Friday, December 04, 2009
Using a Basket of Stocks to Track Market Trending
Here's a screenshot of the 40 stocks I follow in my basket: five highly weighted issues from eight sectors: Materials, Industrial, Consumer Discretionary, Consumer Staples (left column); and Energy, Health Care, Financial, and Technology (right column).
Note the particular weakness among commodity-related stocks (Materials, Energy); small caps, on the other hand, are showing relative strength.
All changes shown above are from the market open, not from yesterday's close. By seeing uniform vs. mixed performance from the open among the stocks, we can gauge whether we're in a trending market or not. Today began looking like a trend day, but has since fallen back into the multi-day range on the heels of U.S. dollar strength and gold weakness following strong jobs data.
.