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

To: bob gauthier who wrote (83879)	6/9/2003 12:41:34 PM
From: Bill Martin	Read Replies (1) \| Respond to of 99985

Re: The DOW is now at a higher level above the 200 day moving average than at any time since January 2000...the area between the 40 day moving average and the actual value of the DOW since the last cross over...This area has not been this high since January 2000....To me these all signals a significant overbought condition. Your note caught my eye so I did a quick check of the SP500 using your approach, but with 200 & 50 day averages. I see the same thing you're talking about, but.... I also charted this all the back to 1990. Basically these high figures seem to be common during bull markets. One or both of the indicators were frequently higher than they are now all the way from mid 1995 through 2000. The numbers back through the 90's bull market get even higher if you plot the deltas and areas as percentages of the index price rather than as absolute numbers. I think you've found an indicator of a renewed bull market in place, which may or may not be an over bought condition. FWIW... Bill