TheTechnicalTake: EEM and IYT

Lately, I hate to bring up any data point or indicator that is contrary to the market moving higher because nothing (and I mean nothing) has made a damn bit of difference to the constant and persistent march of the major equity indices moving upward over the past 4 months.  Breadth divergences.  Don't work anymore.  Sentiment. Who cares?  Inflationary headwinds.  We don't have inflation.  You get the picture.  But being the hard headed soul that I am, I thought I would try again. 

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What's The Message?

Market analysis doesn't need to be too complicated to be good, and probably simpler is better.  Heck, we have just spent the past 12 months listening to every analyst, commentator and pundit under the sun tell us why this market is the buy of the century, and when I look at the numbers, I note the S&P500 is up only 3.68% over the past 52 weeks.  That's a lot of verbage for so little beef.  If you have been holding the S&P500 for 52 weeks, you have made 3.68% on your money.  That's a fact, not an opinion.

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This Is Bearish Price Action: XLF

Figure 1 is a weekly chart of the S&P Select SPDR Financial Fund (symbol: XLF).  The red and black dots are on the price chart are key pivot points, which represent areas of buying (support) and selling (resistance).

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Some Technical Signposts To Help Navigate An Increasingly Hostile Market (part 2)

In this article, I will utilize some daily charts to pinpoint buy and sell points on the ETF's that represent the major indices. These pivot points can be used as road signs to help navigate this hostile market environment.

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FXI: Didn't Get The Message

Aside from being on the wrong side of the market with my current S&P500 index short trade, there are several other things that have me puzzled about the market's ascent. One of these conundrums is the i-Shares FTSE Xinshua/ China 25 (symbol: FXI).

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Brazilian Bovespa: Dead Money

Figure 1 is a monthly chart of the Brazilian Bovespa Index.

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FXI: Lots Of Airspace Below

Figure 1 is a weekly chart of the i-Shares FTSE Xinshua/ China 25 (symbol: FXI).

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My Best Performing ETF

Sorry for the catchy headline, but the SPDR KBW Regional Bank ETF (symbol:KRE) has been my best performing ETF since I first highlighted the sector back on November 18, 2009. KRE is up about 16% since then while the S&P500 has remained flat.

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Key Price Levels: EEM

Figure 1 is a weekly chart of the i-Shares MSCI Emerging Market Index Fund. This is the third largest ETF in the market with $39 billion of assets.

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Follow Up To EWJ and JOF

In the last 6 weeks, I have highlighted the i-Shares MSCI Japan Index Fund (symbol: EWJ) and the Japan Smaller Capitalization Fund (symbol: JOF). Since December 17, 2009, EWJ is up 4% while the S&P500 is essentially flat over that same time period. Since January 21, 2010, JOF is up a couple of percent in an otherwise crappy tape.

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Gee, I Wish I Sold Something, Anything!!!

Back on November 16, 2009 and December 1, 2009, I implored investors to sell something, anything. Why? In the absence of a crystal ball, there were technical signposts that were pointing to a market that was running out of momentum. Trust me, I don't have a crystal ball over here, but the high odds play - which is not always the right play - was to sell something, just anything.

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Stalking Japanese Small Cap ETF

From a technical perspective, I seem to be much more enamored these days with Japanese equities as opposed to US equities, which are highly overbought and over subscribed too.

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ETF's To Buy, Sell, or Hold

This is a follow up to the list of ETF's that I had presented with buy, hold or sell recommendations. See Table 1.

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Treasury Bonds In The Balance

As I have been chronicling for better than a year now, longer term Treasury yields have a high likelihood of undergoing a secular trend change from down to up. See figure 1 a monthly chart of the yield on the 10 year Treasury (symbol: $TNX.X), which has served as our proxy for the long bond.

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The Technical Take: Gold ETF

Figure 1 is a monthly chart of the SPDR Gold Trust (symbol: GLD). The breakout (blue up arrows) from the extended base resulted in the strong surge in GLD shares over the last part of 2009. Gold's parabolic move resulted in selling in December, but as long as prices remain above the breakout point, gold and GLD should be bullish. This level of support is at approximately $96.

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Some Unfinished Business

Before I head out for the week, I wanted to update and follow through on several things that I have been discussing on the blog over the past couple of weeks.

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Currency And Country ETF: Japan

Figure 1 is a weekly chart comparing the Currency Shares Japanese Yen (symbol: FXY) to the i-Shares MSCI Japan Index Fund (symbol: EWJ). As you can see, these two instruments are un-correlated across multiple time frames.

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Currency And Country ETF: Australia

Figure 1 is a weekly chart comparing the Currency Shares Australian $ (symbol: FXA) to the i-Shares MSCI Australia Index Fund (symbol: EWA). As you can see, these two instruments are highly correlated across multiple time frames.

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ETF's To Buy, Sell, or Hold

As price weighs heavy in my market analysis, I always look for methods that quantify the price action. For example, when XYZ stock goes up 3 days in a row, I want to know what does that may mean (if anything) for the future price of that stock. In my work, I have explored the significance of divergences between prices and oscillators used to measure price. Divergences are often associated with market turning points.

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Intra-Day Observations: Anecdotal And Otherwise

Some intra day observations are noteworthy.

At first blush, it would seem we are in a new paradigm - all of a sudden. The Dollar Index is up. Equities are up but former high fliers - the metals and gold and emerging markets - are taking a beating. Treasury yields are rocketing higher as though the recovery is around the corner. All of a sudden the economy no longer needs the support of the federal government?

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