I know the DJIA, S&P, Russell and all of that is important.
but, for me, to get a really good look at everything – I use the New York Stock Exchange Index.
“The NYSE Composite is a stock market index covering all common stock listed on the New York Stock Exchange, including American depositary receipts, real estate investment trusts, tracking stocks, and foreign listings. Over 2,000 stocks are covered in the index, of which over 1,600 are from United States corporations and over 360 are foreign listings; however foreign companies are very prevalent among the largest companies in the index: of the 100 companies in the index having the largest market capitalization (and thus the largest impact on the index), more than half (55) are non-U.S. issues. This includes corporations in each of the ten industries listed in the Industry Classification Benchmark. It uses free-float market cap weighting.”
It’s big and it just gives a good feel for the overall market.
It’s coming into a VERY key area of support shown below. IF YOUR A BULL THEN THIS IS THE AREA TO GET LONG (with a stop) and if the level fails then something is not right. Don’t try to rationalize it, have a plan. We’ve had an amazing 6 year bull run. And, as a PATTERN recognition swing trader, the rules state to BUY the first PATTERN that comes along. Well, since August, this is the “cleanest” buy PATTERN to come along.
Also, as readers of this blog you’ll realize that sometimes the patterns are PERFECT and SPOT ON. At other times, they slip thru some levels but ultimately continue on their way.
Where is the bull thesis wrong? Right now, those August lows are the key to this puppy continuing on ….
also, below is the XLP / $SPX ratio … it’s put in a series of higher lows (bullish ratio – bearish equities) and is banging, right now, up to a high-high trend line … WATCH THIS CLOSELY.
so … the selling that has occurred has been expected to simply finish the pattern. we are getting right into the areas where the patterns are completing.
watch these levels on the $NYA … if were going higher, they should hold. if not, well, hunker down for the time being and we’ll expand our time horizon and look bigger picture.