Stock market churns through week as momentum falters

Weekly Review: MAAD & CPFL Report

McCurtain Call/Put Dollar Value Flow Line (CPFL)

Another new short to intermediate-term high was registered by our Call/Put Dollar Value Flow Line last week, but the indicator has yet to overcome critical long-term resistance at the spring 2011 resistance highs.

It’s true that CPFL remains positive and in a gradually rising trend initiated in December 2011, but the advance is nowhere as strong as during previous rallies, especially off of the March 2009 lows, when options buying was notably positive. The best we can say for the current rally is that it is lukewarm and it has moved higher. It has not, however, via Weekly data, overcome resistance made in September even though the daily series has made incrementally higher highs above the September resistance. As a consequence, upside confirmation between the Daily and Weekly series is mixed.

There is also the overriding tone of options buying that has been noticeably absent for the better part of the past two years. That failure suggests to us that call buyers are far from enthusiastic about this market’s long-term prospects while put buyers are only too willing to step in when prices are falling. That combination does not make for a long-term bullish outlook.



Conclusion

Major index prices were mixed last week with all holding within range of even. The Value Line index eked out a new long-term closing high, but that gain was by point 64%. Movement on a weekly net basis in the S&P 500, Dow 30, and NASDAQ Composite barely registered on the price seismometer. Except for those traders adventurous enough for intraday trading, the week was a sleeper.

In other words, the failure of prices to continue powering higher has left a problem with short-term Momentum that could turn negative in a blink. And a little selling in the face of a historically “Overbought” Minor Cycle could soon set up a threat to the next larger Intermediate Cycle that is “Overbought,” and then the Major Cycle that is also “Overbought. Did we also mention that NONE, that’s NONE, of our key indicators has confirmed any of the strength in the major indexes, except marginally and NONE to new highs, since the spring of 2011. So, to use a metaphor or two, we continue to feel as if we are watching an exhausted Sisyphus jockeying for position under the wobbling Sword of Damocles.

MAAD daily data for past 30 days*

CPFL daily data for past 30 days

Date

NYSE Adv

NYSE Dec

Date

OEX Call $Volume

OEX Put $Volume

1-4-13

16

4

1-4-13

15918

9326

1-7-13

8

12

1-7-13

12111

9021

1-8-13

5

15

1-8-13

30884

8826

1-9-13

11

9

1-9-13

6980

9587

1-10-13

17

3

1-10-13

17253

12394

1-11-13

10

10

1-11-13

21372

8073

1-14-13

8

11

1-14-13

25044

8390

1-15-13

10

10

1-15-13

6735

7626

1-16-13

10

10

1-16-13

9145

14231

1-17-13

11

8

1-17-13

17630

15208

1-18-13

12

7

1-18-13

30618

15985

1-21-13

Holiday

 

1-21-13

Holiday

 

1-22-13

11

9

1-22-13

13881

14187

1-23-13

8

12

1-23-13

11642

7175

1-24-13

11

9

1-24-13

12868

13706

1-25-13

15

5

1-25-13

45897

12776

1-28-13

10

9

1-28-13

9419

33969

1-29-13

12

8

1-29-13

12384

7416

1-30-13

10

10

1-30-13

13203

10238

1-31-13

6

14

1-31-13

4509

11894

2-1-13

17

3

2-1-13

17057

14662

2-4-13

4

16

2-4-13

18445

18181

2-5-13

17

3

2-5-13

25202

18738

2-6-13

11

9

2-6-13

22708

6372

2-7-13

6

14

2-7-13

10706

8964

2-8-13

12

8

2-8-13

11757

10102

2-11-13

15

5

2-11-13

7341

9714

2-12-13

14

6

2-12-13

14035

10674

2-13-13

9

11

2-13-13

22996

19130

2-14-13

10

9

2-14-13

22966

6378

2-15-13

6

13

2-15-13

39599

8680

*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

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

11-23-12

18

2

11-23-12

136708

34280

11-30-12

12

8

11-30-12

152468

59828

12-7-12

15

5

12-7-12

53407

49271

12-14-12

10

10

12-14-12

51445

98445

12-21-12

14

6

12-21-12

216650

126720

12-28-12

5

15

12-28-12

19431

48587

1-4-13

19

1

1-4-13

142605

25100

1-11-13

13

5

1-11-13

90566

22250

1-18-13

11

8

1-18-13

75858

37446

1-25-13

12

7

1-25-13

67580

24811

2-1-13

14

6

2-1-13

47418

27737

2-8-13

10

9

2-8-13

79635

31633

2-15-13

11

9

2-15-13

81129

33755

**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.

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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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