ETF Market Trends: Positive Catalysts Have No Impact

ETF Market Direction Summary: 11-12-2009

On Thursday, equities finally hit a legitimate wall of resistance and started showing signs of a double top pattern (i.e. peaks at October and November highs). Although market news and economic data were a combination of mixed results, positive catalysts had absolutely no impact on Thursday’s trading.

As suspected, a series of weak volume days on advancing prices is proving to be nothing more than distribution of stocks, i.e. selling into strength. The big boys never failed to show up towards the end of the trading session and if they did, then they definitely forgot to bring their hockey sticks.

Bullish Events

• Jobless Claims for the weed of Nov-07-2009 were less than expected at 502k vs. consensus estimates at 512k. The four week average also declined by 4.5k to 519.7k. Continuing Claims fell to 5.631mm for an improvement by 139k.
• Hewlett Packard (HPQ) announced its takeover bid for 3Com (COMS).
  
• Bellwether retailers Walmart (WMT) and Kohl’s (KSS) reported better than expected earnings.
  
• Dow Chemical (DOW) issued positive guidance due to anticipated savings from its acquisition of Rohm & Haas (ROH).
  

Bearish Events

• EIA Petroleum Status report showed a sharp decline in energy consumption as inventory stocks rose to 1.8mm barrels; gasoline stocks rose 2.5mm barrels. Demand is almost comatose these days. Energy stocks sold off along with oil. The XLE was down -2.2%.
  
• The U.S. Dollar rallied against major and emerging market currencies as foreign banks stage a concerted effort to stem the dollar’s decline and prevent their own currencies from appreciating too fast and making their exports less competitive. Of course, this only exacerbates the unwinding of the dollar carry trade.
  
• Mortgage Bankers Association (MBA) reported that its purchasing index for home sales dropped -11.7% for the week of Nov-06 despite the 30 year fixed rate averaging only 4.9%. Refinancings, the only positive aspect of the report, surged 11.3% for the week.
• Fed Reserve will prohibit banks from charging overdraft fees at ATMs or debit card purchases without prior consent from customers. Such overdraft fees represent about $37bn per year in revenue to the banking industry. The XLF was down -1.87%.
  
• FDIC voted in favor of charging banks $45bn in insurance premiums in order to raise capital to deal with future anticipated bank failures. Many believe that this will create a burden for smaller regional and local banks. The RKH closed down-2.21%.

For now, the trends still remain up for stocks, but buyers appear to be exhausted and this makes the market ripe and vulnerable for a pullback correction.

No further comments this evening from Hillbent on the Market Direction and ETF Market Trends™…

ETF New 5 Day Highs & Lows

ETF 5 Day New Highs: U.S. Equities (QQQQ*, VXZ, XLB, XLK*, XLP*, BBH, IGN, IHI, IYT, PPH, RTH*, SEA, SMH, SWH); International Equities (EWT); Forex (CEW); Bonds (EMB, MBB); Real Estate (ICF, ITB, IYR, RTL). (Note * denotes 250 day new high)

ETF 5 Day New Lows: International Equities (EWZ, EWJ); Commodities (JJC, UNG, USO); Forex (BZF, FXB, FXE, FXF, FXY); Bonds (TLT). (Note * denotes 250 day new low)

ETF Market Trends™ Monitor (11-12-2009)

