Monday, October 29, 2007

Update of Technical Strength and Other Thoughts to Start the Week

* Market in Balance - Of the 40 SPX stocks that I track across eight sectors, 13 qualify as technically strong, 15 as neutral, and 12 as weak. This Technical Strength measure is a quantification of short-to-intermediate term trending. The Technical Strength Index, a summary of trending across the 40 stocks, is a neutral +240--an improvement over figures from earlier in the week. The figures show a market with mixed strength. Very technically strong stocks include AA, MCD, PG, MO, KO, MRK, and MSFT. Relatively weak issues include CMCSK, BA, HD, LLY, and C.

* Technical Strength by Sector: Here are the eight SPX sector groups that I track and their Technical Strength Index scores. (Here's how the sectors looked last month). Perhaps anticipating economic slowdown, it appears that investors are favoring consumer staples. I'm surprised that energy stocks aren't stronger:

Materials: +180
Industrials: -180
Consumer Discretionary: -100
Consumer Staples: +320
Energy: +60
Health Care: +60
Financial: -80
Technology: +100

* Market Updates - Here are some good readings from across the blogosphere. I also have posted readings via Twitter:

** Overcoming market fears and other links from Trader Mike

** New tools for evaluating ETF risk and reward and other links from Abnormal Returns

** Excellent review by Kirk of a little book designed to make you rich

** The challenge of making markets in options with penny quotes: Daily Options Report

** Abandoning dollars for yuan and other links from Millionaire Now!

** Speculation of half-point Fed cut and other themes for the week: The Big Picture

Have a great start to your week!

2 comments:

bzbtrader said...

Like Kirk, CXO also has a review of the little book that could. http://www.cxoadvisory.com/blog/
CXO takes their usual intensive analytical approach and breaks it down chapter by chapter. Worth a look

Brett Steenbarger, Ph.D. said...

Thanx BZB Trader,

CXO blog is excellent; thanks for the heads up on their post.

Brett