Markets Overview

Jd French

There is only one side to the stock market; and it is not the bull side or the bear side, but the right side. -Jesse Livermore
By following distribution days, churning, stalling,& market action one can increase the odds of being correct in ones trading decisions.

XLE - Weekly HLC Bars, 1024

XLF - Daily HLC Bars, 900

1 JPMorgan Chase & Co. JPM 13.50%
2 Wells Fargo & Co. WFC 8.75%
3 Goldman Sachs Group Inc.GS 6.56%
4 Bank of America Corp. BAC 6.20%
5 Bank of New York Mellon BK 4.00%
6 U.S. Bancorp USB 3.54%
8 Travelers Cos. Inc. TRV 2.96%
9 MetLife Inc. MET 2.53%
10 CME Group Inc. Cl A CME 2.08%
11 American Express Co. AXP 2.08%
12 Citigroup Inc. C 2.03%
13 Chubb Corp. CB 1.85%
14 Northern Trust Corp. NTRS 1.82%
15 Charles Schwab Corp. SCHW 1.80%


According to the Zweig model, a bullish signal occurs when the Breadth Thrust indicator moves from below .40 to above .615. Chart 9 shows the NY Composite ($NYA) in the main chart window and two versions of the Breadth Thrust indicator in the lower windows. The first shows the 10-day EMA of Advances divided by Total Issues. The bottom window shows the 10-day EMA of Advancing Volume divided by Total Volume. Since March 2009, there have been only three bullish breadth thrust signals based on Advancing Issues: March 2009, March 2010 and July 2010. Even though the current surge is certainly strong, we have yet to see a move above the bullish threshold.

Charting Tips: The indicator ($NYADV:$NYTOT) is plotted twice: once in as a normal indicator and once behind the indicator. Both are invisible. The first invisible indicator is used to apply a 10-day EMA using advanced options. Making the main indicator invisible puts the focus on the 10-day EMA. The second invisible indicator is used to apply the two horizontal lines (.40 and .615). You can click this chart to see the settings and save it to your favorites.

Zweig Value Line 4% Model

Tracks approximately 1,700 stocks in over 90 industries. Timeliness Ranking System ranks stocks on a scale of 1 to 5 for probable market performance over the next 6 to 12 months.

Utilizing this approach to the stock market during the period from 1993 to 1998 would have a return of 241% versus the buy-and-hold approach which provided a return of 120%.

A buy signal is generated when the index rises at least four percent from a previous value. A sell signal is generated when the index falls at least four percent. For example, a buy signal would be generated if the weekly close of the Value Line rose from 200 to 208 (a four percent rise). If the index subsequently rallied to 250 and then dropped below 240 (a four percent drop), a sell signal would be generated.

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