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Strategies & Market Trends : MDA - Market Direction Analysis -- Ignore unavailable to you. Want to Upgrade?

To: Lucretius who wrote (23106)	8/15/1999 11:41:00 PM
From: Chip Anderson	Respond to of 99985

Howdy everyone, We just got back from exhibiting at the Seattle Money show. John Murphy (ex CNBC Technical Analyst) came by our booth and looked at our Interactive InterMarket PerfChart ( stockcharts.com ) and _really_ liked what he saw. It reinforces much of what he wrote in his "Intermarket Technical Analysis" book. For example, try the following: After the chart loads and you can see the performance lines for the four major financial indications (CRB, NYSE, US Dollar Index, Long Bond), click on the legend labels for the Dollar and the Long Bond to turn off those lines. You should be left a red line for the CRB (Commodities) and a black line for stocks (NYSE). Notice that the lines are (basically) mirror images of each other? That's the normal, inverse relationship between stocks and commodities. It indicates that the current market direction is "healthy" from a pure intermarket standpoint. Now find the date slider at the bottom of the chart. It's divided into three parts. Click and drag the left part of that slider to the left until the charts shows data from June 1, 1999 to now. Notice how the two lines move (more-or-less) in unison during the month of June? That's an "unhealthy" situation from an intermarket perspective. Remember that during June, the markets were moving euphorically higher (especially techs). That rally came to a screeching halt in mid-July, soon after the "normal" relationship between stocks and bonds appeared on this chart. Of course, the relationship between stocks and commodities is just one small piece of a very large puzzle. However, you can use this free interactive tool to examine these four major relationships anytime. Enjoy, Chip Anderson stockcharts.com P.S. Also check out our brand new, free, interactive Point-and-Figure charting tool - stockcharts.com