Some stock indexes are at new highs while others sluggish

MAAD & CPFL Review

 

Market Snapshot for session ending 10-14-13
 

Last

Day Change

%Change

S&P 500 Index

1710.14

+6.94

+.41%

Dow Jones Industrials

15301.26

+64.14

+.42%

NASDAQ Composite

3815.27

+23.40

+.62%

Value Line Index

4072.20

+18.12

+.44%

Russell 2000

1090.30

+5.98

+.55%

Minor Cycle* (Short-term trend lasting days to a few weeks) Positive

Intermediate Cycle* (Medium trend lasting weeks to several months) Neutral / Positive

Major Cycle* (Long-term trend lasting several months to years) Positive

* Cycle status is based on S&P 500.

Market Overview – What We Know:

  • Following through on strength last Thursday and Friday, all of major indexes were positive Monday. Value Line and Russell 2000 indexes closed at new highs. Biggest gainer was NASDAQ Composite, up .62%.
  • Despite market strength, however, overall market volume declined 12.2%.
  • S&P 500 has moved back into positive territory with strength above upper edge of 10-Day Price Channel and must now decline below lower edge of 10-Day Channel (1673.92 through Tuesday) to turn Minor Cycle negative. Intermediate Cycle remains positive so long as S&P holds above lower edge of 10-Week Price Channel (1651.61 through October 18).
  • Our VIX-based short-term volatility indicator, VBVI, was last at 56.5%. At September 19 short-term high VBVI was at 92.4%.
  • Daily MAAD was positive Monday by 17 to 3, but has yet to better September 18 new high, still needing 15 positive issues for a new high. Indicator remains above uptrend line stretching back to November 2012 lows. Daily MAAD Ratio was marginally “Overbought” at 1.35.
  • Daily CPFL was negative by 1.02 to 1 Monday with options players remaining relatively unimpressed with market strength since last Thursday. CPFL declined to new short to intermediate low October 9 and worst level since last February when S&P 500 was quoted near 1490. Indicator is below long-term uptrend line stretching back to October 2011. CPFL Daily Ratio is rising toward “Neutral” levels (.89).

Market Overview – What We Think:

  • Another new high in VALUA and a new high in the Russell Monday added more feathers to the bullish cap, but even gains have yet to get the S&P 500 and the Dow 30 out of the cellar. We could even see COMPX at new highs with the blue chips still failing. So it remains to be seen in current strength is merely a short-covering rally or something else.
  • Higher numbers in Daily MAAD were encouraging, but that indicator that has been a cheerleader for higher prices for the past few months still needs to make a new high. Will it?
  • And then there’s CPFL that has been moving net lower since June 11 and simply sniffed at strength over the past few sessions. If market fails on upside, CPFL remains poised to sink to another set of new lows and its worst levels since last February when S&P 500 was quoted toward 1500.
  • Bottom-line for this market remains in effect – nothing but new highs in all of major indexes will re-assert bull trend begun in March 2009. Selective new highs such as those in secondary indexes may develop, but without S&P and Dow 30 on bandwagon, serious follow-through on upside is highly doubtful.

Index Price Channel Stops (10-Bar MAs of Highs/Lows ) Weekly Monthly
 

10/14

10/15

10/16

10/17

10/18

10/18

10/31

S&P 500 Index

SELL 1678.95

SELL 1673.92

SELL 1668.06

SELL 1665.65

SELL 1668.65

SELL 1651.61

SELL 1478.59

Dow Jones Industrials

SELL 15044.51

SELL 14982.44

SELL 14920.61

SELL 14884.30

SELL 14909.91

BUY 15317.59

SELL 13737.33

NASDAQ Composite

BUY 3805.33

SELL 3753.78

SELL 3734.18

SELL 3729.41

SELL 3731.09

SELL 3605.27

SELL 3099.00

Value Line Index

SELL 3999.33

SELL 3986.49

SELL 3969.73

SELL 3959.32

SELL 3964.63

SELL 3651.73

SELL 3285.29

Russell 2000

SELL 1069.34

SELL 1065.25

SELL 1060.83

SELL 1056.94

SELL 1057.66

SELL 1023.32

SELL 3285.29

Note: Stop levels, a function of the extant trend, are based on the trailing moving average price channels for the Highs or the Lows of an index. Whether or not a specific index is suggesting a “Buy” or Sell” is determined by whether or not index prices are above or below the current channel Stop levels. Stop levels should only be used as an entry or exit guide and in conjunction with other market entry and exit strategies.

Next page: Indicator review

Page 1 of 2 >>
Comments
comments powered by Disqus