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14 Indices Tell the Stock Market Story

The Russell 2000 (1181.12) is between its 50-day and 21-day SMAs at 1163.40 and 1184.58. The weekly chart stays negative given a close today below its five-week MMA at 1170.40, otherwise this chart is neutral. Quarterly and semiannual value levels are 1169.22, 1133.29 and 1130.79 with and a monthly risky level at 1211.52, which is below the March 4 all-time intraday high at 1212.82.

The PHLX Semiconductor Index (595.99, up 11.4% YTD) set a multiyear intraday high at 601.40 on April 3. The weekly chart is positive but overbought with its five-week MMA at 569.05. Semiannual and quarterly value levels are 548.36 and 507.19 with a monthly pivot at 581.64 and this week's risky level at 602.78.

The Dow Utility Average (529.71, up 8% YTD) set its 2014 intraday high at 533.80 on March 30. The weekly chart is positive but overbought with its five-week MMA at 519.02. Quarterly and semiannual value levels are 528.10 and 504.03 with a quarterly pivot at 528.10 and annual risky level at 548.70.

Crunching the Numbers with Richard Suttmeier: Moving Averages & Stochastics

This table provides the technical status for the stocks or indices profiled in today's report.

There are five columns with moving average titles: Five-Week Modified Moving Average, 21-Day Simple Moving Average, 50-Day Simple Moving Average, 200-Day Simple Moving Average and the 200-Week Simple Moving Average.

The column labeled 12x3x3 Weekly Slow Stochastics shows the pattern on each weekly chart with readings from Oversold, Rising, Overbought, Declining or Flat.

Interpretations: (stocks below a moving average listed in Red are below that moving average)

Five-Week Modified Moving Average (MMA) is one of two indicators that define whether or not a weekly chart profile is positive, neutral or negative. The other is the status of the 12x3x3 weekly slow stochastic.

A stock with a positive technical rating is above its five-week MMA with rising or overbought stochastics.

A stock with a negative technical rating is below its five-week MMA with declining or oversold stochastics.

A stock with a neutral technical rating has a profile that is not positive or negative.

The 200-Week Simple Moving Average (SMA) is considered a long-term technical support or resistance and as a "reversion to the mean" over a rolling three to five year horizon. (even Apple declined to its 200-week SMA in June 2013)

The 21-Day Simple Moving Average is a short-term technical support or resistance used by many hedge fund traders to adjust positions. A stock above its 21-day SMA will likely move higher over a rolling three to five day horizon and vice versa.

The 50-Day Simple Moving Average is also a technical support or resistance used by many strategists and commentators in financial TV.

The 200-Day Simple Moving Average is another technical support or resistance and I consider this level as a shorter-term "reversion to the mean" over a rolling six to 12 month horizon. (even Apple tested or crossed its 200-day SMA in nine of the last 10 years)


Crunching the Numbers with Richard Suttmeier: Where to Buy & Where to Sell

This table presents where to buy on weakness and where to sell on strength.

EPS Date is the day the company reports their quarterly results.

EPS Estimate is the earnings per share estimate from Wall Street analysts.

Value Levels, Pivots and Risky Levels are calculated based upon the last nine weekly closes (W), nine monthly closes (M), nine quarterly closes (Q), nine semiannual closes (S) and nine annual closes (A). I have one column for pivots, which is a magnet for the period shown. The columns to the left of the pivots are first and second value levels. The columns to the right of the pivots are first and second risky levels.

Investors who wish to buy a stock should use a good-until-canceled GTC limit order to buy weakness to a value level. Investors who want to sell a stock should use a GTC limit order to sell strength to a risky level.

At the time of publication the author held no positions in any of the stocks mentioned.

Follow @Suttmeier

This article represents the opinion of a contributor and not necessarily that of TheStreet or its editorial staff

Richard Suttmeier is the chief market strategist at ValuEngine.com.
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