Commentary for August 13, 2010
After finishing up 7% in July, the four indexes reversed direction during the first half of August, with the Dow, S&P and Nasdaq 100 giving up 2%, while the Russell 2000 fell over 6%. For 2010 to date, the indexes are off 1.2% to 3.2%. The NYSE Summation Index, which rose throughout July, has turned down in August.
On the Foreign Region GO Chart, the shorts have bounced from the bottom of the list two weeks ago to the top today. Among single countries, Chile, Hong Kong, India, the (Arabian) Gulf States, and Taiwan are the only ETFs ahead in August. The four top performers two weeks ago have all fallen to the lower half of the rankings. Among currencies, the Yen, British Pound, and Australian Dollar exhibit the greatest momentum. The Euro, so strong in July, has turned down again.
On the all-commodities PowerShares GO Chart, agricultural and base metals ETFs continue to lead the group, followed by short crude oil and long gold, which had trailed throughout July.
On the ProShares GO Chart, we continue to observe the Flip-Flop pattern evinced since April. Short technology and short small caps have the strongest momentum (versus the weakest in July); utilities and health care are among the few long ETFs with positive momentum.
This week's Top 30 listing includes mostly short ETFs versus two weeks ago when it included only long ETFs. Ultra Short ETFs--Small Cap, Technology and Financial--have the strongest momentum. Cotton, U.S. Treasuries, Gold, and Grain ETFs are the only long ETFs among the Top 30, which are sorted by performance since July 30.
The next bulletin will be published through September 3, 2010.
Commentary for July 30, 2010
The four indexes finished July up in a tight grouping between 6.8% and 7.2%. For 2010 through July 30, the Dow and Nasdaq 100 are up a fraction of a percent, the S&P is off 1% and the Russell 2000 is up 4%. The NYSE Summation Index, which fell consistently throughout May and then rose for the first half of June and fell for the last half of June, rose throughout July.
On the Foreign Region GO Chart, Emerging Europe and Emerging Latin America lead the pack in relative strength. Among single countries, Spain, Austria, and Turkey rank 1-2-3, with Mexico and Japan at the bottom of the heap. The countries on the GO Chart, however, are all up 5% to 24% for July. Among currencies, the Euro, Swedish Krona, and Australian Dollar exhibit the greatest momentum.
On the all-commodities PowerShares GO Chart, base metals and agricultural ETFs lead the group, while precious metals trail behind. On the ProShares GO Chart, real estate, basic materials and small cap stocks have the strongest momentum, health care the weakest.
This week's Top 30 listing includes only long ETFs versus a month ago when it included only short ETFs. Latin America, Real Estate, Base Metals, Emerging Markets, China, and small and mid-cap ETFs dominate the listing. The Top 30 ETF's are sorted by performance since July 16.
The next bulletin will be published through August 13, 2010. Commentary for July 16, 2010
Despite losing 2% to 3% Friday, the Dow, S&P and Nasdaq 100 finished the first half of July up 3% to 4%. (The Russell 2000 is barely above flat for July 1-16 and lost near 4% Friday.) For 2010 through July 16, the Dow, S&P and Nasdaq are off 3.0% to 4.5%, while the Russell is off only 2.4%. The NYSE Summation Index, which fell consistently throughout May, rose for the first half of June, fell for the last half of June, and rose again the first half of July.
The Flop-Flip-Flop continues. On the Foreign Region GO Chart, only short ETFs had positive momentum at the end of May. By mid-June only the short ETFs had negative momentum. At July 2, only the short ETFs had positive momentum. At July 15, only the shorts had negative momentum. European ETFs and the euro—after exhibiting considerable weakness all second quarter—have been strong since. European ETFs are up 8% to 10% for the first half of July, while the Ultra Euro ETF is up 11.5% for the same period. Latin American ETFs are up a modest 3% to 4% so far in July. On the Single Country GO Chart, Spain, Sweden and Italy lead all countries with China and Japan bringing up the rear.
We recently revised the PowerShares GO Chart to include all the PowerShares sub-family of “commodity” DB ETFs and exclude all other PowerShares ETFs. (There are now 130 PowereShares ETFs and to address all of them in the same chart would be too cumbersome. Besides, the ProShares and ProFunds families do a better job of covering industry sectors, in our opinion.) 29 ETFs appear on the chart and they include some double-long and double-short ETFs. The primary focus in on agriculture, base metals, crude oil, the dollar, and gold and silver ETFs. UUP ($ up) and UDN ($ down) now appear on both the PowerShares and Currency GO Charts. A FLIP-FLOP has occurred among these commodities during the first half of July, with Agriculture, which was last on the list in momentum sequence two weeks ago, now on top.
