Value Line Index -- contains 1700 stocks so it is much broader than the S&P 500 or the very narrow Dow 30 -- 20 DMA is sensitive and signaling caution
- The Index was down 3.37% for the week and is down .61% for the month
- The Index closed below its 20 day moving average but is still above the 50 and 100 DMA
- Barchart's 13 technical indicators signal a short term 60% sell signal but an overall hold
Barchart market momentum -- contains 6000 stocks -- the percentage of stocks trading above their daily moving averages for various time frames -- 20 DMA also signaling caution
- 20 DMA -- only 33.90% trading above their DMA -- that's less than half!
- 50 DMA -- 55.50% trading above their 50 DMA
- 100 DMA -- 69.20% trading above their 100 DMA
The ratio of stocks hitting new highs to stocks hitting new lows for various time frames -- above 1.0 bullish, 1.0 neutral, below .99 bearish -- all 3 time frames bearish
- 20 day new high/new low ratio -- 484/2347 = .21
- 65 day new high/new low ratio -- 272/327 = .83
- 100 day new high/ new low ratio -- 208/229 = .91
Summary and strategy: The stock market has taken a blow to the gut given by the person who is supposed to be leading the recovery. He sees the key as new jobs but he is attacking the institutions that can lend the money and raise the capital to make those new jobs possible. This next week I will trim any stocks failing to maintain a price above its 50 DMA but will not be replacing in my portfolios until I see the Value Line Index recover above its 20 DMA. I don't spit into the wind.
Wall Street Survivor results: I took it on the chin this week. The market as measured by the S&P 500 down 2.09% month to date and the leader Anthony Miraydari is up 30.14% so far this month. I'm down in the 7th out of 8th place with a loss of 3.61% month to date -- maybe next week.