The Market’s Traffic Lights
Tim Knight | Oct 26, 2015 12:39AM ET
I wanted to offer up a simple metaphor for where I think the market is by way of a traffic light. In each of the five charts below:
+ the green tint represents the level which, should the price drop beneath it, meaningful weakness in the market is affirmed;
+ the yellow tint represents the level which, should the price go above it, further weakens the bear case (which has already been weakened by staggering market strength);
+ the red (OK, magenta) tint represents the level which, should the price go above it, means the bears are pretty much screwed once more.
So here we have the Dow Jones Composite:
The NASDAQ Composite:
The Dow Jones Industrials:
The Russell 2000:
And, a favorite of mine, the iShares iBoxx $ High Yield Corporate Bond (N:HYG) index fund:
Get The News You Want
Not that the market cares what I think, but I sure wish the ascent in equity prices would…….
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.