ETF Market Trends: Uptrends for Equities Remain Intact

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Includes: AGG, BBH, CEW, DIA, EEM, EWG, EWQ, EWS, EWT, EWU, EWX, EWY, FNIO, FXC, FXI, FXY, GLD, GMF, GUR, ICN, IEV, ITB, IWM, OIH, QQQ, REM, RSX, RTL-OLD, SMH, SPY, SWH, TIP, TLT, UNG, USO, VGK, VXX, XHB, XLF, XLK, XLP, XLU
by: J Clinton Hill

Market Summary: Dow +96.28 @ 10092.19; S&P 500 +10.23 @ 1097.91; Nasdaq +19.52 @ 2176/32; Russell 2000 +6.16 @ 622.34; U.S. Dollar -0.25 @ 75.37; Crude Oil +0.87 9.@ 79.57; CRB +3.55 @ 279.65; Gold +11.30 @ 1065.20; 10-Yr Treasury Yield -0.22 @ 33.95

Leading Industries on Surging Volume: Publishing Periodicals; Research Brokerage Business Equipment; Drug Manufacturers; Farm & Construction Machinery; Hospitals

Lagging Industries on Surging Volume: Mortgage Investment; Toys & Games; Regional-Mid Atlantic Banks

What seemed to be a case of "risk indigestion" was certainly not the case on Monday as equities regained traction and momentum resumed on expectations of continued positive earnings results. The Dow Industrials, Nasdaq, S&P 500 reached 250 day new highs once more. Shares of S&P 500 member companies reporting earnings after Monday’s close or Tuesday demonstrated positive breadth.

Volume was relatively weak on both the NYSE and Nasdaq exchanges. The Hillbent 3000 (top domestic and ADR market cap stocks with minimum average daily volume > 100k) registered distribution signals as 46% of stocks traded up on contracting volume.

A weaker U.S. dollar paved the way for leadership in commodity correlated sectors, e.g. energy, basic materials, and industrials. Needless to say, the CRB and Crude Oil indexes both attained new 250 day highs.

In the background of all this was the Fed Reserve’s disclosure that it has been coordinating with market participants on the operational aspects of reverse repo program. The Fed intends to use this tool to withdraw liquidity from the market and tighten rates in a less disruptive manner once it deems economic recovery is sufficient. The fact that Uncle Ben is willing to openly acknowledge this is somewhat reassuring to the market.

The pace of this week will begin to pick up as quarterly reports should be a primary driver for stock prices. Keep those seat belts fastened.

Today’s Economic Events: Refer to U.S. Calendar or International Calendar

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

ETF Market Direction Trends: The uptrends for equities, whether domestic or international, remain intact. Signals for commodities are also bullish and currencies of natural resource-rich countries such as Australia and Canada are maintaining their relative strength in the forex markets. There are no significant upgrades or downgrades to any of the trends for any of the major asset classes represented by exchange traded funds.

ETF Equity Index Performance Summary
DIA (DJ Industrials) 0.87%
SPY (S&P 500) 0.83%
QQQQ (Nasdaq 100) 1.01%
IWM (Russell 2000) 0.83%
ETF Sector Performance Summary
XLY (Consumer Discrtn) 1.13% XLI (Industrials) 1.15%
XLP (Consumer Staples) 0.57% XLB (Materials) 1.53%
XLE (Energy) 1.37% XLK (Technology) 1.09%
XLF (Financials) 0.39% IYZ (Telecom) 0.54%
XLV (Health Care) 0.85% XLU (Utilities) 1.45%

ETF 5 Day New Highs: U.S. Equities (DIA*, IWM, SPY*, XLB, XLE*, XLI, XLP*, XLU, XLV*, XLY*, SEA, OIH*, SWH*, ITA*, PPH*, RTH* ); International Equities (EWZ*, ISI*, ILF*, EWC*, RSX*, EWG*, IEV*, VGK*, EWU*, IFN, FXI*, VNM, EWH*, EWA*, EWS*, EWM*, EEM*, GMF*, GML*); Commodities (CRBQ; DBA, DBB*, DBC, JJC, UGA*, UNG, USO); Forex (CEW*, CYB, FXA*, FXB, FXE*, FXF*, FXM); Bonds (HYG, JNK, TIP*); . (Note * denotes 250 day new high)

ETF 5 Day New Lows: U.S. Equities (VXX, VXZ); Forex (UUP*); Bonds (AGG, MBB, EMB); Real Estate (BATS:REM). (Note * denotes 250 day new low)

No further comments this evening. Stay Hillbent for the Market Direction and ETF Market Trends™…

Key Pivot Areas for Support & Resistance Levels (on 10-20-2009)

