Return to Pendergraft Research homepage February 10, 2010 In yesterday's Stark Report, I mentioned that it would take a technical bounce for the market to keep from experiencing a fifth straight down week. I failed to mention possible news that would spur a rally. That is precisely what we got yesterday as fears about Greece defaulting, coupled with so many stocks being oversold on the daily charts, created an environment that allowed stocks to rally sharply. Yesterday's bounce created a unique situation for the Stark Market Barometer. We see the second strong bullish signal within the last couple of weeks. The only other time we have seen this was last February 24 and March 4, right ahead of the rally that lasted for the rest of the year for the most part. While I think this is a good sign for the next few weeks, I would not count on the same kind of sharp move higher. The bullish signals last winter came at a time when the S&P was the most oversold it had ever been based on the monthly RSI reading. The overall results from last night's scans were 226 bullish signals and nine bearish signals, all nine of which were inverse ETFs. This sent the SMB soaring to a reading of 93. I look for a nice rally over the next few weeks as the huge number of stocks that are oversold on a daily basis work off some of this bearishness. I ran an extra scan last night with many of the same indicators I use in the Stark Report, but I removed any kind of volume restrictions and I only ran the scan on my database of ETFs. Out of 838 total ETFs, 420 came up on the bullish list, 36 inverse ETFs came up on the bearish list and six bond funds came up on the bearish list. Hopefully this gives you some perspective on how strong of a bullish signal we are getting right now. When you have 235 bullish signals, it makes it tough to isolate a particular stock or a particular sector. I think the best thing you can do is just make some bullish picks and use leverage in some way, either with a leveraged ETF or buy some calls on one of the major ETFs like the Spyders or QQQQ. I must admit that there was one particular stock that I looked for on the bullish list even when I saw the huge number of stocks on the list and that was ArcelorMittal SA (MT). MT is one of the best performing stocks when it appears on either of the lists and especially when it appears on the bullish list. Bullish Symbol Name Open Close Volume ABB Abb Ltd. 17.89 17.97 4882725 ACE Ace Ltd. 48.77 48.70 1739677 ADI Analog Devices, Inc. 27.21 27.12 4841298 ADP Automatic Data Processing, Inc. 40.84 40.70 2948202 AEO American Eagle Outfitters, Inc. 15.81 16.06 2673361 AEP American Elec Pwr Co., Inc. 33.05 33.20 3414755 AET Aetna, Inc. 29.57 28.97 9961248 AIG American Intl Group, Inc. 22.38 23.14 9706526 AKS AKSteel Holding Corp. 20.56 20.80 10685118 ALL Allstate Corp. 28.64 28.73 2813505 AMP Ameriprise Financial Inc. 37.65 37.93 3471447 AMT American Tower Corp. 41.28 41.45 4121257 AMZN Amazon.com, Inc. 118.20 118.03 9224904 ANR Alpha Natural Resources Inc. 41.75 41.83 6023632 APA Apache Corp. 98.55 98.51 3843876 APC Anadarko Petroleum