND YIELDS

by John Murphy,

Chief Technical Analyst, StockCharts.com

CRB INDEX STAYS OVER 50-DAY LINE ... The Reuters/Jefferies CRB Index jumped seven points today to close at 350. As Chart 1 shows, that keeps the CRB above its 50-day moving average. Chart 1 also shows that very little damage has been done to the commodity uptrend. While most of...   READ MORE 

MEMBERS ONLY

SHORT-TERM BOUNCE CONTINUES AS MARKET INDEXES BOUNCES OFF 200-DAY AVERAGES AGAIN -- MONTHLY AND WEEKLY CHARTS, HOWEVER, STILL LOOK TOPPY

by John Murphy,

Chief Technical Analyst, StockCharts.com

THE DOW IS BACKING OFF FROM 2000 PEAK ... Whenever the market is at an important inflection point, it's usually a good idea to take another look at long-term charts. Not that short-term trends aren't important. But longer-term trends are more important. That's why I...   READ MORE 

MEMBERS ONLY

ANOTHER MEASURE OF VOLATILITY FLASHES A WARNING -- MARKET FALLS ON RISING VOLUME AND MAY HAVE ENDED SHORT-TERM BOUNCE

by John Murphy,

Chief Technical Analyst, StockCharts.com

VIX CONTINUES TO CLIMB ... We've produced a number of articles recently showing the CBOE Volatility (VIX) Index climbing to a new two-year high and warned about the danger that poses for the stock market. That's because the market usually trends in the opposite direction of the...   READ MORE 

MEMBERS ONLY

200-DAY MOVING AVERAGES HOLD -- WEEKLY INDICATORS, HOWEVER, REMAIN NEGATIVE -- A LONGER LOOK AT WHY NEW DOW LEADERSHIP ISN'T GOOD FOR THE MARKET

by John Murphy,

Chief Technical Analyst, StockCharts.com

SO FAR SO GOOD... Global stock markets survived an important test this week. Almost everywhere we look in the world, we see major stock markets staying above or bouncing off their 200-day moving averages. The first three charts show some of the foreign markets doing the latter. Emerging markets in...   READ MORE 

MEMBERS ONLY

COMMODITY BOUNCE DOESN'T LAST -- EMERGING MARKETS AND SMALL CAPS TEST 200-DAY AVERAGES -- NEW DOW LEADERSHIP IS A SIGN OF A DEFENSIVE MARKET

by John Murphy,

Chief Technical Analyst, StockCharts.com

CRB GIVES UP ALL OF YESTERDAY'S GAINS ... Yesterday's sharp jump in commodity prices didn't last for long. The CRB Index fell more than nine points today to give up all of yesterday's gains and more. Three of the biggest percentage losers were...   READ MORE 

MEMBERS ONLY

COMMODITIES REBOUND AND PULL RELATED STOCKS WITH THEM -- THE XLE AND XAU BOUNCE OFF 200-DAY LINES

by John Murphy,

Chief Technical Analyst, StockCharts.com

COMMODITIES BACK OVER 50-DAY LINES ... Commodity markets are staging a comeback attempt today and the rally is pretty broad based. Fourteen of the nineteen commodity markets are in the black today. The biggest gainers are copper (+11%), silver (+5%), gasoline (2%) and gold (+2%). Chart 1 shows the Reuters/Jefferies...   READ MORE 

MEMBERS ONLY

GROWING RISK AVERSION HURTS EMERGING MARKETS -- BUT HELPS STAPLES, UTILITES, AND BANKS -- BEAR FUND UPDATE -- RISING VIX SHOWS FIRST SIGNS OF FEAR IN FOUR YEARS

by John Murphy,

Chief Technical Analyst, StockCharts.com

EMERGING MARKETS FALL WITH OTHER FORMER LEADERS... Last Monday I wrote about a number of sell signals that were being given in the market and in commodity-related stocks in particular. I wrote a paragraph entitled "Growing Aversion to Risk" in which I explained that former market leaders were...   READ MORE 

MEMBERS ONLY

VIX SPIKE IS ANOTHER CAUTION SIGNAL FOR THE MARKET -- THE S&P 500 IS TESTING ITS 200-DAY LINE AND LOOKS OVERSOLD

by John Murphy,

Chief Technical Analyst, StockCharts.com

VIX HITS ONE-YEAR HIGH ... The market has something else to worry about. The CBOE Volatility (VIX) Index jumped to the highest level in a year. In so doing, it exceeded the previous peak hit in January and, at one point today, the peak hit last October. That's a...   READ MORE 

