Silver Cross Buy Signal for Dow (DIA) and Russell 2000 (IWM) | decision point

The Dow Jones Industrial Average ETF (DIA) 20-day EMA crossed the 50-day EMA (silver cross), creating a buy signal for the IT Trend Model. The Dow had a better rally today than SPY, but internally it is not as strong as SPY. Except for the Silver Cross Index, participation is still above the bullish threshold of 50%. If participation numbers hold up, we could soon cross the red line. The Silver Cross Index tells you how many stocks have a “Silver Cross” within the index. These stocks have a bullish bias over the medium term. (If you want to see “inside” charts of SPY, you can become a member of DecisionPoint.com and get access to these charts and all other major indices, sectors, and select industry groups.)

Weekly PMO is slowing down but still maintaining Crossover SELL signal. It looks like a good rally, but looking at the weekly chart, expectations appear to be tempered.

The Russell 2000 ETF (IWM) 20-day EMA crossed the 50-day EMA (Silver Cross), creating a buy signal for the IT Trend Model. It wasn’t a good Wednesday for small caps, but we still got a Silver Cross as the price was above the 20/50-day EMA. PMO just got above the zero line, but I don’t like the weakness that is already showing as prices peaked.

IWM was mostly in the range and is now at the top of the range, making it vulnerable. Weekly PMO is on the relatively new Crossover SELL signal. We will be careful with this group.

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