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Tuesday, October 27, 2009

A couple of sectors fall out of favor - Tuesday Swing Signals, Trend Busters, Trend Leaders and Gap Signals for Oct 27, 2009

This post is announcing that Tuesday's Swing Signals, Trend Leaders, Trend Busters and Gap Signals are now available at Alert HQ. All are based on daily data.

Today we have the following:
  • 24 Swing Signals -- 11 BUY signals and 12 SELL Signals and one Strong BUY.
  • 159 Trend Leaders, all in strong up-trends according to Aroon, MACD and DMI. We have 34 stocks that are new additions to the list and 293 that fell off the previous list.
  • 87 Trend Busters of which 23 are BUY signals and 64 are SELL signals.
  • 218 Gap Signals -- stocks with upside or downside gaps or gaps that have been closed.
The view from Alert HQ --

This post is a little late but the signals were up on the web site on time. Some of today's signals, though, were not too pleasant.

Case in point: the Trend Busters. The BUY signals on this list were almost exclusively short or ultra short ETFs. That in itself is not a serious sign unless there is confirmation from the ETFs that are based on the same or similar underlying indexes. Unfortunately, we do have some confirmation. Here is the list of regular, non-leveraged ETFs that have violated their up-trend since this pullback began:

IWC ISHARES RUSSELL MICROCAP INDEX FUND
IWO ISHARES RUSSELL 2000 GROWTH INDEX FUND
IYT ISHARES TRUST DOW JONES TRANSPORTATION AVERAGE INDEX FUND
KBE SPDR KBW BANK ETF
KBW KBW, INC.
PZI POWERSHARES ZACKS MICRO CAP PORTFOLIO
RMT ROYCE MICRO-CAP TRUST INC
RTM RYDEX S&P EQUAL WEIGHT MATERIALS ETF
RWK REVENUESHARES MID CAP ETF
RZV RYDEX S&P SMALLCAP 600 PURE VALUE ETF
VFH VANGUARD FINANCIALS ETF
XLF FINANCIAL SEL SECT SPDR FD

Its clear from this list that small-caps and financials have fallen out of favor.

On the Trend Leaders list, I see that the number of stocks in strong up-trends has fallen to such a low level, only 159, that I am beginning to think we are getting close to the end of this correction already. At least, I hope we are.

Our other signals this week are all over the place, with no one sector standing out. With plenty of variety, there should be something for everyone. Just be careful with those small-caps and financials.

Using our signals --

If you're a momentum trader, the Trend Leaders list is a good place to go shopping. If you practice technical analysis, check out the Trend Busters. And if you are a short-term trader or even a day trader, our Swing Signals or Gap Signals may provide some good trading ideas.

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