Friday, September 20, 2013

Looking at the U.S. New 52 week highs

A few posts ago I disused a few rules that apply to using the new 52-week high / low list as a strategy to screen stocks for buy or sell candidates. The new 52-week high / low list can also be used to measure the strength of the prevailing trend. For example in New York today we had 477 new 52-week highs and only 20 new 52-week lows. During a bear trend the new 52-week high / low list would be swamped with new 52-week lows.

It is important to also note the type of stocks making new highs – is it a bunch of speculative tech social media plays or are the names broadly based and of important leadership quality?

The names are impressive, SPDR Materials XLB, SPDR Technology XLK, SPDR Energy XLE, SPDR Industrials XLI, SDPR Health Care XLV just to list a few sector ETFs. Also I see more economy sensitive stuff like CSX, DD, ETN, GD, GE, FDX, GM, HON, SSW, TK, UTX and UPS. Note the chart of two important transport leaders FedEx and United Parcel both just posting new 52-week highs. By the way UPS last peaked in 2004 and FDX peaked in 2006 well ahead of the 2007-2008 financial crisis.


1 comment:

dh12 said...

The American market is much more liquid than the small Canadian exchanges. You rarely get your fill price in Canada and if you do it will be far from the current market price. Stick to the USA exchanges if you want to play 52 week high or low breakouts.