The Key to the August Breakouts – with Video (Free)

The chart below shows 25-year seasonality for the S&P 500. There are three strong periods and three weak periods. The strong periods are mid March to early May, July, and mid-October to yearend (green arrows). The seasonally weak periods are January, mid-February to mid-March

The big trend is the dominant force at work and SPY remains in an uptrend since the higher high in early February. Seasonal patterns, even when strong, are secondary to the bigger trend. Seasonal weakness in September could still materialized

SPY peaked on July 27th with a big outside reversal day (red arrow) and broke short-term support with a gap-decline on August 2nd. SPY and the major index ETFs then fell into mid August and became

The S&P 500 SPDR and Nasdaq 100 ETF fell sharply in August, but these declines look like corrections within bigger uptrends. However, the S&P MidCap 400 SPDR and Russell 2000 ETF also fell. These two, in contrast, are in long-term trading ranges and immediate downtrends. We

A classic trading technique is to look for short-term oversold conditions within longer term uptrends. Short-term oversold conditions provide opportunities to partake in the long

Selling pressure intensified in August as we saw the first bearish breadth thrust since mid March. I use the 10-day EMA of Advance-Decline Percent to measure breadth thrusts.

Stocks are in pullback mode right now. We never know which pullback will extend far enough to result in a larger downtrend. Currently, the declines in SPY,QQQ and others look like pullbacks after big advances from May to July. There is, however, concern with recent reversals in retail (XRT) and banking (KRE). I would

Stocks moved into pullback mode the last few weeks. It started with QQQ peaking on July 19th and SPY peaking on July 31st. It is way too early to call these “major” peaks. At present, these are just short-term peaks because both ETFs are

The weight of the evidence remains bullish for stocks. The Composite Breadth Model is positive (since March 31st), yield spreads show no stress and upside participation remains strong. SPY and QQQ remain in short-term

The weight of the evidence remains bullish for stocks. The Composite Breadth Model is positive (since March 31st), yield spreads show no stress and upside participation remains strong. The only short-term negative is actually a long-term positive.

The weight of the evidence remains bullish for stocks. The Composite Breadth Model is positive (since March 31st), yield spreads show no stress and upside participation continues to improve. We are seeing new highs in several tech-related ETFs, the Home Construction ETF and the Industrials SPDR.

The weight of the evidence remains bullish for stocks. The Composite Breadth Model is positive (since March 31st), yield spreads show no stress and upside participation continues to improve. The Retail SPDR is coming to life and the Home Construction ETF continues

The weight of the evidence is bullish because the Composite Breadth Model is positive and the 5-day SMA for the S&P 500 is above the 200-day SMA. We are also seeing some risk-on with Nasdaq 100 stocks, technology and housing leading the market.

High-Low Percent is the percentage of stocks making 52-week highs less the percentage of stocks making 52-week lows. The chart below shows High-Low Percent for the S&P 500, Nasdaq 100, S&P MidCap 400 and S&P SmallCap 600. This indicator turns bullish

High-Low Percent is the percentage of stocks making 52-week highs less the percentage of stocks making 52-week lows. The chart below shows High-Low Percent for the S&P 500, Nasdaq 100, S&P MidCap 400 and S&P SmallCap 600. This indicator turns bullish with a move above 10% and bearish with a move below -10%. The first indicator window

The percentage of stocks above the 200-day SMA increased for the S&P 500 and S&P MidCap 400. $SPX %Above 200-day SMA was below 40% last week and moved to 50%. $MID

Large-cap techs are powering QQQ and the Technology sector, which in turn is powering SPY higher. The situation outside of large-cap tech is different because the S&P 500 EW ETF is actually down for the month. Despite underlying weakness in some breadth

The S&P 500 and SPY exceeded their early February highs with surges last week, but breadth failed to confirm and remains a concern. Namely, we are watching the percentage of stocks above the 200, 50 and 20 day SMAs. Large-cap semis