Skip to main content

Weekly Review - on the rebound

What a rebound! Five straight days of gains are certainly a welcome comeback from the previous two weeks of declines. Time for the bears to take control again?

We'll look at where we are today in some of the charts that follow and see if we can figure out where we are going.

The view from Alert HQ --

Charts of some of the statistics we track at Alert HQ are presented below:

SPY vs.Moving Average Analysis, 10-09-2009This first chart tracks our moving average analysis. With stocks doing a quick about-face this week we see the number of stocks above their 50-day MA surging upward (the yellow line). It is close to crossing above the magenta line, the number of stocks whose 20-day MA is above their 50-day MA. If this does come to pass, it will be a bullish signal.

The next chart provides our trending analysis. It looks at the number of stocks in strong up-trends or down-trends based on Aroon analysis.

SPY vs.Trend Analysis, 10-09-2009
As can be expected, we can see the number of stocks in a down-trend has decreased. What I didn't expect is that the number of stocks in up-trends would continue to decline. These two usually move in opposite directions so this is a bit of a worrisome sign.

Conclusion --

One chart bullish, the other chart half-bullish. I guess you can't have everything.

So, the chart setup is pretty decent; however, the real catalyst this week will be in the form of earnings reports. The bellwethers will be out in force: Johnson & Johnson (JNJ), Intel (INTC), JP Morgan Chase (JPM), Citigroup (C), Goldman Sachs (GS), Nokia (NOK), Google (GOOG), IBM (IBM), Bank of America (BAC) and General Electric (GE).

Though earnings may the primary objects of interest, there are a decent set of economic reports on tap this week including retail sales, the consumer price index, the Philadelphia Fed index and industrial production.

It can be assumed that economic reports will continue the "less bad" theme so the market's short-term direction will surely be dependent on earnings. A big miss by a few of those bellwethers and rebound could turn into slump.

Disclosure: no positions in any stocks mentioned

Comments

Popular posts from this blog

Unlock Stock Market Profits - Key #1

This is the first in an ongoing series of articles where I discuss what I feel are keys to successful investing. It is based on a post that provides a summary of the ten keys that individual investors should use to identify profitable stock trades. ( Click here to read the original post ) There are two basic steps to investing. First, you need to find stocks that seem to have some potential. Then you have to determine whether these stocks are actually good investments. There are many stocks that at first glance look interesting, but further research reveals that there are too many negatives to warrant taking a position. This first post in the series starts at the beginning: getting good investment ideas. Key #1: If something special is happening to a stock, it will be reflected in some kind of unusual activity in the markets. As individual investors, we will never be the first to know; however, unusual activity can be an early sign that allows us to follow the Wall Street profess

Unlock Stock Market Profits - Key #4

This is the fourth article in a series of posts describing 10 tools to help you identify and evaluate good investing ideas. It is based on a post that provides a summary of the ten keys that individual investors should use to identify profitable stock trades. ( Click here to read the original post ) With this fourth post, we will continue another step along the path of finding stocks that seem to have some potential. The first post in the series discussed how to use unusual activity to identify investing ideas. The second post described how to use stock screeners. The third post described how to use lists of new highs and new lows. This post will focus on identifying social or business trends in order to find investing ideas. Information on new trends might turn up anywhere. In conversation with friends or business associates, in newspapers or magazines, on TV or though your work. The key is to be aware of trends and how they start, stop or change. We'll start by describing wh

Interactive Ads - Google one-ups Yahoo again

Google's ( GOOG ) press release describing the expansion of a beta program for what are being called Gadget Ads has again shown that Google is unparalleled at melding technology and advertising to benefit its bottom line. Gadget Ads are mini-web pages or "widgets" that can be embedded within publisher pages. I have written in the past on Yahoo's ( YHOO ) Smart Ads and how, by more precisely targeting site users and adjusting ad content accordingly, they provide a much desired evolution of the banner or display ad format. Though Smart Ads and Gadget Ads are not really the same, I think it is fair to say that Google has seen the challenge of Smart Ads and has chosen to leapfrog Yahoo by rolling out its own update to the display ad format. The evolution of the Gadget Ad -- One of the trends on the Internet over the last year or so involves software developers creating "widgets" which can be hosted within web pages and blogs. Widgets can be pretty much any