MEMBERS ONLY

INFLATION REPORT RATTLES STOCKS -- HOMEBUILDERS ARE NEAR 52-WEEK LOWS -- BEAR FUNDS ARE MOVING UP

by John Murphy,

Chief Technical Analyst, StockCharts.com

CORE CPI TOPS FORECASTS ... While the CPI numbers creep higher month after month, economists keep telling us there's really no inflation. It's all energy. There's no inflation anywhere else and not much threat of it picking up. Those of us who look ahead, however,...   READ MORE 

MEMBERS ONLY

CNBC INTERVIEW AT 4:05 -- A SUMMARY OF MY MARKET VIEWS -- ANOTHER LOOK AT SILVER

by John Murphy,

Chief Technical Analyst, StockCharts.com

WITH MARIA ... I'm scheduled to be interviewed at approximately 4:05 pm (Eastern time) this afternoon by Maria Bartiromo on CNBC. If you tune in, you won't hear anything that you haven't already read on this site. Given the events of the past week,...   READ MORE 

MEMBERS ONLY

COMMODITIES SUCCUMB TO PROFIT-TAKING

by John Murphy,

Chief Technical Analyst, StockCharts.com

CRB LOSES MORE THAN 2% ... It was just a matter of time until commodities entered a much-needed correction. And today is the day. The Reuters/Jefferies CRB Index fell over 8 points (-2.3%) as 16 of the 19 commodities experienced selloffs. Most of the biggest losers are in the...   READ MORE 

MEMBERS ONLY

INFLATION FEARS CAUSE HEAVY MAY SELLING -- A LOT OF SELL SIGNALS ARE BEING GIVEN -- ONE WAY TO BENEFIT FROM FALLING MARKET IS TO BUY OTC BEAR FUND

by John Murphy,

Chief Technical Analyst, StockCharts.com

THIS IS LOGICAL SPOT FOR THE MARKET TO PEAK ... I've been writing a lot lately about the inflationary implications of the falling dollar, rising commodity prices, and rising interest rates. I've also been showing a number of negative divergences in market breadth indicators. It looks like...   READ MORE 

MEMBERS ONLY

INFLATIONARY IMPLICATIONS OF FALLING DOLLAR AND SOARING COMMODITIES WEAKEN STOCK MARKET -- NASDAQ FALLS THE HARDEST

by John Murphy,

Chief Technical Analyst, StockCharts.com

TOO MUCH FOCUS ON THE FED ... It seems to me there's way too much focus on what the Fed does or what it intends to do. Yesterday's Fed statement hinted at another rate hike in the offing. I suspect there will be several more after that....   READ MORE 

MEMBERS ONLY

THE FED DOESN'T HAVE MUCH CONTROL OVER LONG-TERM RATES -- GLOBAL INFLATION IS THE DRIVING FORCE -- THE DOLLAR MAY BE IN SECULAR DOWNTREND

by John Murphy,

Chief Technical Analyst, StockCharts.com

GLOBAL FORCES MAY BE TAKING OVER ... Everyone's attention will be on what the Fed does tomorrow and what it says while it's doing it. The consensus view (encouraged by the new Fed chairman) seems to be for another quarter point rate hike to 5% after which...   READ MORE 

MEMBERS ONLY

GOLD'S RISING AGAINST ALL FOREIGN CURRENCIES -- THE RISING YEN BOOSTS JAPAN ISHARES -- WHY JAPANESE LEADERSHIP IS GOOD FOR GOLD AND BAD FOR BONDS -- EWJ NEARS 2000 HIGH

by John Murphy,

Chief Technical Analyst, StockCharts.com

GOLD IN FOREIGN CURRENCIES ... One of our readers asked if the falling dollar is the only reason that gold is rising. The answer to that is most certainly no. Since gold is quoted in U.S. dollars, a falling dollar produces higher gold prices. That means that gold rises in...   READ MORE 

MEMBERS ONLY

OIL FALLS BELOW $70 AND CAUSES ENERGY PROFIT-TAKING -- GOLD AND METALS STOCKS RISE WITH THE EURO -- USING PRICE CHANNELS TO STAY WITH A TREND

by John Murphy,

Chief Technical Analyst, StockCharts.com

CRUDE FORMS SHORT-TERM TOP ... Crude oil prices fell sharply for the second day in a row. More importantly, today's drop of $2.68 puts it back below $70 for the first time in three weeks. That breaks the intra-day low hit last week and has left behind a...   READ MORE 

MEMBERS ONLY

BULLISH PERCENT INDEX GIVES ANOTHER BEARISH DIVERGENCE -- A BREAK OF APRIL LOWS WOULD PROVIDE INTERMEDIATE SELL SIGNAL ON THE S&P 500

by John Murphy,

Chief Technical Analyst, StockCharts.com

A HISTORICAL LOOK AT THE BPI... One of the themes that I keep coming back to is that the 2006 bull market advance into new multi-year highs isn't being confirmed by a lot of technical indicators that measure market breadth. I've written articles showing negative divergence...   READ MORE