Sorry!! The article you are trying to read is not available now.
Thank you very much;
you're only a step away from
downloading your reports.

Secrets to a Better Relationship

By

There was no love lost in last week's market decline.

PrintPRINT


There was no love lost in last week's market decline. But buyers have been trying to patch things up with this week's rally. The relationships among major indexes is inverse from two weeks ago, when markets were topping.

Rather than the Dow outperforming, Nasdaq (NDX) led the way this morning by surging to a new high. Its current challenge is in trying to remain above yesterday's high. The Dow is at the opposite end of the spectrum, not only failing to print new highs this morning, but also standing alone yesterday in having failed to print higher highs then. Buyers have been diverting more energy into the NDX's higher P/Es, instead of being cautiously optimistic with the bluer-chipped Dow.

S&Ps performance meanwhile has been between the two, printing higher highs, following the NDX's lead. The only criticism - and it's not a small point - is that S&Ps aren't converting probes of new highs into actual breakouts. It's not so much a degree of underperformance, and more of an absolute: Unless S&Ps are also at new highs while chasing NDX, the underperformance is a non-confirmation of NDX buying.

New highs this afternoon in S&Ps would go a long way to buying the rally more time. A Dow recovery simultaneously would be icing on the cake, gravy on the steak, butter on the lobster (mmm, butter on the lobster). But today's probes of new highs set the requirement for at least S&Ps and NDX to close above prior sessions' intraday highs. Failing to do so would make the next probe of new highs much more likely to reverse down sharply intraday.
The information on this website solely reflects the analysis of or opinion about the performance of securities and financial markets by the writers whose articles appear on the site. The views expressed by the writers are not necessarily the views of Minyanville Media, Inc. or members of its management. Nothing contained on the website is intended to constitute a recommendation or advice addressed to an individual investor or category of investors to purchase, sell or hold any security, or to take any action with respect to the prospective movement of the securities markets or to solicit the purchase or sale of any security. Any investment decisions must be made by the reader either individually or in consultation with his or her investment professional. Minyanville writers and staff may trade or hold positions in securities that are discussed in articles appearing on the website. Writers of articles are required to disclose whether they have a position in any stock or fund discussed in an article, but are not permitted to disclose the size or direction of the position. Nothing on this website is intended to solicit business of any kind for a writer's business or fund. Minyanville management and staff as well as contributing writers will not respond to emails or other communications requesting investment advice.

Copyright 2011 Minyanville Media, Inc. All Rights Reserved.
PrintPRINT
 
Featured Videos

WHAT'S POPULAR IN THE VILLE