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Strategies & Market Trends : Money Flow Analysis

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To: Vitas who wrote (1)1/30/2004 12:00:05 PM
From: Paul H. Christiansen  Read Replies (1) of 4
 
Yes. I work with the total dollar values for Gainers and the total dollar values for Losers (WSJ terms). To simplify the analysis, I then reduce those numbers to a ratio. Any time the ratio is above 1.0, Gainers are dominating; below 1.0, Losers dominate. This also offers an indication of the intensity of dominance.

It's been interesting to note that all of last year the 30DMA ratio was around or well above 1.5 (on a weekly basis). Beginning in mid-July and ending towards the end of August the ratio spiked from roughly 1.65 to a peak of 4.0. It has since settled back to the 1.5 level.

On a separate note, as indicated I also track individual stocks that appear on the either list for at least 7 out of 10 days. 7 seems to separate the random appearance of some stocks and reflects buyer intensity.

Over the past 12 days, only 3 stocks have appeared on the Gainers list for more than 8 days; AT&T Wireless, Ford and General Motors - each appearing on the Gainers list 11 of 12 days. The latter two can perhaps be explained by new money coming into institutional investors - a reasonably safe investment. AWE is a different story. It looks like the institutions think that there might be further bidding for AWE.

Finally, on the Loser's side, the stock with the most appearances on this list over the past 12 days has been . . . Microsoft!
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