ETF Trends: Economic News Lifts Primary Trend for Stocks

Bullish Events:

1. July-2009 ISM manufacturing data posted 48.9 vs. consensus estimates of 46.5;
2. June-2009 Construction Spending improved to 0.3% vs. consensus estimates of -0.5%;
3. July-2009 motor vehicle sales rose 15% to 8.3mm annualized units vs. previous month’s 7.1mm; and
4. economists in the private sector, e.g. Alan Greenspan and notorious Dr. Doom aka Nouriel Roubini, are also seeing plausible light at the end of an economic tunnel of darkness.

Bearish Events: N/A

Positive Earnings Surprises: Consumer Staples (TSN, TAP, CLX); Consumer Discretionary (PC); Medical (HAE, HUM); Construction (MDU); Energy (USU, NS); Financials (GFA, CNA, MCY, NNN); Utilities (FE)

Negative Earnings Surprises: Consumer Discretionary (MGM); Energy (MGG, JRCC, MRO); Financials (L); Utilities (POR, RRI); Business Services (ASF)

ETF Equity Indexes: There were no changes to the trends for the major equity indexes as they continued to make progress in their newly formed primary uptrend. Making 5 day new highs were the DIA, SPY, and IWM. ( As a side note, I must ask my readers to forgive my repetitiveness on the overbought condition of this market, but I feel compelled to point this out to any Johnny-come-latelies. A combination of rising prices and shrinking volume does not make a good recipe for a sustainable primary trend bull market. To illustrate this point, I have posted a brief technical report: If this is a new bull market, will the real bulls (i.e. buyers) please charge forward?)

ETF SectorS and Key Industries: New 5 day highs (XLF, XLB, XLE, XLI, XLY, RTH, RKH, IYT). Short-term trend upgrades - XLI. Worthy of honorable mention is RKH which is very close through the resistance of its long term downtrend. If it can achieve and sustain this, then the long-term implications and upside potential are quite bullish.

ETF Commodities: New 5 day highs (DBC, USO, SLV, DBB, UNG, DBA); Short-term trend upgrades - UNG; Intermediate trend upgrades - DBA; and Long-term trend upgrades (USO, DBA).

ETF Forex: New 5 day lows (UUP); Short-term trend upgrades (CEW, XRU); Short-term trend downgrades and Intermediate-term trend downgrades (FXY).

ETF Bonds: Short-term trend downgrades (IEF, TLT, TIP, AGG); and Intermediate-term trend upgrades (IEF, TLT, TIP). Volatility in bonds is likely to persist as economic data improves and talk of inflation is revisited. Another contributing factor to the demise of bonds is the less than mediocre reception to 2 out of the last 3 treasury auctions.

ETF Real Estate: New 5 day highs (ITB, XHB, IYR). Last Friday’s new 5 day high for the ITB was no fluke as Monday saw it joined by the XHB and IYR. There are no changes to trends for real estate ETFs covered in this report.

Until tomorrow, remain Hillbent for The Market Direction…

Support & Resistance Levels for U.S. Equity Indexes (for 08-04-2009)

Index ETF	Ticker	S3	S2	S1	Pivot	R1	R2	R3
DJ-30	DIA	90.55	91.58	92.22	92.61	93.25	93.64	94.67
SP-500	SPY	97.65	98.87	99.66	100.09	100.88	101.31	102.53
NASDAQ-100	QQQQ	38.63	39.24	39.65	39.85	40.26	40.46	41.07
R2K	IWM	54.33	55.29	55.91	56.25	56.87	57.21	58.17
VIX Futures ETF	VXX	58.41	59.72	60.28	61.03	61.59	62.34	63.65

ETF Trend Monitor (08-03-2009)

U.S. Equity ETFs	Short-term	Intermediate	Primary
DIA (DJ Industrials)	up	up	up
SPY (S&P 500)	up	up	up
QQQQ (Nasdaq 100)	up	up	up
IWM (Russell 2000)	up	up	up
VXX (S&P 500 VIX Futures)	down	down	down
Sector ETFs	Short-term	Intermediate	Primary
XLY (Consumer Discrtn)	up	up	up
XLP (Consumer Staples)	up	up	up
XLE (Energy)	up	up	down
XLF (Financials)	up	up	down
XLV (Health Care)	up	up	up
XLI (Industrials)	up	up	lateral
XLB (Materials)	up	up	up
XLK (Technology)	up	up	up
IYZ (Telecom)	up	up	down
XLU (Utilities)	up	up	down
Key Industry ETFs	Short-term	Intermediate	Primary
BBH (Biotech)	up	up	up
OIH (Oil Services)	up	up	down
PPH (Pharmaceuticals)	up	up	up
RKH (Regional Banks)	up	up	down
RTH (Retail)	up	up	up
SMH (Semiconductors)	up	up	up
SWH (Software)	up	up	up
IYT (Transportation)	up	up	up
Commodities	Short-term	Intermediate	Primary
GLD (Gold)	up	up	up
SLV (Silver)	up	up	lateral
DBB (Base Metals)	up	up	up
JJC (Copper)	up	up	up
USO (Oil)	up	up	up
UNG (Natural Gas)	up	down	down
UGA (Gasoline)	up	up	up
DBC (Commodities)	up	up	lateral
DBA (Agriculture)	up	up	lateral
Forex	Short-term	Intermediate	Primary
UUP (U.S. Dollar)	down	down	down
FXE (Euro)	up	up	up
FXY (Japanese Yen)	down	lateral	up
FXB (British Pound)	up	up	up
FXC (Canadian Dollar)	up	up	up
FXA (Australian Dollar)	up	up	up
FXM (Mexican Peso)	up	up	lateral
BZF (Brazilian Real)	up	up	up
CYB (Chinese Yuan)	lateral	lateral	lateral
ICN (Indian Rupee)	up	lateral	n/a
XRU (Russian Ruble)	lateral	lateral	n/a
CEW (Emerging Currency)	up	up	n/a
Bonds	Short-term	Intermediate	Primary
SHY (1-3 Yr Tsy)	lateral	lateral	lateral
IEF (7-10 Yr Tsy)	lateral	down	down
TLT (20 Yr+ Tsy)	lateral	down	down
TIP (Tsy Inflation Protect)	lateral	lateral	lateral
AGG (Investment Grade)	lateral	up	up
JNK (Hi Yld Bonds)	up	up	up
HYG (Hi Yld Corp)	up	up	up
MUB (Nat’l Muni Bond)	lateral	lateral	lateral
Real Estate	Short-term	Intermediate	Primary
IYR (DJ US Real Estate)	up	up	down
XHB (Homebuilders)	up	up	lateral
ITB (Home Construction)	up	up	lateral
FIO (Industrial Office)	up	up	lateral
REM (Mortgage Reits)	up	up	up
REZ (Residential Index)	up	up	lateral
RTL (Retail Index)	up	up	lateral

Market Momentum Monitor (08-03-2009)

Market Momentum	20-Day MA	50-Day MA	200-Day MA
Today	89.42%	88.24%	88.57%
Yesterday	87.20%	85.61%	86.95%
Last Week	88.15%	85.12%	86.01%
Last Month	38.72%	55.15%	70.69%

Disclosures: Hillbent.com, Inc. or its affiliates may own positions in the equities mentioned in our reports. We do not receive any compensation from any of the companies covered in our reports.