U.S. Equity ETFs
Equity Indexes	Price	%Chg	Vol%	PMI	ST	MT	LT
DIA (DJ Industrials)	102.17	-0.93%	-3.13%	18	up	up	up
SPY (S&P 500)	109.04	-1.01%	-22.27%	16	up	up	up
QQQQ (Nasdaq 100)	43.65	-0.57%	-11.34%	16	up	up	up
IWM (Russell 2000)	58.17	-1.84%	16.07%	10	up	down	up
VXX (VIX Futures)	43.74	3.06%	0.24%	73	down	down	down
Major Sectors	Price	%Chg	Vol%	PMI	ST	MT	LT
IYZ (Telecom)	17.95	-0.83%	-36.52%	26	up	down	up
XLB (Materials)	31.89	-0.47%	64.93%	23	up	up	up
XLE (Energy)	56.91	-2.20%	16.14%	15	down	up	up
XLF (Financials)	14.70	-1.80%	-13.03%	11	up	down	up
XLI (Industrials)	27.29	-1.16%	-11.40%	15	up	up	up
XLK (Technology)	21.70	-0.73%	-27.93%	7	up	up	up
XLP (Consumer Staples)	26.54	-0.60%	-31.46%	7	up	up	up
XLU (Utilities)	29.11	-1.36%	-26.43%	6	up	down	up
XLV (Health Care)	29.72	-0.57%	-43.88%	20	up	up	up
XLY (Consumer Discrtn)	28.56	-0.97%	-3.28%	14	up	up	up
Key Industries	Price	%Chg	Vol%	PMI	ST	MT	LT
BBH (Biotech)	96.97	0.08%	-44.49%	36	up	down	up
IAI (Broker-Dealers)	28.63	-1.07%	-35.33%	6	up	up	up
IAK (Insurance)	26.38	-2.19%	-12.80%	2	up	down	up
IGN (GSTI Networking)	26.59	-0.49%	-66.42%	5	up	up	up
IHI (Medical Devices)	50.16	-1.03%	-25.13%	0	up	up	up
ITA (Aerospace & Defense)	47.77	-1.04%	-47.70%	11	up	up	up
IYT (Transportation)	70.54	-1.38%	-6.59%	13	up	up	up
KIE (Insurance)	34.50	-2.32%	82.46%	8	up	down	up
OIH (Oil Services)	121.38	-3.05%	-16.06%	15	up	up	up
PPH (Pharmaceuticals)	62.53	-0.24%	-54.26%	23	up	down	up
RKH (Regional Banks)	78.19	-2.21%	-10.78%	7	up	down	up
RTH (Retail)	93.78	-0.39%	21.71%	19	up	up	up
SEA (Global Shipping)	13.17	-0.83%	47.61%	7	up	up	up
SMH (Semiconductor)	25.60	-0.72%	-42.39%	5	up	up	up
SWH (Software)	40.45	-0.25%	-62.93%	11	up	up	up
International Equity ETFs
Americas	Price	%Chg	Vol%	PMI	ST	MT	LT
EWC (MSCI Canada)	25.61	-1.54%	-26.80%	20	up	up	up
EWW (MSCI Mexico)	46.84	-1.24%	54.13%	12	up	up	up
EWZ( MSCI Brazil)	73.56	-3.26%	-19.76%	17	up	up	up
ILF (Latin America 40)	46.36	-2.77%	-28.10%	13	up	up	up
ISI (S&P 1500)	48.85	-1.01%	-21.67%	13	up	up	up
Europe	Price	%Chg	Vol%	PMI	ST	MT	LT
EWG (MSCI Germany)	22.24	-1.64%	-7.23%	11	up	up	up
EWQ (MSCI France)	26.07	-1.77%	-7.25%	10	up	up	up
EWU (United Kingdom)	16.47	-0.42%	1.51%	32	up	up	up
IEV (S&P Europe 350)	39.63	-1.07%	-35.94%	19	up	up	up
RSX (Russia)	30.30	-2.26%	-43.67%	19	up	up	up
VGK (Vanguard Europe)	51.17	-0.79%	5.80%	27	up	up	up
Asian-Pacific	Price	%Chg	Vol%	PMI	ST	MT	LT
EWA (MSCI Australia)	23.68	-1.86%	-7.84%	15	up	up	up
EWH (MSCI Hong Kong)	15.98	-0.56%	-37.02%	33	up	up	up
EWJ (MSCI Japan)	9.49	-1.66%	-8.57%	23	down	down	up
EWM (MSCI Malaysia)	10.87	-1.09%	-26.29%	0	up	up	up
EWS (MSCI Singapore)	11.19	-0.71%	43.27%	19	up	up	up
EWT (MSCI Taiwan)	12.39	-0.64%	-11.10%	10	up	up	up
EWY (MSCI South Korea)	44.63	-2.45%	-36.54%	15	up	down	up
FXI (FSTE China)	44.63	-1.83%	-5.08%	17	up	up	up
IF (Indonesia Fund)	9.96	-0.94%	-74.15%	5	up	up	up
IFN (India Fund)	30.03	-2.78%	-25.19%	4	up	up	up
VNM (Vietnam)	27.90	-0.68%	-25.46%	23	down	down	n/a
Emerging Markets	Price	%Chg	Vol%	PMI	ST	MT	LT
EEM (MSCI Emerging Mkts)	40.36	-2.20%	-10.92%	9	up	up	up
EWX (Emerging Small Caps)	46.42	-0.13%	-55.69%	75	up	up	up
GAF (Middle East & Africa)	60.38	-1.77%	-77.72%	0	up	up	up
GMF (Emerging Asia Pacific)	72.58	-0.44%	-56.37%	31	up	up	up
GML (Emerging Latin America)	75.64	-3.21%	-30.32%	13	up	up	up
GUR (Emerging Europe)	43.04	-1.80%	-62.11%	34	up	up	up
Alternative Assets
Commodities	Price	%Chg	Vol%	PMI	ST	MT	LT
CRBQ (Global Commodities)	41.51	-1.61%	-62.30%	34	up	down	down
DBA (Agriculture)	25.51	-0.70%	-25.12%	24	down	up	up
DBB (Base Metals)	19.64	-1.26%	-8.84%	17	down	up	up
DBC (Commodities)	23.80	-1.61%	9.55%	6	down	up	up
GLD (Gold)	108.21	-1.27%	4.78%	6	up	up	up
JJC (Copper)	40.47	-1.77%	-2.54%	0	down	up	up
JJG (Grains)	39.97	1.19%	100.14%	82	up	up	up
SLV (Silver)	16.92	-2.14%	16.46%	6	up	up	up
UGA (Gasoline)	35.41	-3.09%	-19.66%	21	down	up	up
UNG (Natural Gas)	9.05	-2.16%	14.47%	15	down	down	down
USO (Oil)	39.27	-3.16%	4.57%	9	down	up	up
Forex	Price	%Chg	Vol%	PMI	ST	MT	LT
BZF (Brazilian Real)	26.67	-1.26%	-5.16%	41	up	up	up
CEW (Emerging Currency)	22.14	-0.58%	8.90%	10	up	up	up
CYB (Chinese Yuan)	25.35	-0.04%	441.97%	0	lateral	lateral	lateral
FXA (Australian Dollar)	92.29	-0.87%	-20.86%	7	up	up	up
FXB (British Pound)	165.41	0.09%	-10.28%	97	up	up	up
FXC (Canadian Dollar)	94.43	-0.94%	-23.89%	16	up	up	up
FXE (Euro)	148.24	-0.94%	-22.60%	14	up	up	up
FXF (Swiss Franc)	97.83	-0.94%	13.29%	15	down	up	up
FXM (Mexican Peso)	75.97	-0.43%	146.13%	59	up	up	up
FXY (Japanese Yen)	109.78	-0.69%	-52.93%	50	up	up	up
ICN (Indian Rupee)	25.02	-1.22%	-42.62%	0	up	up	up
UUP (U.S. Dollar)	22.82	1.51%	77.41%	70	up	up	down
XRU (Russian Ruble)	35.38	-0.70%	54.50%	93	up	up	n/a
Bonds	Price	%Chg	Vol%	PMI	ST	MT	LT
AGG (Investment Grade)	104.79	0.20%	-10.43%	100	up	up	up
BWX (Int’l Tsy Bonds)	58.87	-1.19%	37.83%	0	up	up	up
EMB (Emerging Markets Bonds)	102.57	0.13%	-62.58%	59	up	up	up
HYG (Hi Yld Corp)	86.07	0.12%	-27.85%	89	up	up	up
IEF (7-10 Yr Tsy)	91.18	0.00%	-32.53%	90	up	down	down
JNK (Hi Yld Bonds)	38.01	-0.34%	8.98%	20	up	up	up
MBB (Mortgage Bonds)	107.52	0.16%	7.52%	94	up	up	up
MUB (Nat’l Muni Bond)	102.00	-0.07%	-14.15%	24	down	down	up
SHY (1-3 Yr Tsy)	84.02	-0.01%	2.82%	86	up	up	up
TIP (Tsy Inflation Protect)	104.55	-0.49%	7.74%	83	up	up	up
TLT (20 Yr+ Tsy)	93.45	-0.22%	-11.41%	88	down	down	down
WIP (Int’l Inflation Protect)	57.59	-1.13%	-16.61%	18	up	up	up
Real Estate	Price	%Chg	Vol%	PMI	ST	MT	LT
FIO (Industrial Office)	22.03	-0.03%	-100.00%	0	up	up	up
ICF (Cohen & Steers)	48.87	-1.17%	-27.44%	12	up	up	up
ITB (Home Construction)	12.03	-2.73%	-62.31%	7	up	down	up
IYR (DJ US Real Estate)	42.60	-1.23%	-23.32%	10	up	up	up
REM (Mortgage Reits)	14.43	-1.10%	-60.71%	17	up	down	up
REZ (Residential Index)	28.62	-0.38%	-94.06%	0	up	up	up
RTL (Retail Index)	20.32	3.20%	64.20%	97	up	up	up
XHB (Homebuilders)	14.87	-2.43%	-31.04%	16	up	down	up

