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NASDAQ LEADS MARKET INTO BAD END FOR THE WEEK -- INTERNET-RELATED STOCKS LEAD TECHNOLOGY SECTOR LOWER -- AMAZON.COM BREAKS 200-DAY AVERAGE -- THAT'S ALSO BAD FOR CONSUMER DISCRETIONARY STOCKS WHICH ARE BIG FRIDAY LOSERS

by John Murphy,

Chief Technical Analyst, StockCharts.com

NASDAQ LEADS MARKET LOWER ... A 3% loss in the Nasdaq market is pulling the rest of the market lower. Chart 1 shows the Nasdaq Composite Index bearing down on last week's low. The Nasdaq/S&P 500 ratio (below chart) has plunged to the lowest level in...   READ MORE 

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FALLING DOLLAR GIVES OIL AND GOLD A BOOST -- BARRICK GOLD AND NEWMONT LEAD GOLD MINERS HIGHER -- AMAZON.COM TESTS 200-DAY AVERAGE -- TESLA MOTORS FALLS TO TWO-YEAR LOW -- FINANCIAL STOCKS NEED A REBOUND IN BOND YIELDS

by John Murphy,

Chief Technical Analyst, StockCharts.com

DOLLAR PLUNGES ... The dollar is having its worst day in months. Chart 1 shows the Power Shares Dollar Index (UUP) tumbling to the lowest level in three months. That's due partially to the recent drop in U.S. rates, falling stock prices, and weak economic news which have...   READ MORE 

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The BOJ Did Not Start The Trend - They Are Following It

by Martin Pring,

President, Pring Research

* Global rates are in freefall * Interest-sensitive sectors will continue to improve their relative action * Two sectors that are likely to underperform The recent move by the Bank of Japan (BOJ) confirmed what rates around the world have already been doing, i.e. moving lower. In Japan’s case, some rates...   READ MORE 

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PLUNGE IN JAPANESE BOND YIELD PULLS TREASURY YIELD TO NINE-MONTH LOW -- THAT HELPS EXPLAIN WHY BONDS RALLIED WITH STOCKS ON FRIDAY -- FALLING BOND YIELD IS GOOD FOR UTILITIES AND OTHER DIVIDEND PAYERS, BUT BAD FOR BANKS AND INSURERS

by John Murphy,

Chief Technical Analyst, StockCharts.com

10-YEAR TREASURY YIELD FALLS TO NINE-MONTH LOW... A seemingly strange thing happened on Friday. The Bank of Japan surprised everyone by adopting a negative interest rate for the first time by pushing its short-term rate below zero. Not surprisingly, the Japanese yen plunged 2% and Japanese stocks jumped 2.8%...   READ MORE 

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JAPANESE MOVE TO NEGATIVE RATES PUSHES YEN SHARPLY LOWER AND JAPANESE STOCKS HIGHER -- THAT FAVORS WISDOM TREE JAPAN HEDGED EQUITY ETF OVER JAPANESE ISHARES -- FTSE ALL WORLD STOCK INDEX IS AT POTENTIAL SUPPORT LEVEL AND OVERSOLD

by John Murphy,

Chief Technical Analyst, StockCharts.com

PLUNGE IN YEN... The Bank of Japan (BOJ) announced this morning a move to negative interest rates for the first time in its history. That pushed Japanese yields sharply lower and caused the yen to plunge. Chart 1 shows the Japanese yen plunging -2% today, which is its biggest drop...   READ MORE 

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FALLING BOND YIELDS BOOST UTILITIES -- AT&T HITS RECORD HIGH -- FOOD STOCKS LEAD CONSUMER STAPLES -- DOLLAR WEAKENS WITH SHORT-TERM RATES -- DOW BOUNCES ON RISING CRUDE

by John Murphy,

Chief Technical Analyst, StockCharts.com

BONDS AND UTILITIES ARE RISING TOGETHER... With the 10-Year Treasury yield slipping back below 2.00%, bond prices are rising. The daily bars in Chart 1 show the Barclays 7-10 Year iShares (IEF) nearing its January high. Rate-sensitive stocks like utilities usually rise right along with bonds. Chart 2 shows...   READ MORE 

