Weekly Rewind: Signs of a Nascent Recovery?

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(Glossary)

Markets largely recovered from a near 700-point Dow (DIA) downdraft last Monday, posting a mere -1.9% decline for the week. However, considering the period's dour economic news - starting with an official NBER recession call and culminating in the worst jobs report since 1974 - the move almost feels outright positive. (USA Today - NBER Statement; AFP - US Sheds Jobs)

Sector-wise, Consumer Discretionaries (XLY) outperformed with a positive +2.9% pop, but is now approaching overbought status with an RSI-2 of 90 and an RSI-5 of 70. Nonetheless, it has been a relatively steady performer this month with a Trend Stability score of 73. Could this be a leading indicator for a nascent recovery? Meanwhile, the undoubtedly related loser was Energy (XLE), down a whopping -12.2%. If you are looking for oversold, though, look no further than Commodities (DBC), which is now featuring extreme readings (see Non-Equity).

Week 50 of 2008 (can that be possible?) features the following economic reports:

• Yahoo! - U.S. Economic Calendar
• Yahoo! - U.S. Earnings Calendar

Enjoy your weekend!

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Comments

[Did U Think...:]

Recovery?? Look, no stock or index goes straight up or down. We are having a sucker's rally that will soon lose its legs and then start in on another big, fat sell off. The economy is falling aprart. Jobs are vaporizing.

Recovery?? It just doesn seem possible at this point.

2008 Dec 07 09:15 PM

[jgpietsch:]

Hey, no disagreement here -- but maybe we get some upside juice into the new year, no? More importantly, the chart above is incorrect (week 39, not 49). Please see blog for correct chart at marketrewind.blogspot...., and sorry about that. Have a good weekend, Jeff

2008 Dec 07 10:30 PM

[oldman:]

why is LXP listed for this commentary?

2008 Dec 08 10:17 AM