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Showing posts from August, 2011

Despite beating expectations, July Durable Goods report has me worried

The Durable Goods advanced report for July was released on Wednesday and the headline number surprised to the upside. This helped the market tack on some further gains beyond Tuesday's big advance.

Besides its effect on a day's action in the stock market, the Durable Goods report is useful for seeing how tech in aggregate is performing. As of this report, the situation is mixed. I always focus on two particular measures: shipments and new orders. In July, the two measures were not consistent and this is worrisome. Let's see how it played out in July.

Shipments --

I generally give less importance to Shipments since this is a backward looking measure reflecting orders that have been confirmed, manufactured and shipped. It's similar to earnings reports -- it's good to know but the data is in the past and we're more interested in the future. The following chart shows how July shipments looked for the overall tech sector:

Results were actually quite good and, to make …

What theme is emerging from this market carnage?

With the market practically crashing again I wondered if there were any industries hiding stocks with strength.

Poking around in the Industry Inspector at our sister site TradingStockAlerts.com actually did yield a little theme in an unexpected area.

I sorted the list of industries according to percentage of stocks above their 50-day moving average. At the top of the list was the Consumer Services/Automotive Aftermarket industry which contains only one stock: Monro Muffler and Brake (MNRO).

Re-sorting to look for industries with stocks showing bullish MACD and up near the top was the Consumer Services/Motor Vehicles industry. Among the three stocks in this segment is Midas, Inc. (MDS), otherwise known as Midas Muffler.

These stocks seem barely affected by the recent downturn but the simple reason is strong earnings. Both companies rolled up increases in sequential revenues and earnings. On a year-over-year basis, Midas disappointed a bit on revenue but shined on earnings while Monro d…

Stocks dig a deeper hole -- when do we come up for air?

After a week of epic volatility, stocks ended the week on a positive note; nevertheless, it wasn't enough to turn a loss into a gain. The S&P 500, for example, still ended the week down 1.63%.

Last week I reviewed the moving average and trend analysis charts and declared that we were at bearish extremes not seen since the March 2009 market lows. Let's see what they say this week.

The view from Alert HQ --

For those readers who are new to TradeRadar or who don't remember what this is all about, the data for the following charts is generated from our weekly Alert HQ process. We scan roughly 6200 stocks and ETFs each weekend and gather the statistics presented below.

In this first chart below we count the number of stocks above various exponential moving averages and count the number of moving average crossovers, as well. We then plot the results against a chart of the SPDR S&P 500 ETF (SPY).


The number of stocks above their 50-day EMA (yellow line) has improved so lit…

Hello down there! Is there a bottom in sight yet?

Last week I looked at the Trending Analysis chart (I have the updated version below) and said there was further room for stocks to fall before the next rally could begin. Even though I expected a further pullback, I was wholly unprepared for what actually happened: the market fell with a vengeance.

Looking at the S&P 500, for example, it took out the trendline extending all the way back to March of 2009, blew threw the lower support at the bottom of a 6-month consolidation pattern (those who are more pessimistic are saying this was the neckline of a head-and-shoulders), and to put the icing on the cake, dropped decisively below the 200-day moving average. Many of the other indices look pretty much the same.

The moving average and trending analysis charts I often present on the weekend certainly reflect the damage. Let's see what they say this week.

The view from Alert HQ --

For those readers who are new to TradeRadar or who don't remember what this is all about, the data fo…