Tag Archives: SPDR S&P 500 ETF Trust

S&P’s trading divergence now extending to its primary trend, as fundamentals begin to overtake even QE

 

spxd 23jan14

spxw 23jan14

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

Housing Update: focus on existing sales trends, not builder sentiment

Housing: Record institutional/cash buying suggests that investors focus on pending existing sales trends, not builder sentiment

itb 05nov13

Click here to Download a .PDF copy of this commentary

For optimal viewing click the arrow symbol in the upper right of the document window then Zoom+ or download the .PDF at the link above.

SPX: Current market divergences rival those of 2007 and 2011

Current market divergences rival those of 2007 and 2011, though neither prior divergent condition was defended by an $85 billion monthly Fed injection

spx13 01nov13

spx2007 01nov13

spx200 01nov13

spxa-d 01nov13

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

Defensive portfolio repositioning: update

Defensive portfolio repositioning threatening to become the primary trend, as even the weekly XLP/XLY seems to have turned up

xlp 29oct13

xlpw 29oct13

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

Canada looks ready to out-perform

Canada began to under-perform the U.S. in 2011 because of QE, now it looks ready to out-perform, despite QE

tsxw 23oct13

ewcd 23oct13

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

 

KBW Bank Index – BKX

Banking sector’s threatened relative strength breakdown merely confirms the risk to S&P earnings growth

bkx 14oct13

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

CBOE Volatility Index – VIX

VIX has reached resistance ahead of schedule; technical profile stronger than expected, suggesting S&P at even higher risk than expected

vixw 08oct13

vixw2 08oct13

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

CBOE Volatility Index – VIX

While investors continue distracted by D.C., attention should be focused on unusual trifecta of daily, weekly and monthly VIX upturns

vixd 07oct13

vixw 07oct13

vixm 07oct13

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

Transports

The efficacy of stimulus and QE on growth, as viewed through the Transports

tranw 04oct13

tk-spyw 04oct13

xal-spyw 04oct13

tran-spym 04oct13

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

Rally conviction or not, dubious trajectory of the financials adds to S&P uncertainty

Measured across multiple time intervals, changes in relative strength are a highly reliable predictor of directional change in absolute price.  Then, carefully practiced, regular relative strength monitoring of market leading sectors can help signal directional price change in the averages themselves.

With that in mind, the XLF’s current relative strength pattern below should be of interest.  Financials led the S&P rally to its top in July, but have lagged conspicuously since.  Notably, attempts to return the sector to market leadership in July-August failed badly.  Rolling indicators now suggest there won’t be a third.

xlfspy 22sep13

But the validity of trading signals most often is no better than the primary trend signals confirming them.  In the primary trend XLF/SPY pattern below, the cautious trading signal is not only confirmed by the weekly’s trend line break, it is further validated by the important break in the weekly indicator below the price panel.  The still recent break suggests the XLF lag will only worsen over the medium-term.

xlf spy 22sep13 2

Were it not for the preceding perspective, the daily trading pattern the XLF itself has traced out below would seem nothing more than a modestly lagging rally.

xlf spy 22sep13 3

But in the reflection of the sector’s atypical and increasing relative weakness recently, the lagging rally can be seen as the first failure of the financials in two years to go on to a new rally high, following a 3+% pullback.

Despite the signal, however, it’s seldom prudent to suggest rotation away from any sector – particular a leadership sector – absent confirmation from the primary trend.  That’s why the following weekly XLF pattern is important.

xlf spy 22sep13 4

Although conventional evidence of a breakdown is lacking, the chart offers compelling second derivative indication that financial sector stocks are putting in a medium-term top, if not worse.  And, judging by the obvious divergence developing these past two months and the inflection profile of the indicator, similar to that which preceded the sharp sell-offs in the XLF in 2011 and 2012, it wouldn’t take much technical imagination to conclude that such a top might lead to meaningful damage.  Clearly, risk in the sector is rising.

Now, whether or not the S&P could overcome the loss of financial sector leadership is a tougher, riskier call.  All we know is that hasn’t had to for more than two years.

Click here to Download a .PDF copy of this commentary

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

S&P action suggests investors watch what the Fed cannot control

Download (PDF, 377KB)

For optimal viewing click the arrow symbol in the upper right of the document window then Zoom+ or download the .PDF at the link above.

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

ITB/SPY’s divergent double bottom and positive break above 4-month resistance suggests housing’s relative strength the next few weeks, plus the rate relief that would make the move possible

Download (PDF, 411KB)

For optimal viewing click the arrow symbol in the upper right of the document window then Zoom+ or download the .PDF at the link above.

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

Market Internals Update

Download (PDF, 381KB)

For optimal viewing click the arrow symbol in the upper right of the document window then Zoom+ or download the .PDF at the link above.

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

S&P 500 Update

Download (PDF, 388KB)

For optimal viewing click the arrow symbol in the upper right of the document window then Zoom+ or download the .PDF at the link above.

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

The monthly is starting to speak

Download (PDF, 377KB)

For optimal viewing click the arrow symbol in the upper right of the document window then Zoom+ or download the .PDF at the link above.

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

Wondering how much an ITB bounce can be expected even when rates correct?

Download (PDF, 392KB)

For optimal viewing click the arrow symbol in the upper right of the document window then Zoom+ or download the .PDF at the link above.

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)

S&P on its way to completing its second divergent primary trend top this cycle, the first occurring prior to the 2011 sell-off

Download (PDF, 377KB)

For optimal viewing click the arrow symbol in the upper right of the document window then Zoom+ or download the .PDF at the link above.

Disclaimer: This communication should not be construed as an offer to sell or the solicitation of an offer to buy any security. (Click here for full disclaimer)