End of Overbought Period for Stocks Ushers In the Bear – Above the 40 (January 4, 2020)

Stock Market Commentary The weakening overbought conditions finally gave way to a full breakdown. The abrupt end of the overbought period ushers in the bear. Ironically, trading started well with the S&P 500 (SPY) gapping slightly higher at the open. The selling pressure started after the open and did not relent until lunchtime on the … Read more

Weakening Overbought Conditions Greet the New Year – Above the 40 (December 31, 2020)

Stock Market Commentary The extended overbought period still looks tenuous. For the second trading day in a row, AT40 (T2108), the percentage of stocks trading above their respective 40-day moving averages (DMAs), broke down below the overbought threshold of 70% before closing at 73.0%. The major indices do not reveal these weakening overbought conditions. The … Read more

An Overbought Stock Market Stretching for a Fresh Rally – Above the 40 (November 27, 2020)

Stock Market Statistics AT40 = 79.6% of stocks are trading above their respective 40-day moving averages (DMAs) (Day #10 overbought) AT200 = 76.0% of stocks are trading above their respective 200DMAs (near 3-year high and holding breakout above post financial crisis downtrend) VIX = 20.8 Short-term Trading Call: neutral Stock Market Commentary Instead of Monday, … Read more

Bearish Indices and Bullish Reopen Stocks Create Abrupt Rotation – Above the 40 (November 9, 2020)

AT200 (T2107) surged 10 percentage points to close near a 3-year high and a breakout above the post financial crisis downtrend.

Stock Market Statistics AT40 = 67.8% of stocks are trading above their respective 40-day moving averages (DMAs) (high of 75.1%) AT200 = 63.6% of stocks are trading above their respective 200DMAs (near 3-year high and breakout above post financial crisis downtrend) VIX = 25.8 (as low as 22.4) Short-term Trading Call: neutral Stock Market Commentary … Read more

A Time to Retreat to Neutral on the Stock Market – Above the 40 (November 4, 2020)

Stock Market Statistics AT40 = 48.2% of stocks are trading above their respective 40-day moving averages (DMAs) AT200 = 51.5% of stocks are trading above their respective 200DMAs (8-month high) VIX = 29.6. (a plunge of 16.8%) Short-term Trading Call: neutral (downgrade from cautiously bullish) Stock Market Commentary At the time of writing, the U.S. … Read more

Oversold Stock Market Conditions End With An Immediate Challenge – Above the 40 (September 25, 2020)

Stock Market Statistics AT40 = 23.3% of stocks are trading above their respective 40-day moving averages (DMAs) (ended 2-day oversold period)AT200 = 38.6% of stocks are trading above their respective 200DMAsVIX = 26.4Short-term Trading Call: cautiously bullish Stock Market Commentary The oversold period lasted just two days, a typical length of time for oversold periods. … Read more

Stock Market Gap-Downs Send Traders Back to High Tech Playbook – Above the 40 (September 21, 2020)

Stock Market Statistics AT40 = 28.7% of stocks are trading above their respective 40-day moving averages (DMAs). (traded as low as 24.8%)AT200 = 40.0% of stocks are trading above their respective 200DMAsVIX = 27.8 (traded as high as 31.1)Short-term Trading Call: neutral (changed from cautiously bearish) Stock Market Commentary For a brief moment the entire … Read more

Tech Fertilizes the Weeds in the Stock Market – Above the 40 (September 11, 2020)

Stock Market Statistics AT40 = 40.2% of stocks are trading above their respective 40-day moving averages (DMAs) (2-month low)AT200 = 43.0% of stocks are trading above their respective 200DMAs (2 1/2 week low)VIX = 31.5Short-term Trading Call: cautiously bearish Stock Market Commentary The weeds in the stock market thickened last week. Tech stocks fertilized the … Read more

S&P 500 Rejoins the All-Time High Club As Overbought Conditions End – Above the 40 (August 18, 2020)

Stock Market Statistics AT40 = 69.7% of stocks are trading above their respective 40-day moving averages (DMAs) (ended 7 overbought trading days)AT200 = 44.7% of stocks are trading above their respective 200DMAs VIX = 21.5Short-term Trading Call: cautiously bullish Stock Market Commentary A stock market that keeps its focus on positive catalysts finally gained enough … Read more

Stock Market Hits Overbought with A Bullish Divergence – Above the 40 (August 7, 2020)

Stock Market Statistics AT40 = 72.2% of stocks are trading above their respective 40-day moving averages (DMAs) (1st day overbought)AT200 = 42.3% of stocks are trading above their respective 200DMAs VIX = 22.2Short-term Trading Call: cautiously bullish Stock Market Commentary The last overbought period ended in June. The volatility index (VIX) did not drop much … Read more