This week's Top 30 listing includes only long ETFs versus two weeks ago when it included only short ETFs. The ETFs on the list include biofuels and solar energy as well as several already mentioned above--Agriculture/Grains, the Ultra Euro, Spain/Sweden/Italy. The Top 30 ETF's are sorted by performance since June 30.
The S&P 500 Stock Index fell about 30 points Friday, from 1095 to 1065, causing the overall market outlook to take on a bearish cast. Should the S&P fail to hold support near 1065 and then near 1055, it might retest recent lows near 1010.
The next bulletin will be published through July 30, 2010.
Commentary for July 2, 2010
After finishing down 7% to 8% for May, the indexes enjoyed a short-lived rebound in mid-June before resuming their decline. The Dow, S&P, and Nasdaq 100 finished June down 4%, 5%, and 6%, respectively, while the Russell 2000 lost 8%. For 2010 through July 2, the Dow, S&P and Nasdaq are off 7% to 8%, while the Russell is off only 4%. The NYSE Summation Index, which fell consistently throughout May, rose for a couple of weeks in the middle of June before falling again.
Flop-Flip-Flop. On the Foreign Region GO Chart, only short ETFs had positive momentum at the end of May. By mid-June only the short ETFs had negative momentum. Now, once again, only the short ETFs have positive momentum. Emerging Asia Pacific is the strongest of the long ETFs at the moment. On the Single Country GO Chart, Indonesia/Singapore/Malaysia, Chile, and India are the only countries with positive momentum. In currencies, the euro, yen and Brazilian real are moving up, while the North American currencies and Australian dollar are headed in the other direction.
We’ve revised the PowerShares GO Chart to include all the PowerShares sub-family of “commodity” DB ETFs and exclude all other PowerShares ETFs. (There are now 130 PowereShares ETFs and to address all of them in the same chart would be too cumbersome. Besides, the ProShares and ProFunds families do a better job of covering industry sectors, in our opinion.) 29 ETFs appear on the chart and they include some double-long and double-short ETFs. The primary focus in on agriculture, base metals, crude oil, the dollar, and gold and silver ETFs. UUP ($ up) and UDN ($ down) now appear on both the PowerShares and Currency GO Charts.
This week's Top 30 listing includes only triple-short, double-short, and short ETFs. The Top 30 ETF's are sorted by performance since June 18.
In the last bulletin we reported that because the Bollinger bands were unusually tight--and that for June 15-18, the S&P had closed in the very tight range between 1114 and 1118--a big move either sharply higher or lower could be expected, but that he likelihood of moving up or down appeared to be about equal. The big move came immediately, all to the downside, with the indexes selling off 7% to 10% in the intervening two weeks.
The next bulletin will be published through July 16, 2010.
Commentary for June 18, 2010
After finishing down 7% to 8% for May, the indexes rebounded and are up 1% to 3% in June. The Dow and S&P are just ahead of breakeven year-to-date, while the Nasdaq 100 is up 3% and the Russell 2000 up nearly 7% year-to-date. The NYSE Summation Index, which fell consistently throughout May, turned around about ten days ago.
On the Foreign Region GO Chart, only short ETFs had positive momentum at the end of May. Now only the short ETFs have negative momentum. Some European and Latin American ETFs are up 6% thus far in June. On the Single Country GO Chart, Sweden, Chile, Indonesia, Italy and Spain have the strongest momentum and are up 7% to 11% in June. In currencies, the Brazilian real leads the others in relative strength. The US $ has weakened in June while the euro has flattened out after pulling out of its freefall.
On this week's Top 30 listing, energy (esp. natural gas), gold, Latin America, China, Indonesia, Sweden, and Italy top the list with 9%+ returns in June. The Top 30 ETF's are sorted by June performance.
At the end of May, we suggested that, because the Bollinger bands had tightened around the S&P 500, a major move might be afoot and that, from the 1089 level, it would encounter upside resistance near 1115 and downside resistance at 1040. Both moves have transpired in June, with the S&P falling to 1045 by June 7, then rising to meet the resistance near 1115. For the last four days, the S&P has closed in a tight range between 1114 and 1118. The Bollinger bands have tightened again and the S&P is expected to soon move either sharply higher or lower--unfortunately the likelihood of moving up or down appear to be about equal at this time.
