XJO has been up for seven of the past eight days. This has been a short-covering rally precipitated by the big bullish candle on 4 January, which completely reversed the big bearish candle on 3 January. That trapped a lot of short traders now scrambling to get out of trouble.
Daily RSI is at 64.02. Daily RSI is above the Weekly RSI (60.42) which is above the Monthly RSI (55.55). That's a bullish configuration.
XJO is now at horizontal resistance after a strong run-up, which suggests we might see a rest or a pull-back here.
Monthly, Weekly and Daily RSIs. - Sectors + XJO + Gold + Composite Bonds
The above column chart shows the Monthly, Weekly and Daily RSIs for each sector. This can provide information about bullish sectors and sectors to watch (might turn bullish). This can be used as an initial filter before making stock selections.
Bullish Sectors: slope upwards from left to right.
Bearish Sectors: slope downwards from left to right.
Sectors to Watch. First two columns slop upwards, third column is below second column.
Last Week, only one sector was bullish - XMJ (Materials). Gold Miners Industry Group (part of XMJ) was also bullish.
This week we have a slew of bullish readings: XXJ, XMJ, XDJ, XIJ, XTJ, XPJ, XNJ, XGD, XJO, IAF
Bearish readings: XEJ, XHJ. XSJ is bearish in the medium to long-term but showing a short-term bounce.
I have no sectors on a bullish "watch list".
XMJ is short-term overbought with an RSI >70. Expect consolidation or a pull-back in the coming week.
NewHighs-NewLows Cumulative.
This is a long-term lagging indicator.
This is the first time since early 2022 that NH-NL Cum has risen above the 20-Day MA (blue dotted line). That's a bullish event. While the NH-NL Cum stays above the 10-Day MA long term investors can feel more comfortable with their investments.
I've developed another long-term metric "StrongStocks-WeakStocks" which is similar to NH-NL but gives signals a little earlier than NH-NL SS-WS is up for the ninth week in a row and has moved well above its 5-Week MA. This week there were 33 Strong Stocks and 2 Weak Stocks. That's the best result since I began keeping records two years ago.
The SS-SW line has once again kicked up from the 5-Week MA. This remains bullish.
% of Stocks above key moving averages.
1. % of stocks above 10-Day Moving Average: Last Week 46%, This Week 78%.
2. % of stocks above 50-Day Moving Average, Last Week 46%, This Week 70%.
3. % of stocks above 200-Day Moving Average, Last Week 41%, This Week 52%.
All three indicators are now bullish. The short term indicator (stocks above 10DMA) is now pushing up near to an overbought reading of 80%. Any more improvement could see a pull-back.
Conclusion.
January has started well for the XJO and many Sectors are now giving bullish readings.
(20min delay)