Analysis of ETF and Stock Market Trends

Full Trend Analysis of ≈750 ETFs and ≈1000 Stocks.

ETF Performance, Trend Analysis, Ratings and Rankings


Medium-Term Trend Turns Down
Posted 2/21/2018 by Tushar Chande

The short-term and medium-term trends have now turned down, as moving average have had some time to catch up with market moves.

As you can see in Figure 1, the Short-term and Medium-term trends are all either flat or down.  The time step starts at 25-days at the top and doubles at each step from top to bottom.

 

Figure 1: The overall trend state of the market is charted across time (from top to bottom) and market indexes (the number of stocks in the indexes increases from left to right). The key intermediate-term and long-term trend is still up across all market indexes.

 

We can apply trend-following models to the underlying stocks and then roll-up the results by classifying the trend as either up or not-up.  This gives us a sense for what is happening at the individual stock level within the universe of each index.  Thus, this is a map of the environment for stocks in general, and as Figure 2 shows, it now starting to weaken at the intermediate-term level as well.

 

 

 

Figure 2: The Path of Least Resistance gives us a sense for market direction by looking at the trend of each stock in the Russell 1000 universe.  Here you can see that the short-term and medium-term tendency is bearish.  The Intermediate-term has just turned flat-to-bearish but the long-term trading environment is still bullish.

 

Strongest Sectors

 

We can jointly compare the relative performance via the StockCharts.com SCTR ranks, and the absolute performance via the Chande Trend Meter.  The strongest sectors are in the upper right hand quadrant.  So, at the moment, Technology, Financials, Consumer Discretionary and Industrials are stronger than the SPY index as a whole.

 

Figure 3: The SPY ETF is at (0,0).  The strongest ETFs or indexes are in the upper right hand quadrant.  The weakest ETFs or indexes are in the lower left hand quadrant.  Objects to the right of the Y-axis have greater relative performance than the market represented by large-cap stocks.  Objects above the Y-axis have strong absolute performance relative to the SPY ETF or large-cap indexes.  The key groups outperforming the market are Technology, Financials, Consumer Discretionary and Industrials.   Note that the data will change frequently based on daily performance.

 

 

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