NO FOLLOW-THROUGH FROM YESTERDAY ... When a market records an up day like yesterday -- especially on heavy volume -- it's important to watch for upside follow through. In fact, the market gave back most of yesterday's gains. The only positive factor (and it's a... READ MORE
BRISTOL MYERS SQUIBB HITS 52-WEEK HIGH ... Last Tuesday I wrote a piece on the revival of drug stocks and the healthcare sector which were starting to show market leadership April 05, 2005. Part of that was due to their generally defensive qualities. One of the three drug leaders that I... READ MORE
MEDICAL ETFS HIT SIX-MONTH HIGHS ... The Pharm Holders (PPH) are the day's top Exchange Traded Fund. Chart 1 shows the PPH breaking through its recent highs to reach the highest level in six months. Some of the day's top percentage gainers are Merck, Lilly, Schering Plough,... READ MORE
FED MINUTES PUSH BOND YIELDS LOWER... The Fed minutes from its last meeting calmed the financial markets and led to an impressive rebound in the stock market. Two of the intermarket factors that turned the market around in the afternoon were a drop in bond yields and crude oil. Chart... READ MORE
TRANSPORTS LOSE 3% AND BREAK SUPPORT LINE... The market lost another one of its leaders -- the transportation group. The Dow Transports tumbled more than 3% today and was the day's worst group. What's worse the transportation index tumbled beneath its 50-day moving average in very... READ MORE
ALCOA GAPS HIGHER WHILE WAL MART FALLS... Rising aluminum prices have given a big boost to the shares of Alcoa. A positive earnings report is pushing the big aluminum producer over a dollar higher in morning trading. It's also one of the big board's most actively... READ MORE
S&P SPDR TESTING 50-DAY AVERAGE ON LOW VOLUME... I recently wrote about the possibility of a short-term bounce in the S&P 500 to its 50-day moving average. Chart 1 shows the S&P 500 SPDR (SPY) touching that resistance barrier twice over the last four... READ MORE
WHERE TO FIND PROFUND BEAR FUNDS... I promised yesterday to look at a couple of ProFunds Bear funds today. To find them, click on Market Carpets (on main menu) and then ProFunds Carpet. Click on Inverse (at the bottom left) and you'll see eight different bear funds. Chart... READ MORE
FIRST PFIZER ... Because of its large size, Pfizer carries a lot of weight in the drug and healthcare groups. That's why its price jump today is helping to spark buying in both groups. But, in my opinion, it's not one of the more attractive drug stocks... READ MORE
PHARM HOLDERS ARE DAY'S TOP ETF... Pfizer's prediction of double digit growth next year (based on some serious cost-cutting) has sparked some serious buying in pharmaceutical stocks and the healthcare sector. As a result, Pharm Holders (PPH) are the day's top performing ETF. Chart... READ MORE
RYDEX URSA TESTING JANUARY HIGH ... On Friday I repeated an earlier idea of buying a bear market mutual fund to actually benefit from a falling stock market. The chart of a bear market fund is just the inverse of a chart of the market. With the Dow and the S&... READ MORE
FIRST QUARTER RANKINGS ... The sector rankings for the first quarter of the year carry an important message. Unfortunately, it's a negative message both for the stock market and the economy. The sector bars are plotted above and below the S&P 500 which is the zero line.... READ MORE
ENERGY MARKETS SURGE ... The entire energy complex is rising sharply today -- paced by record highs in gasoline and heating oil. Crude is trading 1.64 higher at 55.63. Chart 1 shows that the uptrend in crude is still intact. The energy complex is leading a strong rally in... READ MORE
BASIC MATERIALS AND ENERGY ARE SLIPPPING... Basic materials and energy were among yesterday's weakest groups. The Materials Sector SPDR (XLB) and the Oil Service Holders (OIH) both closed beneath their 50-day moving averages. The month of March has also seen some slippage in their relative strength lines. While... READ MORE
EMERGING MARKETS ARE FALLING HARD ... Given the high correlation between global stock markets, it's no surprise to see most of them weakening along with the U.S. market. Emerging markets are getting hit especially hard. I believe that's due to the recent upturn in long-term rates.... READ MORE
JAPANESE YEN SLIPS UNDER 200-DAY LINE ... With the U.S. Dollar in a rally mode, most foreign currencies have been selling off of late. Among the major currencies, the Japanese yen has been hit the hardest. Chart 1 shows the yen falling under its 200-day average and testing chart support... READ MORE
DON'T WORRY ABOUT THE SHORT-TERM ... I've been getting messages asking about my short-term market view. Partially in response, I wrote a message earlier today about the market being in a short-term oversold condition from which a short-term bounce could materialize. That's especially true as... READ MORE
NIBBLING AT NASDAQ 2000... The market is in an oversold condition from which a rebound is possible. That doesn't turn its chart bullish. But some bottom-fishers are starting to do some nibbling -- especially in the Nasdaq market. Chart 1 shows two reasons why. First, the Nasdaq Composite... READ MORE
GOLD SELLING TIED TO RISING DOLLAR ... Some of you have asked why gold sold off this week in reaction to news of higher inflation. After all, commodities are leading indicators of inflation. Keep in mind that a big part of the commodity advance over the last three years has been... READ MORE
BOND YIELDS SURGE TO EIGHT-MONTH HIGH ... It's amazing to me how the media (and investors) hang on every word from the Fed. Veteran market watchers know that the Fed reacts to market events -- it doesn't anticipate them. Today's admission by the Fed that... READ MORE
