2013 High - Low Stats Signal Bubble Trouble Ahead!
Another useful tool for analyzing an index which only includes your kind of equities is a comparison between the number of issues establishing new 52-week high ground and the number sinking to new 52-week lows. The longer the numbers are overwhelmingly positive, the more likely it is that a correction is approaching.
Superficial analysis is very straight forward --- there should be more new highs in an upward trending market and more new lows during a correction.
- Over the past 49 months (April '09 thru April '13), months with more new highs (45) have exceeded months with more new lows (4) by a huge margin (see chart) --- including the past nineteen months in a row; 30 of the past 32.
- The March numbers were the strongest since the rally began in March 2009.
Has your portfolio reflected this tremendous upsurge in the IGVSI market?
Click here for more information
The New High and New Low issue stats can identify weaker and/or stronger sectors within the Investment Grade Value Stock selection universe --- very important in helping investors determine where the bargains are and where the profit taking opportunities should be.
New High vs. New Low numbers are at pre-Financial Crisis, "Bubble" levels --- markets this strong just don't go upward forever --- why haven't you taken your profits?
Remember to be quick on your profit-taking feet, using the two 7's beats one 10 "Brainwashing Book" strategy. The correction you anticipate will get here eventually --- there has never, not ever, been a permanent upward only stock (or bond) market.
Please join my Linked In network Please join my private mailing list
(c) 2013 by Steve Selengut