Art's Charts

Indicator Summary Remains Negative

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There is no change in the indicator summary as the major index ETFs consolidate after their big breakdowns. New lows continue to outpace new highs. The volatility indices remain at high levels, which reflects a great amount of fear in the market place. Small-caps remain relatively weak as the $RUT:$OEX ratio trades near its August lows.

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  • AD Lines: Bearish. The Nasdaq AD Line peaked in February 2011 and remains in a downtrend. The NYSE AD Line peaked in early July and broke support from the June low in August.    
  • AD Volume Lines: Bearish. The AD Volume Lines peaked in late April-early May, formed lower highs in July and broke down in early August. Nothing but downtrend here. 
  • Net New Highs: Bearish. Nasdaq Net New Highs turned negative in late July and the Cumulative Net New Highs Line moved below its 10-day EMA. NYSE Net New Highs plunged in early August and the Cumulative Net New Highs Line moved below its 10-day EMA.     
  • Bullish Percent Indices: Bearish. Eight of the nine sector Bullish Percent Indices are below 50%. The utilities BPI is at 69.7% and the consumer staples BPI is at 51.22%.
  • VIX/VXN: Bearish. The CBOE Volatility Index ($VIX) and the Nasdaq 100 Volatility Index ($VXN) broke above 25 in late July and surged above 30 in August. An uptrend in fear is bearish for the stock market.      
  • Trend Structure: Bearish. DIA, IWM, MDY, QQQ and SPY broke below their March-June lows to start downtrends in early August.
  • SPY Momentum: Bearish. August marked momentum moves that are characteristic of a downtrend. RSI(14) moved below 30 for the first time since March 2009. MACD(5,35,5) moved below its March 2009 low. Aroon(20) remains in negative territory.
  • Offensive Sector Performance: Bearish. All four offensive sectors are in the same boat. The consumer discretionary, technology, finance and industrials sector SPDRs broke major support in August and remain weak.
  • Nasdaq Performance: Bullish. Technically, the $COMPQ:$NYA ratio remains in an uptrend for 2011 as the Nasdaq holds up better than the NY Composite.
  • Small-cap Performance: Bearish. The $RUT:$OEX ratio is another story as the it moved to new lows in early August and remains in a clear downtrend.
  • 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.

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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
Negative on 17-Jun-11
Positive on 30-Jun-11
Neutral on 29-Jul-11
Negative on 5-August-11

Arthur Hill
About the author: , CMT, is the Chief Technical Strategist at TrendInvestorPro.com. Focusing predominantly on US equities and ETFs, his systematic approach of identifying trend, finding signals within the trend, and setting key price levels has made him an esteemed market technician. Arthur has written articles for numerous financial publications including Barrons and Stocks & Commodities Magazine. In addition to his Chartered Market Technician (CMT) designation, he holds an MBA from the Cass Business School at City University in London. Learn More
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