One of Martin Zweig's minor indicators of strength in the market was the advance/decline ratio over a 10-day (2-week) period. Based on my own definition of the indicator, the latest ratio (Friday, Feb. 26) was almost exactly 3/1. I do not remember seeing a value this high over the last ten years of tracking it (and probably much longer). This supposedly indicates significant upward momentum in the stock market.
My technical indicators are still in bearish territory and I consider the A/D indicator to be less exciting than did Zweig. So I am just reporting it as an indication that stocks might continue upward, at least in the near term. If so, this would give investors a chance to rebalance portfolios toward their target asset allocations between stocks and fixed income.
The main Zweig model is neutral and I do not see how that will improve over the next several months.
Good luck,
Tex
Posted by: mrweyl@hotmail.com
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