RELATIONSHIP BETWEEN SHORT AND LONG RATES ... With the Fed expected to keep raising short-term rates, a lot has been written about the relationship between short and long-term rates. The fact is that they usually trend in the same direction -- but not always to the same degree or at the... READ MORE
DOW AND S&p 500 SLIP UNDER CHART SUPPORT... The blue chip averages continued to deteriorate today. Both the Dow and the S&P 500 closed below their late February lows. Financial stocks were among the day's biggest losers as long-term interest rates rose again. The... READ MORE
THE VIX IS RALLYING ... The CBOE Volatility Index (VIX) is starting to climb. Chart 1 shows the VIX trading at a two month high and nearing a challenge of its 200-day moving average. A more important test will take place at its January high at 14.75. That's... READ MORE
SECTOR PERFORMANCE CHART ... Most weeks in "John's Latest Performance Chart" I show the relative rankings of the nine AMEX Sector SPDRs relative to the S&P 500. Chart 1 shows those sector rankings since the start of the year. I've arranged the sector... READ MORE
SHARPCHARTS 2 IS ON THE WAY ... The March 12 Chartwatchers Newsletter discussed the latest "Beta" version of Stockchart.com's up-and-coming new charting tool -- SharpCharts 2. This new charting version has been in the works for almost two years and it's almost ready. Stockcharts... READ MORE
CRUDE OIL ACHIEVES NEW RECORD ... Crude oil jumped $1.40 today to break through its previous record set in late October. That puts oil in uncharted territory. While that helped energy stocks today, it had a very negative impact on the rest of the stock market. That wasn't... READ MORE
WHAT TO DO?... With the stock market starting to look toppy, I've been surprised at the number of messages I've received asking what to do in an environment of a weak dollar, rising commodities, rising interest rates, and a peaking stock market. Surprised because that'... READ MORE
HEAVIER TRADING ON DOWN DAYS ... One of the market's problems is the fact that the volume pattern has turned negative. The previous week's upside breakout to new highs by the S&P 500 took place on light volume. Last week's downturn came on... READ MORE
WATCH OUT FOR DIVERGENCES IN WAVE FIVE ... Last Friday I expressed my belief that the cyclical bull market that began in October 2002 had probably ended. That belief was based partially on my Elliott wave view that the fifth and final upwave that started last summer had ended. I also... READ MORE
BOND YIELDS BREAKOUT ... With each passing day the headlines get worse for the dollar, bonds, and stocks while supporting rising commodities and stocks tied to those commodities. That's an intermarket recipe for building inflation pressures with higher interest rates, which may have already ended the cyclical bull market... READ MORE
TEN-YEAR T-NOTE YIELD BREAKS THROUGH DECEMBER HIGH ... With all of the leading indicators of inflation pointing upward, it was just a matter of time before long-term rates started to rise as well. They did it today in a big way. Chart 1 shows the ten-year T-note yield breaking through its... READ MORE
THEY'RE USUALLY THE FIRST TO PEAK ... From an intermarket perspective, there are three things that have historically led to market tops. The first two are a falling dollar and rising commodities. We've had those two for some time. The third thing is an upturn in long-term... READ MORE
TEN-YEAR T-NOTE YIELD HITS SEVEN-MONTH HIGH ... It may have been the recent rise in commodity prices to 24-year highs and weakness in the dollar. Or it may have been economists' raising their 2005 forecast for economic growth. It may even be the fact that the Japanese yen is rising... READ MORE
CRUDE OIL TESTING OCTOBER HIGH ... Earlier today I wrote about how another drop in the U.S. Dollar was giving a big boost to gold and most other commodities. Gold closed $5 higher along with rising gold stocks. Both have achieved short-term bullish breakouts. The CRB Index climbed over 3... READ MORE
GOLD SHARES RISE ALONG WITH THE EURO... More dollar selling is boosting gold prices more than $3 higher today (Chart 1). The Gold/Silver (XAU) Index has already broken out to a new three-month high. Since gold stocks usually rise faster than bullion, an upside breakout in the yellow metal... READ MORE
PROFIT-TAKING IN ENERGY ... Last week I wrote about the fact the Oil Service Holders (OIH) were in an overbought condition and up against chart resistance formed during 2000 at the 100 level. Prices backed off from that level last Monday. After a low-volume retest of that level again on Friday,... READ MORE
LOOKING FOR 62% RETRACEMENT AT 1250 ... With the S&P 500 having broken out of its recent trading range, and trading at the highest level in more than three years, it's time to revisit my earlier Elliott wave interpretation and came up with some possible upside price... READ MORE
BOND BUYING PULLS YIELDS LOWER... This morning's strong job report is having a positive impact on both bonds and stocks. The bullish impact on stocks isn't surprising. The impact on bonds may be. Bond traders are encouraged by the absence of upward wage pressure which helps... READ MORE
BUT CLOSES IN LOWER END OF DAY'S RANGE ... The price of crude rose all the way to $55, resulting in a test of its all-time high reached last October. After climbing more than $2.00 intra-day, however, it settled up only .52 cents and in the lower end... READ MORE
CRUDE NEARS $55 TARGET ... Yesterday's spike in crude oil pushed it to $53 for the first time since last October. That puts the price of this key commodity within a couple of dollars of the top its recent trading range. That will be an important test for a... READ MORE