Italy's government passed an austerity budget which soothed investors concerns so stocks rallied once again. In fact, after a grueling week marked by extraordinarily high volatility again bulls were able to eke-out gains for the week. After Wednesday's immense rout you probably thought a positive weekly close was out of the question. Stocks did rally sharply on better news from the euro zone, better than expected Consumer Sentiment (64.2 vs pervious 60.9) and some good earnings from Disney (DIS) for example.

Italy's $2 trillion in debt exceed the combined debt of Greece, Ireland, Portugal and Spain combined per this Bloomberg article. While things "seemed" better Friday, markets are just buying time since these problems will be revisited again and again.

Nevertheless, as stated, stocks scored major gains to close the week higher. Further, major sectors were able to show positive gains for the year. No matter what they throw at markets, this is the season portfolio managers want to make their year. Since 2007 HFTs have been dominating conditions like never before. The algorithmic trading leaps into action on keywords from various news events. No one complains when they give a large assist when markets rise. As some remember, we've posted our HFT analysis examining this activity here.  

It was a light volume melt-up given the Veteran's Day holiday but they won't put that note on your brokerage statement.

Commodity markets (precious metals, base metals and energy) were higher, while the dollar and bonds weaker. Given poor conditions, authorities and global central banks are choosing inflation as the preferred solution which will entail money printing.

Volume was quite light and breadth per the WSJ was positive.

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Continue to U.S. Sector, Stocks & Bond ETFs

Continue to Currency & Commodity Market ETFs

Continue to Overseas Sectors & ETFs

The NYMO is a market breadth indicator that is based on the difference between the number of advancing and declining issues on the NYSE. When readings are +60/-60 markets are extended short-term.

The McClellan Summation Index is a long-term version of the McClellan Oscillator. It is a market breadth indicator, and interpretation is similar to that of the McClellan Oscillator, except that it is more suited to major trends. I believe readings of +1000/-1000 reveal markets as much extended.

The VIX is a widely used measure of market risk and is often referred to as the "investor fear gauge". Our own interpretation is highlighted in the chart above. The VIX measures the level of put option activity over a 30-day period. Greater buying of put options (protection) causes the index to rise.

Continue to Concluding Remarks

That concludes one helluva week from a volatility perspective. TGIF has never been more needed and appreciated.

We, like so many others, salute our troops on this Veterans Day.

Let's see what happens.

Disclaimer: The ETF Digest maintains active ETF trading portfolio and a wide selection of ETFs away from portfolios in an independent listing. Current positions if any are embedded within charts. Our Lazy & Hedged Lazy Portfolios maintain the follow positions: SPY, VTI, RSP, IWM, QQQ, XLY, XLB, XLI, EFA, EEM, EWJ, FXI, EWZ, EPI, VT, MGV, BND, BSV, VGT, VWO, VNO, IAU, DJCI, DJP, VMBS, VIG, ILF, EWA, IEV, EWC, EWJ, EWG, EWU, EWD, GXG, THD, AFK, BRAQ, CHIQ, TUR, & VNM.

 

The charts and comments are only the author's view of market activity and aren't recommendations to buy or sell any security.  Market sectors and related ETFs are selected based on his opinion as to their importance in providing the viewer a comprehensive summary of market conditions for the featured period.  Chart annotations aren't predictive of any future market action rather they only demonstrate the author's opinion as to a range of possibilities going forward. More detailed information, including actionable alerts, are available to subscribers at www.etfdigest.com .

 
This commentary comes from an independent investor or market observer as part of TheStreet guest contributor program. The views expressed are those of the author and do not necessarily represent the views of TheStreet or its management.

Dave Fry is founder and publisher of ETF Digest, Dave's Daily blog and the best-selling book author of Create Your Own ETF Hedge Fund, A DIY Strategy for Private Wealth Management, published by Wiley Finance in 2008. A detailed bio is here: Dave Fry.

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