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STOCKS TURN DOWN AS BONDS BOUNCE -- APPLE WEIGHS ON TECHNOLOGY AS VERIZON HAS STRONG DAY -- WEAKER DOLLAR BOOSTS GOLD

by John Murphy,

Chief Technical Analyst, StockCharts.com

STOCK INDEXES TURN DOWN ... Stocks are weakening after the Fed statement. Chart 1 shows the DJ Industrial SPDR (DIA) reversing down in late afternoon trading. It may now retest last week's low. Chart 2 shows the S&P 500 SPDRS (SPY) doing the same. Chart 3 shows...   READ MORE 

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DOLLAR DIRECTION IS IMPORTANT FOR GLOBAL STOCKS AND COMMODITIES -- SAFE HAVEN BUYING HAS PUSHED JAPANESE YEN HIGHER AND STOCKS LOWER -- U.S. STOCK INDEXES TRY TO BOUNCE OFF AUGUST LOWS -- TODAY'S FED ANNOUNCEMENT COULD BE IMPORTANT

by John Murphy,

Chief Technical Analyst, StockCharts.com

DOLLAR DIRECTION MAY HOLD KEY TO CRUDE OIL ... Everyone is waiting to hear what the Fed has to say today. Markets appear to hoping for a more dovish statement. Currency traders are also paying very close attention. That's because Fed policy has a big impact on dollar direction....   READ MORE 

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A Bear Market Rally Looks As If It Is Underway

by Martin Pring,

President, Pring Research

Several key short/intermediate indicators reverse from oversold conditions Gold ETF very close to violating its bear market trendline The intermediate Indicators are bottoming Internal market action in the last week is starting to confirm the possibility of an intermediate low that I laid out last week. That’s because...   READ MORE 

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Trolling For Bottom Fishing Indicators

by Martin Pring,

President, Pring Research

* Dow Jones Utility Average just above its secular up trendline * 2-year yield probably gave a false upside breakout signal * Three indicators to watch for an intermediate equity bottom Yesterday at the webinar Greg asked me a question that was posed by one of the attendees relating to a potential reverse...   READ MORE 

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GLOBAL SELLOFF CONTINUES -- CRUDE OIL NEARS $25 -- CRB INDEX DROPS TO LOWEST LEVEL SINCE EARLY 1970S WHICH IS DEFLATIONARY -- TREASURY ETF BREAKS OUT TO UPSIDE AS YIELD FALLS BELOW 2%

by John Murphy,

Chief Technical Analyst, StockCharts.com

LONG-TERM LOOK AT CRUDE... The price of crude oil continues to drop and is bringing global stocks down with it. The monthly bars in Chart 1 show how bad the decline has been and where it appears headed. The recent decline pushed WTIC Light Crude Oil below its early 2009...   READ MORE 

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U.S. STOCK INDEXES THREATEN 2015 LOWS -- WHAT HAPPENS IF THEY DON'T HOLD -- THE S&P 500 COULD LOSE ANOTHER 10-12% AND DROP TOWARD 1600 -- NYSE ADVANCE DECLINE LINE TURNS DOWN -- INDEX OF FOREIGN STOCKS IS IN BEAR MARKET

by John Murphy,

Chief Technical Analyst, StockCharts.com

U.S. STOCK INDEXES THREATEN 2015 LOWS ... Another week of heavy selling has pushed major U.S. stock indexes into a critical test of their 2015 lows. The first three charts tell the story. Chart 1 shows the Dow Industrials ending the week just above its late September intra-day low...   READ MORE 

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What Happens If The Fed Is Wrong

by Martin Pring,

President, Pring Research

* Erie comparisons to 1929 * Credit spreads worsen * 30-year bond yields break down prices break out When the fed raises interest rates after a long series of declines it usually signals a change in policy and the start of a new trend to higher rates. What happens, though, when the Fed...   READ MORE 

