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Strategies & Market Trends : Systems, Strategies and Resources for Trading Futures

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To: GROUND ZERO™ who wrote (13527)	1/23/1999 8:50:00 PM
From: SE	Read Replies (2) of 44573

GZ, I have studied the S&P500 today and have some rough results that I would like to share with the thread. There are 43 companies that make up over 50% of the index by weighting. Those 43 break down very roughly as follows: Consumer Products (broad class - CMR) 12.95 Banking (BIX) 5.12 Drugs (HCX or DRG) 8.9 Telecom (XTC) 6.43 Oils (XOI) 3.74 Networking (NWX) 2.46 That encompasses nearly 40% of the index and that does not include the stocks that would be included in the above categories that fell outside the 43 studied stocks making up 50% of the index. Only the XTC is on a buy signal for my system. It has strongly outperformed since its bottom in Sept adding 54%. The NWX has doubled since its bottom in OCT. The HCX and CMR have added 28% since the OCT and Sept bottoms respectively. Oils and banks have performed, but less than the others. 200 day moving averages and current values BIX 670 647 XOI 447 413 NWX 360 425 XTC 756 986 HCX 682 716 CMR 509 534 Both the HCX nad CMR have very bearish MACD divergences on the daily charts and should continue lower. That right there is 20% of the S&P500. NWX and XTC are due for a serious breather being 18% and 30% above their respective 200 day moving averages. There is another 9% of the S&P500. The XOI, well, what can you say. Looks to me like it is going to continue lower. The BIX looks sick at best. Damn, I wish I was short. This does not look good right now based on the index study. MSFT, GE, MRK, XON and INTC take up the top five slots and make up 12% of the index. The only one on a buy signal is XON. MSFT is 54% above its 200 day moving average and has increased 89% since the low. GE has increased 50% since the low. MRK 40% since the low and is very weak right now on the news from Friday afternoon. XON has increased 23% since the low and INTC 112% since the low in JUNE and it is 33% above its 200 day moving average. From what I see, it looks to me like sell the rallies ought to be the order for the time being, not buy the dips. It looks ugly out there. Be Careful. -Scott

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