Stocks walk fine line between correction and bear market

Weekly Review: MAAD, CPFL indicator analysis

Conclusion

Earlier in our summary we noted the absolute losses in the major indexes over the past several weeks. But what we did not highlight was the fact that the S&P 500 has simply eliminated all of the price gains it accrued since the May 2011 highs. That selling effectively erased the 7.5% gain for those who bought above 1370.58 or the 15.6% gain for those who theoretically bought into the S&P lows (666.79) in early March 2009. In other words, an investor who sold in May 2011 would now be slightly better off than the investor who held equities from May 2011 to date.

As we have been suggesting for some time, when key indicators such as MAAD, CPFL, Momentum, and CV continue to negatively diverge from the market, the odds of return on investment begin to diminish. The decline over the past two months has once again highlighted that point.

MAAD Daily data for past 30 days* 

CPFL data for past 30 Days

Date

NYSE Adv

NYSE Dec

Date

OEX Call $Volume

OEX Put $Volume

10-4-12

15

5

10-4-12

19561

14690

10-5-12

7

13

10-5-12

18107

18960

10-8-12

4

16

10-8-12

5046

21196

10-9-12

3

17

10-9-12

18477

31201

10-10-12

4

15

10-10-12

15397

37527

10-11-12

12

7

10-11-12

9410

38706

10-12-12

5

15

10-12-12

12705

33183

10-15-12

13

7

10-15-12

15270

13445

10-16-12

12

6

10-16-12

29103

14115

10-17-12

13

6

10-17-12

29383

12501

10-18-12

7

13

10-18-12

14859

16038

10-19-12

1

19

10-19-12

23597

90225

10-22-12

13

6

10-22-12

78768

44349

10-23-12

4

16

10-23-12

19405

40598

10-24-12

5

14

10-24-12

13195

28399

10-25-12

11

8

10-25-12

18594

32595

10-26-12

5

14

10-26-12

15436

20380

10-29-12

Closed

---

10-29-12

Closed

---

10-30-12

Closed

---

10-30-12

Closed

---

10-31-12

9

10

10-31-12

9884

11891

11-1-12

17

3

11-1-12

86326

16444

11-2-12

5

14

11-2-12

12443

26349

11-5-12

14

5

11-5-12

11722

14660

11-6-12

12

7

11-6-12

45048

15298

11-7-12

0

20

11-7-12

20788

52029

11-8-12

3

17

11-8-12

16602

92193

11-9-12

11

9

11-9-12

25606

54375

11-12-12

13

7

11-12-12

8515

54791

11-13-12

6

13

11-13-12

23074

65737

11-14-12

3

17

11-14-12

16161

95621

11-15-12

11

9

11-15-12

46018

81180

11-16-12

15

5

11-16-12

40162

46466

*Note: Unchanged issues are not counted.

MAAD Weekly data for past 30 Weeks**

CPFL data for past 30 Weeks

Date

NYSE Adv

NYSE Dec

Date

OEX Call $Volume

OEX Put $Volume

4-27-12

12

8

4-27-12

223704

45908

5-4-12

1

18

5-4-12

55698

270290

5-11-12

5

15

5-11-12

89392

179817

5-18-12

1

19

5-18-12

63126

601766

5-25-12

12

8

5-25-12

128890

104849

6-1-12

0

20

6-1-12

44478

278761

6-8-12

19

1

6-8-12

206062

57765

6-15-12

17

3

6-15-12

224947

79354

6-22-12

11

9

6-22-12

41604

118995

6-29-12

11

9

6-29-12

215980

45870

7-6-12

9

11

7-6-12

22987

66734

7-13-12

7

13

7-13-12

115325

165598

7-20-12

11

9

7-20-12

155286

106164

7-27-12

15

5

7-27-12

469554

55021

8-3-12

14

4

8-3-12

189964

56326

8-10-12

18

2

8-10-12

127913

51441

8-17-12

11

9

8-17-12

168381

34193

8-24-12

5

14

8-24-12

61567

91299

8-31-12

4

16

8-31-12

27713

56889

9-7-12

17

2

9-7-12

192729

30202

9-14-12

17

3

9-14-12

295058

62406

9-21-12

4

16

9-21-21

140898

41443

9-28-12

6

14

9-28-28

68066

104869

10-5-12

15

5

10-5-12

82790

46425

10-12-12

4

16

10-12-12

23119

203431

10-19-12

10

10

10-19-12

40632

219576

10-26-12

6

14

10-26-12

43539

151159

11-2-12

15

5

11-2-12

31681

39436

11-9-12

0

20

11-9-12

51223

261506

11-16-12

3

17

11-16-12

104817

333252

**Note: All data is for calendar week ending on Friday even though ending date may be a holiday. Unchanged issues in MAAD calculations are not counted.

<< Page 5 of 5
About the Author
Robert McCurtain

Robert McCurtain is a technical analyst/market timer, private investor and financial markets consultant based in New York City. He can be reached at traderbob@nyc.rr.com.

If you would like to read more about how the CPFL is constructed, read a Futures article on the concept. This link will take you to the MAAD article. A two-part series about system development with the MAAD also is available. 

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