20121228 Moving Average Breadth
This week the markets helped reinforce that probabilities are just the odds. The week after Christmas has an 80% probability of being positive; We fell in the other 20% this year. Of course much of this was headline driven week magnifying the nervousness in very thin trade, but that turned out to be a recipe for beating the odds. Now the real question is what effects did it have under the surface. I found a few things very interesting this week. First Defensive sectors seemed to be sold the hardest building on an ongoing theme in December. Second, Industrials and Financials held pretty well. Lastly, Technology seems to be holding up much better than price is showing. Of course that has a lot to do with $AAPL in the cap weighted tech indexes. Let’s take a look.
First the Total universe of 1898 companies posted over the $SPY
Next I split the universe into 10 broad sectors
Consumer Discretionary (325)
Consumer Staples (91)
Energy (132)
Financials (316)
Health Care (199)
Industrials (252)
Materials (148)
Technology (338)
Telecom (24)
Utilities (73)
These are custom indexes so you cannot invest directly in them, but there are plenty of ETFs available for each sector. For me personally this is another form of relative strength, just with a broader lens .
Good Luck! It is there for you to make.
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