Wednesday, March 2, 2011

$SPX look eerily like about a year ago

I was looking at last year's spring rally, which we all know ended badly in early May, and I realized how much the $SPX chart of last year looks like this year's.

MACD, MACD-H and Slow Stochastics have essentially the same shape. The EMA lines look similar, with the correction in Feb 2010 more pronounced than in Nov 2010, in fact in Feb 2010 the 22-day EMA crossed below the 50-day EMA.

A difference that I hope is important is in the NYSE High Low Index (issues making new high minus issues making new lows). In March 2010, that index started swinging across the 400 line, and it did so several times in April before the drop in early May.  So far, this year, it has not reached the 400 level.  This may or may not work as a predictor of an imminent drop, but I think it's worth keeping an eye on.


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