Corp. 63.03 63.54 4433388 ASML ASM Lithography Holding N.V. 31.48 31.47 2385458 ATI Allegheny Technologies 41.63 41.95 2624233 BAX Baxter Intl Inc. 56.71 56.38 3199750 BBD Banco Bradesco 16.58 16.90 18406274 BBY Best Buy Co, Inc. 35.72 35.98 5554209 BCS Barclays Plc 17.13 17.19 2917033 BGU Direxion Daily Large Cap Bull 3x Shares 46.09 46.18 11667385 BHP BHP Billiton Ltd. 69.95 71.16 5456103 BMC BMC Software Inc. 36.33 36.32 1807585 BMY Bristol Myers Squibb Co. 24.10 24.25 9906506 BP BP Amoco PLC 52.92 53.61 8017014 BTU Peabody Energy Corp. 41.39 42.37 8508670 BUCY Bucyrus Intl, Inc. 53.36 54.11 3185110 CA CA Inc. 21.82 21.76 3978094 CAL Continental Airlines, Inc. 17.79 19.16 10534957 CAM Cameron International Corp. 38.22 39.33 5370121 CAT Caterpillar, Inc. 52.70 53.53 15497719 CCJ Cameco Corp. 26.30 27.01 3508249 CCL Carnival Corp. 33.40 32.80 5075050 CHK Chesapeake Energy Corp. 24.68 24.51 11592906 CLF Cliffs Natural Resources Inc. 41.97 42.75 5728104 CMCSA Comcast Corp. 15.38 15.39 24182885 CNX Consol Energy, Inc. 45.73 46.54 4461313 COF Capital One Fncl Corp. 35.17 35.33 5408975 CRM Salesforce.com, Inc. 62.68 64.66 2274714 CSX CSX Corp. 43.69 43.08 6715416 CTRP Ctrip.com Intl Ltd. 31.22 31.43 2304665 CVX Chevron Corp. 70.89 71.31 13051974 D Dominion Resources Inc 36.50 36.57 2705606 DBC DB Commodities Tracking Index Fund 22.57 22.79 2047264 DDM ProShares Ultra Dow 30 Fund 40.47 40.76 6247884 DE Deere & Co. 49.90 50.32 5843455 DIA Diamonds 100.16 100.65 19228293 DIG ProShares Ultra Oil And Gas 31.35 31.62 7104888 DISH EchoStar Communications Corp. 17.90 18.07 2665497 DOW Dow Chemical Co. 26.54 27.79 20333809 DTV DirecTV Group Inc. 30.77 31.14 9434563 DUK Duke Energy Corp. 16.42 16.56 15168599 DVN Devon Energy Corp. 67.11 67.30 3853293 ED Consolidated Edison, Inc. 43.04 43.44 2116133 EEM iShares MSCI Emerging Markets 37.73 38.03 133342053 EFA EAFE Index iShares 51.59 52.05 30811720 EMC EMC Corp. 16.99 16.95 21683373 EPP iShares MSCI Pacific Ex-Japan 38.20 38.42 1751177 ERX Direxion Daily Energy Bull 3x Shares 33.87 34.51 6345031 ESV Ensco International Plc 39.07 39.55 2564162 ETN Eaton Corp. 62.75 63.86 2602379 EWA Australia iShares 20.98 21.06 5574824 EWC Canada iShares 24.57 24.73 2398317 EWW Mexico iShares 46.90 46.63 3283069 EWY South Korea iShares 45.02 45.17 4211925 EWZ Brazil iShares 65.04 65.37 33276153 EXC Exelon Corp. 44.10 44.22 4478256 EXPD Expeditors Intl of Washington, Inc. 33.24 33.46 2847859 EXPE Expedia, Inc 21.76 21.88 3961541 FAS Direxion Daily Financial Bull 3x Shares 64.00 63.33 48915279 FCX Freeport McMoran Copper&Gold 71.13 71.58 25217935 FE Firstenergy Corp. 41.29 41.74 2909409 FST Forest Oil Corp. 24.22 24.69 1881602 FWLT Foster Wheeler Corp. 25.98 26.02 3095500 FXI iShares FTSE/Xinhua China 25 38.10 38.46 50062027 GDX Market Vectors Gold Miners 41.76 42.57 24228538 GDXJ Market Vectors Junior Gold Miners 22.88 23.41 2310656 GIS General Mills Incorporate 68.87 69.45 1881760 GLD SPDR Gold Trust Shares 105.18 105.41 25959374 HAL Halliburton Co. 28.56 29.08 20175395 HBC HSBC Holdings PLC 51.49 51.45 4167162 HES Hess Corp. 58.05 57.69 4967550 HGSI