Divergence, But Still Negative
By Arthur B. Hill - Thu 23-Oct-08 10:27 AM EDT
The McClellan Oscillator for the Dow Industrials ETF (DIA) formed a positive divergence over the last two weeks, but remains short of the positive surge needed to turn breadth bullish. This year's four positive divergences are marked with the green initials "PD". The first three were confirmed with sharp up thrusts into positive territory. A post divergence up thrust is defined as the first move above 50. These are marked with the blue dotted lines. The up thrusts in late January, mid April and mid July gave way to counter trend rallies in DIA. Currently, the McClellan Oscillator has a sharp positive divergence working, which just shows less selling pressure than before. The indicator needs to surge above 50 to show a material strength that could give way to a rally.
-------------------------------------------------------
Dow Industrials ETF (DIA) – click here
----------------------------------------------------
<< Previous | Next >>
