The U.S. stock market's five major equity averages must be in sync technically if you want to declare a bull market or a bear market.

There have been some nice gains so far in March in anticipation of Fed Chief Janet Yellen providing a dovish outlook on monetary policy. She delivered what investors wanted, so it's time to take some money off the table. Any additional market gains will be difficult to sustain in the "year of the bear." 

On Thursday, the Dow Jones Industrial Average (INDU)   at 17,481.49 at the close, is the highest close of 2016. But when you connect the lower highs going back to the all-time high of 18,351.36 set on May 19 there's a downtrend resistance at 17,675.83, shown on the daily chart below.


Courtesy of MetaStock Xenith

There is a similar pattern for the S&P 500 , which closed at 2,040.59 on Thursday, down fractionally year to date after filling the price gap to the Dec. 31 low of 2,043.62. The daily chart below shows a downtrend resistance of 2,060.47 that connects the highs of Nov. 3 and Dec. 2 as shown on the daily chart below.


Courtesy of MetaStock Xenith

The stock market bulls who blindly say stocks hit new 2016 highs need to look at the daily charts for Nasdaq Composite (NDAQ) , the Dow Jones Transportation Average and Russell 2000,

Here's the daily chart for the Nasdaq.


Courtesy of MetaStock Xenith

At 4,774.99 the Nasdaq is down 4.8% year to date and is 8.7% below its all-time high of 5,231.94 set on July 20. While the Dow 30 and S&P 500 are above their 200-day simple moving averages the Nasdaq is well below its 200-day SMA of 4,873.15 and below 4,843.0, which is the 61.8% Fibonacci retracement of the decline from the all-time high to the 2016 low of 4,209.76 set on Feb. 11. The Nasdaq is well below the Dec. 31 low of 5,007, which is not a sign that a bull market for stocks remains in play.

Here's the daily chart for Dow Transports.


Courtesy of MetaStock Xenith

At 7,959.95 Dow Transports are up 6% year to date and is above its 200-day simple moving average of 7,840.87. Even so, transports are in correction territory 14.5% below its all-time high of 9,310.33 set on Nov. 28, 2014. Transports is also below 8,200.77, which is the 61.8% Fibonacci retracement of the decline from the all-time high to the 2016 low of 6,403.31 set on Jan. 21. A bull market, this is not!

Here's the daily chart for Russell 2000.


Courtesy of MetaStock Xenith

At 1,091.25 the Russell 2000 is down 3.9% year to date and is well below its 200-day simple moving average of 1,148.55. The small cap index is in correction territory 15.8% below its all-time high of 1,296.00 set on June 23. The Russell 2000 is between 1,077.62 and 1,119.33, which are the 38.2% and 50% Fibonacci retracements, respectively, from the all-time high to the 2016 low of 943.10, set on Feb. 11. The Russell 2000 is well below the Dec. 31 low of 1,135.57, which is another sign that the bull market for stocks ended in 2015, and justifies the continued call that 2016 is the "year of the bear."

Beyond the U.S., here's today's scorecard for the major equity averages around the globe followed by the daily charts for the overseas major averages.

 

Here's the daily chart for Japan's Nikkei 225.


Courtesy of MetaStock Xenith

The Nikkei 225 closed Friday at 16,724.81, down 12.1% year to date and in bear market territory 20.2% below its multiyear high of 20,952.71 set on June 24. The horizontal lines are the Fibonacci retracements of the decline from the multiyear high to the Sept. 29 low of 16.901.49. This index is between its 23.6% retracement of 16,297.64 and its 38.2% retracement of 17,118.90. At the Feb. 1 high of 17,905.37 the index failed at its 50% retracement of 17,909.24.

Here's the daily chart for China's Shanghai Composite.


Courtesy of MetaStock Xenith

The Shanghai Composite closed Friday at 2,954.93, down 16.5% year to date and in bear market territory 42.9% below its multiyear high of 5,178.19 set on June 12. Note how this benchmark index has been below its 23.8% retracement of 3,237 since Jan. 8. As a short-term positive the Chinese benchmark is above its 50-day simple moving average of $2,891.32.

Here's the daily chart for India's Nifty 50.


Courtesy of MetaStock Xenith

The Nifty 50 closed Friday at 7,604.35, down 4.3% year to date and in correction territory 16.6% below its March 4, 2015 high of 9,119.20. India's benchmark has been above its 23.6% retracement of 7,385 since March 3, but strength has been shy of the 38.2% retracement of 7,701.05.

Here's the daily chart for Germany's Deutsche Boerse DAX.


Courtesy of MetaStock Xenith

The German DAX is trading around 9,910 Friday, down 7.7% year to date and in bear market territory 20% below its all-time high time high of 12,390.75 set on April 10. The DAX is trading between its 23.6% retracement of 9,569 and its 38.2% retracement of 10,108, well below its 200-day simple moving average of 10,416.11.

With overseas markets in correction or bear market territory, and with transports and small caps in correction territory in the U.S., you cannot claim the seven-year bull market remains in play. You cannot make the blanket and misleading statement that stocks are trading at the highest levels of the year.

That's why 2016 is still the "year of the bear" and the predicable strength in March will soon come to an end.

 

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

If you liked this article you might like

The Stock Market Has Been Amazingly Resilient -- Check Out These 10 Charts

The Stock Market Has Been Amazingly Resilient -- Check Out These 10 Charts

Nasdaq Outperforms in the U.S., the Nifty 50 Leads Overseas

Nasdaq Outperforms in the U.S., the Nifty 50 Leads Overseas

Warning--PowerShares QQQ Tested its Price Target for 2017 Last Week

Warning--PowerShares QQQ Tested its Price Target for 2017 Last Week

S&P 500, Nasdaq, Nifty 50, German DAX See New Highs and Negative Divergence

S&P 500, Nasdaq, Nifty 50, German DAX See New Highs and Negative Divergence