Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Strategies & Market Trends : MARKET INDEX TECHNICAL ANALYSIS - MITA -- Ignore unavailable to you. Want to Upgrade?

To: sidney-8 who wrote (4102)	8/6/2000 9:33:18 AM
From: AllansAlias	Read Replies (1) \| Respond to of 19219

By Monday close this week, it seemed clear to me that the strength in the old-economy charts and the continuing strength in the dollar would limit any downside move that people were worried about coming into the week. The SPU move to new highs on Tuesday I found particularly interesting. As we all know, the utilities and bank indices had a very fine week. SPU +5.4% on the week and BIX +10.4%. I have since been looking deeper into SPU and BIX. My motivation was to see if this would point us up for this week. My sample only goes back to the week of April 30, 1993 and is weekly bars exported from MetaStock/Reuters. As with the market overall since January, I am struck by the increase in volatility. Just looking at weeks with the largest percentage swings, of the top twenty such weeks, how many are from this year? Each of SPX, SPU, and BIX have 8 entries in this top-twenty. This past week is the first time in the sample that both BIX and SPU are up over 5%. No matter. I sliced and diced the data many ways and came to the conclusion that in general, an up week in any combination of BIX, SPU, SPX does not show any tradable pattern. Not surprising really. This sort of test rarely reveals anything interesting. One interesting footnote however. On a week where BIX is up 1% or more and SPX is down (14 such weeks), the chances of the next week being an up week for SPX appear to be greatly improved (12 out of 14, average such up-move is 2%). Does the inverse work? Does a down week in BIX and an up week in SPX point down? There were 24 such weeks and 16 times the following week was down. I have fun testing such things, but I do not trade them and they rarely show anything interesting. I'll stick to price, pattern, and sentiment. Cheers --Allan