From owner-doc-jp@jp.FreeBSD.org Thu Nov 26 20:36:56 2009
Received: (from daemon@localhost)
	by castle.jp.FreeBSD.org (8.11.6p2+3.4W/8.11.3) id nAQBauD61676;
	Thu, 26 Nov 2009 20:36:56 +0900 (JST)
	(envelope-from owner-doc-jp@jp.FreeBSD.org)
Received: from test.com (skellyhome.org [220.231.180.250] (may be forged))
	by castle.jp.FreeBSD.org (8.11.6p2+3.4W/8.11.3) with ESMTP/inet id nAQBapC61651
	for <doc-jp@jp.freebsd.org>; Thu, 26 Nov 2009 20:36:52 +0900 (JST)
	(envelope-from thebullandbearobserver4@gmail.com)
Received: from fls-9e466565812 ([220.231.180.250]) by test.com with MailEnable ESMTP; Fri, 20 Nov 2009 11:37:46 +0800
Message-ID: <4172-220091152033746531@fls-9e466565812>
To: "A1" <thebullandbearobserver4@gmail.com>
From: "The Bull & Bear Observer" <thebullandbearobserver4@gmail.com>
MIME-Version: 1.0
Content-type: text/plain; charset=windows-1252
Content-Transfer-Encoding: quoted-printable
Reply-To: doc-jp@jp.FreeBSD.org
Precedence: list
Date: Fri, 20 Nov 2009 11:37:46 +0800
X-Sequence: doc-jp 74106
Subject: [doc-jp 74106] Bull & Bear - Market Divergence
Sender: owner-doc-jp@jp.FreeBSD.org
X-Originator: thebullandbearobserver4@gmail.com
X-Distribute: distribute version 2.1 (Alpha) patchlevel 24e+060209

In the market things are not always what they seem to be=2E  You can have =
segments of the market hitting new highs but the broader indices falling a=
part=2E  =20


BY Martin Goldberg

As the market averages stage yet another rally, market internals continue =
to degrade=2E It is quite possible that the advance of the major averages =
can continue into the favorable year end seasonality in a similar fashion =
as was the trend in last bull market=2E Another short and shallow correcti=
on lasting at most two to three weeks is also a real possibility for the m=
ajor averages in the short term=2E This would continue a trend that has be=
en fairly consistent since August=2E  However, there appears to be a new p=
henomenon in the market that warrants watching since if it continues, it i=
s probably indicating something more meaningful than the typical short sha=
llow correction of less than 10%=2E=20

What are some of these internals=3F First, it is curious that the small ca=
p stocks are severely underperforming the more capitalized market averages=
=2E Consider the short term chart of the Russell 2000 index=2E What you se=
e in October is an attempt for the small cap average to best the $62/share=
 level reached in August=2E It tried for 5 days before it gave up, whereup=
on it made a low on November 1st that was lower than the low it made on Oc=
tober 1st=2E Over the last ten trading days, as the Dow went to new highs,=
 the Russell made a lower high=2E You can see that the volume bars (corres=
ponding to the Russell 2000 ETF trading) for down days are greater than th=
e up volume days=2E This suggests distribution of the smaller cap stocks=2E=

=20
Those October highs are vulnerable for numerous indices and should be care=
fully watched because a failure to hold the October highs is technically s=
ignificant=2E

And speaking of distribution, it is curious that the proprietary accumulat=
ion/distribution index published by Investor=92s Business Daily (IBD) has =
the Nasdaq, S&P 500, the Dow and NYSE at D-, D-, D and D, respectively=2E =
What is curious about this is that the averages are at their 52-week highs=
=2E Distribution can also be seen by examining the volume trends of the ma=
jor indices which show the tendency toward low volume up days and high vol=
ume down days=2E=20

It is also curious that while the Nasdaq sits on its 52-week high, only ab=
out 40% of the stocks listed within it are above their 50-day moving avera=
ge=2E=20

Of the US major averages, it is the most stable Dow Jones Industrial which=
 is now leading the others=2E History suggests that strong market advances=
 tend to occur with more dynamic leadership=2E Another similar trend which=
 is probably not a healthy one is the trend toward the most liquid of the =
technology stocks=2E It appears that traders have no limits as to what the=
y will pay for an Apple or a Google=2E This was what happened during the O=
ctober 2007 top=2E Remember Las Vegas Sands=3F

These are but a few of the degrading internals=2E There are numerous examp=
les including momentum which is for another day and/or another technician=2E=
=20

The market can surely advance as internals continue to degrade=2E My opini=
on is that this rally will not be subject to a quick reversal; but rather =
there will be optimal market behavior to convince the public that each dip=
 is a buying opportunity=2E Sentiment will continue to stay bullish until =
a major top is put in=2E=20



If you are not interested in receiving these emails, simply click the link=
 below and type the address you want to be removed from our database=2E =20=


http://thebullandbearobserver=2Ecom/remove/index=2Ephp=3Femail=3D

(Please allow us up to 10 days to process your request=2E)


