For today's post, we'll be focusing on the 50-day and 200-day moving average trends for all listed stocks with a market cap north of $2.0B.
The concept is simple: If the 50-day moving average of a stock crosses above the 200-day moving average, it is considered a buy signal. This indicator is nicknamed the "Golden Cross", and represents a major shift from the bears to the bulls.
If, on the other hand, the 50-day moving average crosses below the 200-day moving average, it is considered a sell signal. This is called the "Death Cross" signal, and it represents a shift from the bulls to the bears.
To compile this histogram, we looked at the size of the difference between each stock's 50-day and 200-day moving averages, relative to the 200-day moving average.
For example, if a stock's 50-day moving average is $11, and its 200-day moving average is $10 (a bullish signal), the difference is expressed as (11-10)/10 = 10%. A large positive difference indicates a bullish signal, while a large negative difference indicates a bearish signal.
Our sample contains 1312 stocks. Here is the output:
As the histogram shows, there are 314 stocks with a difference between 0% and 5%. The vast majority of observations fall between -5% and +5%, which reflects the current tug-of-war between bulls and bears.
In our sample, there are 662 observations where the 50-day moving average falls below the 200-day moving average, and 650 observations where the reverse is true. Think of this as the score between bulls and bears.
Going by this indicator, bears lead the bulls 662-650. This is still a very close battle, but how long will it last?
A few ideas: We've listed 10 stocks where the difference between the 50-day and 200-day moving average is negligible. These are the stocks that are at a tipping point...
1. CBOE Holdings, Inc. (CBOE): Current price at $23.80. SMA50 and SMA200 at $29.04.
2. FLIR Systems, Inc. (FLIR): Current price at $29.76. SMA50 and SMA200 at $29.27.
3. hiSoft Technology International Ltd. (HSFT): Current price at $11.42. SMA50 and SMA200 at $11.30.
4. QEP Resources, Inc. (QEP): Current price at $33.97. SMA50 and SMA200 at $31.46.
5. Smurfit-Stone Container Corp. (SSCC): Current price at $20.81. SMA50 and SMA200 at $20.99.
6. Autodesk, Inc. (ADSK): Current price at $28.77. SMA50 and SMA200 at $27.48.
7. The Home Depot, Inc. (HD): Current price at $28.68. SMA50 at $29.96 and SMA200 at $29.97.
8. Wipro Ltd. (WIT): Current price at $13.88. SMA50 at $12.81 and SMA200 at $12.82.
9. Stanley Black & Decker, Inc. (SWK): Current price at $57.88. SMA50 at $54.39 and SMA200 at $54.41.
10. Constellation Brands Inc. (STZ): Current price at $17.25. SMA50 at $16.43 and SMA200 at $16.44.
Disclosure: No positions