* Labor market crystal ball * What are the credit markets saying * Commodities ripe for a correction? Labor market crystal ball The weakness of last month’s Employment Report was a surprise to just about everyone, including yours truly. One month doesn’t make a trend, but two months of bad data... READ MORE
UPSIDE BREAKOUT IN NYSE COMPOSITE INDEX STILL LOOKS LIKELY... My May 25 market message suggested that the stock market still had more work to do on the upside. That was based primarily on Elliott Wave Analysis which suggested that the market was still in a Wave 4 correction/consolidation pattern... READ MORE
MARKET HAS UPSIDE REVERSAL DAY ... After trading lower this morning, stocks rallied this afternoon to respectable gains. That upside reversal also helped the Dow Industrials and S&P 500 bounce off their 50-day moving averages as shown in Charts 1 and 2. Chart 3 shows the Nasdaq Composite Index... READ MORE
10-YEAR TREASURY YIELD TESTING 2012 LOW... The plunge in global bond yields continues. Yesterday's statement from the Bank of England of its intention to lower rates sometime this summer pushed the British 2-year yield into negative territory for the first time, and its 10-Year to another record low... READ MORE
MSCI ALL COUNTRY WORLD INDEX BACK OVER 200-DAY AVERAGE... Investor confidence is returning to global stocks after the short-term panic caused by last Friday's Brexit vote. Improvement is being seen in both developed and emerging markets. Chart 1 shows the MSCI All Country World Index (ACWI) climbing back... READ MORE
EUROPEAN STOCKS LEAD GLOBAL BOUNCE ... A rebound in European stocks is leading a rebound in the states. Chart 1 shows the Dow Jones Europe Ex UK Index climbing 2.5%. France and Germany are up a similar amount. What may be significant from a charting standpoint is that the index... READ MORE
U.S. STOCK INDEXES BREAK CHART SUPPORT... The global selling of stocks that started on Friday continued into today. Big losses in Europe signaled another bad day. The British Pound fell to another 30-year low (Chart 1). Chart 2 shows London's FTSE 100 losing more than 2% and... READ MORE
* Low momentum close to price highs is often followed by above-average declines * Failed patterns are often followed by above average price moves * Those credit spreads are widening again Last week I wrote that there were some positive short-term signs that suggested the reaction to Brexit might be overdone. Monday’s... READ MORE
WORLD MARKETS ARE SHOCKED AT BRITISH VOTE... Even though polls showed the British vote to be very close, a lot of money bet that the Brits would vote to stay in the European Union. That was true with London bookies and global investors. Strong currency and stock action on Wednesday... READ MORE
* Selling climax at the opening * UK versus European Monetary Union * What are global equities saying? * What’s up with the pound? Selling climax at the opening There is an old saying on Wall Street that the market does not discount the same thing twice. Back in early June, we saw... READ MORE
STERLING SHOULD BE BOTTOMING... I'm going to take the chance of ignoring the British vote on Thursday and concentrate instead on the charts themselves. If it's true that markets have a way of discounting (or anticipating) events, that's the best we can do. The... READ MORE
UK LEADS GLOBAL RALLY ... Stocks around the world started the week on a strong note which appears to be tied to shifting sentiment in Britain. Chart 1 shows the British Pound surging more than 2% for its biggest gain in years. British stocks are sharply higher as well. Chart 2... READ MORE
A FRIDAY REBOUND IN BRITAIN AND EUROPE... All eyes are on the British Brexit vote this coming Thursday (June 23) on whether to stay in the European Union or leave. Latest polls show the "leave" vote in the lead. A relief bounce on Friday in Britain and Europe... READ MORE
* Stocks show signs of a near-term reversal * What about those bonds? * Gold showing signs of tiredness Stocks show signs of near-term reversal On Thursday, several markets started off strongly in one direction but by the end of the day, these same markets reversed course. Normally when one market or an... READ MORE
FOREIGN SHARES TUMBLE... Foreign shares continue to fall sharply and are pulling U.S. shares lower. The biggest drops are being seen in developed markets. Chart 1 shows MSCI iShares (EFA) falling to the lowest level in early three months. The biggest losses are being seen in Europe and Japan.... READ MORE
* Some short-term equity market cracks are starting to appear * Rates are starting to breakdown * Keep watching those credit spreads Some short-term equity market cracks are starting to appear In my last article, I pointed out that most of the short-term oscillators were in a bullish configuration. Moreover, they were not... READ MORE
FALLING FOREIGN YIELDS PULL TREASURIES LOWER... The big story this week was the plunge in global bond yields, many of which fell to record lows and deeper into negative territory. Chart 1 compares 10-Year yields of the U.S. (green), Britain (red), Germany (blue), and Japan (orange). The last three... READ MORE
INDUSTRIAL SPDR NEARS RECORD ... One of the positive signs for the stock market is that it's being led higher by economically sensitive stock groups. Chart 1, for example, shows the Industrial Sector SPDR (XLI) testing its April high. The XLI scored a bullish breakout during March when it... READ MORE
OIL SERVICE STOCKS SURGE ... Strong buying in energy shares is helping lead global stocks higher. That's especially true of oil service stocks. Chart 1 shows the VanEck Vectors Oil Services ETF (OIH) surging near 7% today. Its relative strength ratio (top of chart) is surging as well. Crude... READ MORE
* Market reacts to bad news with a nothing-burger and that’s bullish * NYA Coppock goes bullish * NYSE A/D Line at all-time high * Pretty well all sectors pointing north * Those interest rates Market reacts to bad news with a nothing-burger and that’s bullish In my book Investment Psychology Explained,... READ MORE
