For the week ending June 6, 2014, three CI Market Dashboard indicators were bullish, three were bearish and three were neutral.

Gains once again came from all corners of the market, as all nine of the S&P sectors were up for the week. Industrials paced all sectors with a 2.33% gain, while consumer staples lagged with only a 0.42% increase. The technology sector posted a 0.98 gain this week.

The Dow Jones Industrial Average (DJIA) closed at yet another all-time high of 16,924.28 after gaining 1.2% for the week. The index is rapidly approaching another potential round-number resistance level at 17,000.

The S&P 500 Index (SPX), too, reached a new all-time high after gaining 1.3% this week. After closing at 1,949.44, the large-cap index is also nearing its own possible round-number resistance level at 2,000.

The broad market Wilshire 5000 (W5000) also moved past round-number resistance to post its own new all-time high. After rising 1.54% this week, the index closed at 20,661.86.

Lastly, the Nasdaq Composite (COMP) had another strong week, adding 1.9%. The tech index still has some work to do before it surpasses its all-time high close of 4,357.97 from March 5, but it did manage to break through some key resistance levels this week before closing at 4,312.40.

In terms of the CI Market Dashboard, the iShares Dow Jones U.S. Index Fund (IYY) gained 1.4% this week to close at another all-time high of $98.65. Having cast away the shackles of its $95 resistance level, look for the ETF to find likely resistance at the $100 level.

Market Dashboard indicators worth discussing this week are:

  • IYY remained above its 100-day simple moving average, so the iShares Dow Jones Index Fund indicator also remains bullish. The difference between IYY’s closing price and the moving average widened to 5.03%.
  • The MACD on IYY stayed bullish for the third week in a row as the MACD line of IYY (+0.670) remained above the signal line (+0.670).
  • The percentage of NYSE stocks trading above their 50-day moving remained bullish this week. However, the reading moved back above the 75% bearish threshold to end the week at 77.79%. If and when the reading falls back below the 75% level, the “stale date” on which the signal would revert back to neutral without another bearish signal for six month will reset.
  • The NYSE Bullish Percentage P&F chart rose to 70.98% and executed a three-box reversal—moving from a bearish column of X’s to a bullish column of O’s. In addition, the indicator reading moved above the 70% bearish threshold. If and when the reading falls back below the 70% level, the “stale date” on which the signal would revert back to neutral without another bearish signal for six month will reset.
  • The NASDAQ Summation Index Moving Average Crossover with MACD Confirmation indicator remains bullish for the third straight week. The $NASI (-176.11) closed the week above its five-day exponential moving average (-248.16). The second half of this bullish signal is the MACD line of $NASI (-15.505) being above the signal line (-31.865).
  • The AAII Investor Sentiment Survey Bullish Percentage indicator remained bearish while bullish sentiment rose to a 12-week high at 39.51%. Neutral sentiment slipped below 40% for the first time in six weeks while bearish sentiment fell to its lowest level in 14 weeks. The indicator will remain bearish until the bullish percentage falls below the bullish threshold at 25% and begins to rise, or no subsequent bearish signal is generated prior to June 26, 2014. At which point, the signal will go “stale” and revert back to neutral.

Visit the Market Dashboard page for individual charts for all nine indicators as well as more in-depth commentary regarding each indicator and the overall market action for the previous week.


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Wayne Thorp

Wayne A. Thorp, CFA, is a vice president and the senior financial analyst at the American Association of Individual Investors (AAII). His primary responsibility is to oversee AAII's content strategy. He is also the program manager for AAII's Stock Investor Pro fundamental stock screening and research database program and is on the advisory boards of AAII's Stock Superstars Report and Dividend Investing newsletters. He holds the Chartered Financial Analyst (CFA) designation and is a 1997 honors graduate of DePaul University in Chicago. Wayne's interests include stock screening, technical analysis and charting, social media and tech gadgets. However, in the summer he'd prefer to be hip-deep in northern Michigan's Manistee River fly-fishing for rainbow trout. He is also a rabid University of Michigan and Detroit Red Wings fan.

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