Info!! Indicator Update For January 5Th

Last week's indicator review concluded, "The depression 900 surface area continues to serve equally of import resistance for the S&P 500 Index; a interruption higher upward that flat accompanied yesteryear rigid sector participation as well as novel high forcefulness would hold upward an of import indicate for longer-term bulls." We did, indeed, encounter such an upside break, equally forcefulness became evident among the indicators as well as stock marketplace sectors as well as indexes. Indeed, the sectors are straightaway clearly inwards a bullish mode, having broken from their multi-week trading range.

The Cumulative Demand/Supply Index (top chart) is quite stretched to the upside, but banker's complaint that we're seeing a designing of higher highs, alongside pullbacks remaining higher upward the nil level. That persistence is typical of bull marketplace action. During bull phases, pullbacks inwards the DSI toward a neutral surface area typically indicate practiced entries for swing positions to the long side.

Note how we've likewise seen a sizable increase inwards novel 20-day highs vs. lows (second chart), indicating wide participation inwards the marketplace rally. The Cumulative Adjusted NYSE TICK (third chart) has moved solidly to novel highs; banker's complaint the increase inwards its slope, equally buyers lifted offers inwards size during the marketplace breakout.

Money stream for the Dow Industrial issues, piece non at novel highs, has been moving steadily higher (bottom chart) over the concluding 2 weeks.

We are clearly overbought as well as some grade of short-term pullback is expected. If, indeed, nosotros bring position inwards an of import marketplace depression as well as entered a bull phase, the ascension should hold upward a multi-month affair, non a brief rally. New 20-day highs should proceed to outnumber lows, as well as pullbacks should remain good higher upward concluding week's cost lows. Particularly supportive of the bull motion would hold upward a relatively apartment corrective stream inwards which the onetime resistance roughly 900 inwards the S&P 500 Index becomes support. Influenza A virus subtype H5N1 motion dorsum into the trading range, especially on high book as well as weak NYSE TICK, would pose of import questions for bulls.

A review of concluding week's indicator information that I post service each morn earlier trading days via Twitter volition clearly demo the development of the market's strength. These information are especially useful inwards identifying whether markets are strengthening, weakening, or remaining arrive at bound. This tin hold upward helpful inwards keeping traders from fighting trends--or assuming trends when none exist. The information tin hold upward observed on the spider web log page nether "Twitter Trader" or are available via gratis RSS subscription.
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Info!! Indicator Update For October 20Th

Last week's indicator review concluded, "I volition take away to run into bear witness of a drying upwardly of selling line per unit of measurement area earlier in conclusion that the worst is over for stocks. Thus far, every indicator tells us that weakness has been expanding, non drying up." This past times week, nosotros saw a dramatic motion higher inwards stocks, followed past times an close as dramatic motion downward, as volatility continued at extreme levels. So how cause got indicators fared?

Money menstruum has continued weak in addition to the advance-decline figures propose that no broad-based cost forcefulness is however evident. The cumulative Demand-Supply Index (top chart), which cumulates the daily index of stocks closing higher upwardly vs. below their volatility envelopes, remains at oversold levels, albeit off its recent lows. Similarly, nosotros run into weakness inwards the give away of stocks registering fresh 65-day highs vs. lows (bottom chart), exactly these numbers are too good off their lows. For example, nosotros had 107 novel 20-day highs on Fri against 383 novel lows. At the market's momentum depression to date, nosotros registered over 6500 novel 20-day lows across the NYSE, NASDAQ, in addition to ASE. Also good off its momentum lows is the cumulative NYSE TICK.

Thus far, I am working amongst the next assumptions:

1) The marketplace made a momentum depression for the recent acquit move, in addition to nosotros are straightaway inwards the procedure of bottoming;

2) Significant marketplace declines (1974, 1981-2, 1987, 1990, 1998, 2002-3) cause got taken weeks to months to bird bottoms, in addition to the electrical flow bottoming procedure could hold upwardly similar;

3) Given the electrical flow volatility, whatsoever marketplace ascent from such bottoming could hold upwardly quite sharp;

4) While such bottoming may select a meaningful intermediate-term low, it is non at all clear to me that we've seen the ultimate lows for this secular acquit market.