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AUTO PARTS AND RAILS LEAD MARKET LOWER -- BORGWARNER HITS THREE-YEAR LOW -- CSX AND UAL LEAD TRANSPORTS LOWER -- TREASURIES CONTINUE TO GAIN AS STOCKS SINK -- FALLING YIELDS, HOWEVER, ARE HURTING BANKS -- S&P 500 NEARS TEST OF 2015 LOW

by John Murphy,

Chief Technical Analyst, StockCharts.com

AUTO PARTS LEAD CYCLICALS LOWER... A week ago Tuesday (January 5), I showed a chart of General Motors falling below its 200-day moving while autos were leading the Consumer Discretionary SPDR lower. Today, the main drag on that sector is auto parts. Chart 1 shows the Dow Jones US Auto...   READ MORE 

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Please Show Me A Bullish Long-Term Equity Chart

by Martin Pring,

President, Pring Research

* Europe, Asia and Latin America all look bearish I am not kidding. Today I went through pretty well all of the country ETF charts looking back a few years with the long-term KST. I could find only one bullish chart as displayed here as Chart 1. As you can see...   READ MORE 

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MAJOR U.S. STOCK INDEXES ENTER CORRECTION TERRITORY -- A RETEST OF 2015 LOWS APPEARS LIKELY -- SMALL AND MIDSIZE STOCKS HAVE ALREADY BROKEN THAT SUPPORT -- DOW TRANSPORTS ENTER BEAR MARKET TERRITORY -- DEFENSIVE UTILITES SHOW RELATIVE STRENGTH

by John Murphy,

Chief Technical Analyst, StockCharts.com

MAJOR STOCK INDEXES ENTER CORRECTION TERRITORY... After suffering the worst start to a new year in history, the U.S. stock market has entered correction territory which is defined by a drop of 10% from its old high. The charts pretty much speak for themselves. All three major stock indexes...   READ MORE 

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Long-Term Top Looking More And More Likely

by Martin Pring,

President, Pring Research

* Several historically reliable indicators are saying “bear” * World stocks looking extremely toppy * Shanghai may be forming a head and shoulders top At my first webinar of the year on Tuesday, it seemed a good idea to load the presentation with some longer-term charts, as they are all pointing to trouble...   READ MORE 

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GLOBAL STOCKS RESUME SELLING -- U.S. STOCK RALLY HAS BEEN TOO NARROW AND VULNERABLE TO A DOWNSIDE CORRECTION -- GAP BETWEEN SMALL AND LARGE CAPS IS A WARNING SIGN -- SO IS THE DROP TO 40% IN THE NYSE BULLISH PERCENT INDEX

by John Murphy,

Chief Technical Analyst, StockCharts.com

SMALL CAPS ARE LEADING LARGE CAPS LOWER... Global stocks have started the year on a bad note. Most of that is being blamed on China. A plunge in Chinese stocks and a drop in the Chinese yuan to a five-year low are certainly causing a lot of worries in global...   READ MORE 

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DEFENSIVE STOCKS CONTINUE TO SHOW LEADERHIP -- KIMBERLY CLARK LEADS STAPLES HIGHER -- UTILITIES AND REITS CONTINUE TO GAIN GROUND -- KIMCO REALTY JUMPS 3% -- AUTOS HELP PULL CONSUMER DISCRETIONARY SPDR LOWER -- GENERAL MOTORS BREAKS 200-DAY LINE

by John Murphy,

Chief Technical Analyst, StockCharts.com

CONSUMER STAPLES ARE HOLDING UP ... Last Wednesday's message showed that money was flowing toward defensive stocks, which meant that investors were ending the old year in a more cautious mood. That mood is continuing into the new year. With the stock market on the defensive during the first...   READ MORE 

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Did The Market Go Up or Down In 2015?

by Martin Pring,

President, Pring Research

* This week’s bearish two-bar reversal threatens a bullish seasonal for equities * Airlines may be set to join railroads and truckers on the downside * Dollar Index keeps us guessing, which means the next move is likely to be worthwhile * Pound completes a bearish long-term head and shoulders The title of...   READ MORE 