ETF Index S3 S2 S1 Pivot R1 R2 R3
DIA 98.17 99.41 100.14 100.65 101.38 101.89 103.13
SPY 106.75 108.15 108.97 109.55 110.37 110.95 112.35
QQQQ 41.66 42.34 42.78 43.02 43.46 43.70 44.38
IWM 59.75 60.89 61.54 62.03 62.68 63.17 64.31
VXX 40.95 42.32 42.90 43.69 44.27 45.06 46.43

ETF Market Trends Monitor (10-19-2009)

U.S. Equity ETFs
Equity Indexes 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 (Short-term VIX Futures) down down down
VXZ (Mid-term VIX Futures) down down down
Major Sectors Short-term Intermediate Primary
XLY (Consumer Discrtn) up up up
XLP (Consumer Staples) up up up
XLE (Energy) up up up
XLF (Financials) up up up
XLV (Health Care) up up up
XLI (Industrials) up up up
XLB (Materials) up up up
XLK (Technology) up up up
IYZ (Telecom) up up up
XLU (Utilities) up up up
Key Industries Short-term Intermediate Primary
ITA (Aerospace & Defense) up up up
BBH (Biotech) up up up
OIH (Oil Services) up up up
PPH (Pharmaceuticals) up up up
RKH (Regional Banks) up up up
RTH (Retail) up up up
SMH (Semiconductors) up up up
SWH (Software) up up up
SEA (Global Shipping) up up up
IYT (Transportation) up up up
International Equity ETFs
Americas Short-term Intermediate Primary
ISI (S&P 1500) up up up
EWC (MSCI Canada) up up up
EWW (MSCI Mexico) up up up
ILF (Latin America 40) up up up
EWZ( MSCI Brazil) up up up
Europe Short-term Intermediate Primary
EWU (MSCI United Kingdom) up up up
EWG (MSCI Germany) up up up
EWQ (MSCI France) up up up
RSX (Mkt Vectors Russia) up up up
VGK (Vanguard Europe) up up up
IEV (S&P Europe 350) up up up
Asian-Pacific Short-term Intermediate Primary
EWA (MSCI Australia) up up up
FXI (FTSE China) up up up
EWH (MSCI Hong Kong) up up up
IFN (India Fund) up up up
EWJ (MSCI Japan) up down up
EWS (MSCI Singapore) up up up
EWY (MSCI South Korea) down up up
EWT (MSCI Taiwan) up up up
IF (Indonesia Fund) up up up
EWM (MSCI Malaysia) up up up
VNM (Vietnam) up n/a n/a
Emerging Markets Short-term Intermediate Primary
EEM (MSCI Emerging Mkts) up up up
GMF (Emerging Asia Pacific) up up up
GUR (Emerging Europe) up up up
GML (Emerging Latin America) up up up
GAF (Middle East & Africa) up up up
EWX (Emerging Small Caps) up up up
Alternative Assets
Commodities Short-term Intermediate Primary
GLD (Gold) up up up
SLV (Silver) up up up
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
CRBQ (Global Commodities) up n/a n/a
DBC (Commodities) up up up
JJG (Grains) up up up
DBA (Agriculture) up up up
Forex Short-term Intermediate Primary
UUP (U.S. Dollar) down down down
FXE (Euro) up up up
FXY (Japanese Yen) down up up
FXF (Swiss Franc) up up up
FXB (British Pound) up up up
FXC (Canadian Dollar) up up up
FXA (Australian Dollar) up up up
FXM (Mexican Peso) up up up
BZF (Brazilian Real) up up up
CYB (Chinese Yuan) lateral lateral lateral
ICN (Indian Rupee) up up up
XRU (Russian Ruble) up up n/a
CEW (Emerging Currency) up up up
Bonds Short-term Intermediate Primary
SHY (1-3 Yr Tsy) down up down
IEF (7-10 Yr Tsy) down up down
TLT (20 Yr+ Tsy) down up down
TIP (Tsy Inflation Protect) up up up
AGG (Investment Grade) down up up
MBB (Mortgage Bonds) up up up
JNK (Hi Yld Bonds) up up up
HYG (Hi Yld Corp) up up up
WIP (Int’l Inflation Protect) up up up
EMB (Emerging Markets Bonds) up up up
MUB (Nat’l Muni Bond) down down up
Real Estate Short-term Intermediate Primary
IYR (DJ US Real Estate) up up up
ICF (Cohen & Steers) up up up
XHB (Homebuilders) up up up
ITB (Home Construction) up down up
FIO (Industrial Office) up up up
REM (Mortgage Reits) down up up
REZ (Residential Index) up up up
RTL (Retail Index) up up up

Market Momentum as of 10-19-2009 (% of Stocks > Moving Averages)

Market Momentum 20-Day MA 50-Day MA 200-Day MA
Today 70.17% 78.64% 91.85%
Yesterday 65.69% 76.02% 91.35%
Last Week 66.32% 78.70% 91.37%
Last Month 82.43% 85.96% 92.21%

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.