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Can You Feel the Change?

The Investor’s Intelligence bulls moved up to 41%, which is up more than 7 points from last week -- but we're still in choppy-ville.

The Market

I have been waiting for sentiment to show some sign, statistically, not anecdotally, that it has turned and we got some today. The Investor’s Intelligence bulls moved up to 41%, which is up more than 7 points from last week.

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The various put/call ratios do not show an overwhelming desire for calls vs. puts – the ratio is still high -- but certainly the advisers who the Investor’s Intelligence folks poll are feeling better. That is the first step toward turning the intermediate-term indicators.

Aside from that, we still saw no change in the indicators Wednesday. Breadth was weak, so that’s three days in a row of relatively poor breadth now. Remember, it is weak breadth that will ultimately control the indicators and their direction. For example, as of yesterday, the McClellan Summation Index needed a very large net negative. It needed negative 5,300 advancers minus decliners to halt the rise and as of today it is negative 2,800. That’s how weak breadth can begin to weigh on the indicators.

Now, have you noticed that we’ve gone back into an up-down-up-down market? The S&P 500 closed exactly where it closed on Friday, which makes the market look like we’re in choppy-ville again.

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For those looking to be negative on the market right now, keep in mind that the market can go down without the indicators rolling over, but it tends to have more oomph if the indicators have rolled over. What you want to watch for is a rally (Thursday?) where breadth lags, which would lead to a rolling over of the indicators.

New Ideas

I was asked if there was an airline stock I would buy. I will say this about United Airlines (UAL) - Get Free Report: If it can hold this $30 area and cross over $35, that would be impressive. United is set to report next week.

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About a month ago, someone asked me about General Electric (GE) - Get Free Report. I was lukewarm on the stock, so I want to report back that it broke this small uptrend line Wednesday. A retest of $6 (or worse) is possible, especially if the stock cannot recapture $7. The company is slated to report later this month.

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Today’s Indicator

The Volume Indicator is now at 48%, which is not overbought, but is far from oversold. Call it neutral now.

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Q&A/Reader’s Feedback

Helene welcomes your questions about Top Stocks and her charting strategy and techniques. Please send an email directly to Helene with your questions. However, please remember that TheStreet.com Top Stocks is not intended to provide personalized investment advice. Email Helene here.

What is wrong with Tyson Foods (TSN) - Get Free Report is that it made a lower high this week vs. late March, so unless it can get up and over that $65 level, I would be cautious of getting too bulled up on it. It’s possible it simply goes sideways, but I’m more concerned about the lower high.

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I am so upset with Roku (ROKU:Nasdaq), not because it moved, but because on Monday the chart felt good to me, so I jotted it down to put in the “New Ideas” section. I had it all written up. And then the news came out that popped the stock after hours. It’s as if the pencil (translation: someone) knew the news before it was released. Now I’m in the position that profits should be taken in that $120-$125 area, since there is plenty of resistance overhead once it gets up there.

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If Ambev (ABEV) - Get Free Report, which is set to report next month, breaks to the downside (as the textbooks say it should) the next stop is around $1.50.

I know Constellation Brands (STZ) - Get Free Report is not a two dollar stock like ABEV is but if it goes sideways for a few days at least there could be a trade up to that 180 area. That is if you’re looking for Beveridge stocks.

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