YEN SURGES ON CALL FOR HIGHER ASIAN CURRENCIES ... Last week we saw the Euro hit a new 2006 high. Today it's the yen that's jumping. Over the weekend, the Group of Seven called for Asian countries to let their currencies rise to their true market values.... READ MORE
CRB INDEX STAYS ABOVE BREAKOUT POINT ... Yesterday's bout of commodity profit-taking (which was concentrated in metals markets) may have been a one-day affair. At least that's what today's strong bounce back suggested. The CRB Index regained 4.65 points today to close at a... READ MORE
EURO SETTING NEW HIGHS FOR THE YEAR... As indicated in Chart 1, after the strong rally seen on April 05, 2006, the Euro retreated, never breaking the uptrend line. All this backing and filling gave the Euro enough energy to leap forward, gapping higher and printing a new high for... READ MORE
USING PROFUNDS TO TRADE THE DOLLAR ... With the U.S. Dollar continuing to drop toward its low for the year -- and the Euro hitting a new 2006 high today -- it's time to revisit two mutual funds that allow investors to trade the U.S. Dollar. As... READ MORE
MAJOR INDEXES HAVE IMPRESSIVE DAY ... I'm not sure exactly what caused today's impressive stock market rally. It might have been a relatively low core inflation figure. Or it may have been comments from a Fed official hinting that the Fed was concerned about raising rates too... READ MORE
FOREIGN CURRENCIES JUMP AGAINST DOLLAR... The U.S. dollar fell sharply today against all of its major trading partners. Once again, the main impetus came from another Chinese voice calling for a reduction in that country's holdings of U.S. assets. Chart 1 shows today's explosive... READ MORE
PROFUNDS RISING OPPORTUNITY 10 FUND ... I wrote an article yesterday (Thursday) about rising long-term interest rates and why that was bearish for bond funds. That's because traditional bond funds (which are based on the price of bonds) fall when bond yields are rising. The 10-year T-Note yield (TNX)... READ MORE
TEN-YEAR YIELDS EXCEEDS 5% ... Last week the yield on the 10-Year T-note broke through its 2004 peak at 4.90% to reach the highest level in four years. Today the TNX has moved through the psychological level of 5%. That doesn't come as much of a surprise considering... READ MORE
S&P 500 AND DOW BREAK SUPPORT LINES ... Although the S&P 500 closed slightly below its 50-day average, it was the only one of the major stock indexes to do so. That, however, isn't my main concern with today's action. My main concern... READ MORE
GASOLINE CONTINUES TO CLIMB ... It's no secret that energy prices are climbing again. And that shouldn't be a surprise to anyone who watches price charts. Back on March 29, for example, I showed the futures price of gasoline breaking through its January high at 1.89... READ MORE
30-YEAR T-BOND YIELD EXCEEDS 5% ... A strong employment report today finally pushed long-term rates above key chart and psychological barriers. That's having a ripple effect through all of the financial markets. It's giving a boost to the dollar which may be contributing to profit-taking in gold... READ MORE
WE DON'T GET ANY RESPECT ... Modified to correct the language, that familiar refrain was until recently the mantra of the Euro. The beleaguered currency, however, has perked up and begun to rally. We noted in a previous article at the start of March (March 01, 2006) the change... READ MORE
INCLUDES A LOT OF TRANSPORTS ... I recently wrote about the strong action in the Industrials Sector SPDR (XLI) (March 15, 2006). The headline in that piece was "Rails Lead Industrials SPDR to Record Highs". That's still the case. The purpose of that article was twofold. One... READ MORE
SEMICONDUCTOR INDEX MAY BE BOTTOMING ... Last week I wrote about how the Semiconductor (SOX) Index was in an area of chart support and starting to show early signs of turning back up again. The daily bars in Chart 1 show the SOX finding new support just above its 200-day moving... READ MORE
GERMANY LEADS STRONG EUROPEAN GAINS ... A lot of today's intermarket moves can be traced to new signs of strength in Europe. Today, for example, three of Europe's markets -- France, Germany, and Italy -- showed gains of more than 1% to lead global markets higher. The... READ MORE
CRB INDEX MOVES OVER 50-DAY LINE... Last Friday I showed the Reuters/Jefferies CRB Index rebounding off its 200-day moving average and suggested that the commodity correction appeared over. In today's trading, the CRB is climbing above its 50-day moving average and appears to be starting a new... READ MORE
HECLA MINING RALLIES WITH SILVER... Over the last month I've shown two silver stocks that are benefiting from silver's move to a new twenty-two year high. The two stocks are Coeur D Alene Mines (CDE) and Pan American Silver (PAAS). Hecla Mining (HL) is another one.... READ MORE
LOWER RATES WEAKEN ... Just a day after a report showing a big jump in sales of previously owned homes during February, we read today that new home sales tumbled 10%, which is the biggest drop in nine years. Personally, I think the latter number makes a lot more sense in... READ MORE
KBH LEADS HOMEBUILDING GROUP HIGHER... Sales of existing homes rose strongly during February which is giving a much-needed boost to homebuilders. Three of the five top percentage gainers in the S&P 500 are homebuilding stocks. The biggest percentage gainer is KBH which is gaining 5%. [KBH also reported... READ MORE
BMY GAPS UP ON BIG VOLUME ... News that Bristol Myers Squibb reached a settlement calling for delayed production of the generic version of the world's second largest drug pushed the stock 11% higher today and made it the day's strongest stock. Chart 1 shows BMY gapping... READ MORE