WEAKEST JOB REPORT IN FIVE YEARS SURPRISES EVERYONE... Friday's job report of only 38,000 jobs created in May was the weakest in more than five years. And it pretty much shocked everyone. Some of the market reactions, however, were reasonably predictable. Interest rate yields tumbled along the... READ MORE
U.S. HEALTHCARE PROVIDERS ISHARES ... In my message posted earlier today, I showed a number of healthcare providers that are having a strong day, including Aetna (AET), Centene (CNC), Humana (HUM), and Unitedhealth Group (UNH). I want to point out here that an ETF is available to cover that group... READ MORE
HEALTH CARE SPDR NEARS APRIL HIGH... Healthcare stocks continue to gain ground despite a generally soft stock market. Chart 1 shows the Health Care SPDR (XLV) trading higher today and nearing a test of its April high. The XLV/SPX ratio (top of chart) continues to gain ground as well.... READ MORE
HEALTH CARE SPDR SHOWS RELATIVE STRENGTH ... With stocks encountering some selling at the start of June, healthcare stocks are showing more resilience. That may be due to the fact the heathcare stocks have defensive characteristics. It may also have to do with the fact that healthcare stocks are starting to... READ MORE
* The bullish reverse dominos * Chinese ETF’s * PEK or FXI? * What would a Chinese rally mean for US equities * Chinese short interest The Chinese equity market as reflected in the Shanghai Composite $SSEC has fallen by close to 50 % from the 5166 level on the June 2015 high to its... READ MORE
STOCKS ARE ENDING WAVE FOUR CORRECTION... I find Elliott Wave Analysis very helpful in keeping the stock market's trend in proper perspective. I'm revisiting the subject here because I believe it may explain what's happening in global stocks. Here's a brief explanation.... READ MORE
HOME CONSTRUCTION ISHARES CLEAR MOVING AVERAGES ... April new home sales surged to the highest level since 2008. That followed on the heels of last week's report of strong existing home sales. The prospect of newer homes being built is good for homebuilders, the economy, and the stock market.... READ MORE
* A tale of two possible market scenarios * Are we there yet? * Watch those techies * The charts support a higher interest rate scenario A tale of two possible market scenarios I have been calling for a US equity market correction for the last few weeks because an overbought condition in several... READ MORE
VIX FAILS BREAKOUT ATTEMPT... My Thursday morning message showed the Volatility Index (VIX) trying to break through resistance near 17. It rose as high as 17.65 intra-day which was the highest level in two months. Fortunately, it wasn't able to close there. The good news is that... READ MORE
VIX MAY BE TURNING UP ... Chart 1 shows the Volatility (VIX) Index trying to clear 17 for the first time since early March. A rising VIX is usually associated with lower stock prices. Chart 2 shows a point & figure version of the VIX and shows a similar picture. After... READ MORE
* The big picture for oil prices * Oil versus stocks * Commodities versus bonds-the ultimate inflation/deflation relationship * Clean-tech starting to turn around This morning ‘s MarketWatch had a story featuring a recent Goldman Sachs report favoring oil over equities. They also had another, right next to it, saying to the effect... READ MORE
BOND YIELDS JUMP... Chart 1 shows the 10-Year Treasury Yield ($TNX) bouncing strongly today. That's partially the result of stronger economic news this week combined with higher inflation. The Consumer Price Index (CPI) for April saw the biggest gain in three years. Most of that came from rising... READ MORE
TRANSPORTS SHOW SHORT-TERM WEAKNESS... One of the market's short-term problems has been the recent downturn in transportation stocks. The daily bars in Chart 1 show the Dow Jones Transportation Average ($TRAN) slipping below its April low and trading under its moving average lines. So far, the decline has... READ MORE
Using The Special K To Identify Major Trend Reversals: * What’s the Special K saying for US equities? * Important parts of Asia are looking sick * Gold and the dollar two diverging trends At my bi-weekly Tuesday Market Roundup Webinar 2015-05-10 last week, I had a few words to say about... READ MORE
BIOTECHS PULL HEALTHCARE LOWER ... Healthcare is one of the day's weakest sectors. Chart 1 shows the Health Care SPDR (XLV) pulling back to retest its 50- and 200-day moving averages. Its relative strength line (top of chart) has starting to slip as well. Biotechs are the main drag... READ MORE
* Balancing out the possibilities for US equities * Show me the bullish sectors * Those rates were supposed to go up but the charts say that might not be the case Balancing out the possibilities for US equities Chart 1 shows the NYSE Composite ($NYA) and the Coppock Curve. The curve gives... READ MORE
TECHNOLOGY SPDR BOUNCES OFF 200-DAY LINE ... The technology sector has been one of the market's weakest sectors over the last month. That, however, may be changing for the better. The daily bars in Chart 1 show the Technology Sector SPDR (XLK) bouncing off of its 200-day moving average... READ MORE
THE TRADITIONAL NYAD LINE HITS NEW RECORD... Chartists look to the NYSE Advance-Decline line to help determine the trend of the stock market. The NYAD line is simply a running cumulative total of the number of advancing stocks minus decliners on the big board. And it has a good track... READ MORE
* Long-term picture still mixed * Analyzing the Short-term Picture * Global equities are still vulnerable * Confidence looking questionable again * Spot the bullish sector Long-term picture still mixed A couple of weeks ago I pointed out that several long-term indicators had tentatively turned bullish and that others were not far behind. The problem... READ MORE
SHORT-TERM STOCK PULLBACK DEEPENS... Global stocks are continuing the pullback that started last week. Chart 1 shows the S&P 500 heading down toward a test of its early April low and/or its moving average lines. The 14-day RSI line (top of chart) has slipped below the 50... READ MORE