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1/23/2011

January 23, 2011 Leave a comment Go to comments
 
Table of Contents
  • Status of Key Market Parameter
  • Broad Stock Market Swinging in a Rising Wedge
  • Market Volatility below the Panic Threshold
  • Sector Ranking with Energy Sector Leading
  • BRIC Stock Market Performance

 
Current Status of the LWX (Leading Wave Index)
  
 
The LWX Indicator in Last Four Weeks (Past)
 
 
The LWX Indicator in Next Four Weeks (Forecast)

 
Broad Stock Market Swinging in a Rising Wedge
 
The Dow Jones Wilshire 5000 index, as an average or a benchmark of the total equity market, is swinging in a 5-month Rising Wedge with negative readings of both the trend and momentum indicators last week. The market currently is in the choppy zone of the rising wedge. The Leading Wave Index (LWX) indicator, color coded in the price bars of the following daily chart of the Wilshire 5000 index, was bearish last week. Based on the forecast of the LWX indicator, the market is in a neutral time-window that could last weeks until higher market volatility is released.


 
Broad Market Volatility below the Panic Threshold
 
The Broad Market Volatility (BIX), measured from over 8000 U.S. stocks, closed at 24 on Friday and it is below the panic threshold level of 46. The volatility level of 24 is low and it indicates that the current market is bullish. But the BIX is getting higher. The BIX is plotted in the following chart as compared with the Wilshire 5000 index.
 

 
Sector Ranking with Energy Sector Leading
 
The following table is the percentage change of sectors and major market indexes against the 89-day exponential moving average (EMA89). The Dow Jones Wilshire 5000 index, as an average or a benchmark of the total market, is 5.57% above the EMA89. Outperforming sectors are Energy (+10.32%), Banks (+8.56), and Semiconductors (+7.41%). Underperforming sectors are Precious Metals (-3.31%), pharmaceuticals (+0.69%), and Telecommunication (+1.40%), The S&P 400 Mid-cap (+5.72%) is outperforming the market, and the Russell 2000 Small-cap (+4.30%) is underperforming.
 

 
BRIC Stock Market Performances
The table below is the percentage change of the BRIC stock market indexes against the 89-day exponential moving average (EMA89). The Russia market (+13.34%) is outperforming the US market. The China market (-3.65%), the India market (-2.93%) and the Brazil market (-0.01%) are underperforming the US market.
 
 
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