The next bulletin will be published through July 2, 2010.
Commentary for May 28, 2010
For May, the indexes finished down 7% to 8%. For the year, the Dow and S&P and Nasdaq 100 are down 0% to 3%, with the Russell 2000 ahead 6% year-to-date. The NYSE Summation Index has fallen off sharply since late April.
On all GO Charts, only short ETFs have positive momentum and gains for May—except for gold, precious metals, the US $ and the Japanese yen.
This week's Top 30 listing contains short ETFs (esp. energy sector ETFs) exclusively. The Top 30 ETF's are sorted by the last 10 days' performance.
The spread between Bollenger bands on the S&P 500 charts have narrowed to very pinched-in levels, suggesting a major move is afoot, perhaps as early as Tuesday. From near the 1090 level, the S&P will encounter upside resistance near 1115 and downside resistance at 1065 first and 1040 thereafter. A quick drop beneath 1065 spells bad news for the bulls.
The next bulletin will be published through June 18, 2010.
Commentary for May 14, 2010
For the first half of May, the indexes are down 3% to 5%. For the year, the Dow and S&P and Nasdaq 100 are up about 2%, with the Russell 2000 ahead 11% year-to-date. The NYSE Summation Index has fallen off sharply since late April.
Among Foreign Region ETFs, only short ETFs having gains for May and have positive momentum. Among single countries, only Malaysia has positive momentum. In currencies, short euros and long US dollars have the strongest momentum.
This week's Top 30 listing contains almost exclusively short (crude oil, commodities, euros, Brazil. Asia, China) ETFs. Long US treasuries and natural gas barely penetrated the Top Thirty. The Top 30 ETF's are sorted by the last 10 days' performance.
The World Families GO Chart was omitted this weekend because Friday's data remains incomplete for many of its component ETFs. The next bulletin will be published through May 28, 2010.
Commentary for April 30, 2010
For April, the Dow and S&P finished up 1% to 2%, the Nasdaq 2%, and the Russell up nearly 6%. For the year, the Dow and S&P are up 6%, and the Nasdaq 100 up 7%, with the Russell 2000 ahead 15% year-to-date. The NYSE Summation Index has been drifting downward since late March.
The indexes finished April just about where they were at mid-month. Gains made during the third week of the month were erased last week, when the indexes suffered large declines on Wednesday and Friday. Red and yellow squares cropped up on every GO Chart this past week. With Friday’s selloff, the Dow, S&P, and Nasdaq 100 moved into the yellow for the first time in weeks. The Russell 2000, however, still remains in the green.
Foreign Region ETFs have flipped in the past two weeks, from all long ETFs having positive momentum to only short ETFs having positive momentum. Among single countries, Turkey and Indonesia, up 7% and 6% for April, had the best performance, while Italy, down 8%, and France and Spain, down 6%, had the worst. The Brazilian real, up 3% and the Ultra Euro, down 3%, were the best and worst performing currencies in April.
This week's Top 30 listing contains both long (real estate, precious metals, home construction) and short (Europe, China, semiconductors) ETFs. The Top 30 ETF's are sorted by the last 10 days' performance.
The next bulletin will be published through May 14, 2010.
Commentary for April 16, 2010
For the first half of April, the Dow is up 1 ½ %, the S&P 2%, the Nasdaq 3%, and the Russell up 6%. For the year, the Dow is up 6%, the S&P up 7%, and the Nasdaq 100 up 8%, with the Russell 2000 ahead 14% year-to-date. The NYSE Summation Index has flattened out recently.
Last Monday, the Dow closed above 11000 for the first time in many months. It managed to close above 11000 all five days this past week. The S&P closed above 1200 on Wednesday and Thursday, but slipped to 1192 in Friday’s general market selloff.
Among Foreign Region ETFs, European equities edged ahead of Latin American and Asian equities in early April. Among single countries, Turkey, Austria, Singapore, Sweden, and South Korea exhibit the greatest relative strength, with Indonesia, Sweden, and Turkey posting the most gains month-to-date. Currency ETFs have been essentially flat the first half of April, with the Mexican peso currently strongest and the yen and euro the weakest.
This week's Top 30 listing is dominated by Semiconductor and Small Cap ETFs. The Top 30 ETF's are sorted by the last 10 days' performance. Banking and Retail are strong sectors; Health Care and Pharmaceuticals weak.
The next bulletin will be published through April 30, 2010.
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