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SMALL AND MIDCAP STOCKS CONTINUE TO LAG BEHIND S&P 500 INDEX -- CONSUMER STAPLES AND UTILITIES ARE DECEMBER LEADERS -- WHILE CYCLICALS AND INDUSTRIALS LAG BEHIND -- ROTATION FROM CYCLICALS TO STAPLES IS A SIGN OF CAUTION

by John Murphy,

Chief Technical Analyst, StockCharts.com

SMALLER STOCKS STILL LAG BEHIND LARGE CAPS... A yearend stock rebound has boosted major stock indexes. Chart 1 shows the S&P 500 touching a three-week high yesterday. It still, however, remains below a falling resistance line drawn over its November/December highs, and is trying to stay above...   READ MORE 

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Market Sectors: The Good The Bad And The Ugly

by Martin Pring,

President, Pring Research

* Home builders, KBW banks, consumer cyclicals and resources look vulnerable * REIT's, utilities, and healthcare look promising This week I am going to back off from the usual market commentary in order to focus on some industry groups and sectors that have the potential to lead the market higher...   READ MORE 

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STOCKS ARE ENDING THE WEEK ON A DOWN NOTE -- ENERGY SECTOR SPDR TESTS SUMMER LOW -- MONEY FLOWS INTO TREASURIES AS CORPORATE BONDS UNDERPERFORM -- TREASURIES ARE HAVING A BETTER DECEMBER THAN STOCKS

by John Murphy,

Chief Technical Analyst, StockCharts.com

MAJOR STOCK INDEXES UNDER HEAVY SELLING... Stocks have come under renewed selling pressure following Wednesday's Fed inspired bounce. And it looks like they're going to end the week on the downside. Chart 1 shows the Dow Industrials down nearly 200 points in late morning trading. It&...   READ MORE 

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Bearish Two Bar Reversal Threatens The Pre-Christmas Rally

by Martin Pring,

President, Pring Research

* Two bar reversal brings the effect of the rate hike back to reality * Broadly based dollar ETF breaks to new highs * Gold closes at a new low on expanding volume Earlier in the week I pointed out that many of the market averages had formed exhaustion days on Monday and...   READ MORE 

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FED RAISES SHORT-TERM RATE A QUARTER POINT WITH DOVISH COMMENT -- DIVIDEND PAYING REITS AND UTILITIES LEAD REBOUND -- AT&T LEADS TELECOM HIGHER -- S&P CLEARS MOVING AVERAGE LINES -- VIX FALLS BACK BELOW 20

by John Murphy,

Chief Technical Analyst, StockCharts.com

UTILITIES AND REITS JUMP... The Fed raised short-term rates a quarter point as expected, but softened the move with a dovish statement. Shorter-term yields in the two to five-year range are moving higher. Stocks are trading higher on the Fed move. The biggest gainers, however, are rate-sensitive stocks that pay...   READ MORE 

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Small Caps Complete 12-year Top Relative To Large Caps

by Martin Pring,

President, Pring Research

* Bullish exhaustion on Monday suggests that last week’s lows will hold during 2015 * Longer-term indicators continue to point to an overall topping out process * Small caps break down against large caps * 30-year yield at a critical juncture * Euro and yen-denominated gold complete large bearish (deflationary) formations Small year-end rally...   READ MORE 

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S&P 500 FALLS BELOW NOVEMBER LOW IN HIGHER TRADING -- NYSE ADVANCE-DECLINE LINE ALSO BREAKS SUPPORT -- SECTOR ROTATIONS TURN DEFENSIVE -- CRUDE NEARS TEST OF 2009 LOW -- TREASURY BOND/STOCK RATIO STRENGTHENS AS COMMODITY INDEX TUMBLES TO MULTI-YEAR LOWS

by John Murphy,

Chief Technical Analyst, StockCharts.com

S&P 500 FALLS BELOW SEPTEMBER LOW... My Friday afternoon message showed small caps breaking their November lows, and wrote that the S&P 500 Index was in the process of testing that important level. Chart 1 shows the S&P 500 Large Cap Index ending the...   READ MORE 

