Written by Rich B. Meier
TopEquityNews.com
Top Equity news dissected the market four ways to see if stocks might be ready to pull a U-turn. The quartet of measuring sticks we used all show that traders could fill-out a bunch of buy tickets.
According to TEN’s checklist:
- More than 90% of NYSE stocks are trading below their 10 day-averages.
- The NASDAQ’s relative strength is near 30 – a traditional buy signal.
- The S&P, NASDAQ and Dow are touching their lower Bollinger Bands.
- The Trio is also more than two standard deviations below their 20 day-averages.
While the combination is not a guarantee that Wall Street is about to turn on the green light, the spring is definitely compressed. The only question is when does it pop.
With the weekend announcement that IMF is drawing up a $800 billion plan to “save” Italy and Spain, news that Germany and France are putting together a stability plan, and with record Black-Friday sales, the uncoiling could begin today.
Since, in our view, the NASDAQ is the most oversold, TEN is going to take an aggressive position and put forward ProShares Ultra QQQ (QLD).
QLD seeks daily investment results, before fees and expenses, which correspond to twice the daily performance of the NASDAQ-100 Index(R). The fund invests in equity securities and derivatives that the Proshare Advisors believe, in combination, should have similar daily return characteristics as twice (200%) the daily return of the index.
Based on its chart, a run back to $79-$80 during the week seems viable. That’s where TEN sees natural resistance levels and the ETF’s 12 day-moving-average. If the index turns against investors, a stop around $72 looks about right.
Make sure you check back with Top Equity News tomorrow as we run down Black-Friday’s winners.
Stock Market Trends: Is the Spring Ready to Unload is an article from: 
