No chart but not much has changed since the one in the previous post. The market continues to grind higher in an orderly fashion. It appears to be correcting its excesses internally as individual stock groups rotate in and out of favor.
The SPX cash closed at 1326.06 with the upper 20 day BB at 1331.44. So there's about 5-8 points of clear air overhead before the SPX gets above the 2 stdev BB. The 3 stdev BB is 25 points higher and a potential target roughly in the 1350 area.
The MCO finished at +174, in overbought territory but below the +200 level which has produced spike reversals. The MCO has spent 16 of the last 22 days above +100. This means that the 10% Index has been above the 5% Index by 100 or more points for most of the last month and indicates a strong upward trend in the AD line.
The 10% Index finished at +624 today with the 5% Index at +450. These are readings which are equivalent to a big thrust move in a MACD indicator and though they are overbought do not signal a top until they form a negative divergence with the price.
The Summation Index is at 3929, roughly 900 points above its 13 day moving average. It's been above the moving average for about 20 days and my MACD on the SUM Index indicates it would take at least 10 trading days to stall it enough to force a cross below the 10 day MA.
Finally, the Climatic Volume Indicator is NOT SPIKING, its 10 day moving average is a +25 (bullish neutral) It's been 15 days since the last minor spike above +50. The way I am reading this is that so far there is no rush to get in the market, no frothy distribution.
Thursday, January 19, 2012
Click to enlarge
A generally bullish configuration of these indicators. The MCO and 10% Index are slightly overbought so we could see a pause to refresh at some poing in the next few days.
Top Plot: The MCO has been above 100 for 12 of the last 18 sessions. This indicates that AD line is now strongly trending higher.
2nd Plot: The CVI (Climatic Volume Indicator) is well behaved. Its 10 day MAVG is at 24 which is bullish but the raw CVI has been less spiky indicating that the trend is strong but less nervous.
3rd Plot: The SPX with 2 & 3 STDEV Bollinger Bands
4th Plot: The 5% and 10% components (moving averages of the AD line) are trending higher at about the same rate (they are parallel)
5th Plot: The Summation Index (dots) with its 13 day MAVG.
The SUM Index is above 1300 and in the region where stocks start to make sharper price moves higher. The CVI doesn't show this just yet indicating that the trend is grinding higher without drawing too much attention to itself. I view this as strongly bullish because it indicates we haven't reached the recognition phase yet. The SUM Index tends lag the actual market turn since it doesn't turn positive until the MCO is above zero. It is currently above its 13 day MAVG which indicates it's trending bullishly higher.
6th Plot: This is a 12-14-15 MACD on the SUM Index. Seems to be reasonably good at indicating turns in the SUM Index.
Bottom Plot: This is a default 12-26-9 MACD on the SPX for reference.