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The S&P 500 Falls Below Its 50-day SMA And Annual Pivot At 1363.2

|Includes: DIA, GLD, QQQ, SPY, iShares 20+ Year Treasury Bond ETF (TLT), XLE

Markets in Review: Asian stocks were lower again on Wednesday. The Nikkei 225 ended their session at 9,459 - down 0.83% on the day. The Hang Seng ended their session at 20,141 - down 1.06% on the day. European stocks are higher this morning after trading significantly lower on Tuesday, the first chance to react to Friday's employment data here in the States. The FTSE 100 ended Tuesday at 5,596 - down 2.24% on the day. The DAX ended Tuesday at 6,606 - down 2.49% on the day. The CAC 40 ended Tuesday at 3,218 - down 3.08% on the day. The yield on the 10-Year US Treasury declined from 2.067 percent to 1.961 on Tuesday below its 50-day simple moving average at 2.068 and is up to 2.025 this morning. Gold rebounded from $1632.5 the Troy ounce to $1664.8 on Tuesday staying below its 50-day and 200-day SMAs at $1699.5 and $1690.3, converging towards a "death cross" where the 50-day falls below the 200-day. Crude oil declined from $102.96 per barrel to $100.75 on Tuesday staying below its 50-day SMA at $104.08. The euro vs the dollar declined from 1.3143 to 1.3058 staying below its 50-day SMA at 1.3212. The Dow Industrial Average declined to 12,710.56 on Tuesday. A close this week below the five-week modified moving average at 12,987 confirms that the Dow peaked at its 52-week high at 13,297.11 set on April 2nd. The NASDAQ's declined to 2987.00 trending away from its 52-week high at 3134.17 set on March 27th. The 50-day simple moving average at 2989 held at Tuesday's low.

Today's Four in Four Key Levels:

  1. Yields - The yield on the 10-Year US Treasury declined from 2.225 percent to 1.961 since the employment report was released on Good Friday. My semiannual pivot is 1.903.
  2. Commodities - The rebound for gold went above my semiannual pivots at $1659.4 and $1635.8, but moved back between these levels overnight. Crude oil traded below my quarterly pivot at $101.55 overnight with my monthly value level at $97.55.
  3. Currencies - The euro versus the dollar remains between my semiannual value level at 1.2980 and its 50-day simple moving average at 1.3212.
  4. Equities - A weekly close below my annual pivot at 1363.2 on the S&P 500 negates the strength we had after the March 9th weekly close above that level. This would confirm my market call that the subsequent strength would be short-lived. The SPX is also below its 50-day simple moving average at 1372.3. My quarterly value levels are 1337.7 SPX and 2911 NASDAQ with a quarterly pivot at 12,794 Dow Industrials and quarterly risky levels at 5420 Dow Transports and 829.34 Russell 2000. My annual pivots remain at 1363.2 SPX and 836.15 on the Russell 2000. My prediction remains that Transports and Russell 2000 will stay below their 2011 all time highs at 5627.85 on July 7th and 868.57 on May 2nd.
  5. ValuEngine Valuations - Stocks are reasonably priced with 66.5% of all stocks undervalued with six undervalued sectors and ten overvalued sectors. Aerospace is 14.8% UV with Medical 10.5% OV and Computer & Technology 10.3% OV.

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