Don't Ignore This Chart

December 2013

Don't Ignore This Chart

HealthCare and Consumer Discretionary Sectors Duke it Out for Top Honors

by Arthur Hill

The Consumer Discretionary SPDR (XLY) and the HealthCare SPDR (XLV) are the top performing sectors year-to-date. Both are up over 40% and easily outperforming the S&P 500 SPDR (SPY), which is up a mere 29%. The Industrials SPDR (XLI) will take third place and the Finance SPDR (XLF) will end up fourth. This means three of the four offensive sectors led as the market in 2013. Read More 

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Baker Hughes Breaks Key Line on Intraday P&F Chart

by Arthur Hill

Baker Hughes (BHI) perked up over the last few weeks by establishing support in the lows 50s and triggering three bullish P&F signals. First, notice that the stock forged a Triple Top Breakout at 53.7. Second, BHI triggered a bullish Catapult with a move above 54. Third, the stock broke above the Bearish Resistance Line (red trend line). Read More 

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Nasdaq AD Line Confirms Underlying Strength

by Arthur Hill

The Nasdaq AD Line extended its year long uptrend with a surge and new high in December. The chart below shows the AD Line with a series of rising peaks and rising troughs (higher highs and higher lows). Also note that this new high in the AD Line confirms the new high in the Nasdaq Composite, which means market internals are running bullish. Read More 

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Could Copper Play Catch Up in 2014?

by Arthur Hill

The Copper ETN (JJC) is poised to challenge resistance after a channel breakout this month. Notice that the ETF successfully tested the spring-summer lows with a 5+ percent bounce this month. A break above the spring-summer highs would forge a higher high and argue for the start of an uptrend. The indicator window shows Spot Copper ($COPPER) also challenging resistance. Could 2014 be the year that copper plays catch up? Read More 

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Relative Weakness in Retail is Offset by Three Key Groups

by Arthur Hill

The PerfChart below shows one-month performance for ten industry group ETFs. Even though I am concerned with relative weakness in the Retail SPDR (XRT), this concern is offset by relative strength in three other groups. It has been a good month for stocks with the Home Construction SPDR (ITB) and the Internet ETF (FDN) leading the market higher. Both are up over 7% in since 22-Nov. Semis are also strong with the Semiconductor SPDR (XSD) rising over 5%. Read More 

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Pre-defined Technical Alerts Page Lights Up

by Arthur Hill

With a strong open on Monday, the pre-defined technical alerts page is showing lots of green for the stock market. Notice that five sector SPDRs hit new highs, three major indices hit new highs and the S&P 500 Bullish Percent Index surged above 80. The table below today’s alerts shows the past alerts. Click on any symbol to see a live chart.   Read More 

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Sector Summary Reveals the Leading Steel Stocks

by Arthur Hill

A top-down browse through the sector summary shows that steel stocks are up in a down market on Thursday. Starting with the sector overall, chartists can see which sectors are leading and which are lagging. After clicking “materials sector”, chartists will be taken to the industry groups within that sector. Steel is leading and clicking “steel” will show the stocks within that group. Read More 

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Dow Surges Above Flag Resistance with Triple Digit Move

by Arthur Hill

The Dow is making a bold statement as it holds the resistance breakout from November and exceeds flag resistance. The Dow broke to new high with a move above 15700 in early November and the 15600-15700 area turns support. This level held on the throwback, which formed a falling flag. This small correction ended on Wednesday with a break above the upper trend line. The breakout at 15800 is the first level to watch for a failure. Read More 

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Hard Drive Makers Lead Tech Sector

by Arthur Hill

Reports of the death of the PC have been greatly exaggerated. Though not PC makers, the hard drive makers are strong with two hitting 52-week highs this week. Seagate (STX) and Western Digital (WDC) hit new highs and stand out on the predefined scans page. A search for STX shows the stock hitting four different scans. Read More 

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Gold&Silver Index Shows Short-term Relative Strength

by Arthur Hill

The PHLX Gold & Silver Index ($XAU) is actually showing some strength with a small gain over the last six days. Perhaps this is because most other industry group indices are down and XAU is a contrarian play. The PerfChart below shows John Murphy’s eight industry groups since 9-Dec. The Drug Index ($DRG) and Biotech ($BTK) are leading the way down with the biggest declines. Read More 

