We made a stab at new highs in the S&P 500 Index e-mini futures (June contract shown) today before selling off late in the session, bringing us back into a multi-day trading range.
As noted in the intraday Tweet (follow here), the move toward highs was accompanied by considerable non-confirmation. Today we registered 1540 new 20-day highs in the NYSE, NASDAQ, and ASE stock universe, against 285 lows. By contrast, June 1st saw 2732 new 20-day highs against 248 lows.
Until we see a significant expansion of 20-day lows, it is premature to turn outright bearish on this market. To sustain an uptrend, however, we need to see broadening participation, not a narrowing of the trend's base.
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8 comments:
Brett,
I have been following you for quite a while. Great site. Thanks a lot for sharing your wisdom.
I have a question for you. Would you mind telling me what trading platform you use.
Thanks
Hi, how to calculate that moving average in green on the above graph ? its doesnt look like just a MA(HLC/3, 20)
I see the same Pattern in my Institutional Money (http://reflections-of-reality.blogspot.com/2009/06/golden5-breadth-context.html) and Tech (NDX50 http://reflections-of-reality.blogspot.com/2009/06/susi-turn-indicator-technology.html) portfolio developping.
Additionally their is a divergence between the cash and the optionmarket (http://reflections-of-reality.blogspot.com/2009/06/divergence-btw-cash-and-synthetic-s-500.html).
PLUS we had Misdirection day before option expiry.....
...but Dr. Brett agree we need confirmation by among others a spike in the 20d LOWS.
PS. Great podcast at the disciplined investor.
wondering if you count each 20 day high on tick/miutes/seconds basis?
Hi Sam,
I don't trade off an institutional platform, though that could change. I trade off direct access through brokers (multiple accounts).
Brett
Hi Sales,
The MA is a volume-weighted MA calculated by e-Signal.
Brett
Hi HistoryRhymes,
Thanks for the links, observations, and feedback--
Brett
Hi JesusCheung,
Yes, it's a cumulative number of stocks making new highs/lows updated each minute--
Brett
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