Monday, August 10, 2009
Expect A Market Pullback
Once and awhile I like to look at the Value Line Arithmetic Index, it consists of a simple mean or average in which the sum of the items is divided by the number of items. The Value Line index does a better job than the S&P 500 and Dow Industrials do at picking up the price action of smaller stocks, because the $VLE is equally weighted. One of the more particular aspects of the Arithmetic Index is that, based on the way the index is put together, it tends to advance farther in a bull market and decline less in a bear market. Note the double bottom Nov '08 & March '09...it has doubled from the bottom.
Debating what to expect from the Fed tomorrow, with Jeffrey Saut, Raymond James; Peter Boockvar, Miller Tabak on CNBC.
*click on chart to expand image