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Delta and SW Airlines Lead Industrials Sector

by Arthur Hill

The Sector MarketCarpet shows that Delta and Southwest, two airline stocks, are leading the industrials sector on Thursday. Airlines tend to move as a group and this means other airline stocks are likely strong as well. Note that both stock hit 52-week highs in late November and led the market from September to November. Note that today’s video includes a quick demo on the MarketCarpet. Read More 

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Natural Gas ETF Leads as Metals ETFs Lag

by Arthur Hill

The Natural Gas ETF (UNG) is on a tear with a 15+ percent gain since October 30th. The PerfChart below shows UNG with nine other commodity-related ETFs. The eight metal-related ETFs are down with the Gold SPDR (GLD) and Silver Trust (SLV) leading the way lower. The US Oil Fund (USO) is up a fraction. NatGas is the clear leader as the weather turns colder. Read More 

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European Top 100 Index Breaks Channel and Underperforms

by Arthur Hill

The European Top 100 Index ($EUR) broke below the lower trend line of a five month channel with a sharp decline this month. In addition, notice that the index broke below the mid November low and these breaks are holding. European stocks are also showing relative weakness as the price relative ($EUR:$SPX ratio) moves to new lows for the year. Click this image for a live page Read More 

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An Array of Patterns Takes Shape for TEVA

by Arthur Hill

Teva Pharmaceuticals (TEVA) has been all over the place since early October, but two bullish patterns are taking shape and the stock could be poised for a breakout. First, the stock formed a massive island reversal with the late October gap down and the late November gap up. Second, the pattern since mid October looks like be an inverse head-and-shoulders with the red trend line marking the neckline. Notice that upside volume picked up as the stock surged above 40 in November. Short-term, a harami formed on Monday as the stock tested the gap zone. A breakout at 41 would prove bullish Read More 

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A Dark Cloud forms over Seagate

by Arthur Hill

Seagate Technology (STX), which is a Nasdaq stock with a three letter symbol, opened strong and closed weak to make the dark cloud scan list. These are potentially bearish patterns that require confirmation. A move below 49.5 would break the three week trend line and produce a bull trap, which is a failed breakout. Click this image to see the scan results Read More 

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Yield Curve Steepens as 10-Year Surges

by Arthur Hill

The yield curve is steepening as the 10-YR Treasury Yield ($TNX) surges more than the 2-YR Treasury Yield and the 3-Month Treasury Yield. A steepening yield curve confirms loose monetary policy and this could help banks, which make money by borrowing short and lending long. Read More 

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Facebook Challenges Key Moving Average

by Arthur Hill

Facebook (FB) got a bounce over the last seven days and broke above the wedge trend line. This is the first step to ending the correction that started in mid October. The 50-day moving average is the next hurdle. A follow thru break above this moving average on good volume would be quite positive. Also notice that the price relative is just below its 50-day. Click this image for a live page Read More 

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Lexmark Bounces off Support with Good Volume

by Arthur Hill

Lexmark (LXK) presents a conundrum for traders. On the bullish side, the stock bounced off support near 35 with a three day advance on pretty good volume. Relative to the market, the stock is also holding up pretty well the last three days. On the bearish side, the stock shows relative weakness since late October and a bear flag could be taking shape. The bulls get the benefit of the doubt as long as the flag rises. A move below flag support (34.1) would be short-term bearish and project a break below the November lows. Click this image for a live page Read More 

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WTI Surges, but Brent-WTI Spread Remains Large

by Arthur Hill

Brent Crude ($BRENT) surged above $110 this week and WTI Crude ($WTIC) moved above $96, but the spread between the two remains wide. The chart below shows Brent trading some $18 higher than WTI. The indicator window shows the $BRENT:$WTIC ratio nearing 1.2 for the first time since early March. This is helping the refiners because they buy their raw material (oil) at WTI prices and sell their refined products at Brent prices. Note that Valero (VLO) is up over 35% the last two months. Click this image for a live page Read More 

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SCTR Surges as Gap Breaks Wedge Resistance

by Arthur Hill

Gap is making some waves with an island reversal in early November and wedge breakout here in early December. Also notice that the SCTR surged above 40 and is on the verge of breaking into the upper half of its range. Click here for the current SCTRs for the S&P 500. Click this image for a live page Read More