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muditwahal
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Interested in technical analysis using Point and Figure charting, Bullish Percentage Index, on major markets, indices and sectors. Write and test new systems using several long/short strategies using ETFs and mutual funds.
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  • Tale Of Two Instruments – Same Market Different Daily Returns

    Nikkei 225 Index

    The iShares MSCI Japan Index ETF opened 1% down and closed unchanged.

    The Nikkei 225 Index closed up almost 3% previous night.

    So what happened ???? Why is the Japan ETF so much out of sync compared to the Nikkei 225 Index ?

    In this chart, FXY is proxy to the Japanese Yen. We can see that in the one month period, Nikkei 225 Index jumped up by 17.82%, but then Japanese Yen has fallen 7.33%. Since the ETF EWJ is represented in US $ terms, it is able to rise only 8.89%. Its underperforming the Nikkei 225 because the dollar is gaining strength vs the Yen.

    Disclosure: I am long DFJ.

    May 13 3:53 AM | Link | Comment!
  • Market Report For April 17th, 2013

    Bullish Percentages are slowly rolling over

    The major bullish percentages are slowly rolling over now for major indices. Lets first look at the two largest indices, Russell 1000 and Russell 2000.

    Russell 1000

    Russell 1000 (IWB) comprises of largest 1000 companies traded on NYSE and Nasdaq. Its equivalent of buying S&P 500 large cap and S&P 400 midcap stocks. This index reflects what is happening to the large and midcap stocks. Here are the charts for the index and its bullish percentage. A couple of observations, the Russell 1000 has touched its 50day moving average first time since beginning of the year. Its not a red flag, just a caution. But the bullish percentage has been dropping now and dangerously close to 70. A close below 70 will give a caution signal and a defensive approach should be taken. The last time it dipped below 70, the R1K index touched its 200 day moving average, which is around 800 which is about 7% correction from these prices.

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    Russell 2000

    Russell 2000 (IWM) comprises of the next 2000 companies in market cap after the Russell 1000. This index usually indicates the health of the small companies. It is also used to judge the sentiments of the market. Since small cap stocks are usually more volatile, market will only buy these stocks if the risk appetite is higher. A rising R2K is normally bullish and indicates that all the stocks are participating in the rally. A falling R2K index is usually bearish since it means that the small cap stocks are being sold. As of today, the R2K index has broken its 50 day moving average twice in a span of one week and now its about 2.5% below the 50 day moving average. The trend is downwards. The bullish percentage of this index is worse than the R1K (Russell 1000). The BPI has fallen below 70 and is in downtrend. The last time it broke 70, R2K touched its 200day moving average, which is now at 850, which is about 6% correction from here.

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    Other indices - S&P 500, S&P 400, NYSE, NASDAQ, etc

    The S&P 500 (SPY) index touched bounced from its 50 Day Moving average and its bullish percentage index is at 76 though falling. S&P 400 Midcap Index (MDY) broke its 50 DMA and the BPI is at 73 and falling. S&P 600 Small cap index (SLY) broke 50DMA and its BPI has broken 70, its at 68 and falling.

    NYSE Index broke its 50DMA today and its BPI is at 71 and .. you guessed it .. falling. Same story with Nasdaq, broke 50DMA and BPI is at 65 and falling.

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    Summary

    Overall, the market is at an extreme overbought position. The VIX (volatility index) is creeping towards late Feb high of 19. A break in S&P below its 50DMA may push market to sell more feverishly. The next support is at 1475-1480 range and after that at its 200 DMA at 1450.

    At this time, some caution should be taken and any speculative positions should be guarded.

    Disclosure: I am long SPY. I wrote this article myself, and it expresses my own opinions. I am not receiving compensation for it. I have no business relationship with any company whose stock is mentioned in this article.

    Additional disclosure: Point and Figure and Bullish Percentage Index Analysis.

    Apr 18 6:31 AM | Link | Comment!
  • Market Report - Post Election - Nov 9, 2012
    Market Report - Post Election - Nov 9, 2012

    The market was jilted by election surprise. Post election, the major indices dropped over 3%, Dow Jones dropped 3.25%, S&P 500 dropped 3.4%, Nasdaq composite dropped 3.6%. The Bullish Percentage Index of all major indices have now dropped below 70 and some have dropped below 60. Market may be heading for the a correction, S&P 500 has broken all support levels and Dow Jones has dropped below 13000. Several sectors have reached the levels which are ripe for buying when the turn around happens, such as Biotech, Semiconductor and Oil&Gas.

    Market Watch and S&P Sectors Bullish Percent Index for 20121109
    NameBPI1Dy
    Ch
    2Wk
    Ch
    4Wk
    Ch
    3Mt
    Ch
    6Mt
    Ch
    Hi
    3Mth
    Hi
    1Yr
    Lo
    3Mth
    Lo
    1Yr
    NYSE65-2-4-61274806443
    NASDAQ49-1-5-8-3-559664939
    DIA Dow Jones Industrial6900-17-14-490976957
    SPY SP 50064-2-5-12-4279856444
    QQQ NDX 10054-2-5-12-9-171855437
    IJH SP 400620-2-4-2-274856142
    IJR SP 60055-2-6-80-468785546
    OEF SP 100 OEX620-3-17-16-785936250
    IWB Russell 100063-2-3-8-3278866343
    IWM Russell 200054-2-6-9-1-265715441
    SPY SP 50064-2-5-12-4279856444
    XLB (Basic Ind Sector)5800-19-5-277835826
    XLV (Cons Serv Sector)69-4-6-144485986345
    XLP (Cons Stap Sector)7300-73-780906565
    XLY (Cycl/Trans Sector)56-6-8-16-9-478865641
    XLE (Energy Sector)60-3-5-33-223996966014
    XLF (Financial Sector)8000-111485906848
    XLI (Industrial Sector)61-4-7-6-4776896131
    XLK (Technology Sector)50-1-5-13-7-771824729
    XLU (Utilities Sector)770-7-7-13-790917777
    XME SPDR S and P Metals and M5600-2142566794211
    XOP SPDR S and P Oil and Gas54-1-8-29-163284845410
    XPH SPDR S and P Pharmaceutic56-7-14-18-14-1674895648
    XBI SPDR S and P Biotech300-13-36-20-2368783030
    XES SPDR S and P Oil and Gas36-2-13-24-38588883610
    XHB SPDR S and P Homebuilders81-40019985935848
    XHE SPDR S and P Health Care6500-101-1186876539
    XSD SPDR S and P Semiconducto35-2-20-7-350673519
    XTL SPDR S and P Telecom ETF50-2-2-40860804735
    XTN SPDR S and P Transportati62-3-61215-768954442
    EUFN Ishares MSCI Europe Finc60-2-3-222065763833
    XBD NYSE Arca Broker Dealer I450-10-109-1064913618
    FIN NDX Financial 100700-7-105-682826346

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    Nov 11 1:16 AM | Link | Comment!
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