More Signs of Risk Aversion in the Financial Markets (Free)

Mid-caps, small-caps and high-beta stocks are weighing on the broader market, but SPY, QQQ and some large-caps are holding up. We are also seeing a shift away from risk in the bond market as the Junk Bond ETF (JNK) hit a 52-week low

Weakness in mid-caps and small-caps is finally taking its toll on the broader market and the Composite Breadth Model. We are also seeing S&P 500 breadth indicators deteriorate and dip towards bearish levels. Even though

Stocks were hit with a double whammy the last three trading days: the Omicron plunge on Black Friday and the Powell plunge on Tuesday. These, at least, seem to be the reasons given in the financial media. SPY fell 2.2% on Friday, rebounded somewhat on Monday and then fell 2% on Tuesday

I used to have a Friday night poker group and this was the motto when someone needed to call a big bet. Go big or fold. For the stock market, large-caps are the name of the game and technology is still the best performing sector

Big and sudden declines create short-term oversold conditions ripe for a short bounce, but they also distort chart patterns with their volatility. These outsized moves make chart analysis difficult and the volatility increases risk overall. Note that these moves occurred on a pseudo holiday and could be over-reactions

The bull market remains in place, but we are seeing some short-term weakness in the breadth indicators. This weakness is reflected in small-caps, which pulled back the last two days. Pullbacks from new highs are normal and this could produce a bullish setup in the coming

The Market Regime is bullish, which means we are in a bull market. However, there are signs of underlying weakness over the last few days and this could give way to a pullback. Note that predicting a pullback within a bigger uptrend is challenging because the bigger uptrend is still

After a nice run from early-mid October to early-mid November, trading conditions turned rough with choppy price action the last two weeks. The tech-related ETFs are still leading, but still quite extended short-term. Some old economy ETFs extended further on their medium-term breakouts and

The bull market remains in play with the Composite Breadth Model bullish, yield spreads narrow and the Fed balance sheet surging to yet another new high. Participation started broadening a few weeks go with mid-caps and small-caps breaking out to new highs. This week we saw the 10-yr Treasury Yield surge off its rising 200-day and a rising

The surge in the 10-yr Treasury Yield is the talk of the town this week. Last week it was the breakout in the Russell 2000 ETF (IWM). Is there a correlation here? Today’s commentary will look at the relationship between the 10-yr Treasury Yield and three relative performance charts

The broad market environment remains bullish with more groups participating over the last few weeks. Stocks were hit with a bond-market bombshell on Wednesday as the 10-yr Treasury Yield surged 9%. This sudden move spooked high-beta stocks, emboldened the Dollar and led to a big breakout in gold. Tech-related ETFs were hit the hardest

The bull market is clear and present with new highs in large-caps, large-cap techs, mid-caps and small-caps. Micro-caps are the only missing component, but IWC is very close. Participation continues to expand with breakouts in the Industrials

The Market Regime remains bullish and participation broadened over the last six weeks. SPY and QQQ were already doing their part with clear uptrends and new highs throughout the year. The S&P MidCap 400 SPDR (MDY) broke out of a long triangle in late October

The October run continued into November with small-caps breaking out and participation expanding. Some of the old leaders, however, are still leading with new highs in QQQ, XLK and some tech-related ETFs. The setups and breakouts from early-mid October are bearing fruit and ETFs with big runs the last four to five weeks are in the trend-monitoring phase.

Stocks continued their October run with SPY and QQQ closing at new highs. Mid-caps and small-caps are still struggling, but their charts are more bullish than bearish. Some of the old industry ETFs corrected over the

This commentary is an addition to Thursday’s ETF report. ETFs in today’s commentary formed long corrective patterns from spring to fall and made various breakout attempts here in October. The Transports ETF is the leader with a strong move above the August high. The copper and base metals