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STOCKS ARE UNDER HEAVY PRESSURE AS CRUDE OIL HITS NEW LOW -- S&P 500 THREATENS SUPPORT -- SMALL CAPS HAVE ALREADY BROKEN NOVEMBER LOW -- TREASURIES JUMP WHILE JUNK BONDS TUMBLE TO TWO-YEAR LOW -- EMERGING MARKETS LEAD GLOBAL DECLINE

by John Murphy,

Chief Technical Analyst, StockCharts.com

SMALL CAPS LEAD MARKET LOWER ... The drop in crude oil to another six-year low has undercut the recent bounce in energy shares, which are leading today's stock selloff. With all ten sectors in the red, energy stocks are down -3%. Commodity-related material stocks are right behind. The three...   READ MORE 

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More Of The Santa Sell-Off To Come?

by Martin Pring,

President, Pring Research

* Volume starting to expand on the downside * Half a Dow Theory sell signal on the weekly charts * 30-year yield locked in a tight trading range * Dollar Index facing important test Expanding volume on the downside This market continues to be plagued with volume problems. Initially, it was a lack of...   READ MORE 

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OIL BOUNCE FADES -- BUT ENERGY STOCKS END HIGHER -- MATERIALS JUMP ON DUPONT AND DOW CHEMICAL MERGER -- STOCKS END LOWER -- VIX NEARS 20 BARRIER

by John Murphy,

Chief Technical Analyst, StockCharts.com

MARKET RECAP... A morning oil bounce on low inventory faded in afternoon trading and the testing of support continues. Even so, energy stocks held some of their gains. Chevron and Exxon Mobil helped support the Dow. Materials had a strong day on the merger of Dupont and Dow Chemical. The...   READ MORE 

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CRUDE OIL TRIES TO REBOUND OFF AUGUST LOW -- ENERGY STOCKS ALSO REBOUND OFF CHART SUPPORT -- HIGH YIELD BONDS TEST OLD LOWS AS WELL -- TREASURIES SELL OFF -- DOLLAR DROP BOOSTS COMMODITIES -- S&P TRIES TO HOLD CHART SUPPORT

by John Murphy,

Chief Technical Analyst, StockCharts.com

WTIC CRUDE OIL STILL TESTING LONG-TERM SUPPORT... The recent drop in the price of oil has caused energy stocks to drop which, in turn, has caused nervous selling in the rest of the market. That has pushed a number of energy-related assets into tests of important support levels. The monthly...   READ MORE 

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Did Friday's 370-Point Rally Change Anything For The Equity Market?

by Martin Pring,

President, Pring Research

* Friday’s rally fails to reel in new highs * Guggenheim asset flows just above critical support * 30-year yield caught between two converging trendlines * Energy SPDR XLE completes a bearish head and shoulders A couple of days ago I wrote that a bearish two-bar reversal that had developed in many averages...   READ MORE 

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FRIDAY JUMP KEEPS STOCKS IN UPTREND -- PRICE PATTERN LOOKS POSITIVE -- GOLD STOCKS JUMP ON WEAK DOLLAR -- PROSPECTS FOR HIGHER RATES BOOST BANKS -- FALLING OIL HELPS AIRLINES RISE -- NASDAQ 100 NEARS NEW RECORD -- APPLE MAY BE TURNING UP

by John Murphy,

Chief Technical Analyst, StockCharts.com

SHORT-TERM PATTERN LOOKS POSITIVE... A strong rally on Friday more than erased losses from Thursday and left the market in much better shape. Chart 1 shows the S&P 500 ending the week back above its 200-day average after bouncing off its 50-day line on Thursday. Chartwatchers will now...   READ MORE 

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STOCKS HAVE A HUGE FRIDAY -- NEWMONT MINING LEADS GOLD STOCKS -- FINANCIAL LEADERS ARE CME GROUP, CHARLES SCHWAB, AND PNC FINANCIALS

by John Murphy,

Chief Technical Analyst, StockCharts.com

STOCK INDEXES GAIN 2%... Stocks are having a huge day on Friday. Stock indexes are showing gains of 2%. Chart 1 shows the S&P 500 gaining 40 points nearing the close. Its ability to bounce back above its 200-day line is also impressive. That gives its recent pattern...   READ MORE 

