The market remains firm with no internal selling pressure evident. The number of stocks making NYSE new 52-week lows is extremely low and most industry groups are participating in the ongoing rally. I think the dearth of new lows can be attributed to peaking seasonal strength ahead of “Sell in May and go away.” Meanwhile the number of 52-week highs has expanded once again—to 149 on Monday—after contracting last week. The Hi-Lo Momentum (HILMO) index is still confirming that the path of least resistance for equities is up.
Our immediate-term (1-3 week) trend indicator re-confirmed another bullish signal late last week after giving a caution signal the previous week. All six of the major indices are now decisively back above their rising 15-day moving averages. The intermediate-term trend indicator is also bullish with all six indices above the 30-day and 60-day MAs. Featured on page 2 is a six-month chart of the Dow Jones Industrial Average (DJTA) in relation to its 15-day/30-day MAs. Note that the Dow made a 6-month high on Monday. A move above 18,000 from here would put the Dow closer to new all-time high territory.
Cliff Droke, Momentum Strategies Report, www.cliffdroke.com, 707-282- 5594, April 18, 2016
