Dow Theory Update for Nov 27: Markets down. No changes in trends

Volume for stocks very bearish

 Let’s get started with our Dow Theory analysis in this blog for today.

The SPY, Industrials and Transports closed down again. Under Dow Theory nothing has changed. The primary trend and the secondary trend remain bearish.

Volume was up in a down day which has a bearish connotation. We have had six bearish volume days in a row. To add insult to injury, the last pivot high made two days ago was on notoriously lower volume than the previous pivot high made on 11/06/2012. This is also a bearish sign. Furthermore, the last two pivot lows as well as the last two pivot highs have displayed bearish volume patterns. The icing on the bearish cake, as you can see in the chart below, has been the declining trend of volume as the market rallied until a couple of days ago. Clearly, price action was negated by volume (see blue trend lines).

All in all, it is not frequent to see so much bearish information conveyed by different volume readings. While anything can happen in the next few days, volume seems to suggest that the primary bear market signal displayed on Nov 16 (Nov 11 according to Schannep) is to be heeded. More about the primary bear market signal here.

 

Here you have a chart displaying volume so that you can judge for yourself.

Six bearish volume days in a row. Volume at last four pivots bearish

 

Gold (GLD), Silver (SLV), GDX (gold miners’ ETF) and SIL (silver miners’ ETF) all of them closed down today. Technically, nothing has been achieved under the Dow Theory. The primary trend remains bullish whereas the secondary trend remains bearish.

Here you have the figures of the markets I monitor for today:

 

Data for November 27, 2012
DOW THEORY PRIMARY TREND MONITOR SPY
			SPY
Bear market started		09/14/2012	147.24
Bear market signaled		11/16/2012	136.37
Last close		11/27/2012	140.33
Current stop level: Bull market high			147.24
Price chg since bear mkt signaled	Tot decline since start bear mkt	Max Pot Loss %
2.90%	-4.69%	-7.38%
DOW THEORY PRIMARY TREND MONITOR GOLD (GLD)
			GLD
Bull market started		05/16/2012	149.46
Bull market signaled		08/22/2012	160.54
Last close		11/27/2012	168.73
Current stop level: Bear mkt low			149.46
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
5.10%	12.89%	7.41%
DOW THEORY PRIMARY TREND MONITOR SILVER (SLV)
			SLV
Bull market started		06/28/2012	25.63
Bull market signaled		08/22/2012	28.92
Last close		11/27/2012	32.93
Current stop level: Bear mkt low			25.63
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
13.87%	28.48%	12.84%
DOW THEORY PRIMARY TREND MONITOR ETF SIL
			SIL
Bull market started		07/24/2012	17.08
Bull market signaled		09/04/2012	21.83
Last close		11/27/2012	22.89
Current stop level: Bear mkt low			17.08
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
4.86%	34.02%	27.81%
DOW THEORY PRIMARY TREND MONITOR ETF GDX
			GDX
Bull market started		05/16/2012	39.56
Bull market signaled		09/04/2012	47.77
Last close		11/27/2012	47.48
Current stop level: Bear mkt low			39.56
Unrlzd gain %	Tot advance since start bull mkt	Max Pot Loss %
-0.61%	20.02%	20.75%

Sincerely,

The Dow Theorist.