The indicator summary remains firmly positive, but downgrades in momentum and continued weakness in Nasdaq breadth are a concern. Even though SPY hit a 52-week high in April, RSI did not exceed 70 and failed to confirm strength. Also notice that 20-day Aroon for SPY dipped below -50 this week. I am also concerned with the triangle break in the Nasdaq AD Line and negative Net New Highs last week. Even though the Nasdaq has been outperforming the NY Composite since late March, breadth is not keeping pace and this undermines relative strength. Stocks have been weak most of May. This weakness is starting to take its toll. However, we have yet to see enough weakness to turn the bulk of the evidence negative. See the About Page for details on Art's Charts.
- AD Lines: Neutral. The Nasdaq AD Line broke triangle support and exceeded its April low. The NYSE AD Line shows no signs of weakness and remains in a clear uptrend.
- AD Volume Lines: Neutral. The Nasdaq AD Volume Line met resistance at its February high, but remains in an uptrend overall. The NYSE AD Volume Line edged above its February high in late April.
- Net New Highs: Bullish. Nasdaq Net New Highs dipped into negative territory last week, but the Cumulative Net New Highs Line remains above its 10-day EMA. NYSE Net New Highs weakened the last two weeks, but remain positive overall.
- Bullish Percent Indices: Bullish. All but one Bullish Percent Index is above 50. The Energy Bullish% Index ($BPENER) is at 39.94%. Of note, the Technology Bullish% Index ($BPINFO) is the second weakest at 56.98%.
- VIX/VXN: Bullish. The S&P 500 Volatility Index ($VIX) and the Nasdaq 100 Volatility Index ($VXN) are below 20 as fear remains subdued.
- Trend Structure: Bullish. The major index ETFs (DIA, IWM, MDY, QQQ, SPY) recorded 52-week highs in April and are in uptrends overall.
- SPY Momentum: Neutral. Early signs of weakness are appearing in momentum, which is a leading indicator. Aroon dipped below -50 this week. RSI dipped below 50, but recovered the last two days. Also note that RSI failed to exceed 70 with the April high in SPY. MACD(5,35,5) is just above the zero line.
- Offensive Sector Performance: Neutral. The Finance SPDR (XLF) has been a laggard the entire year. The Industrials SPDR (XLI) led the way lower in May and we saw relative weakness in techs this week. Only the Consumer Discretionary SPDR (XLY) is holding up well.
- Nasdaq Performance: Bullish. Despite relative weakness in techs this week, the $COMPQ:$NYA ratio has been rising since late March and remains in a two month uptrend.
- Small-cap Performance: Bullish. The $RUT:$OEX ratio peaked in early April and small-caps have been lagging since then. However, the ratio has been rising since late August. I will turn bearish on this indicator if the ratio breaks its April low.
- Breadth Charts (here) and Inter-market charts (here) have been updated.
This table is designed to offer an objective look at current market conditions. It does not aim to pick tops or bottoms. Instead, it seeks to identify noticeable shifts in buying and selling pressure. With 10 indicator groups, the medium-term evidence is unlikely to change drastically overnight.
Previous turns include:
Positive on 11-Sept-09
Negative on 5-Feb-10
Positive on 5-March-10
Negative on 11-Jun-10
Positive on 18-Jun-10
Negative on 24-Jun-10
Positive on 6-Aug-10
Negative on 13-Aug-10
Positive on 3-Sep-10
Negative on 18-Mar-11
Positive on 25-Mar-11