RETAIL HOLDERS RESOLVE BULLISH TRIANGLE ... Near the end of February, I wrote a positive piece on the retail sector (February 27, 2006). At the time the Retail Holders (RTH) were testing the upper line in a triangular-shaped pattern which favored an eventual move to the upside. Chart 1 shows that... READ MORE
DOLLAR INDEX BREAKS 200-DAY AVERAGE ... The Dollar Index has taken a turn for the worst this past week. The daily bars in Chart 1 (through Thursday) show the USD falling below its March low and its 200-day moving average. The daily MACD lines are also in negative alignment. That suggests... READ MORE
INDUSTRIALS SPDR INCLUDED TRANSPORTS ... While the Dow Industrials have reached the highest level in four and half years, the Dow Transports are trading at a new record. In today's trading, the transports gained more than 2.0% and were the day's strongest group. In case you&... READ MORE
GOLDMAN SACHS SURGES TO RECORD HIGH... The big brokerage firm reported the biggest profit in the history of Wall Street. As a result, the stock gapped to a new high on very strong volume as shown in the daily bars in Chart 1. The monthly bars in Chart 2 are... READ MORE
TWO DIFFERENT VIEWS ... Last week I wrote an article on sector rotations that suggested that consumer staples were now due to show market leadership. They were in fact the strongest sector last week. Chart 2 gives two views of the group. The black line is the S&P Consumer... READ MORE
LONG-TERM DOLLAR VIEW ... I've long maintained that currency markets represent a separate asset class that most investors don't participate in. Institutions can and do trade cash currencies through interbank arrangements. Futures and options traders can trade foreign currencies on the Chicago Mercantile Exchange or the Dollar... READ MORE
STAPLES COME AFTER ENERGY ... In the latter stages of an economic expansion and and bull market in stocks, basic material and energy stocks take over market leadership. We've seen that over the last two years. Energy stocks are usually the last group to peak at a market top.... READ MORE
RISING RATES HURT RISKIER MARKETS ... This week's upside breakout in U.S. bond yields, and prospects for more global tightening of short-term rates, takes a toll on riskier markets. That certainly includes emerging markets which are falling hard today with average losses of 3%. What's more,... READ MORE
BOND BREAKOUT ... Last Friday I showed the yield on the 10-year T-note testing its 2004 highs. It broke through those highs today. Chart 1 shows the TNX trading over 4.70% for the first time since the middle of 2004 (see red circle). That appears to leave little doubt that... READ MORE
WHY BULLION CAN LEAD GOLD STOCKS FOR A TIME... Earlier in the week I made the observation that, at the moment, bullion might be a better bet than gold stocks. Naturally, I got a lot of e-mail questioning that view. After all, I've written in the past that... READ MORE
CISCO BREAKS OUT ON BIG VOLUME ... Although most technology stocks rallied today, Cisco was the chart standout. Chart 1 shows why. The big networker broke through its summer 2005 highs and it's done so on sharply higher volume. That's a bullish combination. Its relative strength line... READ MORE
ECB EXPECTED TO RAISE RATES... This Thursday we have an interest rate decision from the European Central Bank. It is widely expected that it will increase the European rate at that meeting. It's likely that the recent bounce in the Euro is in anticipation of that expected rate... READ MORE
GOOGLE FALLS ON BIG VOLUME ... Today's market selloff can't be blamed entirely on Google. There were other factors at work as well. But the plunge in Google didn't help. A disappointing forecast sent the huge Internet stock plunging over $30 today on huge volume.... READ MORE
RETAIL HOLDERS TEST RESISTANCE LINE... In an article on Regional Banks Holders last Wednesday, I incorrectly used the symbol RTH instead of the correct RKH. I showed the right chart, but typed the wrong symbol. Maybe my subconscious mind was at work because today I'm writing about the... READ MORE
CRB INDEX STAYS OVER 200-DAY LINE... Earlier in the week we showed the Reuters/Jefferies CRB Index bouncing off its 200-day moving average. After dipping back on Thursday, it rallied again at week's end. Thirteen of the nineteen commodities in the CRB bounced on Friday with most of... READ MORE
BANK BREAKOUT ... Some good things happened to the market today. One of them was a bullish breakout in bank stocks. Earlier today I showed the Bank Regional Holders (RTH) hitting a new record high (February 22, 2006). They were the day's strongest ETF. Chart 1 shows the bullish... READ MORE
FINANCIALS ARE DAY'S STRONGEST SECTOR ... Judging from today's strong surge in the financial sector, it seems that the market is encouraged by the January core CPI inflation rate of 0.2% and less concerned about the threat of rising interest rates. That would explain today'... READ MORE
TWO WAYS TO MEASURE MARKET BREADTH... One of our readers asked me to explain the difference between the NYSE Advance-Decline line and the NYSE Bullish Percent Index. They both tell us something about market "breadth", but in different ways. Chart 1 shows the NYSE AD line which is... READ MORE
CRB UPTREND IS STILL INTACT... It was in October of 2001 that the Reuters/Jefferies CRB Index started the four-year rally that continues to this day. During that period, we've seen steep rallies followed by downside corrections or periods of consolidation. Two things,however, have remained constant. One... READ MORE
KEYSPAN LEADS UTILITY BOUNCE ... Although utilities are usually thought of as being interest-rate sensitive, they're being heavily influenced by the trend of energy stocks -- and natural gas stocks in particular. Today is a good example of that. News that KeySpan, which is the largest natural gas seller... READ MORE