jump to navigation

The Slow, Steady Climb, but with Changes April 29, 2011

Posted by Tom in Thoughts.

The markets did continue there slow, steady climb this week.  The strength and breath are hard to deny.  So, I’ve decided to try posting some graphics which may help to show this.  (it’s an experiment, so let’s see how it comes off; click on the graphic to enlarge it)

The pie chart above shows the number and the percentage of stocks in the S&P 1500 Index (small cap thru large cap), that are in the 5 slices of Accumulation and Distribution.  A complete discussion is outside the scope of this blog, but let’s keep it simple and say that Accumulation is a measure of money flowing into a stock, while Distribution is flowing out of it.  The shades of green and red are an indication of strength and weakness.  (alot of green is good)

Next pie chart shows the strength of the price of the stocks.  The pie chart is divided into “slices” or “buckets”.  Each slice shows the number and percentage of stock prices in relation to their Bollinger Bands.  Way above the upper band is very strong, above the mid-point moving average is pretty good and below gets worse.  I think you get the point; dark green is real strong, yellow is neutral, while the reds are weak.

Now, while the market is showing definite signs of strength, I should note that there appears to be some signs of sector rotation.  Sectors that look strong now are:  Heath & Bio Science, Auto Parts, Internet, Semiconductor Mfg., Cable & Wireless, Drug – Pharma, Chemical, select European and Asian-Pacific Rim countries and Steel.  It seems that there may be a rotation away from some Retail and Tech names.  So keep an eye open for signs of money changing sectors.

Other than that, I’ve sold Silver on friday.  No big technical reason except I’ve done well with it, and the daily volume speaks of a bubble to me.  Way tooo many people (likely retail investors) are chasing it now.  And once the last person buys it, it WILL go down.  I certainly don’t know when that will be, but it will likely be a violate move.  No thanks.

Have a good weekend and an even better week.  Cheers !

Chart courtesy of High Growth Stock Investor (www.highgrowtstock.com), (C) 2000-2011, used by permission.


No comments yet — be the first.

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

This site uses Akismet to reduce spam. Learn how your comment data is processed.

%d bloggers like this: