The 5 U.S. Equity Averages Have Positive Weekly Charts as Does China

All five major U.S. equity averages have positive weekly charts with Dow Transports now overbought. Three set all-time intraday highs this week - Dow Industrials at 18,934.05 on Nov. 14, the Nasdaq at 5,346.80 and the Russell 2000 at 1,316.22 on Nov. 18.

For Dow Transports, its all-time intraday high is 9,310.33 set two years ago on Nov. 28, 2014.

For Japan's Nikkei 225 its all-time intraday high was 38,957.44 set in December 1989. For the current cycle the multiyear intraday high is 20,952.71 set on June 24, 2015. This average set its second-half 2016 intraday high of 18,043.72 on Nov. 18. The average is thus in bull market territory 20.9% above its June 24 low of 14,864.01, but is still in correction territory 14.2% below the June 24, 2015, high.

For China's Shanghai Composite, its all-time intraday high was 6,124.04 set in October 2007. For the current cycle the multiyear intraday high is 5,178.19 set on June 12, 2015. The average set its second-half 2016 high of 3,221.46 on Nov. 14. The average is thus in bull market territory 21% above the Jan. 20 low of 2,638.30, but is still in bear market territory 38.3% below the June 12, 2015, high.

India's Nifty 50 is the only average with a negative weekly chart. India's benchmark is now in correction territory 11.5% below its March 4, 2015, high of 9,119.20.

The German DAX has a neutral weekly chart. It's in bull market territory 22.6% above its Feb. 11 low of 8,699.29. The index is in correction territory 13.9% below its April 10, 2015, high of 12,390.75.

Here's this week's scorecard for the nine major global equity averages.

 

The weekly charts show a red line through the price bars, which is the key weekly moving average (a 5-week modified moving average). The green line is the 200-week simple moving average considered the "reversion to the mean."

The study in red along the bottom of the chart is weekly momentum (a 12x3x3 weekly slow stochastic), which scales between 00.00 and 100.00, where readings above 80.00 indicate overbought and readings below 20.00 indicate oversold.

A negative weekly chart shows the stock below its key weekly moving average with weekly momentum declining below 80.00 in a trend toward 20.00. A positive weekly chart shows the stock above its key weekly moving average with weekly momentum rising above 20.00 in a trend towards 80.00.

Here's the weekly chart for Japan's Nikkei 225.

Courtesy of MetaStock Xenith

The weekly chart for Japan's Nikkei 225 is neutral with the average above its key weekly moving average of 17,197.41. The 200-week simple moving average is 16,299.64, last tested during the week of Nov. 11. The weekly momentum reading ended the week at 79.04 down from 79.91 on Nov. 11, slipping below the overbought threshold of 80.00.

Here's the weekly chart for China's Shanghai Composite

 

Courtesy of MetaStock Xenith

The weekly chart for China's Shanghai Composite is positive but overbought with the index above its key weekly moving average of 3,115.36 and well above its 200-week simple moving average of 2,770.07. This average stayed above its "reversion to the mean" during the week of March 4 when the average was 2,623.41. The weekly momentum reading ended the week at 82.13 up from 77.03 on Nov. 11.

Here's the weekly chart for India's Nifty 50.

 

Courtesy of MetaStock Xenith

The weekly chart for India's Nifty 50 remains negative with the average below its key weekly moving average of 8,457.38 and above its 200-week simple moving average of 7,421.55. The "reversion to the mean" held during the week of March 4 when the average was 6,904.80. The weekly momentum reading ended the week at 25.99 down from 31.69 on Nov. 11.

Here's the weekly chart for Germany's Deutsche Boerse DAX.

 

Courtesy of MetaStock Xenith

The weekly chart for the German DAX is neutral with the index above its key weekly moving average of 10,562.88 and is above its 200-week simple moving average of 9,746.47. This "reversion to the mean" last held during the week of July 8 when the average was 9,454.31. The weekly momentum reading ended last week at 61.53 down from 65.40 on Nov. 11.

Here's the weekly chart for the Dow Jones Industrial Average (INDU)

 

Courtesy of MetaStock Xenith

The weekly chart for the Dow 30 is positive with the average above its key weekly moving average of 18,404.59 and well above the 200-week simple moving average of 16,799.69. This "reversion to the mean" was last tested during the week of Feb. 12 when the average was 15,819.45. The weekly momentum reading ended last week at 44.95 up from 35.48 on Nov. 11.

Here's the weekly chart for S&P 500

Courtesy of MetaStock Xenith

The weekly chart for the S&P 500 is positive with the average above its key weekly moving average of 2,147.85. The average is above its 200-week simple moving average of 1,931.45. The weekly momentum reading ended last week at 40.65 up from 33.10 on Nov. 11.

Here's the weekly chart for the Nasdaq Composite (NDAQ)

Courtesy of MetaStock Xenith

The weekly chart for the Nasdaq is positive with the index above its key weekly moving average of 5,223.53. The index is well above its 200-week simple moving average at 4,456.96. The weekly momentum reading ended last week at 51.85 up from 50.87 on Nov. 11.

Here's the weekly chart for the Dow Jones Transportation Average

Courtesy of MetaStock Xenith

The weekly chart for transports is positive but overbought with the average above its key weekly moving average of 8,261.24 and above its 200-week simple moving average at 7,693.36. This "reversion to the mean" was last tested during the week of July 8 when the average was 7,421.76. The weekly momentum reading ended last week at 82.22 up from 77.48 on Nov. 11.

Here's the weekly chart for the Russell 2000

Courtesy of MetaStock Xenith

The weekly chart for Russell 2000 is positive with the index above its key weekly moving average of 1,241.37 and above its 200-week simple moving average of 1,132.63. The weekly momentum reading ended last week at 46.98 up from 36.11 on Nov. 11.

This article is commentary by an independent contributor. At the time of publication, the author held no positions in the stocks mentioned.

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