Human Genome Sciences, Inc. 26.12 27.06 4295257 HIG Hartford Financial Servic 23.39 22.34 20528014 HK Petrohawk Energy Corp. 21.91 21.67 6649555 HOG Harley Davidson Inc 22.61 22.73 2633961 HON Honeywell Intl 37.37 37.82 6870842 HUM Humana, Inc. 47.35 47.92 3131191 IBM International Business Machines 122.65 123.21 6044466 IGT International Game Tech 17.81 17.62 5206095 IJR SP SmCap 600 iShares 52.14 52.20 1707471 ILF Latin America 40 Index iShares 42.71 42.98 4847103 ILMN Illumina, Inc. 35.50 35.83 1638409 INTC Intel Corp. 19.64 19.65 69198799 INTU Intuit, Inc. 29.54 29.31 3876938 IP International Paper Co. 22.86 22.92 6754421 ITUB Itau Unibanco Banco Multiplo S.A. 19.26 19.62 20727459 ITW Illinois Tool Works, Inc. 42.71 43.29 3267071 IVV S&P 500 iShares 107.49 107.58 4977193 IVZ Invesco Ltd. 18.66 18.61 7248122 IWB Russell 1000 iShares 58.97 58.99 3089878 IWD Russell 1000 Value iShares 55.33 55.51 2826161 IWF Russell 1000 Growth iShares 47.68 47.80 3369164 IWM Russell 2000 iShares 59.38 59.49 91987171 IWO Russell 2000 Growth iShares 64.52 64.66 2917569 IYF Financial iShares 49.71 49.53 2499117 IYM Basic Matls iShares 55.42 56.12 2213021 JEF Jefferies Group, Inc. 25.22 25.24 1235688 JNJ Johnson & Johnson 62.55 62.76 11356334 JNK SPDR Lehman High Yield Bond ETF 37.76 37.79 1805642 JOYG Joy Global Inc. 45.74 45.73 2697192 JPM J.P. Morgan Chase & Co. 38.19 38.39 45177325 KBE SPDR KBW Bank Index ETF 22.30 22.18 5735798 KLAC KLA-Tencor Corp. 29.11 29.17 3539885 KO Coca Cola Co. 53.69 54.01 15747669 KRE SPDR KBW Regional Banking Index ETF 23.06 23.07 2924298 L Loews Corp. 35.13 35.22 2060884 LIFE Life Technologies Corp 47.52 47.82 1600290 LLTC Linear Technology Corp. 26.84 26.67 4184301 LM Legg Mason, Inc. 24.83 25.08 2268175 LNC Lincoln National Corp. 24.50 24.50 10533642 LOW Lowes Companies, Inc. 22.02 21.84 16562882 LVS Las Vegas Sands Corp. 15.93 15.89 20932090 MAR Marriott Intl Inc New 26.37 26.12 4293118 MCK McKesson Corp. 58.37 58.75 1693127 MDY S&P Midcap SPDRs 127.31 127.35 3871201 MEE Massey Energy Co. 39.45 40.05 5365388 MET Metlife, Inc. 34.00 35.15 16339662 MHS Medco Health Solutions Inc. 60.71 61.25 3093210 MRO Marathon Oil 28.44 28.62 7086290 MS Morgan Stanley 26.86 27.13 19517282 MT ArcelorMittal SA 39.31 39.46 5438177 MTL Mechel Steel Group OAO 21.41 21.90 5408418 MXIM Maxim Integrated Products, Inc. 17.84 17.79 3160758 NBR Nabors Industries, Inc. 21.97 22.29 8486956 NKE Nike Inc. 61.78 62.51 2359528 NTRS Northern Trust Corp. 50.40 50.08 1869046 NUE Nucor Corp. 40.42 40.46 5044310 OIH Oil Services Holders 117.07 118.09 7723752 PBR Petroleo Brasileiro (Petrobras) 39.67 39.54 25030345 PBR/A Petroleo Brasileiro Sa 34.97 34.99 7914238 PCAR PACCAR, Inc. 34.45 34.95 2949031 PCU Southern Copper Corporation 28.08 28.22 5194699 PFE Pfizer, Inc. 17.87 17.88 70976415 PFG Principal Financial Group 21.64 21.45 6365476 PGR Progressive Corp. 16.41 16.37 3193263 POM Pepco Holdings Inc. 16.08 16.09 1607173 PRU Prudential Financial Inc. 47.81 48.36 4967033 PTEN Patterson-UTI Energy, Inc. 15.43 16.04 8335378 PX
Best Bets: Alpha Natural Resources (ANR) and ArcelorMittal (MT)