For the record, Stockopedia’s front page is reporting UK Edition Technicals:
- Advancers 614. Decliners 410
- New Highs 843. New Lows 1018
- Above 200dMA 843. Below 200d MA 1056
- Median forecast PE 14.32
- Median dividend yield 2.70%
- Earnings Growth estimates 13.74%
- FTSE100 6730
I actually think that the market is not in frothy territory, and have confidence (overconfidence?) that I can produce an acceptable return for 2014. However, I think the New Lows exceeding New Highs, and the number of shares below their 200d MA exceeding those above, is likely to be bearish technically. The theory – well at least my interpretation of technical lore – is that the preponderance of new lows indicates a change in momentum for the worse. The 200d MA would also tend to act as either a floor or ceiling for stocks. There are now more ceilings than floors, which is bearish.
The switchover to negativity seems, to my recollection, a very recent development. So maybe we’re in for a bumpy ride. Anyway, we shall see. Don’t take it too seriously, though.