*PMI measures strength of % daily trading range on scale of 0 to 100

**ST = Short-Term Trend; MT = Intermediate Trend; LT = Long-Term or Primary Trend

***Vol% measures % change in daily volume vs. average daily volume

Market Momentum Diary: 11-12-2009

% Stocks > Mov Avg	20-Day MA	50-Day MA	200-Day MA
Today	46.31%	48.39%	84.83%
Yesterday	57.48%	57.07%	86.96%
Last Week	33.60%	47.90%	86.24%
Last Month	71.21%	79.12%	92.04%
Daily Market Stats	NYSE		Nasdaq
Advancers	607		641
Decliners	2454		2041
Advancing Shares	645345400		786965800
Declining Shares	3543857200		1434678900
52 Week New Highs	147		58
52 Week New Lows	4		9

Hillbent Market Direction Resources

Economic Calendar Events: Refer to U.S. Calendar or International Calendar

Postive & Negative Earnings Surprises: Refer to Hillbent’s earnings summary report for a detailed analysis of positive & negative earnings surprises

Disclosures: Hillbent does not provide individualized market advice. The information we publish regards companies in which we believe our readers may be interested and our reports reflect our sincere opinions. Nevertheless, they are not intended to be personalized recommendations to buy, hold, or sell securities. Investments in the securities markets, and especially in options, are speculative and involve substantial risk. Each individual investor should determine their respective appropriate level of risk. It is recommended that you seek personal advice from your professional investment advisor and conduct further independent due diligence research before acting on information published in any of our reports. Most of our information is derived directly from information published by the companies on which we report and/or from other sources we deem to be reliable, without our independent verification.

Therefore, we cannot assure the completeness or accuracy of information contained within these reports and we do not in any way warrant or guarantee the success of any action which you take in reliance on our statements.

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.