Typically during up trends, corrections find support when the percentage of S&P stocks above their 50-day moving average falls at or near the 20-25% range. As of yesterday, the reading is 33.0%. The symbol on Stockcharts.com is $SPXA50R.
Likewise, corrections sometimes find support when the percentage of S&P stocks over their 150-day moving average falls into the 60-65% range. Currently, that percentage is 77.6%. The symbol is $SPXA150R.
To me, these ranges are a good definition of "oversold in an up trend." Both served as support in the corrections of July 2009 and February 2010.
I am looking for one more down draft in the equity market that takes us to these oversold levels. Hopefully, that down draft also produces some bullish divergence on the Volume Oscillator and other momentum indicators. Such a happy convergence should produce an excellent buy point.
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Posts
Parker...........
ReplyDeleteYep......looking for the same now ......last turn up is now into my next price and time date. I believe we are looking at a 4th wave into the 5th..........my date into it is 4/2....chomping at the bit for this buy! Good trading...........charts are up showing my thoughts!
http://traderjoed.blogspot.com/
Parker-
ReplyDeleteAs we know, the final stages of a stock market rally can advance with deteriorating breadth. After working with Terry, what are your thoughts on getting a final T that does NOT involve a rising bottoms pattern (bullish divergence)? I guess this all has to be made with the assumption that a cyclical market top will be seen in the coming months...
An indicator I have been following is Barack Obama. Is he still the president? Off with his family for another taxpayer-paid vacation in Rio, while the world falls apart.
ReplyDeletePolitical comments are so childish and meaningless.
ReplyDelete...and true
ReplyDelete