Just a brief market comment this week as the tax deadline approaches.

Our 6-month chart of the NASDAQ composite shows that although the NASDAQ has recovered from its mid-March low, it did so on weak volume. Rising prices on lower volume is always a sign of deteriorating market strength, and so it is not surprising that the index failed to hold above resistance at 2802. The flat progress this week reflects continuing weakness as earning season gets off to a disappointing start and rising commodity prices, particularly oil, threaten the strength of the recovery.

The market could go up or down from here. Maybe this will be a good test of our new bottom trend reversal signal :)  (See below).

No new features this week.

Coming soon - Facebook App.

Downward Trend Reversal Signal Progress

Tax prep took a bite out of the time to work on this project but progress has been steady. I've identified a promising combination of the stochRSI and Accumulation/Distribution Line which looks good so far.

The value of these two indicators is that the stockRSI is price based while the Acc/Dis indicator is volume based. Although price and volume are not wholly independent, there are advantages to using the acc/dis line to confirm the overbought/oversold indications of the stochRSI.  More rigorous backtesting is needed which we will get too next week (hopefully).

Here is a graphic that shows the signals over the last nine months and there is a bigger chart on the site showing the downward trend reversal signals for the last three years.