Picture of the bear

Every week we scan and test all the stocks on the major exchanges as part of our Alert HQ process. A byproduct of the Alert HQ process is the Trend Leaders list, our collection of stocks in strong up-trends. These stocks are registering strong signals using Aroon analysis, DMI and MACD. They are also at least 1% above their 50-day exponential moving average. This week's list is now available at the TradeRadar site on the Trend Leaders page.

TrendLeaders paint depressing picture of a bear market --

This week we have 61 stocks and ETFs on the list. The total number has been declining steadily over the last few weeks. The nature of the securities comprising this week's list show how badly stocks in general are performing - more than half of our Trend Leaders are inverse ETFs.

Not only do we have a bunch of the usual ProShares ETFs on the list but we see that the Direxion Bear 3X ETFs are well represented as are a number of Rydex Inverse 2X ETFs.

Here is the list of inverse ETFs. Prices are as of the close last Friday; I suspect they are all up nicely after today's market rout.

Symbol	ETF Name	LastPrice
BGZ	Direxion Large Cap Bear 3X Shares	90.58
DOG	ProShares Short Dow30	83.03
DPK	Developed Markets Bear 3x Shares	106.53
DXD	ProShares UltraShort Dow30	77.09
EFU	ProShares UltraShort MSCI EAFE	135.18
EFZ	ProShares Short MSCI EAFE	105.7
EWV	ProShares UltraShort MSCI Japan	105.716
MWN	Direxion Mid Cap Bear 3X Shares	94.01
MYY	ProShares Short MidCap400	79.145
MZZ	ProShares UltraShort MidCap400	75.46
PSQ	ProShares Short QQQ	77.34
QID	ProShares UltraShort QQQ	62.65
RFN	Rydex Inverse 2x S&P Select Sector Financial	58.331
RHO	Rydex Inverse 2x S&P Select Sector Health	69.97
RRZ	Rydex Inverse 2x Russell 2000	131.06
RSW	Rydex Inverse 2x S&P 500	158.97
RWM	ProShares Short Russell2000	80.73
RXD	ProShares UltraShort Health Care	74.04
SCC	ProShares UltraShort Consumer Services	108.68
SDD	ProShares UltraShort SmallCap600	95.26
SDK	ProShares UltraShort Russell MidCap Growth	93.22
SDS	ProShares UltraShort S&P500	98.72
SFK	ProShares UltraShort Russell1000 Growth	97.77
SH	ProShares Short S&P500	85.95
SIJ	ProShares UltraShort Industrials	89.55
SJF	ProShares UltraShort Russell1000 Value	160.73
SJH	ProShares UltraShort Russell2000 Value	104.46
SJL	ProShares UltraShort Russell MidCap Value	117.71
SKF	ProShares UltraShort Financials	177.85
SKK	ProShares UltraShort Russell2000 Growth	84.21
SZK	ProShares UltraShort Consumer Goods	99.07
TWM	ProShares UltraShort Russell2000	91.91
TZA	Direxion Small Cap Bear 3X Shares	80.5

A few stocks still fight the bear --

What other stocks complete this picture of the bear?

Well, there are several gold stocks, for example: Gammon Gold (GRS), Central Gold Trust (GTU) and Seabridge Gold (SA). With the whole stock market and gold itself down today, these stocks all took a hit; nevertheless, their charts are still looking a lot more attractive than most.

There has been much written about people "trading down" and shopping at Walmart. It appears the same thing is taking place with respect to food. Dinner at fancy restaurants is out but pizza is in. Take a look at Papa John's (PZZA) - they were one of the few stocks to register a gain today.

Italians have always known that pasta helps stretch the food budget. Perhaps that explains why American Italian Pasta Company (AIPC) is doing well lately.

Finally, special situations always get investor attention. As a result, Genentech (DNA), the object of a takeover bid, is on the list. Unfortunately, the stock plunged 4.6% today and fell below its 50-day and 200-day moving averages. Perhaps investors were betting that Roche will not be able to accomplish their buyout of DNA.

Conclusion --

The bear, it seems, is firmly charge again. Our TrendLeaders list started out with a couple of hundred stocks and only a few ETFs. Now the list is dominated by inverse ETFs and a dwindling number of stocks that fit the recessionary mood.

There have been a number of blog posts that suggested that when inverse ETFs become especially popular it is a sign of a market bottom. Lately, though, the market looks bottomless. This is a situation only a contrarian could love.