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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 Monday'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 (NYSEMKT:GTU) and Seabridge Gold (NYSE: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 (NYSE:WMT). 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 (NASDAQ: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% Monday and fell below its 50-day and 200-day moving averages. Perhaps investors were betting that Roche (OTCQX:RHHBY) will not be able to accomplish their buyout of DNA.


The bear, it seems, is firmly in 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.

Source: Portrait of a Bear: Inverse ETFs Rule