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Market Direction

Over the weekend I ported my market internals charts from Tradestation to TickQuest’s NeoTicker and along the way made some minor changes and improvements to them.

One bonus of satellite delivered DTN Realtime data is the availability of New High and New Low statistics at the close of trading – I’m not aware of any other service which provides this. In fact, many data services do not provide this calculated statistic, period. DTN sister company IQFeed offers very complete and price competitive product which does include this data and a wealth of other statistics not commonly found from internet-delivered data services, although the new high/new low data is not available until long after the close to my knowledge.

NYSE

  1. ADX is in the extreme range, near 48
  2. New highs are falling even as price is rising
  3. Declining volume is starting to assert itselve
  4. Point 4 on the chart marks where a reasonable retracement should stop; anything much deeper than this level ought to be looked at with much more skepticism.

NASDAQ

  1. ADX us above 40 and headed to extreme levels; high ADX does not automatically mean a strong advance or decilne is over, but it does warn us that the end is closer than the start.
  2. New highs are contracting even as price is rising
  3. A trendline on the advance/decline line can be useful in identifying market tops and bottoms – we look for a cross through the trendline as part confirmation
  4. Midway down the tall up bar is where first support should come in on any decline. Do note also the spikes visible in the past two candles – another sign of topping action.

TSX

No market internal data is available for the TSX from common data providers, however I am working on constructing these statistics for our purposes. Stay tuned.

Thanks in part to recent sell-offs in the energy and metals sectors the TSX overall has not advanced much during the past week. Here a trendline is our basic guide. ETF buyers might look at XIU:C (TSX) for a buy above Friday’s high if broken, and I do stress IF as markets are likely to at least start the day weak.

04.12.06 09:23 #