For the time being, this will be the new format, showing only the basic U.S. stock index momentum, the bullish reversals in ETFs and bullish reversals in stocks. I will periodically comment on major issues at critical times, but during the time I am attempting to build the algorithm required to download signals from almost 1300 stocks that I have built models for using NeuroShell Day Trader Professional, this is what I will leave you with. Most who have commented (and I have received, thankfully lots of comments with great appreciation to readers) want to see the reversals and not necessarily trade signals I generate. That makes life simpler for me, though at some point I will discuss methodology for building your own models. For now, I will present the data with little commentary. I will always respond to readers' comments. This blog will steadily evolve as the time I have and the technology I use evolves. Thanks for your patience during this transition.
For 10/06//2010:
N means neutral, Neg means negative, Pos means positive (OS) means oversold and (OB) means overbought. The value to price estimate (it is not a guarantee, only a cash flow based estimate) can be defined loosely as a multiplier of price. A number higher than one means the stock is undervalued using this model and a number less than one means the stock is overvalued.
Index and ETF I-shares Bullish Reversals (Note: to look up quotes for the Dow Indexes (starting with DJ or DW, add a dollar sign. No dollar sign is required for the ETFs beginning with other letters.) Today's list includes only those ETFs with a 50-day moving average of daily volume greater than 100,000 shares:
The stocks listed below are ranked by pattern bullish reversals based on a momentum indicator. Each stock by sector is listed with the cheapest stocks on a near-free-cash-flow value/price basis at the top, and more expensive stocks on that basis farther down each sector list (they are listed alphabetically):
Stocks that almost passed the neural net screens but just missed: STEC
Note: Somehow the mere act of an interest rate cut with give traders and investors some incentive to run to stocks, as the Bank of Japan decided to once again debase their currency to help exports in its already fragile economy. When that happened, volume leaped up and the $COMPQ, which looked like a laggard, began to outpace the rest of the indexes. Once again, however, the reversal list was incredibly small as stocks are still relatively extended, though internet commerce names did indeed show up once again. Transportation stocks even seem ready to break out once again. Weekly index momentum is quite extended, but until we see the true cracks in the daily data, the sideways to slightly upward consolidation is likely to continue. All are waiting on employment data this week, and that will likely set the tone for the week after. Weekly patterns on the $INDU and $SPX are becoming bearish.
I realize that this very volatile market has not been kind to this methodology this year, but it was not kind to it in 2004 either. The swings that fit the Fib patterns have been strong when they have appeared, but they have not appeared as often on a daily basis because of the rather sideways action this year. Such is the way it works. We should see a spate of decent pattern setups should we get a normal correction. If the weekly patterns hold, that should happen shortly. Only time will tell, but one cannot trade what does not exist to trade.
Take care,
DBB
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