Weekly Stock Market Update: All 9 Indicators are Down

This week ended down with all 9 indicators in the dumps. As a refresher, the reason we look at the 9 indicators is to get a sense of the overall market direction. If they are all flashing down like they are this week, then we know this is not a good time to buy new stocks for a trade (shorter duration of holding the stock) because it is very possible the market will go down further.  

I am staying on the sidelines with my discretionary stock money but continuing to do my monthly investing in long term mutual funds. Long term, as in I won't need the money for many years and therefore will take advantage of dollar cost averaging in a down market.



1 - 3. Major indexes vs. their 30 week moving averages. All three indexes blew down past their 30 week moving averages.

4. Convergence of NYSE AD and DOW. Both moved down this week. Click here to see Barron's chart.


5. NYSE 200 day Moving Average.The NYSE dropped well below its 200 day moving average.

6. NYSE 52 Week High vs. Lows. We have a pretty solid streak of more new lows than highs. This pattern has been in place for at least 6 months and shows weakness in the market.

7. NYSE 52 Week High Low vs. Dow Convergence/Divergence. This week the NYSE 52 Week High/Low Differential was down (see above chart in #6) and the Dow moved Down (see #1). Both agree in the downward direction.



8. International Markets. The Global Dow is still way below its 30 week moving average.

  
9. Cost of a Dividend on the DOW.  Still costly at 37.