A couple of indicators flipped this week, but the net result is the same as the indicator summary remains at +7. The Nasdaq AD Line shows too much weakness to be considered bullish, but it is offset by strength in the NYSE AD Line. Momentum flipped back to bullish as stocks surged over the last two days. Perhaps most importantly, the AD Volume Lines and the NYSE AD Line all established important support levels with the March-April lows. A break below these lows would likely produce enough selling pressure to turn the indicator summary negative. It has not happened yet though. Keep in mind that the indicator summary is an assessment of CURRENT conditions, which makes it a trend following type indicator. It is not predictive. This means it will turn negative after a market top or positive after a market bottom.
- AD Lines: Neutral. The Nasdaq AD Line shows weakness with a lower low in April and the 125-day EMA of Net Advances is in negative territory. The NYSE AD Line established key support with the March-April lows and the 125-day EMA of Net Advances remains in positive territory.
- AD Volume Lines: Bullish. The NYSE and Nasdaq AD Volume Lines established key support with the March-April lows and the 125-day EMA of Net Advancing Volume remains in positive territory for both.
- Net New Highs: Bullish. Nasdaq Net New Highs have been oscillating around the zero line and the cumulative line flattened with the mid April low marking key support. NYSE Net New Highs surged this week and the cumulative line moved to a new high. Note that it never broke its 10-day EMA.
- Bullish Percent Indices: Bullish. Eight of the nine sector BPIs are above 50%. Only the Energy Bullish% Index ($BPENER) is below (34.88%). The Consumer Staples Bullish% Index ($BPUTIL) is the strongest (90.48%).
- VIX/VXN: Bullish. The CBOE Volatility Index ($VIX) and the Nasdaq 100 Volatility Index ($VXN) hit resistance from their February highs this month and fell sharply this week. It would take a break above the February-April highs to turn these indicators bearish.
- Trend-Structure: Bullish. DIA, MDY and IWM held support from the March lows this month and surged the last 2-3 weeks. SPY and QQQ held above their March lows and bounced this week. Note that all hit new 52-week highs in March.
- SPY Momentum: Bullish. 20-day RSI held the 40-50 zone with the November dip and with the April dip. A move below 40 would turn RSI bearish. MACD(5,35,5) hit the zero line with the April dip and turned up this week. Aroon moved into negative territory, but did not break below -50, which is the bearish threshold. Overall, momentum favors the bulls again.
- Offensive Sector Performance: Bullish. XLY continues to lead the market. XLK corrected hard in April, but held well above its March low and surged this week. XLI and XLF are lagging somewhat as consolidations took shape the last two months, but neither has yet to break support.
- Nasdaq Performance: Bullish. The $COMPQ:$NYA ratio took a hit in April, but remains in an uptrend overall and got a big bounce the last two days.
- Small-cap Performance: Bearish. The $RUT:$OEX ratio peaked in early February and broke below its November low in April. Relative weakness in small-caps is a concern overall.
- 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 30-December-11
Negative on 16-December-11
Positive on 3-December-11
Negative on 23-November-11
Positive on 28-October-11
Negative on 5-August-11
Neutral on 29-Jul-11
Positive on 30-Jun-11
Negative on 17-Jun-11
Positive on 25-Mar-11
Negative on 18-Mar-11
Positive on 3-Sep-10
Negative on 13-Aug-10
Positive on 6-Aug-10
Negative on 24-Jun-10
Positive on 18-Jun-10
Negative on 11-Jun-10
Positive on 5-March-10
Negative on 5-Feb-10
Positive on 11-Sept-09
