Positive 52-Week New Highs vs. New Lows streak enters month 35!
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. Typically, New Highs vs. New Lows is the last market statistic to weaken...
- Over the past 64 months (April '09 thru July '14), months with more new highs (60) have exceeded months with more new lows (4) by a huge margin (see chart) --- including the past thirty-four in a row; 45 of the past 47.
- How many of you think this is going to last forever... please, I want to hear from you.
- Does your 401K Plan take your equity profits automatically?
New High vs. New Low Numbers Still @ Stock Market "Bubble" Levels
Has your equity manager taken profits during this tremendous upsurge in the IGVSI market?
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The New High and New Low issue stats also 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 around histerical, "Bubble" levels --- markets this strong don't continue forever --- have 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've anticipated may have arrived --- there has never, not ever, been a permanent upward only stock (or bond) market.
What's this all about? Check your copy of "Brainwashing" or contact the only authorized Market Cycle Investment Management practitioner on the planet --- yes, there is only one, and this guy can put you in touch...
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