Thursday, January 31, 2008

Wednesday Market Momentum Breadth Volume

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Bernie Schaeffer made the observation this week that when the bear market started back in 2001, the moving averages served as resistance for every rally attempt.  In that decline, once the 80 and 160 week averages were broken, that was it. 

Schaeffer notes that this time, the market broke below the 160 week, but then snapped back up above it.  He wonders if this could possibly be a favorable development for the market.  The 160 week now becomes an important test of support.




The NYSE new lows continue to behave really well.  Five days after the big .75% Fed Funds decline, the punishing new lows have dried up.  The NASDAQ new lows are higher then the NYSE and aren't quite as favorable, but have also stabilized.

Posted by at 03:52:52 | Permanent Link | Comments (1) |
Comments
1 - This move above the moving averages could be because of the exterior forces at bay. Imagine if we didn't have a 1.25% rate cut in a week? If it was Greenspan's process of incrementally lowering rates of course we'd be below.

So you need to view the charts in a similar fashion only imagine Greenspan had cut the rates 1.25% in a week.

Just my thoughts. (Comment this)

Written by: Kevin at 2008/02/01 - 01:55:00
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