The stock market inches higher

On Friday, the market advanced on weak volume and with a close well under the day’s high. It was also below the December 12 high. This pattern makes it less likely that the market will blast through to higher highs; these moves are mostly accomplished with big steps.


The market has been advancing since the late June lows. The Dow is above its trend channel, the S&P is near the top of its trend channel and the Nasdaq Composite has made a wedge pattern over the same time period. If the market was “healthy”, the Nasdaq Composite would be the strongest and the Dow  the weakest; now, it’s just the opposite.


In my relative-strength stock sector table, the Automobile Sector has rocketed higher by over 7% since December 1, out of all sense of proportion (i.e., +-3% has historically been an exceptionally big monthly move).


LDL 19% 45%
CYD -8% n/a
OSK 11% -36%
HMC 7% n/a
GNTX 10% 6%
DAN -6% 14%
TTM 5% n/a
DLPH 13% 15%
GT -8% -5%
TSLA 145% 93%
F -6% -37%


The only truly good row is TSLA; all the others are weak or negative. All this for the market’s best sector! The average sales change was 16.5% and the average EPS change was 11.9%.

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