Friday, June 01, 2012

Market Performance

The broad market suffered a strong decline today. The strongest decline was noted on the Russell 2000 (3.14% loss) while S&P 500 lost only 2.48%. Of the last 24 sessions, the DJI has closed red 19 times. On the NASDAQ 100, we saw the 17th down-close in the last 21 sessions. The DJI is now at new one-year low. The Russell 2000 made a new one-year low today. The NASDAQ 100 pushed to new eighteen-week low today. The S&P 500 saw its lowest close in 21 weeks today. The S&P 500 saw its worst decline since 11/9/2011 when the S&P 500 lost -3.66%. The least downside was seen on the DJI on 11/9/2011. The NASDAQ 100 had its strongest decline since 11/9/2011. The last strongest decline was seen on the Russell 2000 on 11/23/2011. The bigger daily loss was seen on the NYSE Comp. on 12/8/2011 when it declined by -2.50%. The NASDAQ 100 index slid 2.62% (resulting in a weekly loss of 2.7%). The S&P 500 dropped 2.48% (resulting in a weekly decline of 3.02%). The Dow lossed 2.27% (bringing its weekly loss to 2.71%).

The S&P 500's daily volume was 3,292 million shares today, which was higher by 23% than the average daily volume sustained over the past 3 months.

Short-Term Market Outlook

5-day charts (1 bar = 5 minutes) with a 20-period SBV are showing declining SBV oscillator readings at session's end. Negative money flow on this chart would suggest the possibility of negative trading tomorrow after the market open. 15-day charts (1 bar = 15 minutes) with a SBV(16) are showing negative money flow (declining SBV) as well, thus confirming 5-day chart's outlook. 30-day charts (1 bar = 30 minutes) with a 13-period SBV are showing flat SBV, yet, SBV readings are at low, negative levels which would favor bears as well.

Longer-Term Market Outlook

60-day charts with a 20-period SBV are now showing declining SBV oscillator readings. The following SBV values were recorded at session's end: minus 48% on the S&P 500, minus 41% on the DJI, minus 46% on the NASDAQ 100 and minus 61% on the Russell 2000. Declining SBV readings are bearish and suggest the possibility of a down-move. We will continue to monitor this chart setting in order to determine at which point SBV oscillator readings start to advance; this might then suggest increased odds for a coming move to the upside.

1.5-year charts with a 10-period SBV are showing flat SBV oscillator readings. The negative SBV values seen on this chart are bearish. Overall, this chart reflects bearish longer-term market sentiment.

Coming Economic Reports

Financial Press

From Reuters:

Stocks fell more than 2 percent on Friday, dragging the Dow into negative territory for the year after a dismal U.S. jobs report added to fears that Europe's spiraling debt crisis was dragging down the world economy.

Bear markets are raging in Spain, Italy, Brazil and Russia. Asian stocks have been weak. Most of Europe's other markets are negative for the year, and that is where U.S. stocks are going - and fast.

U.S. job growth braked sharply for a third straight month in May and the unemployment rate rose for the first time in nearly a year, raising chances of further monetary stimulus from the Federal Reserve to support the sputtering recovery.