JimVanMeerten (46.91)

Market on uptick

December 26, 2009 – Comments (0)

Each week I use BarChart to step back from all the noise and evaluate how the market really performed and determine my investing strategy for the coming week. I like the Value Line Index because it contains 1700 stocks giving me a much broader view of the market instead of the more narrow S&P 500 or the very narrow Dow 30. The market as measured by the Value Line Index was up 3.60% for the week and 8.32% month to date. With only 4 more trading days left we should end the year on a good note.

Value Line Index -- 1700 stocks -- All indicators are positive
1 - All 13 BarChart technical indicators have a buy rating for a 100% buy rating overall

2 -  The index closed on Friday above its 20, 50 & 100 daily moving averages

3 -  The Index has had a price appreciation in 12 of the last 20 trading sessions and is 5 for 5 recently

4 - The Index has had a 7.89% price appreciation in the last 65 sessions

BarChart Market Momentum Indicator -- percentage of stocks closing above their Daily Moving Averages for various time frames -- approximately 6000 stocks - Positive for all 3 time frames

1 - 76.79% closed above their 20 DMA

2 - 74.06% closed above their 50 DMA

3 -  74.79% closed above their 100 DMA

Ratio of stocks hitting new highs to new lows for various time frames -- 1.0+ bullish, 1.0 neutral, less than .99 bearish -- very bullish

1 - Ratio of stocks hitting new highs to new lows for the last 20 days -- 1614/203 = 7.95

2 -  Ratio of stocks hitting new highs to new lows for the last 65 days -- 913/124 = 7.36

3 -  Ratio of stocks hitting new highs to new lows for the last 100 days -- 823/93 = 8.85

Summary and investing strategy -- The market performed well this week and seems to have support across the board. I'll stay fully invested but still trim any stock not maintaining a price above its 50 day moving average. January is usually a strong month so I feel that I can safely replace any stock I cull. Have a great week and a prosperous New Year.

Jim Van Meerten is an investor who writes on financial matters here and on Financial Tides. Please leave a comment below or email JimVanMeerten@gmail.com