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StochRSI turns oversold for SMH

by Arthur Hill

Also known as RSI on steroids, StochRSI is the Stochastic Oscillator applied to RSI values. It becomes overbought and oversold a lot more than both indicators. SMH declined to support in the 25.5-26 area as StochRSI moved below .20 to become oversold. The cup is half full for StochRSI below .50, but a surge above .60 would turn short-term momentum bullish. Click this image for details Read More 

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S&P 500 tests May lows

by Arthur Hill

With a sharp decline early Tuesday, the S&P 500 is once again testing the May-June lows. In fact, this test also involves the February low. The 1040 level held in February, late May and early June. Can it handle another assault? Read More 

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Gold ETF battles resistance

by Arthur Hill

For the second time in two weeks, the Gold ETF (GLD) surged above resistance at 122 and then moved back below with a long red candlestick. The overall uptrend in GLD remains in place, but there is considerable resistance in this area. First support is set at last week’s lows. Second support is set at the May low. Click this image for details Read More 

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Negative MACD for Euro Top 100 Index

by Arthur Hill

The Euro Top-100 Index ($EUR) is forming a potentially lower high with bearish momentum. After a bounce in June, the index reversed course this week with an outside reversal well below the April high. MACD moved into negative territory in late May and remains in negative territory. Click this image for details Read More 

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A weekly outside reversal working for $DIA

by Arthur Hill

As of late Thursday afternoon, the Dow SPDR (DIA) was forming a weekly outside reversal. Notice how Monday’s trading started above last week’s close and is now below last week’s open. This week’s reversal has completely engulfed the prior white candlestick. Click this image for details Read More 

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Markets turn defensive ahead of Fed

by Arthur Hill

The PerfChart below shows the performance for five intermarket related ETFs over the last two days. Stocks and the oil are down as money moved out of risk ahead of Wednesday's FOMC policy statement. Conversely, bonds, gold and the Dollar are up as money moved into relative safety. These are the relationships to watch going forward. Click this image for details Read More 

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Shanghai Composite remains relatively weak

by Arthur Hill

Despite a big bounce on Monday’s currency news, the Shanghai Composite ($SSEC) remains within a trading range and continues to show relative weakness. After a sharp decline in April-May, the index formed a triangle consolidation around 2550. Watch these boundaries for the next directional clue. Also notice that the index remains below its early June high, but the S&P 500 broke above this corresponding high. The missing candlesticks represent holidays. Click this image for details Read More 

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Yuan Fund surges to long-term moving average

by Arthur Hill

News that China adjusted its currency’s peg to the Dollar sent the Chinese Yuan Fund (CYB) surging back above 25. While the three week move may seem impressive, the ETF is really just making it back to its 52-week average. In fact, the ETF spent most of 2009 trading between 25.2 and 25.6. With today’s move, it is right back in last year’s range. Click this image for details Read More 

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Staples forms bearish engulfing

by Arthur Hill

Staples surged with the rest of the market over the prior seven days, but hit resistance from broken support with a bearish engulfing candlestick on Thursday. Also notice that the falling 200-day EMA and the 50% retracement mark.  Click this image for details Read More 

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GE forms rising flag near support

by Arthur Hill

GE is trying to bounce off its February low, but the bounce look feeble so far and the stock shows relative weakness. The stock shows relative weakness because the S&P 500 broke above resistance and GE remains below corresponding resistance. The support zone around 15-15.5 is holding so far, but a break below flag support would argue for a break to new lows. Read More 

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Apple challenges resistance

by Arthur Hill

Apple (AAPL) remains one of the strongest stocks as it surges to resistance from the April-June highs. The stock formed a triangle over the last 2-3 months and broke the upper trendline today. Volume was light though. QQQQ traders should note that Apple accounts for 18.84% of the ETF. Click this image for details Read More 