What this way is that nosotros could run into to a greater extent than broad, range-bound, whippy activity as markets seek an intermediate-term bottom. Unless I run into breakout forcefulness inwards such indicators as coin flow, NYSE TICK, in addition to novel highs/lows, my leaning volition hold upwardly to fade abrupt marketplace rallies, exactly too to fade tests of recent lows that are accompanied past times non-confirmations inwards these indicators.
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Info!! Indicator Update For March 14Th

Last week's indicator review concluded that the path of to the lowest degree resistance was toward the upside as well as a exam of bull highs. That indeed materialized this past times week, every bit the major indexes--as good every bit the advance-decline lines for nearly averages--moved to novel highs.

The bullish tendency condition is captured past times the proprietary mensurate of Technical Strength (top chart), which assesses short-term trending for major stocks inside each sector. All of the sectors are inwards uptrend modes, amongst week-over-week forcefulness seen amid Industrial, Consumer Discretionary, Financial, as well as Technology shares. Health Care remains the weakest of the sectors, every bit it's been for several weeks now.

The Cumulative Demand/Supply Index (middle chart) has begun to deed off its highs, reflecting the loss of upside momentum noted inwards the recent post. It is non odd for the DSI to transcend ahead of cost amongst a considerable atomic number 82 time, leading me to anticipate that a pullback of the DSI toward the cipher grade could offering a short-term buying opportunity. As long every bit those pullbacks inwards DSI are occurring at successively higher cost levels, nosotros get got to count the longer-term tendency every bit up.

Finally, we've seen an expansion of 20-day novel highs this past times calendar week (bottom chart), exactly those besides get got pulled dorsum during the latter component subdivision of the week. We are non seeing the sort of peak of 20-day lows that usually precedes a important correction, which i time again supports the thought that pullbacks from hither may decease buying opportunities fifty-fifty if the marketplace is commencement an extended topping process.

In short, nosotros get got lost upside momentum as well as it would non at all move odd to meet the marketplace accept a breather here. The indicators, however, are non showing meaningful deterioration, as well as then that I'm non anticipating a driblet below piece of cake Feb lows. As always, I'll move updating indicators each forenoon earlier the marketplace opened upward via Twitter; you lot tin flaming follow the tweets here.
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Info!! Indicator Update For June 1St

Last week's indicator review concluded that "I maintain to sentiment us every bit inside the May range, leaning toward fading gain extremes unless expanding novel lows together with collapsing NYSE TICK order us otherwise." We did non run across an expansion of novel lows or a spend upward inward the Cumulative TICK this past times calendar week and, amongst Friday's belatedly rally, ended upward knocking on the door of 2009 bull highs.

My range-based sentiment remains intact, however, until nosotros tin run across breakout forcefulness among the sectors together with the indicators above. (I volition encompass Cumulative TICK inward a kind post shortly). We maintain to run across waning upward momentum amidst stocks, every bit captured past times the Cumulative Demand/Supply Index (top chart); we're too seeing fewer NYSE, NASDAQ, together with ASE issues registering fresh 65-day highs. Even amidst the S&P 500 sectors, at that topographic point is mixed performance relative to the momentum highs of early on May.

This weakness shows upward inward the advance-decline trouble for NYSE mutual stocks, every bit posted past times the first-class Decision Point site. (By the way, their tracking of advance-decline lines specific to the S&P 500 sectors is peculiarly informative). Although nosotros striking a bull marketplace position high inward the NYSE Composite Index (bottom chart), the advance-decline trouble for NYSE mutual shares is lagging a bit. That lag is fifty-fifty to a greater extent than pronounced amidst S&P 600 small-scale cap stocks, suggesting a narrowing of the base of operations of this rally.

I volition involve to run across a broadening of that base of operations earlier final that Friday's forcefulness is the firstly of a fresh bull leg higher. Should nosotros neglect to sustain novel toll highs across the major indexes, I would facial expression a supply to good inside the trading gain defined past times the highs together with lows of the past times several weeks. As always, I volition post the major indicators to Twitter prior to the opened upward of each marketplace position day; free subscription via RSS here.
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