There is no change in the indicator summary. Many indicators improved over the last few weeks as the major index ETFs broke above their mid August highs. However, this improvement looks like a bear market rally. Net New Highs recovered with a move back to the zero lines. The Bullish Percent Indices rebounded as five of the nine are now above 50%. The NYSE AD Line bounced back above its support break. These positives follow severely oversold conditions in early August. Therefore, a bounce is normal and I am not ready to turn bullish overall.
- AD Lines: Bearish. The Nasdaq AD Line peaked in February 2011 and remains in a downtrend with lower lows since March. The NYSE AD Line broke support in early August and bounced back over the last few weeks. This looks like a counter trend bounce that will end soon.
- 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 returned to the zero line and NYSE Net New Highs edged into positive territory. However, this could just be a bear market bounce. The zero line/area acts as support in a bull market and resistance in a bear market.
- Bullish Percent Indices: Bearish. With the break above the mid August highs in a number of sector SPDRs, five of the nine Bullish Percent Indices moved above 50%. While this is positive, note that the consumer discretionary, technology and finance BPIs are still below 50%.
- VIX/VXN: Bearish. The CBOE Volatility Index ($VIX) and the Nasdaq 100 Volatility Index ($VXN) broke above 25 in late July and held above 30 the last four weeks. Fear remains at high levels and this is bearish.
- Trend Structure: Bearish. DIA, IWM, MDY, QQQ and SPY broke below their March-June lows to start downtrends in early August.
- SPY Momentum: Bearish. Momentum improved as RSI moved into the 50-60 zone, but this area marks resistance in a downtrend. MACD(5,35,5) and the Aroon Oscillator (20) remain 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 broke above its mid August high, but this mini-breakout pales in comparison to the big support break in early August.
- 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
Negative on 17-Jun-11
Positive on 30-Jun-11
Neutral on 29-Jul-11
Negative on 5-August-11
