Archive for July, 2009

Dow Theory Update

Thursday, July 23rd, 2009

Earlier this month I sent the following e-mail note to my colleagues here.

The Dow Transport index is not confirming the move in the Industrials. That index is making new highs, while the Transports are just below old highs. That leaves the rally in the Industrials in doubt for now.

I included the following graph in the e-mail.

dt

 

 

 

 

 

Today I sent them an update as the picture has improved.  Now the Transports are making new, short-term highs, as you can see below.

Dow IndustrialsWith a poke above 9,000 the Industrials continue to make new, relative highs.

 

 

 

 

 

 

Transports

Now the Transports have confirmed that move, giving a bit more credence to the rally.

 

 

 

 

 

 

A longer view of Dow Theory shows the Transports have some more goods to haul.  The Industrials are pushing above the January closing highs, while the Transports are still about 6% below those highs.  There are two ways to look at this.  The first is to doubt the rally in the Industrials and assume further new highs are not in the near future.  The second is to assume the rally is for real, and the Transports will catch up.

ti

 

 

 

 

 

 

 

 

 

 

You can see a more detailed discussion of Dow Theory by clicking here or here.  Here’s a critical view of it, probably written by a professor somewhere who thinks everything should fit into an equation:  here.

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Weekly Recap & Outlook – 07.17.09

Friday, July 17th, 2009

Tower Private Advisors

London: ( 44) 207 847 4042 – Paris: ( 33) 1 5528 8040 – New York: (1) 212 847 2387 – Fort Wayne (1) 260 427 7141

Below

  • Super strong stocks
  • Earnings season gearing up
  • Economy as an alphabet

(more…)

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Weekly Recap & Outlook – 07.10.09

Friday, July 10th, 2009

Tower Private Advisors

London: ( 44) 207 847 4042 – Paris: ( 33) 1 5528 8040 – New York: (1) 212 847 2387 – Fort Wayne (1) 260 427 7141

Below

  • Low volume stock action
  • Earnings season gearing up
  • Economy needs a boost

(more…)

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Allen Sinai and Jeffrey Saut on CNBC

Wednesday, July 8th, 2009

Here’s a pretty good interview from two savvy dudes.  Jeff Saut, in particular, doesn’t have an axe to grind like a lot of folks.  He calls ‘em like he sees ‘em.  Takeaways from him:  1.) market’s lows were seen in March; won’t be revisited.  2.) If support between 870 – 880 doesn’t hold we’ll be taking “a quick trip to 820,” which is close to the head and shoulders measured move.

(more…)

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July 7, 2009, S & P 500 action

Tuesday, July 7th, 2009

The Head & Shoulders pattern was triggered.  Based on the last 15 years of such instances, we have a 75% chance of reaching the measured move, which is in the neighborhood of 822, which is a 7% decline from here.  See the previous posting.

(more…)

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