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----- Original Message -----
From: <A
title=mike-burk@xxxxxxxxxxxxxxxxxxxxxx
href="">Mike Burk
To: <A title=mike-burk@xxxxxxxxxxxxxxxxxxxxxx
href="">Mike Burk
Sent: Saturday, March 20, 2004 7:27 PM
Subject: 3/20 Report
Technical market report for March
20, 2004The good news is:
<LI class=MsoNormal
>The
number of new lows remains insignificant.
<LI class=MsoNormal
>The
secondaries have held up well relative to the blue chips.
Friday’s market activity was
troublesome. Many of the short term
indicators appeared to bottom with Monday’s low and were heading upward until
Friday.The chart below makes the point.<SPAN
> The chart shows a 10% trend of New lows
calculated over the past 6 weeks (rather than 52 weeks as reported by the
exchanges) of only the issues in the S&P 500.<SPAN
> The indicator is plotted on an inverted
Y axis so an increasing number of new lows moves the indicator downward.<SPAN
> There was a low for the past year on
Monday and the indicator was heading upward until Friday.
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This reminded me of patterns
seen in July-August of 1990 when new lows continued to build during the rallies
following the mid-July high..The chart below shows a 10% trend of
NYSE new highs (52 week) in green and a 10% trend on NYSE new lows on an
inverted Y axis in blue, the Dow Jones Industrial Average is shown in red.<SPAN
>
<v:shape id=_x0000_i1026
type="#_x0000_t75"><v:imagedata
src=""
o:title="HL-1990"><IMG
src="gif00084.gif">
I got a reality check looking at
a chart of the current period using the same parameters..<SPAN
> In the first chart the new high
indicator was off a high made a year earlier and the value of the EMA of new
lows was 117. In the next chart the
new low indicator is barely off the top of the chart and the value of the
indicator is 9. In the first chart
the value of the ;new high indicator was 24 while the current value of the new
high indicator is 177. Even
considering the caveat that NYSE new high and new low data is not what it used
to be, there should be no confusing the current period with 1990.
<v:shape id=_x0000_i1027
type="#_x0000_t75"><v:imagedata
src=""
o:title="HL-Now"><IMG
src="gif00085.gif">
Longer term I remain optimistic,
next week is a different matter.
The deterioration Friday was widespread, the chart below shows the
difference of momentum of volume of issues of the S&P 500 moving down
subtracted from momentum of volume of issues moving up.<SPAN
> The indicator has made rapid reversals
several times in the past 6 months, but usually a turn downward has indicated
the beginning of a weak period lasting a week or two.
<v:shape id=_x0000_i1028
type="#_x0000_t75"><v:imagedata
src=""
o:title="SPX-UD-MoM-Diff"><IMG
src="gif00086.gif">
The next chart shows momentum of
total volume of the issues in the Russell 2000 (R2K).<SPAN
> The best performance is usually realized
while the indicator is rising. The
indicator lags, but the current posture of sharp decline is not encouraging.
<v:shape id=_x0000_i1029
type="#_x0000_t75"><v:imagedata
src=""
o:title="R2K-Composite-Vol-MoM"><IMG
src="">
The last chart shows 3
indicators along with the NASDAQ composite.<SPAN
> Thei indicators are summation indexes
(SI) of oscillators of NASDAQ advances and declines, new highs and new lows and
upside and downside volume. They
vary somewhat, but when they are all heading in the same direction it is
imprudent to bet against them and they are all heading downward.<SPAN
> A chart made from NYSE data looks
similar.
<v:shape id=_x0000_i1030
type="#_x0000_t75"><v:imagedata
src=""
o:title="OTC-3SI"><IMG
src="gif00087.gif">
It is a little early to
say, but my expectation for a low early last week was probably wrong.
I expect another leg
downward and the major indices will be lower on Friday March 26 than they were
on Friday March 19.<SPAN
>This
report is free to anyone who wants it, so please tell your friends.They can
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Description: "with REMOVE in the subject line.Thank you,Mike Burk W5/L5/T1 "
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