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Airline Index closes in on 52-week high

by Arthur Hill

Airlines continue to show relative strength and upside leadership. First, the Airline Index ($XAL) is challenging its April high with a big move on Tuesday. A break would forge a new 52-week high. Second, the price relative broke out in late May and recorded a new high this week. Click this image for details. Read More 

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Commodities follow stocks

by Arthur Hill

With the exception of precious metals, commodity indices have gone the way of the stock market over the last eight weeks. The PerfChart below shows the S&P 500 six commodity related indices. Only the GSCI Precious Metals Index ($GPX) shows a gain since mid April. Click this image for details Read More 

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A lot of fill black candlesticks

by Arthur Hill

Looking through the pre-defined scans page, it was surprising to see a high number of filled black candlesticks on Thursday. These candlesticks form when the close is below the open and the close is above the prior close. Even though the stock closed up for the day, the stock moved down after the open and buying pressure was limited to the open. Click this image for details Read More 

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Bullish Percent Indices below 50%

by Arthur Hill

Stockcharts.com tracks the Bullish Percent Indices (BPI) for six major indices and 10 sectors. The BPIs for the major indices are below 50% and eight of the ten sectors have BPIs below 50%. Only telecom and utilities have BPIs above 50%. These numbers can be found at the bottom of the Market Summary page. Click here to read more about the Bullish Percent Index. Click this image for details Read More 

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Dow breaks Ichimoku cloud

by Arthur Hill

Ichimoku Clouds, a form of Japanese technical analysis, show a trend reversal in the Dow Industrials. The senior average broke below the cloud formation and the “Standard Line” moved below the cloud formation. This is the red line, which is a moving average of the 26-day high-low range. Learn more in our chart school article. Click this image for details Read More 

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VIX bounces off support

by Arthur Hill

The S&P 500 Volatility Index ($VIX) surged in May and broke above its January-February high. After a pullback, the index found support near broken resistance and bounced the last few days. Also notice that the S&P 500 hit resistance near broken support. Click this image for details Read More 

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An evening star for IBM

by Arthur Hill

With a short-term reversal in stocks over the last three days, the evening star scan was about as full as it’s been in a long time. IBM formed an evening star with a long white candlestick on Wednesday, a gap-stall on Thursday and a gap-decline on Friday. Volume also expanded on the decline. Click this image for details Read More 

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XLY and XLK show relative strength

by Arthur Hill

The sector perfchart provides an easy means to identify the leaders and laggards. Even though all sectors are down over the last three weeks (since May 13), some are down more than the S&P 500 (laggards) and some are down less (leaders). It is positive to see the Consumer Discretionary SPDR (XLY) and Technology SPDR (XLK) holding up better than the S&P 500. Finance and industrials remain a drag though. Click this image for details Read More 

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Natural Gas ETF surges above April high

by Arthur Hill

The US Natural Gas Fund (UNG) is perking up with a little break above the April-May highs today. However, like the commodity itself, UNG remains in a long-term downtrend. After consolidating the last two months, the breakout argues for an oversold bounce that could retrace 50% of the prior decline. The indicator window shows the Amex Natural Gas Index ($XNG) along with the US Natural Gas Fund (black). click this chart for details Read More 

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Bollinger Bands contract for Micron

by Arthur Hill

Micron Technology (MU) is testing support with a consolidation over the last four weeks. Support in the 8.25-8.5 area stems from the February lows. The stock has been trading between 8.25 and 9.5 since May 10th. Also notice that the Bollinger Bands are narrowing. Look for a consolidation break to trigger the next directional move. Click this image for details Read More 

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3 Inside Days for Microsoft

by Arthur Hill

After becoming oversold and plunging on high volume last week, Microsoft is starting to firm with three inside days. Notice the long red candlestick on high volume four days ago. Was that a selling climax? The stock has traded the last three days in the upper half of the long red candlestick. A break above its high would be short-term bullish for Mr. Softy. Click this image to see a live chart Read More