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ECB DISAPPOINTS MARKETS -- EURO JUMPS AS DOLLAR FALLS -- TREASURY YIELDS FOLLOW EUROPE HIGHER -- EUROPEAN STOCKS TUMBLE -- RISING RATES HURT UTILITIES, SUPPORT BANKS -- KROGER BREAKS OUT TO NEW HIGH -- ENERGY SECTOR WEAKENS -- S&P 500 RETESTS 200-DAY LINE

by John Murphy,

Chief Technical Analyst, StockCharts.com

DRAGHI DISAPPOINTS... Mario Draghi promised more stimulative measures to boost eurozone inflation and economic growth. The ECB today lowered its deposit rate 10 basis points to -0.3%. It also extended its QE bond buying program for an additional six months. Either those moves were already expected, or the markets...   READ MORE 

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Volume Is About To Expand, But Which Way Will It Send Prices?

by Martin Pring,

President, Pring Research

* Two bar reversal for the S&P says the rally is over * Volume is oversold. That means volume is likely to expand on the downside. * Credit spreads challenging their bear market lows * Commodities breaking down in a very big way * This week's two-bar reversal says the market...   READ MORE 

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TECHNOLOGY ETFS TEST NOVEMBER HIGHS -- ALTHOUGH BIG TECHS LEAD RALLY, EQUAL WEIGHT ETF SHOWS STRENGTH -- SEMICONDUCTOR ETF AT SIX-MONTH HIGH -- INTEL AND NVIDIA ARE CHIP LEADERS -- STRONG DOLLAR MAY HELP AIRLINES BY MAKING INTL TRAVEL CHEAPER

by John Murphy,

Chief Technical Analyst, StockCharts.com

TECHNOLOGY STOCKS CONTINUE TO LEAD THE MARKET HIGHER... It's usually a good sign when the economically-sensitive technology sector is leading the market higher. And it is. Chart 1 shows the Technology Sector SPDR (XLK) in the process of testing its November high. Its relative strength ratio (above chart)...   READ MORE 

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SMALL STOCKS START TO SHOW LEADERSHIP -- DOLLAR NEARS 13-YEAR HIGH AS EURO WEAKENS -- COMMODITY DEFLATION HOLDS BOND YIELDS DOWN -- SO DO NEGATIVE EUROZONE YIELDS

by John Murphy,

Chief Technical Analyst, StockCharts.com

SMALL CAP INDEXES TURN UP -- MIDCAPS ARE RIGHT BEHIND... Smaller stocks are not only catching up to larger stocks, they're starting to do better. That normally happens near yearend in anticipation of the "January Effect" when investors favor smaller stocks. Chart 1 shows the S&...   READ MORE 

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Time To Watch Those Commodities Like A Hawk

by Martin Pring,

President, Pring Research

* CRB Composite touches a 40-year low but is deeply oversold * Oil is also at critical support * Short-term commodity picture finely balanced but narrowly favors the bears * Dollar Index is back at its March 2015 high * Some short-term dollar indicators starting to roll over Long-term commodity picture Chart 1 shows that...   READ MORE 

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THANKSIVING WEEK IS USUALLY GOOD FOR THE MARKET -- SO IS THE MONTH OF DECEMBER -- THAT'S ESPECIALLY TRUE OF SMALLER STOCKS WHICH ARE TURNING UP -- CONSUMER DISCRETIONARY SPDR NEARS RECORD -- ALEXION AND AMGEN LEAD HEALTHCARE SECTOR

by John Murphy,

Chief Technical Analyst, StockCharts.com

THANKSGIVING TREAT ... Stocks are approaching the Thanksgiving holiday in an optimistic mood. That's not unusual. According to the Stock Trader's Almanac, the Wednesday before and the Friday after Thanksgiving are up days most of the time. Following that, stocks enter December which is usually the strongest...   READ MORE