Market gains on low volume, developing negative volatility

Weekly Review: MAAD & CPFL Analysis

McCurtain Call/Put Dollar Value Flow Line (CPFL)

CPFL activity was unimpressive last week. At the end of 3 ½ days of trading the indicator was only a bit higher than at the end of the previous week. CPFL also remains below a defined uptrend line stretching back to the November lows and a short-term plot high made June 11.

But like Daily MAAD, Daily CPFL declined less than index prices following the May 22 highs. If modest buying comes into the market in the days just ahead, there is an outside chance CPFL could make a new short to intermediate high. Anything short of that possibility would be an ongoing suggestion options players believe the intermediate trend initiated last November is over.

Conclusion

A low volume rally and movement by our volatility indicator toward negative in the face of a classic market reversal pattern (KRD) May 22 make us suspect strength over the past several days is unsustainable. But since the stock market never lacks surprises, we will defer to market action as traders return from a long holiday weekend to give more normalcy to pricing. But in a summer vacation environment it could be that “normal” is operating at only about 75%. That lack could have an effect of the current short-term rally.

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

5-23-13

7

13

5-23-13

54072

26123

5-24-13

7

13

5-24-13

23756

26622

5-27-13

Hol

---

5-27-13

Hol

---

5-28-13

14

6

5-28-13

18897

26818

5-29-13

9

10

5-29-13

31332

19318

5-30-13

16

3

5-30-13

21198

16440

5-31-13

1

19

5-31-13

14444

73380

6-3-13

12

8

6-3-13

32908

28279

6-4-13

8

12

6-4-13

19870

17545

6-5-13

1

19

6-5-13

31541

52720

6-6-13

16

4

6-6-13

49254

41512

6-7-13

14

6

6-7-13

54078

24555

6-10-13

11

8

6-10-13

22738

15800

6-11-13

2

18

6-11-13

31570

15611

6-12-13

3

16

6-12-13

16856

54812

6-13-13

15

5

6-13-13

54829

27474

6-14-13

4

16

6-14-13

21615

25234

6-17-13

18

2

6-17-13

14895

20292

6-18-13

18

2

6-18-13

26356

10390

6-19-13

3

17

6-19-13

9214

19005

6-20-13

1

19

6-20-13

34878

122103

6-21-13

10

10

6-21-13

21232

41894

6-24-13

3

17

6-24-13

31707

39671

6-25-13

15

5

6-25-13

20941

13480

6-26-13

15

5

6-26-13

21559

18482

6-27-13

18

2

6-27-13

21085

21086

6-28-13

10

10

6-28-13

17627

16807

7-1-13

14

6

7-1-13

19118

15879

7-2-13

7

13

7-2-13

12792

19881

7-3-13

11

9

7-3-13

16867

6921

7-5-13

11

9

7-5-13

28360

11927

*Note: Unchanged issues are not counted.

MAAD weekly data for past 30 weeks**

CPRL weely data for past 30 weeks

Date

NYSE Adv

NYSE Dec

Date

OEX Call $Volume

OEX Put $Volume

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

2-22-13

4

16

2-22-13

92498

42338

3-1-13

7

12

3-1-13

84043

45510

3-8-13

19

1

3-8-13

99617

35462

3-15-13

13

7

3-15-13

146291

30502

3-22-13

6

14

3-22-13

60614

38326

3-29-13

13

7

3-29-13

46289

19185

4-5-13

7

13

4-5-13

36138

75905

4-12-13

17

3

4-12-13

102421

24788

4-19-13

5

15

4-19-13

77064

98927

4-26-13

16

4

4-26-13

69002

47733

5-3-13

18

2

5-3-13

106307

39059

5-10-13

16

4

5-10-13

101919

27785

5-17-13

16

4

5-17-13

264768

40669

5-24-13

7

13

5-24-13

133188

105220

5-31-13

10

10

5-31-13

52189

172660

6-7-13

14

6

6-7-13

208337

89250

6-14-13

6

14

6-14-13

84672

121886

6-21-13

4

16

6-21-13

47968

226866

6-28-13

16

4

6-28-13

102801

64660

7-5-13

11

9

7-5-13

79591

26170

**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 4 of 4
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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